Agency Contract Clarification

I can't comment on the legalese of your contract but I can offer these thoughts based upon my own contract with a reputable and successful agent:

1 - When an agent sells your book they will work out a contract with the publisher on your behalf. One of the clauses in that contract will appoint the agent to receive payment on your behalf from the publisher. That's how they get paid.

You may change agents for book #2 but book #1's royalties will flow through agent #1 as long as they last.

2 - My contract for representation - like many other authors' - extends until cancelled, and it can be cancelled on 30 days notice by either of us.

Edita A Petrick said:

I sent this a couple of days ago...probably to the wrong source since I can't find where it went...apologies to any admin person that might come across it - but I would appreciate if anyone with know-how or even experience might be able to tell me in plain words what this "term length" clause means.

My questions pertain to the issue of "not-granting-extension" - I understand the contract is to run for 1-year with <options> for 3 more terms of 1-year each/extensions if parties so desire. But what if one party DOES NOT desire to extent the contract?

There is a clear provision of what to do if one or the other party wishes to extend the contract - but there is absolutely nothing about if the party that's CLIENT (author) after 1-year contract, does NOT wish to option agency's representation and wishes to terminate it.

I wouldn't mind signing the contract if it ran for 1-year and then I could simply give a 30-day notification that I want it to end at the 1-year aniversary. Should I assume that the contract runs for 1-year and expires...ends? What if the agency wants to extend it but I don't? Without knowing for sure what's the case...? Anyone's help is appreciated. Edita.

<<11. CONTRACT TERM LENGTH
The term of this contract shall be the earliest of one (1) year commencing with the date hereof or such time as the project has been sold. Upon mutual agreement made in writing by authorized representatives of XYZ Agency and Client, parties grant each other THREE (3) successive options to extend the term of this agreement for periods of one (1) year each upon all the terms and conditions herein contained. Such extensions shall commence at the expiration of the term of this agreement, unless it shall have been extended, in which event it shall commence at the latest expiration date of any such extension. Any option to extend the term of this agreement may be exercised by either party by giving the other party notice in writing at least thirty (30) days prior to the expiration of the term of this agreement or any extensions thereof. Such notice may be given by delivery personally or by mailing to the last address known.

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I don't like the sound of this clause. The contract shouldn't terminate when the book 'has been sold' unless the agent intends to sell it only in one medium and to only take their cut from your advance. The wording is imprecise and ambiguous and there should be a provision in this or another clause relating to 'termination' and the requisite notice. Under this agreement you're locking your project up with the agent for four years, I think. Not good. Looks dodgy to me.

You could always ask for the terms you want to be included. Everything is negotiable.

Also, it seems to me that a year is a long time. Isn't it more standard to have something open ended with a 30-60 day notice of termination?

Hopefully Victoria is around and can help you out. Try sending her a PM. This does sound a little dodgy.

Edita A Petrick said:

Thanks for the reply - what I'm trying to determine is exactly what you have in your contract - is this also the same - can I terminate the contract after the legal 1-year term has expired by giving notice? And moreover, can I terminate the contract after 1 year has expired if the agency did not sell the book? I guess by now you're wondering where I'm going with this - and it's that while I wouldn't mind giving this agency a chance to try and sell the novel for 1-year-only - if they're unsuccessful after that, I do not want to continue with them and want to make sure that I can end the contract after 1 year has expired.

This contract, also has another clause that states that the agency - if they sell this novel - has the rights to all sequels to this novel. Now, that's not such a bad thing to have for an author -- if the agency sells the novel within 1 year. But if they don't, I will be essentially tying myself down to 3 more years of representation that may well yield nothing and I don't want to have to wait 3 more years to find a new agent - not when I can always go the e-book route and publish the novel that way.

Contrary to what many writers out there believe, e-books aren't doing that badly in terms of business for the writers. The only problem I see with e-books is that once you build up your reading audience base, they actually expect you to come out with a new book every 4-6 months which forces the author...well, it's a little stressful but the monetary incentive is defintely there.

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I think you may be confusing two different contracts. I will use my own situation as an example.

I have a contract - between myself and Crown publishers - for my current book. That contract appoints my agent - Ralph Vicinanza, Ltd, as my agent with respect to that work. RV, Ltd can audit Crown's sales figures and negotiate and differences on my behalf. Crown will pay RV, Ltd all monies due to me.

That contract stands for as long as Crown keeps my book in print. It's a typical contract with a major publishing house.

Now, I also have a second contract, between myself and RV, Ltd. In that contract, I agree to pay them their agent's fee for any work they sell on my behalf. I can cancel that contract at any time, with notice, as can they.

But if I cancelled my contract with RV, Ltd, they would continue to represent me to Crown with respect to the previous contract.

I hope that has clarified the contract situation.

Now, to look at your one-year question. If I wrote a book, and gave it to my agent, and he failed to sell it after one year, I would be telling myself that I need a different book. I already know I have a capable agent, and I know editors will pay attention to him. Therefore, if my book is not saleable I am prepared to conclude that the problem lies with my work, not my agent.

And it would not take me a year to form that conclusion. It would take a few months.

In fact, I can go farther than that. I can say with reasonable confidence that my agent will advise me if something I send him is saleable before he even sends it out to anyone. Like many agents, mine was a good editor at a major house before becoming an agent. If he does not think it's good enough, I would improve it until we agreed we had a work worth offering editors.

You have probably read that agents are sort of gatekeepers for publishers. No matter how skilled a writer I imagine myself to be, I would take my agent's advice seriously.

Of course, to do the above, you need to establish a relationship with an agent who is capable, and likes and believes in you and your work. And you must feel the same about him/her.

Having said that, I hope you can see why I'd regard a contract with a specific time limit as irrelevant. If my agent and I work well together, we will continue to write, present, and sell work until one of us decides to quit. It's like getting married, or at least moving in with a significant other. You keep doing it as long as it works. You don't need an annually renewable contract to keep things together.

That clause seems strange to me. Don't we have some agents on the board who can comment on it?

Edita, you might want to hold off on signing that.

How about whispering the name of the agency to me in an email?

[email protected]

Edita A Petrick said:

<<11. CONTRACT TERM LENGTH
The term of this contract shall be the earliest of one (1) year commencing with the date hereof or such time as the project has been sold.

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Edita A Petrick said:

It does seem odd to me - the agency is reputable, nevertheless I've been reading the contract and this article 11 caught my attention and I kept going to it, trying to understand it -- and I don't. I'm usualy not that legally-challenged either.

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No, you're not legally-chellenged, but the person who wrote the contract is.

I'm a newbie writer but an experienced contract attorney. Here's my take, FWIW:

A term is a period of time with a definite beginning and end. Saying "the term shall be the earliest of" is wrong; it confuses the start or end of the term with the total term itself.

It's OK to say that the term starts (or ends) when the earliest of two events occurs. In your example, the term is one year, and it starts either today when you sign the contract, or the day you sell the book. This makes no sense. Obviously today occurs first. And you wouldn't start the agency agreement when you sell the book.

I think what they were trying to say was that it starts today, and ends on the earliest of (a) one year from today or (b) the date on which the book sells. But that's not what the contract says. Ambiguity is bad in contracts. It leads to litigation.

The main concern, which you have identified, is that there is no clear end date or mechanism to end the contract. It's perfectly acceptable to say it starts today and just keeps going until one of you ends it with 30 days' notice. That gives you a definite end -- 30 days after the date of the termination notice.

Like the others have said, figure out what you want and negotiate it. Find out how that concept is normally worded in agency agreements. Sounds like the right to terminate with 30-60 days' notice might be the way to go.

Edita A Petrick said:

My questions pertain to the issue of "not-granting-extension" - I understand the contract is to run for 1-year with <options> for 3 more terms of 1-year each/extensions if parties so desire. But what if one party DOES NOT desire to extent the contract?

There is a clear provision of what to do if one or the other party wishes to extend the contract - but there is absolutely nothing about if the party that's CLIENT (author) after 1-year contract, does NOT wish to option agency's representation and wishes to terminate it.

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As I read the clause below, the contract expires automatically at the end of any one-year period if the parties don't specifically agree to re-up. However, that's not totally clear from the wording.

The clause does NOT address the issue of termination at will. Is there a termination clause in the contract? If not, be wary. Speaking for myself, I'd never sign a contract that didn't let me terminate at will, without having to show cause.

<<11. CONTRACT TERM LENGTH
The term of this contract shall be the earliest of one (1) year commencing with the date hereof or such time as the project has been sold. Upon mutual agreement made in writing by authorized representatives of XYZ Agency and Client, parties grant each other THREE (3) successive options to extend the term of this agreement for periods of one (1) year each upon all the terms and conditions herein contained. Such extensions shall commence at the expiration of the term of this agreement, unless it shall have been extended, in which event it shall commence at the latest expiration date of any such extension. Any option to extend the term of this agreement may be exercised by either party by giving the other party notice in writing at least thirty (30) days prior to the expiration of the term of this agreement or any extensions thereof. Such notice may be given by delivery personally or by mailing to the last address known.

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This is a weird clause.

- Since a project will be definition be sold only after the agent takes the author on, the "earliest" 1-year term will always be "the date hereof." So the first sentence is pointless.

- Why limit the extension options to 3? Suppose you want to stay with the agent for longer than 4 years? I've been with my agent for more than 20.

- Why make the parties notify each other if they are extending the agreement? It'd be far easier to have the extension be automatic unless either party decides to terminate. This is unnecessarily complicated.

Who's the agent?

- Victoria

Edita A Petrick said:

All the rest deals with standard issues 10% domestic rights,15% foreign, etc.

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This is a possible red flag. 15% domestic/20-25% foreign is the overwhelming standard. Lower commissions can signal an agency that's less than professional.

- Victoria

victoriastrauss said:

This is a possible red flag. 15% domestic/20-25% foreign is the overwhelming standard. Lower commissions can signal an agency that's less than professional.

- Victoria

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.... or a UK agency!

Yes, that's true. Since Edita is US-based, I was assuming it's an American agency.

- Victoria

If you decide you want to sign with this agency, ask them to change the wording to be more specific in regards to termination. Have them clarify the ambiguities for you. And make sure you get an out, like Victoria mentioned, for termination at will.