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Court Orders Repayment of Royalty Fees Paid for Unlicensed Engineering Work

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Construction Bulletin

The British Columbia Supreme Court recently ordered the repayment of royalties on the basis that work falling within the definition of the “practice of professional engineering” was performed by an individual who was not a member of the Association of Professional Engineers and Geoscientists of the Province of British Columbia (“APEGBC” or “Engineers and Geoscientists British Columbia”) or licenced under the Engineers and Geoscientists Act, R.S.B.C. 1996, c. 116 (the “Engineers Act”).

In reaching its decision in Billing v. Precisioneering DKG Corp., 2017 BCSC 1777, the court relied on section 24 of the Engineers Act, an infrequently cited provision which provides in part as follows:

Except as provided in this Act, a person is not entitled to recover any fee or remuneration in any court of law in British Columbia for any work done or service rendered that is within the definition of “practice of professional engineering” or of “practice of professional geoscience” unless the person is a member of the association and holds a certificate of registration or is licensed under the provisions of this Act at the time the work is done or service rendered.

The “practice of professional engineering” includes the designing of industrial works and any other engineering works. The plaintiff testified that he designed the honeycomb structure of a manhole cover, a complex design that took him about five years to complete. He said that his plan was that he would eventually be remunerated by royalties and that the royalty rate he negotiated with the defendants was intended to be his remuneration for the work he had done in developing the manhole cover.

The court found that the work that the plaintiff carried out in designing and developing manhole covers fell within the definition of the practice of professional engineering and that section 24 of the Engineers Act barred the plaintiff from recovering any remuneration for the work.

Accordingly, the plaintiff was ordered to repay to the defendants the amount received by him as prepaid royalties. However, the court found that section 24 of the Engineers Act did not apply in respect of other parts of the underlying transaction, including the sale of related assets to the defendants.

The case serves as a lesson regarding one of the risks of the unauthorized practice of professional engineering. The plaintiff’s design and development of manhole covers fell within the definition of professional engineering, and he was not entitled to receive royalties based on the sale of the manhole covers he designed.

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