Paymaster (Jamaica) Ltd & Anor v Grace Kennedy Remittance Services Ltd (Jamaica), Privy Council, Judgment, Law, casemine.com

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Paymaster (Jamaica) Ltd & Anor v. Grace Kennedy Remittance Services Ltd (Jamaica)

Smart Summary

Factual and Procedural Background

Company A was established by Person A to operate a “multi-payment agency” in Jamaica, allowing customers to pay several utility bills at one kiosk. Company A engaged Company C (a consultancy) whose employee, Individual A, adapted his pre-existing cashiering program (“CSSREMIT”) to meet Company A’s needs. Company A was granted only a non-exclusive licence to use the software.

In 1996 Company A disclosed two confidential business plans to Company B while seeking investment. Negotiations failed. In 1999 Individual A licensed his software (with minor modifications) to Company B, which launched a competing multi-payment service in 2000. Company A sued, alleging:

Copyright infringement by Company B and Individual A.
Breach of confidence by Individual A (software containing Company A references).
Breach of confidence by Company B (misuse of Company A’s business plan).

Judge Jones dismissed all claims. The Court of Appeal affirmed on copyright and the claim against Individual A, but reversed on breach of confidence against Company B and awarded consequential damages. Both sides obtained final leave to appeal to the Privy Council.

Legal Issues Presented

Whether an implied contractual term assigned ownership of copyright in the multi-payment software from Individual A to Company A.
Whether Company B misused confidential information contained in Company A’s business plan when launching its competing service.
Whether Individual A breached confidence by supplying software to Company B that included references to Company A.

Arguments of the Parties

Company A (Appellant on copyright; Respondent on breach of confidence)

The oral contract with Individual A necessarily implied a term assigning copyright to Company A to give the arrangement business efficacy.
Company B used the confidential business plan as the blueprint for its competing service.
Individual A’s delivery of software containing Company A’s data to Company B breached confidentiality.

Company B and Individual A (Respondents on copyright; Appellants on breach of confidence)

Individual A retained copyright under section 22(1) of the Copyright Act 1993; his standard business model was to license, not assign.
The multi-payment concept was neither novel nor confidential; Company B conducted independent research and relied on its existing Western Union network.
The limited references to Company A within the demonstration software were trivial and lacked confidentiality or value.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Robin Ray v Classic FM Plc [1998] 25 FSR 622	Nine-point test for implying a term assigning copyright from contractor to client.	Both lower courts relied on Judge Lightman’s factors; the Privy Council agreed that most pointed against an implied assignment.
Coco v AN Clarke (Engineers) Ltd [1968] FSR 415	Three requirements for breach of confidence: quality of confidence, obligation of confidence, unauthorised use.	Applied to assess use of the business plan; Privy Council held third requirement not satisfied.
Marks & Spencer plc v BNP Paribas [2016] AC 742	Modern statement of the “business efficacy” and “obviousness” tests for implied terms.	Used to reject implication of an assignment term in the oral contract.
Philips Electronique v BSkyB [1995] EMLR 472	Implied terms must be the only, or the unquestionably preferred, solution.	Cited to show an exclusive licence could equally have achieved commercial coherence; hence assignment not inevitable.
Trollope & Colls Ltd v NW Metropolitan RHB [1973] 1 WLR 601	Courts will not reformulate contracts merely because one party “obviously” did not mean what was written.	Reinforced refusal to imply transfer of copyright.
Thomas v Thomas [1947] AC 484	Appellate restraint in overturning first-instance findings of fact.	Grounded Privy Council’s deference to Judge Jones on factual determinations.
McGraddie v McGraddie [2013] 1 WLR 2477; Henderson v Foxworth [2014] UKSC 41	Further authority on limits of appellate interference with trial findings.	Relied on to criticsise Court of Appeal for substituting its own view of evidence.
Beacon Insurance v Maharaj Bookstore [2014] UKPC 21; Central Bank of Ecuador v Conticorp SA [2015] UKPC 11	Recent Privy Council guidance on appellate review of fact.	Cited in reaffirming need for demonstrable error before reversal.
Seager v Copydex Ltd [1967] 1 WLR 923	“Springboard” doctrine: subconscious use of confidential information can breach confidence.	Noted but found inapplicable; no identified information was used as a springboard.

Court's Reasoning and Analysis

1. Implied Term / Copyright

Section 22(1) of the Copyright Act makes the author the first owner absent agreement.
Business efficacy test: assignment would conflict with Individual A’s established model of retaining copyright and licensing clients.
Even if exclusivity were implicit, an exclusive licence (not an assignment) could equally achieve that goal; therefore assignment was not the “only” obvious solution.
Company A never pleaded which precise elements of the software it owned, and no Company A copyright material was incorporated into the code.
Accordingly, no term assigning copyright was necessary or obvious; Judge Jones and the Court of Appeal were correct.

2. Breach of Confidence – Company B

Applying Coco, only the first two limbs (quality and obligation of confidence) were satisfied.
Trial judge found Company B conducted independent research (Person C’s year in the USA, identification of alternative software, use of existing Western Union network).
Court of Appeal overturned that finding, relying on similarities and software overlap.
Privy Council held appellate court exceeded its remit: no demonstrable error by trial judge; evidential basis supported independent development; similarities equally attributable to industry norms and Company B’s existing operations.
The concept of a multi-payment agency was not inherently confidential; any confidential detail was not shown to have been used.

3. Breach of Confidence – Individual A

Only confidential matter cited was the appearance of Company A’s name, three client names, and six branch locations in illustrative screens within the user manual.
Information was trivial, already public, and had no competitive value; no misuse established.

Holding and Implications

HELD: The Privy Council allowed Company B’s appeal, restoring Judge Jones’s dismissal of the breach-of-confidence claim. Company A’s appeals on copyright ownership and breach of confidence against Individual A were dismissed.

Implications: The decision re-affirms strict criteria for implying contractual assignments of intellectual property and emphasises appellate restraint in disturbing primary factual findings. No new legal doctrine was created; the ruling chiefly affects the parties, freeing Company B from liability and costs while confirming Individual A’s copyright ownership.