BILL ANALYSIS Ó AB 630 Page 1 Date of Hearing: April 23, 2013 ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER PROTECTION Richard S. Gordon, Chair AB 630 (Holden) - As Introduced: February 20, 2013 SUBJECT : Architects. SUMMARY : Prohibits a person from using an architect's instruments of service without a written contract or written assignment authorizing that use. EXISTING LAW : 1)Establishes the California Architects Board (CAB) under the Department of Consumer Affairs, to license and regulate architects and administer the provisions of the Architects Practice Act (Act). (Business and Professions Code [BPC] Section 5500 et al.) 2)Provides that an architect's professional services may include the following: a) Investigation, evaluation, consultation, and advice; b) Planning, schematic, and preliminary studies, designs, work drawings, and specifications; c) Coordination of the work of technical and special consultants; d) Compliance with generally applicable codes and regulations, and assistance in the governmental review process; e) Technical assistance in the preparation of bid documents and agreements between clients and contractors; f) Contract administration, and, g) Construction observation. (BPC 5500.1 (b)) 3)Requires an architect to use a written contract when providing professional services to a client, and requires the contract AB 630 Page 2 to include a description of the procedure to be used by either party to terminate the contract. (BPC 5536.22) 4)Provides that an original design of a building created in any tangible medium of expression, including a constructed building or architectural plans, models, or drawings, is subject to copyright protection as an "architectural work" under the federal Copyright Act. (Title 17 of the United States Code [USC], Section 102) 5)Defines "architectural work" to mean the design of a building as embodied in any tangible medium of expression, including a building, architectural plans, or drawings. The work includes the overall form as well as the arrangement and composition of spaces and elements in the design, but does not include individual standard features. (17 USC 101) FISCAL EFFECT : None. This bill is keyed non-fiscal by the Legislative Counsel. COMMENTS : 1)Purpose of this bill . This bill is intended to add an additional layer of protection to an architect's work by explicitly prohibiting its' use without a written contract. This bill is sponsored by the American Institute of Architects, California Council (AIACC). 2)Author's statement . According to the author's office, "AB 630 attempts to clarify that a person or entity must have contractual authorization to use the work, or instruments of service prepared by an architect. By clarifying existing law in plain English, the objective is to establish a clear law that can be used to avoid timely and costly arguments when an unauthorized user attempts to use the instruments of service prepared by an architect. "Like other professionals, architects provide a service to their clients. Those instruments of service - planning, schematic and preliminary studies, designs, working drawings, specifications - are used to develop buildings and structures? Importantly, architects provide a service and not a product. The service cannot be bought and sold except by the architect, with the consent of the architect, or by the client if the architect has transferred ownership of the intellectual AB 630 Page 3 property to the client." 3)Written contracts and copyrights . Current law already provides protections for an architectural work under federal Copyright law and state contract law. If a person improperly uses or transfers architectural work, an architect can pursue legal action in a federal court and seek injunctive relief or compensation ranging from $200 to $150,000 for each infringement. In addition, if a contract prohibits the transfer of architectural work, then an architect can sue for a breach of contract in state civil court. If an architect's written contract does not state whether the right of the original client to use the architectural work can be transferred to another person, it is implied that the only person who is authorized to use the architectural work is the client who signs the contract. The sponsor believes this bill will remove any ambiguity as to who is authorized to use an architectural work. However, given that tort law provides a means for architects to be compensated for damages, it is unclear why this bill is necessary. In addition, if a written contract is silent on the transfer rights of an architectural work, this bill would prohibit the use of an architect's work without permission, even if that was not the intent. Generally, this would pose no problem, since anyone other than the original client should seek permission from the architect to use his or her work. However, since copyright protection for a work can last anywhere from 70 years following the life of the author to 120 years after the date of publication, a situation may arise in which the architect will not be available to grant permission, even if it is sought. 4)CAB concerns . While the CAB supports this measure, the CAB wrote a letter "to point out, however, that these proposed provisions may be more appropriate in the Civil Code or the general provisions of the BPC rather than the Act. This is because CAB has no regulatory authority over consumers/clients? The CAB is also concerned that these well-intended provisions could be abused by an architect simply terminating a contract even though the payment for services is current. This would leave the consumer/client in the untenable position of having to negotiate with the architect to continue the project and ultimately use the AB 630 Page 4 instruments of service." 5)Arguments in support . According to the sponsor, the AIACC, "AB 630 seeks to add to state law language that clarifies in plain and simple English that a person must have permission to use the work, or Instruments of Service, prepared by an architect. [AIACC's] hope is AB 630 will give architects a tool to educate a person who is trying to illegally use the Instruments of Services prepared by the architect, and hopefully avoid timely and costly arguments? Importantly, architects provide a service and not a product. The service cannot be bought and sold except by the architect or, if by third parties, with the consent of the architect. "While the federal Copyright Act does prohibit the unauthorized use of [an] architect's Instruments of Service, architects find themselves in situations where a person believes he/she bought the plans, owns them, and has the right to use them. A survey the AIACC conducted early last year of architectural firms in California showed that a sizeable percentage (nearly 50%) of the firms that responded have encountered a person attempting to use their Instruments of Service without permission." According to the CAB, "AB 630 solves the problem of architects' instruments of service being used without their consent in the event a party other than the original client takes over a project. In some cases, the architect has not been paid for their professional services, the original client enters bankruptcy, and a bank subsequently takes over the project believing they own the instruments of service. In this situation, the architect's instruments of service are subsequently used to construct the project without the architect being compensated for the professional services, and potentially without the services and construction documents being complete and compliant with codes and standards." REGISTERED SUPPORT / OPPOSITION : Support American Institute of Architects, California Council (sponsor) California Architects Board Opposition AB 630 Page 5 None on file. Analysis Prepared by : Joanna Gin / B.,P. & C.P. / (916) 319-3301