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Bailment of Intellectual Property in Nigeria: A Conceptual Possibility
Published online by Cambridge University Press: 06 February 2023
Abstract
This article interrogates the traditional limitations of the concept of bailment at common law. It argues that, although possession is a critical element, in modern commerce, a bailment relationship should be capable of being created without actual physical possession and control, but through constructive possession, which is as effective as physical possession and control. With this adjustment to the interpretation of the element of possession, bailment could then apply to intangible property, such as intellectual property. With the support of evidence from other progressive common law jurisdictions and inroads from the tort of conversion and criminal theft, the article argues that this new bailment jurisprudence is beginning to emerge. It then recommends that, in deserving circumstances, the courts should not hesitate to find that a bailment relationship exists, notwithstanding the absence of physical control and possession, at least pending legislative intervention.
Keywords
- Type
- Research Article
- Information
- Copyright
- Copyright © The Author(s), 2023. Published by Cambridge University Press on behalf of SOAS University of London
Footnotes
*
Group general counsel and group company secretary of a Nigerian and indigenous oil and gas company; doctoral candidate in the Department of Commercial and Corporate Law, Faculty of Law, The University of Nigeria, Enugu Campus, Enugu, Nigeria. LLB (hons) (The University of Nigeria), LLM (University of Lagos), LLM (University of British Columbia, Vancouver), barrister at law, FICA, ACI Arb (UK), ACMR.
References
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7 [1986] 5 NWLR (pt 41) 350.
8 The court relied on an earlier decision in West African Examinations Council v Koroye [1977] 2 SC 45. See also Broadline v Monterey, above at note 6 at 50.
9 Ike v Mangrove, above at note 7.
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11 [1999] 13 NWLR (pt 634) 235 at 250. See also Halliburton (Nigeria) Ltd v Chapele [1996] 8 NWLR (pt 468) 554.
12 Leventis v Cyrus, id at 256.
13 In England, the tort of detinue was abolished by the Torts (Interference with Goods) Act 1977, sec 2(1) and replaced with different classifications, such as trespass or conversion of goods and negligence. See Florence Labode v Godfrey Otubu [2001] 7 NWLR (pt 712) 256 per Ayoola JSC at 290. By virtue of inherited English common law, detinue remains a tort in Nigeria, in addition to the tort of conversion.
14 MF Kent WA Ltd v Martchem Industries Nigeria Ltd [2000] 8 NWLR (pt 669) 459 at 474. See also Umoru v Ijumu Local Government Council [2010] 7 NWLR (pt 1192) 1.
15 Kent v Martchem, ibid. See also Iheanacho v Uzochukwu [1997] 2 NWLR (pt 487) 257; Umoru v Ijumu, ibid.
16 West African Oilfields Serv Ltd v UAC Nigeria Ltd [2000] 13 NWLR 68 at 75.
17 Kent v Martchem, above at note 14 at 480; Sodimu v Nigerian Ports Authority [1975] 4 SC 15; Umoru v Ijumu, above at note 14.
18 (31 May 2017) Federal Republic of Nigeria Official Gazette (Government Notice No 50) No 58, vol 104, A37–60.
19 In the matter of Welldog Pty Ltd (in liquidation) (Receivers and Managers Appointed) [2017] FCA 1065.
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21 STMA, sec 63(1).
22 Id, sec 63(1).
23 Ibid.
24 Id, sec 39(2) provides that an operating lessor may enforce its rights under the lease agreement or any other law governing the operating lease where the security interest is sought to be realized.
25 Id, sec 63(1) defines an operating lease as an agreement between two parties under which the lessor allows the lessee to use its asset for a specific period of time in exchange for periodic fees.
26 Barbedos Ventures Ltd v FBN Plc [2018] 4 NWLR (pt 1609) 241; FBN v Songonuga [2007] 3 NWLR (pt 1021) 230 at 266–67.
27 Okoro v Nwachukwu [2007] 4 NWLR (pt 1024) 285 at 298; Agada Okoiko v Esedalue [1974] 3 SC 15.
28 See Nwosu v Udeaja [1990] 1 NWLR (pt 125) 188.
29 UCC, sec 9-305. See also DA Ebroon “Perfection by possession in article 9: Challenging the arcane but honored rule” (1994) 69/4 Indiana Law Journal 1193.
30 [1989] 3 NWLR (pt 109) 354 at 366 per Nnaemeka-Agu JSC.
31 268 A2d 364 (NJ 1970) at 419.
32 N Medniuk “Rights and duties arising from bailment and liens” (26 February 2014), available at: <https://www.lexology.com/library/detail.aspx?g=4b0aed7b-647f-413a-baed-4cec871bb0b5> (last accessed 9 December 2022).
33 Newman “Bailment and the property”, above at note 1 at 27.
34 Ibid. See also US Copyright Code (cap 17), sec 109(a) (Limitations on exclusive rights: Effect of transfer of particular copy or phonorecord).
35 Newman, ibid.
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37 See for example, Softman Products Co LLC v Adobe Systems Inc 171 F sup 2d 1075 at 1086 (CD Cal 2001).
38 [2018] LPELR-45181 (CA).
39 Then, Longman Nigeria Plc.
40 Learn Africa, above at note 38 at 3.
41 See “The bailee's right to recover full damages: Historically and critically” (1950) 25/1 St John's Law Review 51 at 54–55; and “A re-examination of the Winkfield case” (1940) 9/2 Fordham Law Review 247 (both providing justifications for the Winkfield rule).
42 [1902] P 42, 1900–03 All ER 346 (1901).
43 Id at 42, thus overruling the decision in Claridge v South Staffordshire Tramway Co [1892] 1 QB 422, where the court decided (at 422–23) that “if a man is in possession of a chattel and his possession is interfered with, he may maintain an action but only for the injury sustained by himself. The right to bring an action against a wrongdoer is one thing; the measure of damages recoverable in such action is another.”
44 See above at note 41.
45 Dickerson, D “Bailor beware: Limitations and exclusions of liability in commercial bailments” (1988) 41/1 Vanderbilt Law Review 129Google Scholar at 138–49.
46 Id at 129–30.
47 Learn Africa, above at note 38 at 22.
48 [2020] 13 NWLR (pt 1742) 415 at 535 per Ogbuinya JCA.
49 Copyright Act, sec 1(2)(b).
50 Ibid.
51 [1996] 4 All ER 481.
52 [2008] EWHC 355 (Ch).
53 [2014] 4 All ER 928; [2015] QB 41, available at: <https://www.casemine.com/judgement/uk/5b46f1ed2c94e0775e7ee3bb> (last accessed 18 January 2023).
54 For critique, see: M Lewis “Virtual possession: Electronic data is not tangible property” (21 May 2014) Solicitors Journal, available at: <https://www.solicitorsjournal.com/sjarticle/Virtual%20possession:%20electronic%20data%20is%20not%20tangible%20property> (last accessed 9 December 2022); PM Cooper “Lien out: Electronic data is not tangible property so no lien arises” (25 June 2014), available at: <https://www.penningtonslaw.com/news-publications/latest-news/lien-out-electronic-data-is-not-tangible-property-so-no-lien-arises> (last accessed 9 December 2022); “Tangible vs intangible: Can a lien exist over electronic data?” (24 April 2014, Olswang LLP), available at: <https://www.cms-lawnow.com/ealerts/2014/04/tangible-vs-intangible-can-a-lien-exist-over-electronic-data?sc_lang=en> (last accessed 9 December 2022); P Friedman, N Jamieson and S Garg “Intangible property, such as electronic databases, may not be subject to liens” (8 December 2014), available at: <https://www.lexology.com/library/detail.aspx?g=da2d3590-b344-4f9c-bd34-e333fab7500d> (last accessed 9 December 2022); M Dunster and S Florance “Holding data hostage” (24 April 2014), available at: <https://www.lexology.com/library/detail.aspx?g=64cc21dc-6b8a-4199-8b0b-a4cfd7d6f453> (last accessed 9 December 2022); and “Do service providers have a lien over data?” (7 August 2014, Mason Hayes & Curran LLP), available at: <https://www.lexology.com/library/detail.aspx?g=2f02e233-f731-4195-89c7-a4cc08138f9a> (last accessed 9 December 2022).
55 [2007] UKHL 21.
56 Id, para 97. See for example, the English Torts (Interference with Goods) Act 1977, sec 1, which defines wrongful interference with goods to include “conversion of goods”. “Goods” on the other hand is defined as “… all chattels personal other than things in action and money”.
57 [2014] EWCA Civ 909.
58 Datateam, above at note 53 (online), para 27, per Lord Justice Moore-Bick.
59 Id at 41–42, per Lord Justice Floyd. See generally, TF Aplin “Confidential information as property?” (2013) 24/2 King's Law Journal 172; AA Pam and JI Mantu “An appraisal of the legal framework on confidential information and trade secrets in Nigeria” (20 May 2019), available at: <http://dx.doi.org/10.2139/ssrn.3422302> (last accessed 9 December 2022).
60 [1967] 2 AC 46. Here, the House of Lords, per Lord Upjohn, categorically held that information cannot be regarded as property, but a person may be restrained in equity from disclosing confidential information that contains secret processes or know-how.
61 [1978] Cr App R 183. This case held that information is not property under English law and thus cannot be stolen.
62 [2008] 1 AC 1. Lord Walker observed in this case that confidential information, whether personal or commercial, cannot be regarded as a form of property.
63 [2012] UKSC 28, [2013] 1 AC 1. The court observed that, although confidential information is not strictly property, it is not unusual to include it as an aspect of intellectual property.
64 Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, available at: <https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A31996L0009> (last accessed 9 December 2022).
65 Datateam, above at note 53 (online), paras 38–39.
66 SV Erp “Ownership of data: The numerus clausus of legal objects” (2017) 6 Property Rights Conference Journal 235 at 250–52.
67 See for example, Express One International v Steinbeck 53 SW 3d 895 at 901 (2001); Montecalvo v Mandarelli 682 A.2d 918 at 929 (RI 1996); and Allied Investment Corp v Jasen 354 Md 547 at 562, and 731 A.2d 957 at 965 (1999). In the latter, the court declined to apply conversion to an interest in corporation and partnership.
68 See S Green and J Randall QC The Tort of Conversion (2009, Hart Publishing Ltd) at 109–11 and 118–34; and TJ Hall and JA Archer “The slow expansion of conversion claims to cover intangible property” (20 February 2020) New York Law Journal (online), available at: <https://www.law.com/newyorklawjournal/2020/02/20/the-slow-expansion-of-conversion-claims-to-cover-intangible-property/?slreturn=20200923042308> (last accessed 9 December 2022). The writers note that, notwithstanding the traditional view on conversion, recent case law has provided some exceptions to the tort of conversion so that it can protect intangible property where it is manifested in some physical form. See also CJ Akins “Conversion of digital property: Protecting consumers in the age of technology” (2010) 23/2 Loyola Consumer Law Review 215.
69 See Green and Randall, ibid; B Pratama “Legal prescription on virtual property and its rights” (2017) International Conference on Computing and Applied Informatics Journal of Physics Conference Series 801, available at: <https://iopscience.iop.org/article/10.1088/1742-6596/801/1/012090/pdf> (last accessed 9 December 2022); W Erlank “Introduction to virtual property: Lex virtualis ipsa loquitur” (2015) 18/7 Potchefstroom Electronic Law Journal 2525; JT Fairfield “Virtual property” (2005) 85 Boston University Law Review 1047; P Palka “Virtual property: Towards a general theory” (PhD thesis presented to the Department of Law, European University Institute, 2017), available at: <https://cadmus.eui.eu/handle/1814/49664> (last accessed 9 December 2022); C Blazer “The five indicia of virtual property” (2006) 5/1 Pierce Law Review 137.
70 (1996) 46 Cal App 4th 1559, 54 Cal Rptr 2d 468 at 1567. See J Macdonald “Electronic trespass in Canada: The protection of private property on the internet” (2006) 5/3 Canadian Journal of Law and Technology 163 at 163–64 and 167.
71 962 F Supp 1015 (SD Ohio 1997).
72 Macdonald “Electronic trespass”, above at note 70.
73 71 P 3d 296 (Cal 2003) at 308. This case was criticized as a setback to the advancement of the law on cyber trespass because trespass is actionable per se.
74 384 F Supp 2d 1219 at 1230 (ND Ill 2005). For an analysis also from an unmentioned nuisance viewpoint, see J Anderson and D Fish “Sotelo v DirectRevenue, LLC: Paving the way for spyware-free internet” (2005) 22/5 Santa Clara Computer and High Tech Law Journal 841.
75 See PA Winn “The guilty eye: Unauthorized access, trespass and privacy” (2007) 62/4 The Business Lawyer 1395; MJ O'Connor “The common law of cyber trespass” (2020) 85/2 Brooklyn Law Review 421; C Sharkey “Trespass torts and self-help for an electronic age” (2009) 45 Tulsa Law Review 101; S Balganesh “Common law property metaphors on the internet: The real problem with the doctrine of cybertrespass” (2006) 12/2 Michigan Telecommunications & Technology Law Review 265.
76 337 F3d 1024 at 1033–34 (9th cir 2003).
77 (2007) NY Slip Op 2442, 8 NY 3d 283.
78 (2006) NY Slip Op 30664 (NY Sup Ct 2006). See LN Jacobs “Is what's yours really mine? Shmueli v Corcoran Group and Penumbral Property Rights” (2006) 14/2 Journal of Law and Policy 837.
79 MP Innovations v Atlantic Horizon International No 604133/2007 (2008) WL 7729118 (NY Sup Ct NY Cnty 2008).
80 See KG Faley and AM Alonso “Conversion in electronic age” (21 January 2014) New York Law Journal, available at: <https://mdafny.com/index.aspx?TypeContent=CUSTOMPAGEARTICLE&custom_pages_articlesID=14846> (last accessed 9 December 2022).
81 [1996] AC 81.
82 P Binning and B Henriques “A thief is not necessarily a fraudster. A fraudster is not necessarily a thief” (6 July 2018), available at: <https://www.corkerbinning.com/a-thief-is-not-necessarily-a-fraudster-a-fraudster-is-not-necessarily-a-thief/> (last accessed 9 December 2022).
83 J Lipton “Property offences into the 21st century” (1999) 1 The Journal of Information, Law and Technology, available at: <https://warwick.ac.uk/fac/soc/law/elj/jilt/1999_1/lipton/#a4> (last accessed 9 December 2022).
84 Eighth Report: Theft and Related Offences (Cmnd 2977, 1966, Criminal Law Revision Committee, House of Commons).
85 See Theft Act 1968, sec 1, which uses the word “appropriate” instead of “steal” and which defines “appropriate” in detail in sec 3. See also sec 4, which defines property to include “money and all other property, real or personal, including things in action and other intangible property”. See A Steel “Taking possession: The defining element of theft?” (2008) 32/3 Melbourne University Law Review 1030.
86 Pub L No 98-473, § 2102(a), 98 Stat 2190 at 2190–92.
87 US Code, title 18, secs 1030(a)(2) and 1030 generally. Authorization was not defined in the Computer Fraud and Abuse Act 1986, but see International Airport Centers LLC v Citrin 440 F3d 418 at 419–20 (7th Cir, 2006), where the court hinged authorization on agency of employment relationship. In EF Cultural Travel BV v Explorica Inc 274 F 3d 577 at 582–84 (1st Cir 2001), the contract approach was adopted as suitable to prove or disprove authorization.
88 US Code, title 17, sec 101 (West 2012).
89 Id, secs 101, 104, 104A, 108, 132, 114, 117 and 701.
90 US Code, title 18, sec 1030.
91 Id, secs 1831–39 (West 2012).
92 See TG Field “Crimes involving intangible property” (2013) 11/2 The University of New Hampshire Law Review 171; GS Moohr “Federal criminal fraud and the development of intangible property rights in information” (2000) University of Illinois Law Review 683; M Song and C Leonetti “The protection of digital information and prevention of its unauthorized access and use in criminal law” (2011) 28/4 The John Marshall Journal of Information Technology & Privacy Law 523; AF Popper “More than the sum of all parts: Taking on IP and IT theft through a global partnership” (2014) 12/4 Northwestern Journal of Technology and Intellectual Property 253.
93 HS Zaytoun “Cyber pickpockets: Blockchain, cryptocurrency, and the law of theft” (2019) 97/2 North Carolina Law Review 395.
94 Emphasis added. See Criminal Code Act (cap 77, Laws of the Federation of Nigeria 1990), sec 382 and (cap C39, Laws of the Federation of Nigeria 2004).
95 Id, sec 3(2).
96 Crimes, subject to covering the field, are within the residual list for states to legislate on. See Ontario Oil and Gas Ltd v FRN [2018] 13 NWLR (pt 1636) 197.
97 Criminal Law of Lagos State 2011 (cap C17), sec 281(2) (emphasis added).
98 Cybercrime (Prohibition, Prevention, Etc) Act 2015, sec 1(c).
99 Id, sec 12(1). See also generally, secs 14 and 15, the latter providing against unauthorized modification of computer systems, network data and system interference.
100 See for example, R v Wilkinson [1999] 1 NZLR 403 (CA), where it was held that electronically transferred bank credit could not be stolen within the meaning of extant criminal law; and subsequently R v Misic [2001] NZCA 128, [2001] 3 NZLR 1 (CA) where, for the offence of theft, it was held that “document … in any form” covers documents in electronic or digital files. In Dixon v R [2016] 1 NZLR 678, the accused was convicted for obtaining property by accessing a computer system for a dishonest purpose, thereby holding that digital files are property. For a critique of the latter decision, see D Harvey “Case note: Digital property - Dixon v R [2015] NZSC 147, [2016] 1 NZLR 678” (2017) New Zealand Criminal Law Review, available at: <https://ojs.aut.ac.nz/new-zealand-criminal-law-review/index.php/tewharenga/article/view/54/46> (last accessed 9 December 2022). For the general position in New Zealand, see Rumbles, W “Theft in the digital: Can you steal virtual property?” (2011) 17/2 Canterbury Law Review 354Google Scholar; Steel, A “Problematic and unnecessary? Issues with the use of the theft offence to protect intangible property” (2008) 30 Sydney Law Review 575Google Scholar. For South Africa, see Njotin, MN “Re-positioning the law of theft in view of recent developments in ICTS: The case of South Africa” (2016) 19 Potchefstroom Electronic Law Journal 1Google Scholar.
101 For example, GPS information, cloud storage services and all forms of custodial digital storage services and hosting, email servers and services, telephone calls and historical cell-site location information for mobile phone operators.
102 Gallant, S “The old bailment doctrine: The answer to Fourth Amendment jurisprudence in the digital age” (2020) 25/1 Roger Williams University Law Review 116Google Scholar.
103 138 S Ct 2206 (2018).
104 389 US 347 (1967).
105 Carpenter, above at note 103 at 2269.
106 Skedvold, MC “A duty to safeguard: Data breach litigation through a quasi-bailment lens” (2018) 25/2 Journal of Intellectual Property Law 201Google Scholar.
107 For example, Datateam, above at note 53 and Learn Africa, above at note 38.
108 Datateam, id (online), para 27, per Lord Justice Moore-Bick.
109 Brighton County Court, per District Judge Bell.
110 Datateam, above at note 53 (online), para 27, per Lord Justice Moore-Bick.
111 T Etherton “Constructive trusts: A new model for equity and unjust enrichment” (2008) 67/2 The Cambridge Law Journal 265. See also In Re Alpert 9 Misc 3d 1102 [A].
112 223 F Supp 2d 1109 (CD Cal 2002) at 1139.
113 225 NY 380 [1919] at 386.
114 Simonds v Simonds 45 NY2d 233 at 242 [1978].
115 See Westdeutsche Landesbank Girozentrale v Islington LBC [1996] UKHL 12; [1996] AC 669 at 671G–715A.
116 Huebner v AIEPM Co Ltd [2017] 14 NWLR 397 at 419, 420 and 442; Ibekwe v Nwosu [2011] 9 NWLR (pt 1251) 1 at 14–16; Kotoye v Saraki [1994] 7 NWLR (pt 357) 414; Anyaegbunam v Osaka [1993] 5 NWLR (pt 294) 449 at 461.
117 See Moore v Sweet [2018] SCC 52; DBDC Spadina Ltd v Walton [2018] ONCA 60 and Muschinski v Dodds [1985] 160 CLR 583 as applied by courts in Canada and Australia, respectively. Also for Australia, see Liew, YK “Constructive trusts and discretion in Australia: Taking stock” (2021) 44/3 Melbourne University Law Review 1Google Scholar.
118 See Westdeutsche Landesbank v Islington, above at note 115 at 705; Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; J Dietrich and P Ridge “The receipt of what? Questions concerning third party recipient liability in equity and unjust enrichment” (2007) 31 Melbourne University Law Review 47 at 53, 55–56 and 63; Saunders, BJ “Imperfect property: Defective protection for bona fide purchasers of copyrights” (1988) 5/1 University of Miami Entertainment & Sports Law Review 13Google Scholar at 13–14; Wheeldon, S “Reflections on the concept of ‘property’ with particular reference to breach of confidence” (1997) 8/2 Auckland University Law Review 353Google Scholar at 369 and 383; Carlson, DG “Constructive trusts and fraudulent transfers: When worlds collide” (2019) 103/2 Marquette Law Review 366Google Scholar at 377.
119 Nemo dat quod non habet: one cannot give what one does not have.
120 See Wentworth v Riggs 143 NYS 955 (Sup Ct NY 1913).
121 538 SE2d 268 (Ct App SC 2000).
122 CM Newman “Bailment and the property / contract interface” (George Mason University Legal Studies Research Paper Series LS 15-12) at 17.
123 English decisions, even with the highest authority of the House of Lords, are only persuasive in Nigerian courts. See In Re Abdullahi [2018] 14 NWLR (pt 1639) 272; Yahaya v State [2002] 3 NWLR (pt 754) 289; Lijadu v Lijadu [1991] 1 NWLR (pt 169) 627 at 648.
124 See P Nolan et al “Do service providers have a lien over data?” (12 August 2014) Mondaq, available at: <https://www.mondaq.com/ireland/data-protection/334150/do-service-providers-have-a-lien-over-data> (last accessed 9 December 2022).
125 See Datateam, per Lord Justice Davis, id (online), para 40. See also P Susman QC and N Dilworth “Possessory lien does not apply to database” (20 March 2014) Henderson Chambers Alerter at 4. The writers of this article successfully represented Datateam in Datateam.