Chances are, you might think that contracts are a boring and an unnecessary part of your business. If so, you COULD be right.
Contracts may be unnecessary if your sales are all cash on delivery, if you’re careful about the people you do business with, and if you are lucky. But if those three statements don’t describe every sale you make, then keep reading!
In “Why Legal Documents are so Important for Artists” I described why you need a contract if you are selling your work through a third party, like an agent or gallery dealer, or if you license your art for products.
Now let’s look at why you need to get it in writing and how to make sure you get what you need.
Selling art is like the start of a love affair. You are your work. To love your work is to love you. When you are in love everything has the ineffable aura of sweet delight. Yet when the bills need to be paid, and you’ve delivered a painting before getting your money, you may wish you had protected your interests with a “pre-nuptial agreement.”
I know—what a buzz-kill!
Remember Sam Goldwyn’s familiar advice: “Oral contracts are not worth the paper they are written on?” I have spoken to gallery dealers who say that they do not use contracts because they themselves are trustworthy. I’ve never understood why, if they are to be so trusted, they resist putting their agreements in writing, even in the form of a letter or e-mail.
Verbal agreements actually complicate transactions because they have the appearance, but seldom the reality, of an agreement. We each hear what we want to hear and we reject the rest. Human beings have an infinite capacity to rationalize their positions after the fact.
Because you are an artist, and you sell objects people want rather than need, contracts are a necessary part of your art business. The words in a contract on a piece of paper are the end result, not the beginning of relationships with people who buy, represent or license your art.
Contracts force the parties involved to think through and discuss their mutual expectations of one-another. If the parties agree in advance about what each party will do, the chance of a misunderstanding is reduced and the odds of building a trust-based relationship are increased.
If someone asks you to sign his or her contract, read every single word. If you don’t understand the entire agreement, don’t sign it until you do. If you don’t like a term, negotiate what you would like.
If you’re reading a contract and can imagine a scenario in which bad things could happen to you as a result of a particular term in a contract, raise it with the other side.
When you explain your fear, you may hear:
“Don’t worry, we would never do that.” At this point you should say: “Okay, if you would never do what this term seems to allow you to do, let’s take it out because it is not needed.”
Or you might hear:
“This is just a standard form contract that we use with all our exhibitors.” Your reply to this should be “Since you use this contract form routinely, I am sure you want it to be as good as it can be. I believe that the agreement would be a lot better if we remove this particular ambiguity. Let’s change it to this. . .”
Contracts also serve as a record of the agreement so that when an issue arises the parties involved can consult the document to refresh their memories on what they agreed to do.
We all know that memory can play tricks on that, and like witnesses to a car crash, we each may see and remember a different scene. Trust the contract, not your memory.
Contracts are the final reference point for legal settlements, although that should only be a last resort.
When a dispute arises in the relationship, the contract will always favor the party who drafted the contract. When you sign as contract you are agreeing to what it says. Courts will hold you to your agreement. You need to know what you are getting into. When you read it, keep asking this question: “What is the worst thing that could happen to me if I agree to this deal?”
If the attitude going into the deal is “take it or leave it” and the other party rejects a reasonable request for modification of the contract during the negotiation, you are probably doing business with someone who is unreasonable.
This is a good sign that you may not be in a marriage made in heaven after all, and perhaps it’s time to walk away.
Before you sign that contract, you have nothing to lose, so it’s a good time to ask for advice. Don’t wait until you have to go to court—it’ll be too late to save your art, reputation or the relationship.