UK: Does An Implied Licence To Use Software Continue After The Extension Of An Initial Term Of A Services Agreement?

Last Updated: 14 October 2013
Article by Mark Alsop

Noemalife SPA v Infinitt UK Ltd [2013] EWHC 2376 (TCC)

Ferrania UK Ltd ("FUK") (a company later acquired by the defendant Infinitt UK Ltd) was granted a licence by its sister company in 2003 to use certain software (known as "RIS"), for the purposes of providing services to Newcastle upon Tyne NHS Trust (the "NHS Trust") under a managed services agreement.

The term of the agreement was a period of seven years but the agreement contained provisions by which the agreement could be extended for further six month block periods up to a maximum extension period of thirty six months. The provisions of the agreement provided that any amendment to the agreement, including to the agreement term, had to be made in accordance with the change control procedures set out in the agreement itself.

The initial term of the services agreement expired on 30 September 2010 and was extended for six months to 31 March 2011 by a contract change control note. In December 2010 the agreement was extended again, this time for 30 months (expressed as five blocks of six months) to 30 September 2013 all in one change control note.

The claimant Noemalife SpA ("Noemalife") had acquired the copyright in the software from FUK's sister company and argued that, at the expiry of the initial period in September 2010, a fresh implied licence came into effect on 1 October 2010, and that it was a term of that licence that the defendant would pay a reasonable fee for use of RIS.

One issue before the court was whether the licence granted to FUK in 2003 to use RIS for the purposes of providing services to the NHS Trust continued after the expiry of the initial seven year term, and if so, for what period.

The judge ruled that the original implied licence granted by FUK in 2003 was extended by six months to 31 March 2011. However, when the agreement was further extended, but not in accordance with the provisions of the agreement, no further licence to use the software could be implied for the further extension.

Noemalife had no contractual right to recover any sum from FUK in relation to the use of RIS for the purposes of providing services under the agreement to the NHS Trust beyond 30 September 2010.

Key Points

  • The fee for first six month extension: on the basis of the evidence, the judge found that there was no intention on the part of Noemalife to enter into any agreement in relation to a licence fee for RIS for the six months extension to 31 March 2011. The judge found that Noemalife had decided to allow FUK to continue to use the licence for six months and on that basis there was no intention to create legal relations with FUK in connection with a licence fee for the six month period.
  • The fee for the second extension: the judge found that there was no evidence that Noemalife gave any indication to FUK that it proposed to charge a fee for FUK's use of RIS after 31 March 2011. The judge concluded that there was no evidence of any intention to create legal relations in relation to the use of RIS from the end of March 2011 to 30 September 2013. There was in fact no evidence to support either an implied agreement that the licence should continue beyond 31 March 2011 or an implied agreement that a fee was to be payable. Accordingly, the judge found that any claim to an entitlement to a licence fee beyond 31 March 2011 failed for want of any intention to create legal relations.
  • Extension by change control: the judge said that a request to extend the agreement was in his view a variation which fell within the scope of the change control procedure set down in the agreement. The agreement provided that a formal request for a change shall be requested and that neither party shall unreasonably withhold its agreement to any proposed change. The agreement provided that extensions to the contract should be in six month blocks and for a maximum aggregate period of 36 months. (The reference to six month blocks was quite specific and it was probable that this was included because there was a risk under Community procurement legislation that an extension of three years (almost 50% of the term) would be regarded as a material amendment to the contract and therefore open to challenge.

    The judge concluded that the NHS Trust contract could only be validly extended by six months at a time and therefore that the extension of 2 ½ years made by change control note on 14 December 2010 was not made in accordance with the terms of the contract.
  • The duration of the licence to use RIS: the judge considered whether the licence lasted a minimum of seven years or was extended automatically to any period by which the NHS Trust contract was extended. The judge found that the original 2003 implied licence covered the initial period of seven years and the extension of the agreement to 31 March 2011. The implied licence would have gone no further than the minimum necessary to enable FUK to enter into the services agreement (following Robin Ray v Classic FM [1998] FSR 622) and would have extended to include any extension of the contract that FUK was contractually bound to accept.

    Under the terms of the agreement, the NHS Trust could request FUK to extend the contract by six months and FUK could not unreasonably refuse that request.

    Since the 2 ½ year extension was not an extension made in accordance with the terms of the agreement, it was a change that FUK was entitled to refuse. The licence did not extend beyond the period for which FUK was required to provide services. Since FUK was not required to provide services after 31 March 2011, the implied licence came to an end on that date.
  • Copyright infringement: In order to provide services after 31 March 2011 to the NHS Trust, FUK required a licence from the copyright owner to use RIS. No such licence was granted by Noemalife, for want of any mutual intention to create legal relations. The judge said that it would have been open to Noemalife to claim for copyright infringement but this was pleaded too late in the proceedings. The timetable for the trial did not allow for Noemalife to be put to proof of its ownership of copyright in RIS. The judge said that his refusal to allow an amendment to claim copyright infringement did not prevent Noemalife bringing a fresh claim for infringement for the period from 1 April 2011 onwards.


The case illustrates the importance of complying with the procedures set down in an agreement when any change to terms is agreed. In this case, a failure to do so meant that the service provider (i) continued to provide services when it was under no obligation to do so; and (ii) infringed the rights of the copyright owner by continuing to use the software without the benefit of a licence to do so.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.