Peer International Corporation & Ors v Termidor Music Publishers Ltd. & Ors

A foreign governmental act cannot alter rights in movable or intangible property situated in England merely because that act reflects the foreign state’s policy. The lex situs governs such property. Public policy may, in rare cases, justify refusing recognition to foreign law otherwise applicable to property within the foreign state. It cannot operate as a positive connecting factor which validates an extra-territorial foreign act and displaces English property law.

A written confirmation that only confirms an existing publishing arrangement does not itself assign a copyright. However, where a signed addendum makes clear that the parties intended an assignment, the documents may be construed together and can effect it.

Peer claimed ownership, alternatively an exclusive licence, of United Kingdom copyright in Cuban musical works. Its title depended on assignments made by composers before the Cuban revolution and on later confirmations and addenda signed by composers’ heirs. EMC claimed that Cuban Law 860 had divested Peer of those rights and licensed them to the Termidor defendants.

Neuberger J answered three preliminary questions in Peer’s favour. EMC alone appealed. The live issues were whether Cuban Law 860 could affect United Kingdom copyright, and whether the confirmations and addenda assigned the heirs’ reversionary copyright.

1. Appeal dismissed. Aldous LJ, with whom Mance LJ and Latham LJ agreed, upheld all the answers given on the preliminary issues.

2. The copyright was property situated in the United Kingdom. The applicable connecting factor for a foreign governmental act affecting movable or intangible property was its situs. Cuban Law 860 purported to divest Peer of United Kingdom copyright. English law could not recognise that extra-territorial effect.

3. [2002] UKHL 19 did not support an exception. It concerned the exceptional refusal, on public-policy grounds, to recognise foreign law otherwise governing property within the foreign jurisdiction. Public policy was a control on the applicable foreign law. It could not positively validate a foreign act affecting property in England or replace the law of the situs. The contrary approach in Lorentzen was wrong. Recognising such an exception would subordinate English property law to changing foreign policy and create unacceptable uncertainty.

4. In any event, Law 860 was confiscatory. Its transitional Decree 10 deprived Peer, without compensation, of copyright under agreements not presented for approval or not approved. The possibility that an agreement might be approved did not alter that conclusion.

5. Under Copyright Act 1911, section 5(2), the reversionary copyright vested in the authors’ heirs and could be assigned by them in signed writing. The confirmations merely confirmed Peer’s administration under existing publishing agreements. Read with the signed addenda, however, they clearly expressed the parties’ intention to confer an exclusive licence and assignment of the United Kingdom reversionary rights. Construed together, they effected the assignment.

• Court of Appeal (Civil Division): dismissed EMC’s appeal and affirmed the preliminary-issue answers in favour of Peer.
• Chancery Division, Neuberger J: on 11 December 2002 answered the three preliminary questions in favour of Peer. No citation for that judgment is stated.