Contract Advice

[Edrick]

I'm working on creating a general purpose contract for events that I do. I'm no lawyer nor do I play one on TV and I sure didn't stay at a Holiday In last night. So I figured I'd post it up here so you guys could include any feedback or suggestions.

http://edricksmith.pro/contract.pdf

 

[BrockTucker]

Can you post in another format, preferably word, so I can mark this up as I read it.

 

[ScottT]

It's breach of contract, not breech.

 

[Edrick]

I don't believe I can export it from Indesign into Word. It's a InDesign File, I can export just the text into a word document however.

http://edricksmith.com/Contract.docx

I'll fix that breach issue.

 

[museav]

No matter how I try to get to your web site, be it through the link here or Google or Facebook, I get the error message that "Internet Explorer cannot display the webpage". Google found the referenced document and managed to load it as a web page, that was the only way I could access it.

Invest in a good attorney to review the proposed contract. If nothing else there seem to be some terminology issues. For example, you state "agrees to abide by the follow rules and regulations" yet what is presented seem to actually be terms and conditions rather than rules and regulations. And legally, you may actually be bound by the rules and regulations of whatever jurisdiction applies, no matter what you put in the terms it cannot conflict with existing laws where you are located and that's something an attorney should help review. For example, breach of contract may require some intent or damages and not simply your determination of failure to abide by terms and conditions that may or may not comply with applicable existing laws and interpretations.

If the deposit is due when the Contract is signed then you may want to have a place on the Contract to sign that you have received the related deposit. And while you may make scheduling contingent upon receiving the signed Contract and Deposit, I'm not sure about the apparent potential of a having a signed Contract that states that you are not entering into a Contract until the deposit is received. I can also see that working against you, someone could seemingly sign a Contract with you, not pay the deposit and cancel the day of the event, then argue that since you never received the deposit then per your terms the two parties had never actually entered into a binding Contract. Maybe whether it is the Contract or scheduling that is actually contingent upon your receiving the deposit could be clearer.

Again, something for an attorney to review but your payment terms could possibly be clearer. For example I'm not clear if someone cancels if they are out the 25% deposit plus a $75 fee or just the $75 fee. And the cancellation period should probably not be stated as 2 weeks in advance, it should probably be worded as a minimum of X business days in advance or something like that. Right now you seem to say that someone couldn't cancel or reschedule other than exactly two weeks in advance and then they would get a $75 charge. Also, what about payment terms, such as what form of payment is accepted?

However, what perhaps bothers me most about the document from the perspective of potential Client is that the way it is currently worded, if you canceled a day before the event or just didn't show up then it would be up to you to determine if the client would lose their deposit and have to pay an additional fee. In know that is probably not what you intend but it does seem to be what is presented. That may be as simple as clarifying that it is cancellation by the Client that is being addressed.

I also noted that just about everything shown seems to address payment. What about indemnification or hold harmless requirements or any other insurance issues? What about liability for equipment damage caused by others? What about requirements as far as basic site conditions or access that might be applicable to most if not all jobs?

 

[rochem]

I'm not a lawyer by any stretch of the imagination, but I do have some experience writing for formal government procedures, so I'll give it a shot. I agree with all of Brad's points, and I'll add a few of my own.

Biggest issue is that you don't follow through with the rest of a payment schedule. You will receive 25% at contract signing, but what about the other 75%? Does that get paid on the day of the event? Within x business days following the event? Will you refuse to do the actual event until payment is rendered in full, or does payment happen at the end of the event? Is there a further breakdown of payment, like an additional 25% ten business days before the event, or is the rest all paid as one sum? You do say "at the end of services rendered," but you need to specify further. Do you expect your client to physically hand you a check as soon as the event ends? What if they need to send it through another department and it needs to be mailed to you? Also, if you're presenting them a "final billable invoice" at the end of services rendered, there's a good possibility they would have to send this to a purchasing department, who can then authorize the payment, who can then get it to you.

This is more of an aesthetic note, but I had a hard time reading the contract in its PDF form. Perhaps you could change the background image a bit, or at least darken the text to make it more readable. I'm not sure if there's any legal recourse to the effect of readability of contracts, but it'd just be a nice thing overall. Also, you should probably include all your company info (address, fax, full name, etc.) in the header of the contract.

Consistency. Sometimes it's "Edrick Smith Productions" and other times it's "Edrick Smith Productions LLC". It sounds stupid, but that can be the loophole that screws you over. Also, the last sentence of the first paragraph should probably read "...must immediately contact Edrick Smith Productions LLC" or "the offices of Edrick Smith LLC", as opposed to "our offices". The legal writing which I have experience in was very anti-pronoun, but I don't know how applicable that is in this case.

What is your idea of an "emergency causing cancellation of the event"? Is this strictly limited to acts of god, or will "emergencies" such as the death of the promoter's dog also warrant a refund? I realize you specify that every situation is up for individual review, but being very clear about what does and does not constitute a refundable emergency will only help you. Regardless of legal recourse, you don't want an angry client telling people that you denied them a refund for their emergency.

"Please note that this quote is only a bare minimum of services rendered." - I don't know what this is saying that isn't already said elsewhere. I think you're trying to say "This quote includes only the services that I told you we would provide, which are outlined on the attached quote, and if you want to add more than that, you can expect a higher price," but this isn't how it reads. I'd say, either remove the sentence or reword it slightly to say something different.

SAFETY! You need a clause that allows you to cancel or postpone the gig in the event of unsafe or unsanitary conditions. This could/should also apply to damage to equipment. As written right now, if a gig has the potential to put the lives of you or your employees in danger, you have effectively no legal grounds to refuse the gig. This is definitely an area where you'll want to consult an attorney.

(Disclaimer: I am not, have never been, and will never be an attorney, nor have I ever played one on TV, and while I did in fact stay at a Holiday Inn Express last night, that does not in any way qualify me to offer legal advice. Please consult an Bar-certified attorney to look over the contract before putting it into practical use.)

 

[Edrick]

Hey,

Thanks for the feedback, I'll read over the contract again and make some revisions. The issue I'm having with wording the payment is basically Customer comes to me says we'd like you to do a basic wedding video and audio for our wedding. So we agree on 350 for video 350 for audio for example, they sign the contract and put down a 25% deposit of the total amount. However a month before the event they now decide they want to add full blown automated lighting instead of some standard conventional lights. So we write up the additional cost and that's added onto the end amount unless an additional deposit is needed for rental fees for example.

In the end we tally up the total amount (damaged equipment, additional stuff day of, discounts, fees, etc...) so I would need to reword the payment due to something like 14 business days after services rendered.

Basically I suppose I'm asking what you guys usually put for that, being in the event business. How do you determine your payment structure, what's due upfront, halfway through, at the end, how do you bill additional things making sure it's all adhering to the contract.

Next the cancelation policy, basically I want a thing that allows us to say well hey you canceled your sons birthday party cause he was a brat, or you decided not to put on some event just out of the blue. Because of this and you didn't notify us in reasonable time you've now incurred a $75.00 fee for not notifying us 14 days in advanced. The next question is when you have a client put a deposit down, if they do cancel do you always refund the deposit or once the deposit is done and the contract is signed no matter what (unless it's an emergency) do you still keep it as you kept your side of the contract, planned for the event, possibly didn't schedule another event for that date because it was locked in?

Emergencies would be death of a relative for example for personal things, or death of a CEO or someone important the event was for or something that was just basically an act of god. Not because you decided you don't want to have your company christmas party anymore. Rained out would also be included, again as you said safety concerns, etc....

 

[WDS]

I will preface this by stating that I was unable to read the entire contract

My 2 Cents:
*+1 for a review by a lawyer. Even seemingly minor wording changes (quote vs estimate) can have significant legal impact depending on your state. The best advice I ever got was "contracts are only as good as the person backing it up, otherwise its just a piece of paper". If you have to go to court, which I hope you never will, the person with the better legal team will win every time regardless of who is right or wrong.

*Give yourself the most protections possible. From there you can always interpret it based on the client. For example if your terms are 50/50 with balance due at installation and you are doing a kids birthday I would not unload the truck until I had a check in my hand. If you are working for an established company with a valid PO then it is probably ok to bill them the other 50% after the fact.

*Eliminate as much wiggle room as you can, there are many people that will argue tooth and nail that they shouldn't pay a cancellation fee because they had a bad haircut and couldn't go on. Very few will complain that you waived the fee. Consider making the cancellation fee a percentage of the job, $75.00 is nothing on a big order, you may get yanked around just so they have a backup plan.

*Add something along the lines of "I agree to pay for any and all damages" in case they break something.

*Add something along the lines of "I agree to charges up to 10% above the written estimate without explicit permission" to give you wiggle room in case you have to pass along higher labor, rentals, ect than you estimated.

*Clearly state that the job is limited to what is written on the estimate, that way you can hopefully avoid some of the "that's not what I wanted" or the "what about the xyz we talked about on the phone"

*+1 on including something about liability and insurance.

Personally I hate throwing the contract in someones face during an argument, and hopefully you will never have to use most of whats in your contract but it will make resolving issues alot easier if it is.

PS: I would try to get the payment for the base order the day of, before the event begins, and would bill damages, day of changes, etc. separately. When you do bill changes make sure you list the name of the person that ordered the changes.

 

[museav]

PS: I would try to get the payment for the base order the day of, before the event begins, and would bill damages, day of changes, etc. separately. When you do bill changes make sure you list the name of the person that ordered the changes.

Those payment terms seem to make sense for many situations, however if you do corporate work then my experience is to be prepared for them to have very specific payment terms they will accept (and perhaps their own Contracts that have to be used). My world is a bit different but unless it is a Client that you have worked with on a regular basis and have a relationship that allows it, it is common practice to not incorporate any changes to a Contract without written approval.

I have to disagree on having a 'fudge factor' built in, at least most of my Clients would not accept such terms and I know my wife in her jobs, which have included negotiating and coordinating corporate events, could not accept such terms. Unless the quote is defining a T&E (Time and Expenses) basis, I find that a quote usually needs to be either a single either lump sum or a set hourly rate. What I do to address this is pretty much what WDS noted, to define the scope being provided carefully and to specifically identify any services that I feel may end up being involved but that are not included in the initial fee as being potential Additional Services to be provided as requested and approved.

Acceptable or unacceptable reasons for cancellation and the status of any down payment in such event should probably be better enumerated. In general, if terms in a Contract are too broad they may become unenforceable, so some attempt at limiting what is or is not an acceptable cause may help greatly in making it legally enforceable. And also consider the other side of it, what is your commitment and how able are you to avoid a cancellation? For example, if your equipment is damaged the day before, would you cancel or do you have arrangements with other providers to cover that even if at a loss? What you ask your potential Clients to commit to in regards to cancellation may want to reflect your commitment as well.

The damages issue is one that always seems to have two sides. Damages caused by someone else's neglect or carelessness should be their responsibility, but there is also some level of responsibility on your part. If you want specific security, storage or venue provisions then be sure to define them in the Contract, if you fail to request them and your equipment is damaged as a result it's difficult to place all the resulting responsibility on another party. Similar for damage by third parties and 'acts of God'. I understand protecting yourself but I've seen too many examples of poor practices or lack of coordination by the provider result in equipment being damaged that they then expect others to cover. Also consider how you expect any damages to be paid, it's not unusual for insurers and others to get involved and for any subsequent compensation to take months.

 

[WDS]

Those payment terms seem to make sense for many situations, however if you do corporate work then my experience is to be prepared for them to have very specific payment terms they will accept

Probably 80% of the clients I deal with pay at delivery, now most of my business comes from other production companies and not the end client so this is not always the case for most people. Obviously when you get to the larger corporate clients, contracts are a whole different ball game but I would recommend these terms as a good starting place. It eliminates allot of worry and headache especially for one off gigs (which is how I read you using this contract).

From your wedding example it sounds like you are dealing with allot of people that are not used to how events work. This is why I suggested the 10% wording. Most event people will understand that if you get to a venue and then have to wait around an extra two hours because the stage is not yet up or if the rehearsal goes over or something else happens then there might be extra charges, but to the dad that is putting on his daughters wedding these charges could be viewed as you trying to rip him off. All it does is give you something to fall back on when the client asks why you didn't come to them and get authorization for the 50 extra feet of cable because they moved the buffet tables.

Damages, I hate dealing with damages, it is probably my least favorite part of the job. my best advice is let them know as soon as possible, be fair and document everything. regardless of what you say in your contract ("all damage is solely the clients responsibly...ect") damages can only be dealt with on a case by case basis. If you don't realize that your board is shorted out till you pull it out a month later, your probably hosed. Likewise if something can be repaired or still used in a lessor capacity then you probably shouldn't charge full replacement cost for it. In my opinion there are so many variables that the only way to deal with it is with a hardline approach in your contract and a fair realistic approach in reality.

All in all I view a contract as a "worst case scenario" kind of document that you hopefully will never have to fall back on to win an argument. If you do find yourself hiding behind a signed contract more often than not then you are probably doing something wrong. All in all the easiest way to have all partys leave happy at the end of the event is to be as specific and clear as you possibly can on your estimate.