The Agent-Author Contract

Most people, I know, are intimidated by the ‘legalese’ in contracts, and will simply sign whatever is put in front of them.

I’ve been a lawyer for thirty years and I do that sometimes myself. Not because I don’t understand what’s in a contract, but because it comes down to trust. I’ve found over the years, that if someone is going to screw you over, it doesn’t matter what the contract says, they’ll find a way to do it. And it doesn’t matter how detailed a contract is, it will never be long enough or complete enough to cover every single contingency, so it really does come down to the relationship you have, and how you work out disagreements.

Before finding my current UK agent, I was sent an agency contract to look at by a Canadian literary agent. I had some real concerns about it, and I thought I’d pass them on. (The agent, by the way, is having the contract re-written by her lawyers: I’m not sure whether this one is still in use or not.)

The contract, first of all, covered absolutely everything. Non-fiction, fiction, anything I might write, and everywhere on the entire planet. When I spoke to the Canadian agent she said, “that’s right. And cyberspace, too. We want e-books as well.” But I wanted to negotiate world rights as we went along, rather than granting representation so broadly right away. The same applied to movies, TV, etc. if I was lucky enough to have those happen.

Now I already had a non-fiction book contract with UBC Press so the reference to representation of ‘non-fiction works’ had to be deleted. When I spoke to the agent about this, she said, “ that’s no problem, strike the reference to non-fiction out.” But the rest she was unwilling to change.

If I signed, I would be getting an agent who would represent everything I created, whether I wanted her to or not. Personally, I think it should be up to the author whether they want representation for only a certain book (or ‘Work’ as it’s usually described) or for everything that emanates from their imagination.

As for the world-wide scope of the representation, I had spoken, by then, to a UK agent (not the one who now represents me) that I liked a lot. The UK agent said, when she found out that I had verbally accepted an offer of representation from a Canadian agent, to let the Canadian agent know she’d be happy to work with her to handle the UK rights. I emailed the UK agent back and asked if that was possible to have two different agents in two different countries. “Sure,” she replied. “Agents like to have as much control as possible, but at the end of the day, it’s the author’s choice as to who represents them.”

Which makes perfect sense. An agency relationship is called a fiduciary relationship in law. In legal terms, that means it’s a ‘trust’ relationship – a legal term that highlights a duty of care, not the kind of trust I referred to before.

That duty of care is the highest imposed by law, because in a fiduciary relationship, you turn power over to an agent to act on your behalf, to handle your contracts, your money. They have to account for everything they do. (Under Quebec law, they have a ‘mandate,’ but the duties are just as high.) At its essence, an agent is required to put your interests ahead of their own: that’s one of the hallmarks of the fiduciary relationship.

I wanted representation for The Beggar’s Opera alone. But that, I was informed, wasn’t negotiable.

Now I understand the economics of that position. After all, if the horse gets fed, the sparrows get to eat, too. But legally, an agent who insists on having a contract that covers everything, even when you want representation for only part of your work, or only for a certain geographic location, isn’t actually putting your best interests first — they’re putting forward their own. And in fact, the Canadian agent made that clear when I raised that issue. “It’s a deal-breaker for me,” she said. “I want the world rights; it’s where I make my money.”

Hmmm.

The contract also said that the client (that was me, the author) would be bound to the agency for a period of twelve months. To get out of that particular agency,  I had to wait for that twelve months, then give 60 days notice in writing by registered mail. Nothing said when that notice was deemed to be received, i.e. when I sent it or when someone signed for it.

Which meant that if the relationship fell apart, or the agent wasn’t doing the job I wanted, I’d be stuck for at least fourteen months.

A right to terminate that only arises after 12 months was confusing. It implied that the contract had a one year term instead of being executory (ie. continuing indefinitely until ended by that notice of termination or by operation of law).

In my view, 30 days’ written notice of termination should be sufficient for just about anything, in any kind of contract. (I actually happen to think that if a contractual relationship isn’t working, you should be free to leave it at any time, provided that everyone gets whatever is owed to them for the work they’ve done.)

Two months for notice is a long time to tie people up. The agreement also made no mention of what was supposed to take place during that 60 day notice period on the part of the agent  (would she continue to represent me? Send out manuscripts? Negotiate sales?) or the effect of termination on my works in progress or books that might be completed within that time frame (was I free to find another agent for them?).

I think that if you’re going to have a written contract, you should at least have one that’s not only clear, but makes sense. A twelve month ‘no-exit’ agreement made no sense. When I raised this, the Canadian agent agreed with me, verbally, but the fact remains that it was still in the contract.

Something all non-lawyers should know is that the verbal promises made outside an agreement aren’t worth the paper they’re printed on. They have absolutely no effect. There’s a rule of contract law that prevents what’s called ‘parole’ evidence from contradicting the express terms of a contract. Parole evidence (what people say) can be used to interpret an ambiguous contract, but not a clear one. Most of the stuff in this contract that I didn’t like was clear enough; I just didn’t like it.

Another problem I had was this particular contract with the section dealing with the commission arrangement. The standard agency fee for representation is 15% for domestic representation (based on where the agent lives, by the way, not you) and 20% everywhere else on the world. It’s also 20% for translated materials.

This makes sense when you realize that the agent is actually also making less outside the jurisdiction they live in, because they have to split a commission with a foreign agent, or in the case of translated materials, with whoever is doing that work. So both of you share the pain: you get less, but so does your agent.

I didn’t have a problem with those figures — I’m fine with them. But the contract didn’t say who would pay the GST or HST (Canadian taxes) on those amounts. In Canada, that’s a thorny issue. “We didn’t have GST when that particular contract was drafted up,” the agent said to me. But we have it now.

A contract that doesn’t refer to those kinds of bread and butter matters is a misunderstanding waiting to happen. And it puts the agent at risk too. A court could say, ‘you had the chance to deal with that matter and chose not to, meaning you, agent, will have to pay.’

It also made no mention of when I was going to be paid the advances or royalties owed to me. I wanted something in that contract that obliged the agent to forward those to me within say, ten days. Once again, the Canadian agent assured me that these are sent right away and I believe her. But I would have preferred to see that in writing, for the reasons I mentioned.

And so we ended up agreeing not to sign a contract, (essentially, because I refused to sign it) and to carry on work based on our verbal understanding. That turned out to be a good thing, because I later decided this agent wasn’t the right ‘fit’ for me. Because I hadn’t signed, I was able to withdraw from the agency without any legal issues over notice, although this is a very good agent: I’m pretty sure we would have worked it out.

For those of you who hit the stage of receiving a contract to review, here’s one I think is acceptable. It could be written a bit more simply, but it hits all the bases.

http://www.northernlightsls.com/our-standard-contract.htm

Here’s a slightly simpler version of a similar agreement.

http://www.sfwa.org/2009/07/sfwa-model-author-agent-contract/

By the way, my new agent doesn’t use a contract. He sends out a letter of engagement that sets out his duties to me. And he very kindly offered – unilaterally – to reduce his commission in Canada to 15% because he doesn’t think it’s fair that I should pay more for his services than I would have if I had retained a local agent. Can you see now why I like him so much?

Update (September 1, 2010)

I forgot to mention that some contracts will set out a fee for extraordinary costs, like obtaining trade copies of your book for reviews. Nothing wrong with that, as long as it’s upfront. What they should not charge, however, is reading fees. No reputable agent will charge you a cent for reading your manuscript.

As for photocopying fees, I’d likely object to that in an era in which most manuscripts are shipped around electronically. And long distance fees, if your agent is in another country, like mine is, are usually included in the commission, not billed to you as an additional expense.

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 Check out Penguin Canada’s book trailer for The Beggar’s Opera  here! It’s pretty cool!

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