Four Top Legal Tips For Signing A Music Contract

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A guest post by Dan Chisholm, Entertainment Lawyer at Trollope & Co.

So you’re an artist about to sign a deal. It’s exciting, and no doubt the label or manager or producer on the other side are in a rush to get it done. You feel pressured to sign without properly checking it out – they seem trustworthy, it’s easier to assume everything will be ok and hope for the best, right?

It’s surprisingly common to see musos seriously damage their careers by entering relatively blindly into agreements. If you’re serious about your music, here’s four simple legal tips to help you toward safeguarding your creative capital and future earnings.

1. Get it all down in writing

Here’s the thing – contracts don’t have to be written down to be legally binding, but there’s a very good reason why they usually are. While it’s tempting to do a handshake deal and assume the other party has your back, both parties need to know where they stand to prevent ugly disputes down the track. You’d be surprised how many artists and music businesses do a bad job of this – with expensive and devastating consequences for the artist.
During the negotiation phase, verbal promises not to enforce certain clauses may be made to you. This includes comments such as “don’t worry, we’d never implement this clause” and “just ignore that part.” If you hear this, alarm bells should ring.
Legally, the contract you sign will take precedence over any other agreement. So don’t be afraid to stand your ground and get it in writing – any verbal or informal discussion to vary or add terms needs to be reflected in the final contract. This also means deleting any clauses that the parties agree are “non-applicable.”

2. Don’t get ‘legal advice’ from the person you are signing with
Being a muso can be hard graft. “Safer” careers can mean a comparatively comfortable and more predictable lifestyle. Instead, your decision to pursue a creative path most often means sacrifice, set-backs and uncertainty – along with huge creative rewards, fun, freedom and passion for what you do.
After going through the inevitable early days of hard graft and small pay, offers for commercial contracts can look like welcome relief in the shape of quick money and bigger exposure. Don’t forget this deal is likely to be a long-term relationship, so don’t rush into it. Take your time to understand the terms.
This may seem obvious, but artists often choose to enter into a contract purely because the other party has assured them it is “standard” and “very fair.” More often than not there are terms that are more favourable to the other party and may not protect the artist appropriately. You’re entitled to fully understand what you’re agreeing to so you can make an informed decision.
If you seek expert advice, make sure you use an appropriate source. Don’t get legal advice from your neighbour, an accountant or even a lawyer that doesn’t practice in entertainment. Music law is a very specialised field, it’s in your best interests to make sure your advisor knows the area well and appreciates the big and small fishhooks to look out for.

3. Contracts 101: Start with the basics
Contracts are usually long and complicated. If you’re trying to get your head around a deal, a good starting point is to look at the basics. Obviously, you will also need to work through the finer details as well, but concentrating on a checklist of core questions as a first step can help kickstart discussions.

Asking the questions below can be a good place to start:
– What is the term of the contract? (i.e. how long are you locked into it for)
– Are there any options to extend the contract? Who has the power to do this?
– What territory does the contract cover? Just New Zealand and Australia? Europe? Worldwide?
– Are there any warranties (i.e., promises to do certain things)? What are they? Are they realistic? What else does the contract obligate you to do?
– Who can terminate the contract? For what reasons?
– How is each party remunerated?

4. Get something in return
Finally – a good agreement should involve a fair exchange of obligations to the benefit of both parties. Be warned – you need to make sure the other party is clearly outlining what they are going to deliver by signing you on. If the other party doesn’t meet their obligations, the agreement should include an option for the artist to get out of the contract.
A classic example of this going badly is a record deal where the artist has assigned the copyright on their masters over to a record company in exchange for the financing of an album, EP or single.
In this scenario, the muso no longer owns the music. The recordcompany may then choose not to release the album. Instead, it stays in the vault and never reaches its audience.
Needless to say it’s a devastating outcome for the artist. To cover your bases, a release commitment needs to be added in to the contract before signing.

In summary
The ability to play and write music is a rare gift. You are the talent, this is your future. Think smart and go hard!

Thanks to Dan Chrisholm for this article! For more of Dan’s advice, check out his other guest piece, Setting the Sample Example: Legal Tips for Sampling Success.

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