Succession Planning for Patents: Lessons from the Monarchy

Lubo Minar Hunkka6vtzc UnsplashI was on a plane from Singapore to San Francisco to attend a recently concluded conference when the news of HRH Queen Elizabeth II’s passing came through on the news channel. Whilst quietly acknowledging her remarkable life well-lived, the end of an era got me thinking about the issue of succession planning when it comes to patents.

The concept of “death” is a particularly difficult topic to discuss and in my ten years of working in patent law, it has not come up very often. However, it is an important consideration even when it comes to patents and this article explores the Australian perspective on the death of a patent applicant. 

Section 15 of the Australian Patents Act specifically deals with the death of a patent applicant.

Death of applicant or nominated person

             (1)  If an applicant dies before a patent is granted on the application, his or her legal representative may proceed with the application.

             (2)  If a nominated person dies before a patent is granted on the application, the patent may be granted to his or her legal representative.

             (3)  Where, at any time after a patent is granted, the Commissioner is satisfied, on the balance of probabilities, that the patentee had died (or, in the case of a body corporate, had ceased to exist) before the patent was granted, the Commissioner may amend the Register by substituting for the name of the patentee the name of the person to whom the patent should have been granted.

             (4)  An amendment by the Commissioner has effect, and is to be taken always to have had effect, accordingly.

The Australian Patent Examination Manual in Section clarifies that where an applicant dies before a patent is granted, the patent may be granted to that person’s legal representative as set out in Section 15-1(d) of the Patents Act. In this situation, evidence setting out the right of the legal representative to the patent must be filed and such evidence is considered by the Australian Patent Office.

Under Australian rules, if the applicant dies before a patent is granted, the application can proceed in the original name until, or even beyond, grant. In either case, the provisions of Section 215 still apply. A person with legal rights to the patent may then have his or her name substituted for that of the deceased patentee after providing suitable evidence. The same principle is also applicable when one of a number of applicants dies without having made a will.

When a ‘natural person’ dies an ‘estate’ comes into existence. The estate is the legal person or entity that contains all the contractual and property rights and responsibilities that were controlled by the natural person before their death. There are exceptions, but when the owner of a patent dies, the patent usually becomes the property of the estate. Importantly, it has also been clarified in Trivett Classic Pty Ltd v Estate of Trivett (dec’d) (1999) 44 IPR 437 that a patent cannot proceed in the name of “the estate of X” and that ownership must be devolved according to the will of the patentee. 

Importantly, the death of an inventor who has assigned their rights to a company is rather insignificant and while dealing with death is always difficult such difficulty does not extend to the issue of patent ownership. In such a scenario, business would continue as usual which is why it can be advantageous to set up a patent holding company, especially where licensing or multiple inventors are involved. In some overseas jurisdictions, particularly at the US Patent and Trademarks Office, if there are living co-inventors, these co-inventors may be able to enter a ‘substitute statement’ which allows them to proceed, without the deceased inventor participating.

One of the ways in which the deceased person’s patent ownership would be transferred to another person or entity could be via the will of the person. In such a scenario, the will would direct the deceased person’s patents from a will into a trust with one or more trustees or to another person. Importantly, under the Australian system trusts are not considered as an eligible “legal person”. In such scenarios, the trustees of the trust would need to be recorded as the legal person in accordance with the requirements of Section 15.

If there is no will, then the situation becomes more complicated, and someone would need to step in to become an administrator of the deceased patent person’s estate. This generally involves a spouse or close family member going to court with a death certificate and asking for ‘letters of administration’ (sometimes called ‘letters rogatory’). These documents indicate that the would-be administrator has the authority to manage the deceased patent owner’s matters. In such a scenario, the patents would need to be assigned to the administrator as an interim measure before being assigned again to a new owner.

From corgis to family businesses, structured succession planning provides certainty, clarity, and freedom to give assets to beneficiaries chosen by the deceased person and leaves nothing to chance. All persons including inventors and patent owners die eventually, and this inevitability has an impact on the patent applications and patents that they own. The death of a patent owner is a significant event and can therefore raise some interesting legal questions in patent law. 


Andy Mukherji
written by Andy Mukherji, Principal