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Posts Tagged ‘cancellation’

The Response of the Performing Arts to the World Premiere of the Coronavirus

Wednesday, March 4th, 2020

By Brian Taylor Goldstein

Let’s all step back and take a breath for moment.

As you can imagine, the coronavirus has overrun (dare I say “infected?”) our office with an ever growing stream of cancellations based on force majeur and concerns from venues, presenters, agents, and artists from around the world. As the situation has continued to develop (dare I say “spread?”) so rapidly, we have so far focused solely on dealing with issues on a case-by-case basis rather than take on the task of posting any advice or updates which might be outdated in 2 days.

However, as cancellations are becoming more frequent and more likely, we have increasingly begun to receive questions from all sides about what does and does not constitute a legitimate force majeure cancellation and who is responsible for lost income and covering expenses. While not at all unreasonable concerns, we get the sense that people are “preparing for battle” rather than accepting the reality of a shared crisis in which we all find ourselves. For instance, we have been told:

That no one can call off a concert unless the U.S. government “officially” declares a pandemic. (That’s unlikely given the regime’s current position that this can all be resolved through the power of prayer alone.)

That venues are “legally” required to educate their audiences not to be led by fear and racism. (Since when? I missed this in law school.)

That artists should not be allowed to cancel unless they come from the specific part of a country where there have been cases. (So it doesn’t matter that an audience is not going to come to see a South Korean artist regardless of what part of Korea they have just arrived from?)

“They cancelled a month ago, before there were any outbreaks, so they shouldn’t be able to get the benefit of that now!” (So, the fact that they wound up making the right decision is irrelevant?)

“The coronavirus cases in their state is not anywhere near where their venue is located!” (Do you live there? Are you planning on going to the concert yourself?)

“Airlines are still flying to the U.S. from that country, and the artist is willing to be quarantined, so the venue cannot cancel!” (So, just because someone has found a way to break into my house, I have to let them stay so long as they promise not to cough in my face?)

And I JUST heard an idea being tossed about of adding a Force Majeure “penalty fee” clause to contracts. (Why stop there? Why not a public shunning?)

Without a doubt, and not in the least to dismiss the gravity of potential, if not, devastating financial losses throughout the performing arts, these arguments miss the point. Everyone is facing difficult decisions and financial loss—and not just in the performing arts.

Whether you are anticipating a cancellation or it has already happened, you should take the following immediate steps:

STEP 1: Review Your Contract

Most contracts will actually spell out the situations that allow for a Force Majeure cancellation, including what the parties are and are not responsible for.

STEP 2: Prepare Martini (gin, slightly dirty, extra olives)

STEP 3: Discard Your Contract and Accept Reality

The legal concept of Force Majeure or Act of God anticipates situations where one or both of the parties to a contract cannot meet their obligations due to something outside of their control and which could not have reasonably been anticipated. A fire in the venue. An artist gets sick. A snowstorm closes an airport. Etc. However, there does not have to be a physical impediment to the performance for a performance contract to be permissibly cancelled due to a force majeure. Does a theater have to actually burn all the way down? Can the artist insist that they are still willing to perform on what’s left of the smoldering stage? What if the artist is sick, but not dead? Can the venue insist that the artist be dragged on stage with a portable oxygen tank?

At present, in the case of a new virus that has spread internationally and was previously unknown, while an official government declaration or ban on travel would certainly make things simpler, that is by no means a requirement. In just two months, we have long been overtaken by circumstances justifying both venues and artists to declare a force majeure for any number of reasons, including:

A show involving artists coming from or who have recently been to an infected area.
Travel restrictions or quarantine requirements imposed by a state or local government in the the U.S. and or any country in the world that might impact the ability of an artist or group to leave their own country and/or enter or leave the U.S.
An artist from one part of the U.S. traveling to another part of the U.S. where cases have been reported.
Venues deciding to close out of abundance of caution.
An artist wishing to cancel to avoid exposure or to avoid being trapped inside or outside the U.S. should official travel bans start to be put in place.

On their face, these are all a reasonable. Conversely, it may, in fact, be unreasonable for someone to insist on a performance taking place where there was even a “reasonable” risk of putting an artist or audience in harm’s way. If God (and/or Goddess and/or the universal cosmic energy) forbid, someone were to get sick, this could raise significant issues of liability for negligence.

The reality is that we are all facing the same situation (and our own office is no exception) which, without a doubt will impact some more than others. There are already several universities who have cancelled classes and performances out of an abundance of caution. Some venues in the U.S. have informed artists from China, Iran, South Korea, Japan, Italy, and Hong Kong (and that list will most certainly grow) that they will not be allowed to enter the venue for 14 days after arriving in the U.S. Others around the world have either imposed similar restrictions or closed completely, including major opera houses and concert halls. Are these decisions going to impact travel costs, tour dates, lost engagement fees, lost commissions, and even risk an artist exceeding a visa validity period? Of course.

However, even if you believe a cancellation is unreasonable or even if it goes so far as to violate the terms of the contract, what then? Raise contractual and legal arguments? Send snippy and condescending emails? Bring in a lawyer? Sue? While there are almost always legal arguments and threats one could through at any situation, doing so with regard to anyone’s response to an unknown and spreading virus which is causing world-wide fear and confusion is not merely delusional, but will certainly trigger ethical, professional, and PR concerns that will haunt you far beyond any lost income.

While not all of these will apply to everyone in every situation, here are some practical suggestions for dealing with an actual or threatened cancellation due to the coronavirus:

Anticipate and prepare financially for losses;
Explore options for mitigating losses, such as refundable tickets, cancellation policies, and the risks and liabilities of not cancelling sooner rather than later;
Listen to the fears and concerns of all parties;
Entertain any and all reasonable alternatives to a cancellation, such as checking constantly for updates from the CDC or WHO, as well as reaching out to local health and public safety experts either in the location of the performance or in the location from which an artist will be traveling.
Entertain any and all reasonable proposals to share losses, taking into consideration a fair, honest, and truthful assessment of who is in a better position to bear them;
Consider the professional and ethical considerations of pressing an argument, making demands, or simply acting like a jerk;
If a deposit has not been paid, consider it no longer due. If a deposit has already been paid, apply it towards actual, non-refundable expenses (such as airline tickets, rental fees, etc.) and return the rest; and, of course;
Try to re-book the date.

In addition, here are some websites with calm, cool, and well-thought advice, including suggestions of how to prepare and what to consider:

www.artsready.org

www.americanorchestras.org

However rightly or wrongly you may think someone’s decision may be, and how deeply you fear the effects on your own economic health, this is not the moment to judge, argue, or act impulsively. Rather, now is the moment to test the performing arts industry’s so oft-toted (and even more often self-proclaimed) reputation for being able to support one another in surviving a time of crisis and to coalesce as a community in working towards a greater and larger mission. I know you can do it without suing on another!

…And now, to throw some bleach on my keyboard and sage the office!

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For additional information and resources on this and other legal, project management, and business issues for the performing arts, as well as to sign up for our newsletters and follow us on social media visit ggartslaw.com

THE OFFICIAL LEGALESE:
THIS IS NOT LEGAL ADVICE!

The purpose of this blog is to provide general advice and guidance, not legal advice. Please consult with an attorney familiar with your specific circumstances, facts, challenges, medications, psychiatric disorders, past-lives, karmic debt, and anything else that may impact your situation before drawing any conclusions, deciding upon a course of action, sending a nasty email, filing a lawsuit, or doing anything rash!

Tags:acts of god, cancellation, cancellations, Contracts, Coronavirus, force majeure
Posted in Acts of God, Law and Disorder: Performing Arts Division, Uncategorized | Comments Closed

Termination For Convenience

Thursday, April 28th, 2016

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder:

I recently received the following clause from a performing arts venue in a contract they sent:

I told them that, in my mind, this makes the contract virtually worthless. They came back with this:

TERMINATION FOR CONVENIENCE: Either party may terminate this Agreement at any time upon written notice to the other party. If this Agreement is terminated before the performance, the University shall have limited obligations to pay Artist, as defined below. If this Agreement is terminated during the performance for any reason other than the Artist’s breach of this Agreement, the University shall compensate Artist on a prorate basis. Under no circumstances will either party be liable to the other for indirect, consequential, or incidental damages, including but not limited to anticipatory profits. The University may from time to time, under such terms and conditions as it may prescribe, make partial payments and payments on account against costs incurred by the Artist in connection with the terminated portion of this contract whenever in the opinion of the University the aggregate of such payments shall be within the amount to which the Artist shall be entitled hereunder.

I feel that I wouldn’t be doing my due diligence as a Manager to sign this, but it’s a very important venue to me and I do quite a bit of business with them. But I think this is unconscionable. Am I wrong?

“Unconscionability” implies a certain level of moral indignation is generally unwarranted in a simple engagement negotiation. The venue is merely proposing terms that are in its own best interest, not demanding that you sacrifice a sack full of kittens! If acting in one’s own self-interest were unconscionable, then most artists would have an incalculable amount of karmic debt. However, you are quite correct that the terms they are proposing are unfair to your artist. I’ve seen more and more presenters and venues trying to give themselves the unilateral right to cancel. I get it. Times are tough. Tickets are hard to sell. But it’s unreasonable and unfair to expect an artist to bear the entire loss of a cancellation. The venue’s proposed compromise is basically to reimburse the artist for any out-of-pocket costs, but not to pay the artist for the lost performance or the fact that the artist may have turned away other engagements. That’s not exactly what I would call an equitable compromise.

Regardless, the point of a contract is not to provide some false sense of security or protection, but, rather, to enable the parties to identify any issues that need to be negotiated, evaluate the pros and cons of a deal, and determine whether or not to proceed. In this regard, this contract has proven to be extremely valuable in that the venue has made it quite clear that they want to have the right to cancel without consequences. You have done your due diligence in reading and evaluating the contract. Now comes the hard part. What to do? You need to determine whether or not to engage in further negotiations, to accept the venue’s terms and sign the contract, or walk away and find another engagement. Ultimately, the decision is up to your artist. Your job as the Manager is solely to evaluate and advise your artist.

All art requires risk. The performing arts business requires a certain amount of risk as well. As the Manager, its your job to help your artist evaluate reasonable risks from unreasonable risks. Obviously, I don’t know enough about your specific artist or the specific venue to render an opinion. However, I can tell you that what is completely irrelevant to the analysis is whether or not the venue is important to you and whether or not you do “quite a bit of business with them.” As a Manager, the focus of all managerial decisions must be what is best for your artist, not you. Is the venue particularly prestigious or important to the artist? Is the fee is particularly large? Does the engagement offer your artist a particularly advantageous opportunity? Then it may be worth advising the artist to take the risk. Otherwise, the artist should decline the engagement. The impact of the artist’s decision on your own relationship with the venue, past or future, is beside the point.

If your ongoing relationship with the venue is more important to you than the relationship with your artist, then you should drop the artist. I have often heard Managers say that artists come and go, but venues are forever. However, I don’t necessarily believe this. In my experience, if an artist is popular and in demand, and especially if an artistic director wants the artist, the presenter or venue won’t care if the artist is represented by Satan himself.

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For additional information and resources on this and other legal, project management, and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.com

All questions on any topic related to legal, management, and business issues will be welcome. However, please post only general questions or hypotheticals. GG Arts Law reserves the right to alter, edit or, amend questions to focus on specific issues or to avoid names, circumstances, or any information that could be used to identify or embarrass a specific individual or organization. All questions will be posted anonymously and/or posthumously.

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THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:breach, cancellation, contract, damages, engagements, Liable, manager, negotiation, payment, presenter, risk, venue
Posted in Artist Management, Contracts, Law and Disorder: Performing Arts Division, Presenters, Venues | Comments Closed

Dodging A Bullet With A Contract

Thursday, March 31st, 2016

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder:

I am a classical concert pianist and booking representative for my small ensemble. I just finished the negotiation of a performance contract with a presenter and, unfortunately, we could not reach an agreement. In my three years of working as a self-presenting artist, it was the first time when a contract became an issue. To summarize the situation, I didn’t agree to sign the presenter’s one-page contract because it didn’t have any terms dealing with such things as cancellation or the date we would be paid. So, I provided my own, more detailed, contract. I also provided a technical rider for such things as piano tuning and how much space our group needed to perform. The presenter claimed that their contract was “standard” and that they engage lots of artists and that no manager or artist had ever objected to their one-page standard contract. So, I offered to propose changes to their contract instead, but then withdrew their offer to engage us, saying that we were obviously too hard to work with and that they had dodged a bullet. Quite a number of series send us one-page agreements and some of them react with frustration when I present a more detailed contract. I start to have a feeling that maybe while I am building my network, I have to play by the rules of the presenter and just hope that everything should be OK. However, in some ways it contradicts what I have learned from reading your blog. It also doesn’t help if its true that most managers are happy to sign these simple contracts creating a way out for a presenter to say: “we never had a problem with our one-page contract” before.

I’d like to say that these are the perils of dealing with small, unsophisticated presenters. But, alas, you have stumbled into one of the dark corners of the entire performing arts industry: at all levels it’s a business run by people who prefer to pretend it’s not a business until someone doesn’t get what they want and then they will all pretend to be experts on business contracts.

In your case, the presenter’s claim that other artists or managers may or may not have had a problem with their one page contract should be disregarded for several reasons: (1) it may or may not be true; (2) many artists and their managers are so happy just to get an engagement that they are happy to sign anything; (3) many artists and their managers often know less about contracts than presenters; and, most importantly, (4) nothing is “standard”. As for your suggestion that you have “…to play by the rules of the presenter and just hope that everything should be OK”, I disagree.

A career in the arts and entertainment in inherently based on risk. So, yes, there may be instances where an engagement or an opportunity presents itself and you may just have to take a risk. However, you can’t make this your standard policy. You need to be judicious. The only way to evaluate the risks and advantages of any offer or opportunity—whether it is an engagement or a recording contract—is through the contract process. You may not always be in a bargaining position to get what you want, but the process itself can be vital. Even if someone refuses to agree to a specific request or a contractual you may propose, that information in and of itself can be essential in helping you evaluate whether or not proceed. However, any presenter or venue that won’t even take the time to discuss your concerns should be avoided.

Nevertheless, while its fantastic that you have taken the time to devise your own contract and technical rider, you also need to know your audience. Its very different to negotiate with Carnegie Hall that it is with a group that operates out of a church basement with a broken upright. If you don’t want to unnecessarily scare off unsophisticated presenters and venues, there are things you can do to make sure your concerns are being addressed without having to send a formal contract with a rider. One approach may be just to send an email or a list confirming your specific concerns. Or you can avoid email altogether and have an actual conversation. Remember, a contract does not have to “look” like a contract. At the end of the day, its less about the wording and format than communicating your concerns, expectations, and clarifications. In short, it doesn’t mean you have to be less flexible in what you need, but more flexible in how you communicate it.

Ultimately, I think you were the one who “dodged a bullet” on this.

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For additional information and resources on this and other legal, project management, and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.com

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:Agreements, artist, cancellation, contract, Contracts, formal contract, manager, negotiation, presenter, risk, venue, work
Posted in Agents, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Presenters, Venues | Comments Closed

International Touring: More Tales From The Front Lines

Thursday, December 10th, 2015

By Brian Taylor Goldstein, Esq.

I realize there are other equally important issues out there than visas and international touring. However, in the wake of the recent terrorist attack in California, and as U.S. politicians and political candidates roll out a “Keep the Hate Alive” campaign, we are constantly receiving alarming updates from clients as well as from the American Immigration Lawyers Association of artists encountering new obstacles and challenges. Here are the latest changes and challenges you need to be aware of:

1. A Visa Cannot Be Valid Beyond The Dates In The Approved Visa Petition

When a visa petition is approved by USCIS, it is approved for a specific classification period. When an artist then goes to a U.S. Consulate to apply for her or her visa, the visa issued is supposed to reflect the classification period of the approved petition. For example, if a violinist is approved for an O-1 classification period of August 1, 2015 to July 31, 2016, then the O-1 visa stamped into her passport should reflect an expiration date of July 31, 2016. If you examine an O or P visa, you will most often see the letters “PED” followed by a date. “PED” refers to the “Petition Expiration Date.” The PED date “should” coincide with the expiration date of the visa itself.

Unfortunately, some U.S. Consulates have erroneously been issuing O-1 visas that expire beyond the classification period of the approved petition—in some cases, O-1 visas have been issued for with a validity period of up to five years in the future! If this happens, your artist has not won the immigration jackpot! Under U.S. law, the maximum validity period of an O-1 visa for an artist cannot exceed three years. Moreover, it cannot exceed the classification period of the approved petition.

Recently, a prominent artist was turned away because she attempted to enter the U.S. under just such circumstances. A visa petition had been filed for her in 2014 and the petition was approved for an O-1 classification period of 8 months. However, the U.S. Consulate issued her an O-1 visa that did not expire until 2019. She and her management reasonably presumed that this meant she was free to use her O-1 visa until 2019 and no further visa petitions were required. Indeed, until recently, she had been entering the U.S. on the visa ever since 2014 without any trouble. Her past entries were the result of luck and inadvertence on the part of U.S. Immigration Officers at the port of entry. This will no longer be the case. All U.S. Immigration Officers will be scrutinizing all visas far more closely.

When USCIS approves a visa petition, it issues an I-797 Approval Notice with the specific dates of the approved visa classification period. If you or your artist ever receives a visa from a U.S. Consulate that expires beyond the dates of the classification period or beyond the PED date on the visa, ignore all dates beyond the PED date! Assume the visa expires on the PED date and do not use it for any work or travel beyond that date.

(For those of you who are actually interested in legal minutiae, there ARE, in fact, legitimate categories of 5 year O and P visas—they just don’t apply to artist categories. This is why the consulates can get easily confused.)

2. All Artists Should Travel With A Copy of Their I-797 Petition Approval Notice

Another artist was recently detained at a U.S. airport for attempting to enter the U.S. on an erroneous “5-year O-1 visa.” Ultimately, he was permitted to enter only because he happened to have a copy of his I-797 O-1 Petition Approval Notice indicating that his upcoming U.S. engagement was within the approved classification period. However, he was reminded not to travel on his O-1 visa after the expiration date of the classification period.

Earlier this week, an artist was actually refused entry on his P visa because a U.S. Immigration Officer claimed that he needed to have a copy of his I-797 approval notice. The U.S. Immigration Officer was wrong. The artist had to fly home and be booked on a return flight to the U.S. the next day. Aggravatingly, but not surprisingly, when the artist flew back to the U.S. the next day with a copy of his approval notice, the U.S. Immigration Officer on that occasion didn’t even ask for a copy of the approval notice and the artist was admitted without any questions.

Also this week, a Canadian artist arrived in the U.S. with a copy of her I-797 approval notice (which is all that is required for Canadians) and was refused entry because the U.S. Immigration Officer claimed that she needed to have the original I-797 approval notice. The U.S. Immigration Officer was wrong on this occasion as well. Fortunately, a supervising officer was able to step in and resolve the matter so that the artist was ultimately able to enter.

Except for Canadians, artists and others are not required to travel with a copy of their I-797 petition approval notices—much less the original I-797 approval notice itself. Nonetheless, given that U.S. Immigration Officers have been placed on high alert (without always knowing exactly what they are looking for), we are recommending that all artists travel with a copy of their I-797 approval notice. Should any artist be asked for an “original” approval notice, he or she should calmly and politely ask to speak with a supervising immigration officer. More often than not, the supervising officers are better trained than the officers assigned to the inspection desks.

3. Changes To The ESTA/Visa Waiver Program

Congress is in the process of adding additional restrictions to the Visa Waiver Program—the program which permits citizens of 38 countries to travel to the United States for business or tourism for stays of up to 90 days without a visa. This is often erroneously referred to as an “ESTA visa.” The term “ESTA” stands for “Electronic System For Travel Authorization” and is merely the registration process through which an individual indicates their intent to enter the U.S. without a visa. It is not a visa. This is important because artists are required to have a visa whenever they enter the U.S. to perform—even if they perform for free; even if no tickets are sold; even if they are performing for a non-profit; even if they are performing for a festival; or even if they are performing for a college or university. In short, performers can never enter the U.S. to “perform” under the Visa Waiver Program.

While most of the propose changes to the Visa Waiver Program should not have any impact on artists (unless the artist is from or has ever travelled to certain counties in the past 5 years), United States Customs and Border Patrol has already begun significantly seeking out artists who may be registering for ESTA and attempting to enter the U.S. on the visa waiver program with the intention of performing. We are getting almost daily reports of artists being stopped, refused entry, and having their ESTA/Visa Waiver privileges revoked for life!

I cannot emphasize this enough: any artist who attempts to enter the U.S. under the Visa Waiver Program for any purposes that involves actually performing does so at his or her own peril!

The only limited exceptions—and they are very narrowly construed—are competitions, auditions (including non-public showcases at arts conferences) and speaking (but not performing) at a college or university.

4. There Continue To Be Significant Delays In Processing Visa Petitions

USCIS is presently taking a minimum of 8 – 10 weeks to process visa petitions at both the Vermont and California Service Centers and there appears to be no end in sight to these delays. This means that, as of today, if you need to have an artist enter the U.S. any earlier than March 2016, you need to pay the additional $1225 for premium processing. (The official visa processing times that USCIS posts on its website have always been purely propaganda and should always be disregarded as such.)

On the bright side, dealing with international touring at the moment makes all those other topics we write about–cancellations, copyright infringement, taxes, commission disputes–a little less daunting.

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For additional information and resources on this and other legal, project management, and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.com

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:approval notice, audition, canadians, cancellation, competitions, exceptions, immigration, immigration law, performer, processing times, Tour, travel, university, uscis, validity period, visa petition, visa petitions, visa waiver program, visas, waiver, work
Posted in Artist Management, Law and Disorder: Performing Arts Division, Touring, Visas | Comments Closed

The Damaging Truth About Cancellation Damages

Thursday, March 12th, 2015

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder:

A presenter wants to breach our engagement contract by cancelling. Our cancellation clause says that, in the event of cancellation, we get 50% of the engagement fee or actual damages. They are offering 50%, but at this stage want the full fee.

If you have an engagement contract that has a cancellation clause, and a presenter cancels, then the presenter is not breaching your contract. A contract breach only occurs when someone fails to do something the contract requires (such as pay a deposit) or does something the contract does not permit (such as record a performance). In this case, if your contract has a cancellation clause, then you have given the presenter the right to cancel. So long as the presenter complies with the terms of your cancellation clause, then they are not in breach. They are merely exercising the right you gave them to cancel. If you don’t want them to cancel, don’t give them the right to do so.

According to your cancellation clause, if a presenter elects to cancel, they have to pay you either 50% of the engagement fee or actual damages. However, your actual damages may or may not be the full engagement fee. To determine whether or not you are entitled to the full engagement fee, you first have to calculate your “actual damages.” Actual damages are simply that: your actual out-of-pocket losses from the cancellation of that particular engagement. No more. No less. Calculating “actual damages” involves taking the full engagement fee and subtracting any costs or amounts you saved or did not incur as a result of not having to perform.

In some instances, the “full engagement fee” might include the performance fee as well as other costs, such as the value of travel and/or hotel that the presenter was covering. However, for the sake of simplicity, let’s assume that the full engagement fee was $5000, of which you needed $2000 to cover costs such as travel and equipment, leaving $3000 for profit. If by cancelling, you did not have to incur the travel and equipment costs, that means you saved $2000, and your “actual damages” are $3000. You would only be entitled to the full fee of $5000 if the engagement were cancelled too late for you to save or recoup any of your costs.

However, “actual damages” can never exceed the total value of the full engagement fee. As we all know, sometimes a single cancellation in a larger tour can also have residual implications. What if you were counting on the travel and hotel from a larger presenter to “underwrite” the costs of a smaller engagement fee from another presenter or run-out? If the larger engagement gets cancelled, that may necessitate the cancellation of the smaller one as well, or even the entire tour. Sadly, those losses are not “actual damages.” That’s just called bad planning.

Just because you were counting on something to make an entire tour break even, does make the loss “actual damages.” If the loss of a single engagement will trigger a domino effect, such as the cancellation of the entire tour, then, in addition to “actual damages”, you have suffered “consequential damages.” I know, that doesn’t make sense, but lawyers came up with these concepts hundreds of years ago and contracts still use the same broken terminology. This is the risk inherent in using contractual language you copy from someone else or don’t fully understand. You may inadvertently be using language that makes sense to you, but has a different legal meaning. The solution is simple: use English and be specific—even if it means (perish the thought!) using more words. For example, rather than write “we get 50% or actual damages” write what you mean:

If you cancel the contract, we get either a minimum of 50% of the engagement fee or all of the damages we actual incur as a result of the cancellation, including the cancellation of other engagements and/or any additional costs we must incur for travel, hotel, or other tour expenses, whichever is greater.

Wordier? Yes. Clearer? Indeed. An even clearer solution? Specify at the outset that the engagement is non-cancellable.

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For additional information and resources on this and other legal, project management, and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:breach, cancellation, cancellation clause, contract, Contracts, damages, engagement contract, engagements, losses, presenter, risk, Tour
Posted in Agents, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Liability, Presenters, Touring | Comments Closed

The Divine Right To Cancel

Thursday, February 12th, 2015

By Brian Taylor Goldstein, Esq.

We were in the process of booking one of our singers with an orchestra, when we encountered the following Force Majeure clause in the orchestra’s contract: “If, as a result of any event beyond the control of the Orchestra, including, but not limited to, war, national calamity, strike, labor relations, lack of funds, poor ticket sales, or other Acts of God or force majeure of any kind or nature, Orchestra determines it necessary to suspend, cancel, or terminate the giving of any of the performances specified herein, then the Orchestra, in its sole discretion, shall have the right to do so by giving notice to the Artist. Upon such notice, the Orchestra and Artist shall be relieved from any further obligations under this Agreement without any liability of either party to the other for any damages arising from such suspension, cancelation, or termination.” We asked if they would strike the reference to “lack of funds” and “poor ticket sales”, but we were told that their contracts must be approved by their board of directors and, as such, nothing can be changed. Have you encountered this before? Do you have any advice on how to respond?

Telling someone that a contract cannot be changed because their board of directors says it can’t be changed is the equivalent of a parent telling a child “because I said so.” As I am frequently reminded when faced with the manifest irrationalities of my own parents: do not engage and back away.

I actually don’t doubt that the orchestra’s board of directors did, in fact, suggest and recommend such language. It’s just the type of thing a poorly formed board of wealthy corporate donors with no actual arts experience would come up with. (It brings to mind an occasion when I was called in to consult with a board of directors who was insisting that no season could be planned or programmed unless the artistic director was willing to guarantee exactly how many tickets would be sold to each performance!) Regardless, such language is absurd and quite frankly, insulting and unprofessional.

It is absurd because, as I have previously written, a force majeure clause is supposed to be limited to events truly beyond anyone’s control: floods, snowstorms, terrorist attacks, etc. Ticket sales and funding are not determined either by serendipity or the intervention of divine energies (though I often suspect many strategic plans are based on such notions.) I find it insulting and unprofessional because the orchestra’s board of directors is trying to obfuscate a cancellation provision under the pretext of a force majeure clause. By defining force majeure to include “lack of funds” and “poor ticket sales” the orchestra is attempting to give itself the luxury of being able to cancel at any time for any reason with no liability or consequence. Contractually, this would render the Agreement terminable at will by the orchestra and, thus, meaningless for the Artist.

As a compromise, I would propose amending the force majeure clause and adding to the agreement a proper cancellation clause whereby, if the Orchestra felt that it needed to cancel due to “lack of funds” or “poor ticket sales” then they would have the right to do so by paying a specific, pre-determined cancellation fee. If the orchestra refuses such a reasonable alternative, then I would simply thank the orchestra for its time and walk away.

I realize, of course, that, in practical terms, artists are not always in a position to walk away. Just like good art always requires risk, occasionally this applies to deals and negotiations as well. Perhaps the artist is young and needs engagements. Or perhaps the engagement presents an artistic or resume-building opportunity to the artist. Those might be reasonable reasons to take a risk. However, such risky transactions must be entered into with eyes wide open as opposed to wide shut. As the artist’s manager, it falls to you to make sure the artist understands the risks and that both of you understand that, should the orchestra avail itself of its contractually unfettered right to cancel, you will accept that and, whilst reserving the right to swoon, sway, and cry foul, resist the temptation to threaten a frivolous lawsuit.

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For additional information and resources on this and other legal and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

All questions on any topic related to legal and business issues will be welcome. However, please post only general questions or hypotheticals. GG Arts Law reserves the right to alter, edit or, amend questions to focus on specific issues or to avoid names, circumstances, or any information that could be used to identify or embarrass a specific individual or organization. All questions will be posted anonymously and/or posthumously.

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THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:acts of god, artist, cancellation, cancellation clause, cancellation fee, contract, Contracts, damages, engagements, flood, force majeure, negotiation, poor ticket sales, storms
Posted in Acts of God, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Liability, Non-Profits, Presenters, Venues | Comments Closed

Presenting: What’s In A Name?

Thursday, December 18th, 2014

By Brian Taylor Goldstein, Esq.

I work for a small performing arts organization which performs each year in a tax-payer funded, non-traditional space. The venue makes itself available for rental as an event space. In the past, we have been allowed to pay them a reduced rental rate in exchange for a full-page ad in our program and recognition as a lead sponsor. Additionally, we regularly receive glowing reviews in local and national media that prominently feature color photos and positive mentions of the venue, which our audiences and reviewers (and we!) view as critical to our work and to our experience. This year they have asked for additional money in order to cover what they claim are increased maintenance costs. This would be a significant burden for us, as we are a small non-profit and we are already cutting expenses. We did not budget or anticipate an increase rental fee. They have suggested that they will waive the fee increase if we agree to bill them as a “presenter.” We are certainly open to the idea, but would like to understand what “presenter” typically means in this context. What would that word represent to our audiences and other organizations? What could we reasonably ask of them, financially or otherwise, in exchange for such billing? The venue does not produce, and rarely hosts other arts performances.

“Presenter” is one of those performing arts industry terms that can take on many different connotations and meanings depending upon the context and whom you ask. Legally, on its own, it is not self-defining. Like terms such as “hold”, “commission”, or “cancellation”, there is no official grimoire of terms or official definitions that are “industry standard.” Contractually, it means whatever the specific parties agree it means.

The better, or, should I say, more meaningful question is what implications listing them as a “presenter” would have in the minds of third parties critical to you and your organization, such as your audience, reviewers, and donors. In this context, the term “presenter” becomes more of a branding or marketing issue than anything else.

For most folks within the performing arts industry, being a “presenter” carries a curatorial implication. A presenter is usually perceived as an individual or organization that has used its own artistic judgment to select a production or performance that reflects its mission, has artistic merit, and meets the standards expected of the presenting venue or institution. However, the general public typically approaches this far differently.

Many venues produce and present performances as well as rent their spaces out to others. Most people do not realize this, much less make a distinction—or even care. Whether the Vienna Philharmonic performs at Carnegie Hall or Applebees, the average audience member, rightly or wrongly, usually assumes that wherever they are physically sitting at the time is the entity that is responsible for producing or presenting the performance they are watching. (Chicken wings and Mozart—what a concept!) Its sort of like blaming the waiter for over-cooking your steak—whoever presents the meal will enjoy the credit or the blame.

If your venue is asking to be billed as a “presenter” then it probably means they want to be seen as having discriminating tastes in deciding whom to allow to pay their rental fee. Perhaps they want to leverage some artistic credibility for marketing purposes or perhaps they are simply trying to justify their public funding by showing that they are more than just a commercial rental space. Either way, they obviously want to ride your coat tails. Fine. You wouldn’t be the first entity to leverage a little artistic integrity in exchange for survival. By acknowledging them as a lead sponsor, your audience has probably been giving the venue credit for the success of your performances anyway. Just make sure that your program, credits, billing, and other marketing materials continue to emphasize that it is you and your artistic team that are responsible for your work. And make sure that your written agreement with them clearly specifies the exact wording of the billing they will receive. Leave nothing to misinterpretation or chance. You might even ask to have approval over any marketing or publicity the venue issues on its own.

As for what you could reasonably ask of them, financially or otherwise, in exchange for such billing: There is nothing to “ask.” They have already set the price. You would agree to credit them as a presenter in exchange for letting you rent the space for a lower fee. Now is not the time for counter offers to try and get further concessions from them. Your immediate goal should be to avoid having to find a new venue or spend money you didn’t budget for, not win a negotiation challenge on “The Apprentice.”

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HAPPY HOLIDAYS

We will be taking a short break from the blog until January 7, 2015.

Please click on the photo to enjoy our gift to you.

Presenting the Dancing GG Arts Law Holiday Elves: Brian, Robyn and Ann

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For additional information and resources on this and other legal and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:cancellation, distinction, interpretation, marketing, negotiation, presenter, publicity, venue
Posted in Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Presenters | Comments Closed

Whose Lawsuit Is It Anyway?

Thursday, October 30th, 2014

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder:

I’m dealing with a presenter who wants to cancel two weeks out due to poor ticket sales. While it’s not a huge engagement fee, my artist has already contracted its performers and paid out expenses for the date as its part of a bigger tour. I have a cancelation clause in my contract and I’ve explained what canceling would mean and that the presenter will be on the hook. However, he still wants to cancel. Its been a rough year and I can’t afford legal counsel. Do you have any suggestions?

At least the presenter is not trying to claim that poor ticket sales constitutes an act of God. While I am familiar with many organizations whose strategic plans require some degree of divine intervention to stay operational, God rarely takes an interest in ticket sales.

If you have a cancellation clause in your contract, then that will govern the legal remedies for the situation. Contractually, the presenter either has the option of either proceeding with the engagement or cancelling and abiding by the terms of the cancellation clause (which, I am hoping, spells out how much the artist is owed in the event of cancellation). If the presenter elects to cancel, but refuses to honour the terms of the cancellation clause, that would constitute a breach of contract…which really just gives the artist the right to sue the presenter, obtain a judgment, and, hopefully, collect the judgment. Whether or not attorney fees, interest, or court costs would also be part of the judgment depends on the terms of your contract as a judge has no authority to awards such costs unless the contract requires them. However, regardless of the terms of your contract, a lawsuit should always be the last resort under any circumstances.

Have you tried discussing with the presenter any solutions for increasing ticket sales or promoting the performance? Does your artist’s shows typically sell at the last minute? Has the artist ever performed in this market before? Don’t presume the presenter knows its own market or how to sell your artist in that market better than you do. You may have ideas for selling tickets that the presenter has not considered.

Is the person you are dealing with the final decision maker in the organization? If not, don’t hesitate to go over their head. Don’t threaten—just do it! If the presenter is a non-profit organization, then even the president or executive director reports to the board of directors. Contact the board president or an officer of the board. Often board members are far less cavalier about breaching contracts than an organization’s administrative staff. Its very possible that the board doesn’t even know about the situation as many presidents and CEOs are quite proficient at keeping their boards on a need-to-know basis.

If the presenter refuses to honour the cancellation clause, resist the urge to scream, threaten anyone’s reputation, or toilet paper the venue. While tempting, those options rarely work and will almost always make the situation worse. Ultimately, the decision as to whether or not to file a lawsuit, along with costs and expenses of filing the lawsuit, belong to your artist, not to you. Regardless of whether or not you signed the contract, if the contract is between the presenter and your artist, then all legal claims belong to the artist and only the artist can file a lawsuit and appear in court. You should not be paying or incurring any legal fees out of your own pocket. Unless you, too, are operating as a charitable institution, if the artist wants to pursue a lawsuit, that is their cost burden to bear, not yours.

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For additional information and resources on this and other legal and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:act of god, administrative staff, artist, board member, board members, breach, breach of contract, cancellation, cancellation clause, Contracts, judgment, lawsuit, performer, poor ticket sales, presenter, reputation, venue
Posted in Acts of God, Agents, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Liability, Presenters, Venues | Comments Closed

When Non-Payment Is A Crime

Wednesday, September 24th, 2014

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder

Our group got a bad check from a venue for a performance. We called them and they sent us a new check, but that bounced, too. Now they won’t return our phone calls. Is there anything we can do?

Many venues, especially smaller non-profits, wrongly believe that if they run out of money and can’t pay their debts, then that is simply the unfortunate consequence of “doing the best they can in a difficult economy” and they are “judgment proof.” I once even had an artistic director of a deadbeat presenting organization tell me that, although they were unable to pay the money they owed my artist, the artist had already been paid ten-fold in goodwill and the joy they brought to the audience. Try to pay a landlord with love and goodwill and see how far that gets you!

Almost every state has a statute that allows a person who receives a bad check to sue the issuer of the check and not only receive two to three times the value of the check, but to recover attorneys fees and court costs as well. While its true that suing an organization that has no money is often a waste of time and money, passing a bad check falls into a category of its own. Its bad enough not to pay an artist for a performance (which is always a crime in my book), but most states also makes it a criminal offense to write a bad check. The value of the check will determine whether the crime constitutes a misdemeanor or a felony. You will want to do some research on the laws in your particular state.

Writing a bad check is also considered a personal tort (legalese for “offense” or “a bad thing which you can be liable for doing”) and the person who signed the check is NOT protected from liability or prosecution even if they were acting on behalf of a corporate organization. In other words, the individual who signed the check can be personally sued…or even arrested…even if they were an officer, employee, board member, or volunteer or the organization.

While these can be important tools, your first step should never be to file a lawsuit or run to the police. Besides, both civil and criminal laws require some form of “intent” on the part of the issuer of the check such that there is no liability for inadvertently writing a bad check or where the check merely crossed with the available funds. However, the issuer must immediately provide payment upon notice that the check was returned.

If the venue is not returning your calls, then write them a formal letter. (I am always surprised by the number of artists, agents, and presenters who believe that email—or even text messages—is an appropriate method for conducting business communications of a contentions or delicate nature. Step away from the electronic device!) If necessary, send letters to the Chairman of the Board or to individual officers. You may want to remind them of their exposure to personal as well as criminal liability. If they continue to ignore you or fail to make payment, then you have written proof of their intent not to honour the check. You will now need to consider whether to contact a local attorney, file a claim in smalls claims court, or contact the prosecutors office in the city or town where the venue is located. Also, in the future, especially when dealing with venues with whom you have never worked before, I would urge you to ask for deposits that are at least sufficient to cover your actual costs and out-of-pocket expenses in the event of cancellation or non-payment.

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For additional information and resources on this and other legal and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:agent, artist, Brian Taylor, cancellation, debts, Goldstein, judgment, lawsuit, Liable, money, payment
Posted in Agents, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Liability | Comments Closed

Rattle Sabers, Not Contracts

Thursday, February 27th, 2014

By Brian Taylor Goldstein, Esq.

Dear Law and Disorder

We recently had a presenter call us and cancel an engagement “due to inclement weather” because the company’s flight was canceled and they could not arrive the day before the performance as required. The company offered to fly the next day and arrive on the afternoon of the performance. However, the presenter expressed that they were not comfortable with this because they felt the company would not arrive at the theater in time to run a tech with their team and also had the fear that the company would not arrive in time to perform. The engagement contract has a Force Majeure clause that says:

In the event that the performance of any of the covenants of this agreement on the part of the Company or the Presenter shall be prevented by…act of God, illness, physical disability, acts or regulations of public authorities or labor unions, labor difficulties, strike, war, epidemic, interruption or delay of transportation service, or any other causes beyond the reasonable control of such party, such party shall be relieved of its obligations thereunder with respect to the Performance(s) so prevented on account of such cause. If the Performance(s) shall be prevented due to a Force Majeure event, neither the Company nor the Presenter shall be under any obligation to present the Performance at a different time, except that if the Performance(s) shall be prevented for any of the foregoing causes, the Presenter shall use its best efforts to re-engage the Company within a twenty-four (24) month period on the same terms and conditions set forth herein, subject however to Company’s availability…In the event that the performance is cancelled due to Force Majeure on the Artist’s behalf, all deposit monies will be returned to Presenter. In the event that the Presenter cancels the performance for any reason other than those described in the preceding paragraph, then the Presenter is responsible for the full fee.

Do we have to return the deposit since the company was willing to fly in the next day, but Presenter decided to cancel anyway? Can we ask for the full fee? We have not yet spoken to the Presenter, but wanted to be forearmed before we do so we can stand our ground.

“Forearmed” for what? Has the Presenter asked for the deposit back? Are you planning on initiating this “battle”? A contract is a tool, not a weapon to be rattled like a sabre. If you approach this as a “battle”, here’s how it will likely play out:

Presenter: Great to see you at APAP. Thanks for the drinks. I’m afraid we’re going to need the deposit back because the artists couldn’t get here due to weather. The force majeur was theirs.

Manager: But they were willing and able to come the next day. You didn’t want to take that risk. So, you cancelled. In fact, you owe us the rest of the performance fee. And, thanks for the birthday card. That cat was adorable.

Presenter: It’s industry standard for the deposit to be returned when there is a cancellation due to weather.

Manager: But you cancelled and its industry standard that the artist gets paid if the presenter cancels.

Presenter: The company’s flight was cancelled because of the snow. That’s a force majeur.

Manager: The weather prevented the artist from arriving the day before the concert. They could have arrived on the day of the performance. You didn’t want them, so you cancelled and the contract says if you cancel we get to keep the deposit and you owe the full fee.

Presenter: But that’s not industry standard

Manager: It’s what’s in the contract.

Presenter: We were forced to cancel the performance and refund the tickets, which didn’t sell that well anyway. I just didn’t want to say anything about that earlier because of our good relationship. We can’t take those kinds of losses. We are a non-profit.

Manager: The artist had losses, too. And if you weren’t selling tickets, then you should have told me sooner so I could help with the marketing. If you had marketed better, the show sells itself.

Presenter: No show sells itself. Did I mention we are a non-profit?

Manager: We can’t give the deposit back and the company can’t afford to take a loss on this tour. It’s not their fault it snowed.

Presenter: It’s not our fault either, which is why we need the deposit back.

Manager: I spoke with an attorney and we will have to turn this over to legal counsel if we have to. It not personal.

Presenter: I understand. This isn’t personal on my end either, but we have a free attorney on our board and they will sue you to get our money back…and I won’t ever hire any artist on your roster again.

Manager: Fine

Presenter: Fine

…and scene…

Unless you are dealing with the cancellation of the road tour of “Spiderman”, neither of the parties will…or should…be willing to spend the money, time, and energy necessary to sue each other, so they will just stew over this, avoid each other at conferences, and write nasty things about each other on social platforms.

The point of having an engagement agreement, or any contract, much less as force majeure clause, is to identify problems ahead of time and articulate in advance how disputes will be resolved. In your case, based on the engagement agreement, both parties knew that, in the event of snow or other unforeseeable issues, either could be facing losses they might not be able to recover. A force majeure operates like an “excuse.” It gives each party the right to cancel under certain conditions without having such cancellation become a breach. However, because it isn’t a breach, neither party is going to emerge unscathed. Someone is either going to have lost out-of-pocket costs they can’t recover, or a deposit they can’t get back, or both. However, knowing this, hopefully, allows you to budget and plan for various eventualities.

In this scenario, the phrase “due to Force Majeure on the Artist’s behalf” isn’t really defined. However, a reasonable interpretation is that the cancellation of the artist’s flight constituted a force majeur event on the part of the artists—in other words, it was their flight that was cancelled. The fact that the artists were willing to travel on the day of the performance was a reasonable solution, but it was just as reasonable for the presenter not to want to take that risk. The more important issue is that the engagement agreement requires the presenter to use its “best efforts” to try and re-book the date within the next two years. That’s the first place to start. If you can find a mutually agreeable date, problem solved—you keep the deposit and they presenter pays the balance of the fee after the next performance date. (No, you can’t ask for a higher fee if it’s the same performance!) If you can’t find a date within the next two years, then its reasonable for the artist to keep the deposit, but the presenter not to have to pay the remaining fee. “Reasonable” doesn’t mean that everyone will agree or be happy. “Reasonable” usually means that everyone walks away with less than what they wanted, but more than there were probably entitled to, which, for me, is a much better solution any day than mutually assured self-destruction.

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For additional information and resources on this and other legal and business issues for the performing arts, visit ggartslaw.com

To ask your own question, write to lawanddisorder@musicalamerica.org.

__________________________________________________________________

THE OFFICIAL DISCLAIMER:

THIS IS NOT LEGAL ADVICE!

Tags:act of god, artist, attorney, breach, Brian Taylor, cancellation, contract, Contracts, dispute, engagement contract, force majeure, Goldstein, interpretation, lawsuit, losses, manager, marketing, presenter, reasonable solution, risk, Tour, travel
Posted in Agents, Artist Management, Arts Management, Contracts, Law and Disorder: Performing Arts Division, Non-Profits, Presenters, Touring, Venues | Comments Closed

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Presenting: What’s In A Name?

Whose Lawsuit Is It Anyway?

When Non-Payment Is A Crime

Rattle Sabers, Not Contracts

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