Let me try again, I am trying to develop a custom smartphone, at the moment it is simply as a hobby, but if for some reason it reaches the level of being a consumer device what restrictions would be involved as far as hardware is concerned? So for example if I used the display out of my old HTC One in my new device, would that be an issue or is it considered "mine"since i own the HTC? Are there licenses involved when using certain bits of hardware in reproducing a new device? Can i buy all the best bits of hardware I can find and then combine them all together to make a new device?
I have already started OS development, however I am having trouble working out what hardware I am allowed to use to back it up.
Your words are so far away from sanity that it will be nearly impossible to answer you.
You understand that smartphones are developed and sold by companies with huge development budgets (hundreds of millions of $$$), vast and capable technical staffs, and access to enormous commercial, legal and manufacturing resources, right?
Trying to design and make a smartphone of your own as a commercial offering is like trying to run a space exploration program out of your garage. The reason you have got nowhere with the people you have talked to so far is because there is nowhere to get. Your questions go nowhere. It's like you are in the middle of Arizona and you've asked for walking directions to the Sahara desert.
Now, if you want to do something as a hobby project, you may have a chance. You should look into an existing open hardware platform that you can customize the software for, like Android. Using an Android phone as the hardware and the appropriate tools, you can customize the OS and apps as much as your skills and resources allow. That's entirely within reason as a hobby or enthusiast project.