Telstra Corporation Ltd v Australasian Performing Right Association Ltd

(1997) 191 CLR 140

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(Judgment by: Toohey J)

TELSTRA CORPORATION LTD v AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LTD

Court:

Judges: Dawson, Gaudron

TooheyMcHugh
Kirby JJ

Subject References:
COPYRIGHT
Exclusive rights
Infringement
Musical and literary works
Provision of music to telephone callers placed on hold
Callers using conventional telephones
Diffusion right
Whether Telstra caused works to be transmitted to subscribers to a diffusion service
Callers using mobile telephones
Broadcast right
Whether Telstra broadcast works.

Other References:
Copyright Act 1968 (Cth), ss 10(1), 26, 31(1)(a)(iv), 31(1)(a)(v), 199(4).

Judgment date: 14 AUGUST 1997

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Judgment by:
Toohey J

The circumstances giving rise to this appeal and the relevant provisions of the Copyright Act 1968 (Cth) ("the Act") appear in the judgment of Dawson and Gaudron JJ.

In this Court Telstra Corporation Limited ("Telstra") challenged the judgment of the Full Court of the Federal Court that it had broadcast works in which the copyright was owned by Australasian Performing Right Association Limited ("APRA") and that it had caused the works to be transmitted to subscribers to a diffusion service. In the first case there was held to be a breach of s 31(1)(a)(iv) of the Act; in the second case there was held to be a breach of s 31(1)(a)(v) ^[F14] .

I agree with Dawson and Gaudron JJ that, by participating in the provision of music on hold to callers using mobile telephones, Telstra broadcast the works within the meaning of s 31(1)(a)(iv). I have nothing to add to what their Honours have written in this regard. Accordingly, the appeal in relation to this part of the judgment of the Full Court must be dismissed.

As to the appeal in relation to s 31(1)(a)(v), I agree with much of what Dawson and Gaudron JJ have written. In particular, I agree that Telstra was the operator of a diffusion service. But I cannot take the further step of concluding that the works, that is the music in question played on hold to callers using conventional telephones, were thereby transmitted to subscribers to a diffusion service. On this aspect I find the reasons of Sheppard J in the Full Court persuasive. I shall explain why this is so.

Section 26(1) of the Act provides that a reference to the transmission of a work to subscribers to a diffusion service

"shall be read as a reference to the transmission of the work ... in the course of a service of distributing broadcast or other matter (whether provided by the person operating the service or by other persons) over wires, or over other paths provided by a material substance, to the premises of subscribers to the service".

Neither "diffusion" nor "diffusion service" is defined in the Act but s 26 is critical in determining whether there has been a breach of s 31(1)(a)(v).

There are three situations in which Telstra participates in the provision of music on hold which is played to callers using conventional telephones:

(1)

Where the service is provided by Telstra itself when its customers are placed on hold when they telephone one of its offices or service centres;

(2)

Where the call is made to an organisation which has availed itself of the transmission facility provided by Telstra;

(3)

Where an organisation causes music on hold to be played to customers from the service known as CustomNet, provided by Telstra. This involves the diversion of a call, where the line is busy, to a music on hold facility at Telstra's nearest telephone exchange.

Clearly enough, in each of these cases there is a transmission of recorded music which may be the subject of copyright. And there is a transmission of that music in the course of a service of distributing matter over wires or other paths. The real problem, and the source of difference between Black CJ and Burchett J on the one hand and Sheppard J on the other, is whether that transmission is "to the premises of subscribers to the service".

It is apparent that the persons who listen to the music are not themselves subscribers to the service of transmitting the music. Indeed, in the words of Sheppard J ^[F15] :

"They are strangers to it. They do not solicit it and they do not subscribe to it. Their purpose in telephoning the number is to deal with the organisation, [Telstra] or otherwise, with which they have business."

It must be remembered that it is the service of distributing the matter to which s 26(1) refers. That is the service of distributing the music. It is not the telecommunications service to which a caller may subscribe. The two are separate. That much is apparent from s 26(5) which reads:

"Where a service of distributing matter over wires or over other paths provided by a material substance is only incidental to, or part of, a service of transmitting telegraphic or telephonic communications, a subscriber to the last-mentioned service shall be taken, for the purposes of this section, to be a subscriber to the first-mentioned service."

Sub-section (5) contemplates two services which are related but are nevertheless distinct. The sub-section may well apply where there is a subscription to a combined diffusion service and telecommunications service. It may also apply where there are separate subscriptions to two such services. But, in the present case, it is the services received by the caller which are relevant. And from the caller's perspective there is but one service. The service of receiving telephonic communication and the service of hearing music during that communication are the same thing. For the caller, it is of no moment whether there is music on hold or an answering machine or indeed silence. An argument that receiving a transmission of music on hold is incidental to receiving a telephonic transmission cannot be accepted. Sub-section (5) cannot fairly be construed so as to confer rights which are not otherwise to be found in the relevant provisions of the Act. As Gummow J, the primary judge, observed ^[F16] :

"Subsection (5), in deeming a person to be a subscriber to the service, cannot be taken to also deem an agreement with the subscriber and an undertaking to provide them with the service, for the section provides no guidance as to who would be deemed to have made such an undertaking. The very process of identification of the person who is to be taken to be operating this service set down in subs (4) requires an analysis of the agreement to ascertain who is undertaking to provide the service, an analysis which cannot be performed upon a deemed agreement."

That the music on hold facility would have to be treated as separate from the facility of making telephone calls for s 26 to operate is made abundantly clear from s 26(4) which reads:

"A reference in this section to the person operating a service of distributing broadcast or other matter shall be read as a reference to the person who, in the agreements with subscribers to the service, undertakes to provide them with the service, whether he is the person who transmits the broadcast or other matter or not."

The sub-section places emphasis on the existence of agreements with subscribers to the service, that is the service of providing subscribers with material which is copyright.

Section 26 relevantly is concerned with the distribution of recorded music to the premises of subscribers to a diffusion service. The obvious illustration of such a service is the transmission of music (or film), whether for a fee or not, to those who wish to listen (or watch), by providing them with a facility for listening to (or watching) the material over wires, or other paths provided by a material substance, to the premises of the subscribers. The use of the term "premises" shows, as Sheppard J noted ^[F17] , "that what was intended to be covered was the physical transmission of copyright material from some central source to the premises of the various subscribers to the service".

It follows that the majority in the Full Court erred in allowing the appeal in respect of s 31(1)(a)(v). I would allow the present appeal in that regard and, to that extent, restore the judgment of Gummow J.