Copyright and Estate Planning
Legacy and the Law
PRESENTED BY THE CANADIAN SENIOR
ARTISTS RESOURCE NETWORK
ELISE ORENSTEIN, LL.B.
JUNE 4, 2012
TORONTO, ONTARIO
Goals of Presentation
 Basic overview of copyright
 Understand significance for estate planning
 Identify assets that attract copyright protection
 Determine value (monetary or sentimental)
 Decide whether they are to be destroyed or preserved
 Decide who will inherent them
 Decide who will protect your legacy
 Prepare and plan
What is Copyright?
 Copyright is a bundle of time-limited rights
 Typically characterized as economic rights and moral
rights
 Purpose is to enable the owner to control the way the
property is exploited commercially and to protect the
integrity of the work and author’s reputation in it
 It can be divided and subdivided, licensed
exclusively, licensed for free, transferred, sold,
portioned off in time, by geography, or withheld
from exploitation- or from being published during
the term
How is This Asset Different From Other Assets?
 Works that attract copyright meet a threshold of
creativity/original labour
 Society recognizes the benefits of such works
 Society grants a time-limited monopoly to the
creator or owner to encourage him or her to
continue creating and to reap the economic benefits
in the work
 Many countries also recognize the need to preserve
the integrity in the work and the artist’s reputation
What About Estate Planning?
 Copyrighted works can be bequeathed
 Act allows appointment of executor of moral rights,
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who can be a beneficiary or not
If author is intestate, works subject to normal rules
Income from copyright can survive children
First executor of moral rights may need directions on
appointment of successor “down the road”
Author may wish to withhold publication of certain
works to protect privacy of others or have them
destroyed
Types of Original Works That Attract Copyright
 Literary
 -includes tables, computer programs and compilations of
literary works, books, e-books, maps, charts, pamphlets,
papers, essays, magazines, sheet music, instruction or repair
manuals that accompany a product or service, diaries
Types of Original Works That Attract Copyright
 Dramatic
 -includes any piece for recitation, choreographic works and
mime (fixed in writing), movies, TV shows, Internet
productions, compilations
Types of Original Works That Attract Copyright
 Digital Assets
 -includes emails, digital photos, word processing documents,
YouTube postings, spreadsheets
 -stored in digital memory storage device (a chattel) or in print
or other format, or on Flickr, Gmail, Facebook
 Can be subject to client identification process- “passwords and
user name” and difficult to extract
Types of Original Works That Attract Copyright
 Musical
 -any work of music or musical composition, and any
compilations
Types of Original Works That Attract Copyright
 Artistic
 -includes paintings, drawings, maps, charts, plans drawings,
architectural works (any building or structure or any model of
one), engravings, photographs, sculptures, compilations of
artistic works
Types of Original Works That Attract Copyright
 Collective work
 - encyclopedia, dictionary, newspaper, work incorporating
work of different authors
 Compilation
 -work from the selection or arrangement literary, dramatic,
musical or artistic works-e.g. a musical play, or form the
selection of data
 Works of joint authorship
 Produced by the collaboration of 2 or more authors in which
the contribution of one is not distinct form the contribution of
the other(s)
“Neighbouring” Rights
 Performer’s Performance of
 - an artistic work, dramatic work or musical work,
 - a recitation or reading of a literary work, or
 - an improvisation of a dramatic work, musical work or literary
work
 Rights in Sound Recordings
 Rights in Broadcast Signals
Economic Rights
 Permit the rights holder to control a work and earn
money from it
 For works that have been exploited, important to
prepare the chain of title documents, licenses,
registrations, if any, and other paperwork
 Identify any collective societies appointed by the
rights holder
Moral Rights
 Right to the integrity of the work
 Where reasonable in the circumstances, to be
associated with the work as its author by name or
pseudonym
 Right to remain anonymous
Moral Rights
 Mere physical changes to the physical structure or
steps taken in good faith to preserve a work do not
breach moral rights
 Right of integrity infringed only if the work is:
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-to the prejudice of the honour or reputation of the author
-distorted, mutilated or otherwise modified
-used in association with a product, service, cause or
institution
Moral Rights
 Moral rights may be assigned in whole or in part
 Mere assignment does not constitute waiver of moral
rights
Moral Rights
 On death of author moral rights in works pass to
 person specifically identified (to whom bequeathed)
 person who inherits copyright if no one appointed
 person entitled to property if author dies intestate
Fair Dealing and the Balance of Rights
 In Canada, exemption limited to sole purposes of
research, private study, criticism and news reporting
 Source must be attributed for criticism, review and
news reporting but not research or private study
 In U.S., “fair use” defense includes teachingmultiple copies permitted in the classroom
Fair Dealing and the Balance of Rights
 New laws will likely enable owners to prevent
circumvention of copyright arising from digital
technologies by addressing downloading, file
sharing, responsibilities of ISPs, “digital locks”
 Exemptions also address handicapped users
 Issue of protecting the rights holders’ economic
interests while balancing the users’ reasonable access
and use
 Author may direct that his/her works be made
accessible on death- or not
Executors and Intellectual Property
 The Writers’ Union of Canada recommends that a
writer appoint two executors;
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one for the estate generally and
one (or a team) of whom will deal exclusively with copyright,
both the economic and moral rights
Will may also have to address appointment of second or third
generation of executors based on the duration of the term
Corporations as Executors of Moral Rights?
 Quirk in the Act regarding photographs, arguably
results in corporations, not people, as the holders of
the moral rights in the photos
 S. 10 (2) of the Act may be interpreted together with
S. 14 dealing specifically with moral rights, as
permitting the original owner of the negative or
plate, or photo, as the moral rights owner on death
 Issues may arise as to proving conduct that is
prejudicial to the honour or reputation of the
corporation
Duration
 Nothing last forever- unless it is on You Tube!
 Generally, 50 years following the end of the calendar
year in which the author dies—Life plus 50
 Unknown author(s)-earlier of
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first publication plus 50 years, or,
75 years from the making of the work
Duration- Posthumous Works
 Generally life plus 50 years
 In Canada, making a work available on a web site not
equal to “publication”
 By 2048. term for published and unpublished works
will be the same
 Before 1997, there was perpetual copyright in
unpublished works- i.e. they could be published 80
years after death and still enjoy copyright protection
for 50 years
 Stephen Leacock’s estate has lost rights already
Posthumous Works
 50 years not enough time for author’s hiers, likely
children and grandchildren, to benefit form royalties
from a successful work
 May be too soon to publish because
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Material sensitive for diaries and papers
Time to decipher handwriting and collect
Some works in private hands and difficult to find
May be defamation issues if people still alive
May be confidentiality issues- such as political diaries
Moral Rights and Posthumous Works
 In Canada, 50 plus life rule
 Need to provide express directions regarding
author’s wishes regarding publication during this
time
 Some executors may decide to destroy works rather
than let them fall into the public domain after 50
years because of sensitivity concerns
 Must balance these actions vs. public’s benefit in
previously undisclosed works
International Term of Rights
 Many countries have longer terms for both moral
and economic rights
 Rationale to protect first two generations of
descendants, given longer life spans of people
 Life plus 70-E.U., U.S., Australia, Israel, Brazil
 Mexico- 75 years
International Term- Moral Rights and
Posthumous Rights
 U.S., U.K- 70 plus
 France- Perpetual
 Posthumous-Australia 7o years, India 60 years,
 U.S. U.K more or less 70 years depending on
transition rules and works
International Conflicts Regarding Duration
 Longer duration of term in both moral and economic
rights in many countries
 Executors may wish to consider first publishing
unpublished works in those jurisdictions rather than
in Canada
 If work “originates” in a “life plus 70 years”
jurisdiction, e.g. the U.S., estate recieves the benefit
of an additional 20 years protection after death, in
those jursidictions
 If first published in Canada, rule of shorter term
applies- i.e. 50 years- even in the E.U. and U.S.
Reversionary Interest
 In Canada, copyright in an author’s work reverts to
the estate 25 years after the author’s death, even if
the author assigned the work to a third party for
consideration, if
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Author was the 1st owner
Assignment made after June 4, 1921
Assignment made otherwise than by will
Reversionary Interest
 The so called “Dickens” provision intended to relieve
against hardship suffered by the impoverished family
of the deceased
 Repealed in U.K.
 Considered paternalistic today in most jurisdictions
 Can diminish the value of an assignment if duration
short
Reversionary Interest
 Provision does not catch
 Owner of work made in course of employment
 Owner of work that was ordered-engraving, photo, portrait
 Works made for the Crown
 May not apply to
 Posthumous works, mechanical contrivances or plates owned
by others, photos made for others, cinematographic works
 May catch
 Gifts in contemplation of death in Quebec, intestate
successions
Reversionary Interest
 Silent as to assignments resulting from provisions of
a marriage contract unless provisions can be
assimilated under provincial laws to a will
 To avert the operation of the Act,
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Legal reps can assign the reversionary interest back to the
original assignee, at any time during or after the 25 year period
Author can provide for assignment of reversionary interest in
his or her will to the original assignee
Parties can enter assignment and royalty free licence
agreement at the 25 year mark- or stipulate the reps will assign
back the copyright to the assignee
Reversionary Interest
 Rights reverted to L.M. Montgomery estate in 1992
even though the copyright had been assigned to Page
and then Farar
 Opposite can occur
 Law appears to permit the Estate to sell the reversionary
interest to a third party, in futuro
What If There Is More Than One Owner?
 Generally, the rule changes to life of the longest
surviving author plus 50 years
 But estate may need directions on intention of joint
authors regarding all kinds of issues, such as
publication of materials, destruction of materials,
each author’s percentage of copyright interest, etc.
Owners Who Cannot Be Located
 S. 77 of the Act enables the Copyright Board to issue
a licence to use a published work, fixation of a
performer’s performance, published sound recording
or fixation of a communications signal in respect of a
work in respect of which the owner cannot be located
 Important for the executor to be locatable
 Important to have lists of all works, their location,
last publication, licenses, registrations( if any)
 Important to notify collective societies of contact
information of executors
Valuation of Property and Tax Implications
 The inventory of visual artists, which has been
valued at zero each year during life, must be valued
at full market value upon death
 This can trigger considerable capital gains tax which
the estate may not be able to cover
 Important to review this issue with tax advisors to
determine if other tax rules can ease burden
Practical Tips When Planning
 1.
 2.
Identify works which attract copyright
Decide which assets you wish to control
Gather
 3.
 chain of title of copyrighted works,
 location of and number of known copies,
 written assignments, written licenses,
 registrations ( if any),
 history of exhibitions of works, or publications, or recordings
or communications (to establish value),
 contact information for collective societies, Legal Reps
Practical Tips When Planning
 3.b Don’t forget about your “Digital Assets” stored in
memory storage, online, etc.
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Include any username and passwords to online storage
accounts, including Facebook, YouTube, and the like
Same for your own computer access
Practical Tips When Planning
 4. Decide which works you wish to
 destroy,
 withhold publication of for reasons of privacy, confidentiality,
or other sensitivity and for how long,
 or otherwise control the use of
 5.
If you are a joint author, you may assign your
interest without the permission of the other authors
but you may not licence others without the consent
of the other authors
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Consider special instructions regarding these works
Practical Tips When Planning
 Also provide info regarding % of your interest and
elaborate intention of joint authors regarding
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Publication or destruction of materials
Other instructions
Location and contact information of joint authors or their
estate representatives/executors
Practical Tips When Planning
 6.
If you own any Neighbouring rights, such as to
the Performer’s Performance, identify same and
whether there have been any royalties, any collective
societies on your behalf or agents
 7. Consider the moral rights in your works and
whether to waive or any specific instructions you
may wish to include regarding
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integrity of the works, [any forbidden service or product]
attaching or removing your name,
remaining anonymous
Practical Tips When Planning
 8.
Consider whether you wish to extend the ambit
of fair dealing exemption by making your works
more accessible on death
 Flip side is to consider not permitting the publication
or use of your works
 9. Obtain tax advice regarding impact of visual
artworks inventory on estate
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Consider whether you can and wish to enable the executors to
use the reversionary interest mechanism to assign or license
the works to trigger income for the estate for the last 25 years
of copyright
Practical Tips When Planning
 10. Consider whether any works will be subject to a
reversionary interest and whether to
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Direct your executors to exercise the attendant rights
Direct your executors to avert the Act and enable the original
assignee to enjoy copyright in the works during the last 25
years of copyright protection
Include provisions in your will which will bequeath the
copyright in certain works so that S. 14 of the Act does not
apply
Practical Tips When Planning
 11. In your will,
 address the issue of who will be the beneficiaries of your
assets, including those which enjoy copyright
 Who will be the executors of your overall estate
 Who will be the executors of your assets which attract
copyright
 Who, if anyone, would you prefer to be appointed as the
executor of your copyrighted works from the second, third or
fourth generations
Practical Tips When Planning
 12. Consider providing instructions to your
executors and to any corporations who may own
your works and enjoy moral rights in them after your
demise, regarding your intentions- even if the latter
may ignore them
 13. Don’t forget to address your wishes regarding
publication of posthumous works
Practical Tips When Planning
 14. Reflect on your best and worst case scenarios
and enable your executors to act in the best interests
of the beneficiaries and in a manner which reflects
your intentions