Artistate Q & A

Contracts

Artists contract on a regular basis with studio assistants, galleries, collectors, providers of artist’s residencies, museums, art suppliers, art storage companies and insurers. These diverse contractual relationships, whether they are concluded orally or in writing, are legally binding and enforceable. Artists may not realise they are committing themselves contractually, but a shake of hands on the sale of an item, or upon entering a professional or artistic relationship, generally results in the creation of a contract. It is therefore imperative that artists take steps to ensure that their contractual relationships reflect their interests, rights, and their co-contractor’s obligations. Doing so ensures that artists are appropriately protected in business relationships and can retain their bargaining power.

1. Are written contracts preferable to oral contracts?

#writtencontracts

Written contracts are preferable to oral contracts for three key reasons. First, it is significantly easier to rely upon a written contract when seeking to enforce or comply with agreed rights and obligations. Second, a written contract that is drafted in clear and succinct language offers clarity to both parties by replacing the need to rely upon their memory and preventing differing understandings of the agreement. Third, a written contract provides transparency and equal certainty to contracting parties which is likely to strengthen their business relationship.

2. How is a contract formed?

A contract can be formed in a variety of ways:
A shake of hands
Over the telephone
An exchange of letters or emails
An exchange of texts
WhatsApp or similar platform
A formal document recording the terms of the contract.

If the contract is not in writing, it might be challenging to evidence the terms of the oral contract in a dispute. In the event of litigation, this can cost the parties a great deal of money, and render any prediction of the outcome of court proceedings more difficult. Having said that, an oral contract is often preferable to a poorly written contract, so it is important to get the best advice.

3. Is it safe to use generic contract templates?

The effectiveness of generic contract templates is limited. If the the wrong template is used, the consequences in the case of a dispute can be catastrophic. Although contract templates can serve as a reminder of key clauses for different types of contractual relationships, they are designed to be ‘one-size-fits-all’. Therefore, they may not reflect the potentially decisive elements of a particular contractual relationship. This may lead both the artist and their co-contractor to commit to obligations that they did not understand and to fail to reach precise agreement over rights that are essential to them. The use of templates can thus damage rather than strengthen a contractual relationship. A prudent means of reducing the cost of legal advice is to use a template as the base of a written agreement and obtain legal advice for its adjustment to the specific contractual relationship.

By Mona Yapova, Constantine Cannon LLP

The law varies from country to country. In this section of the website, we describe the law as it applies in England and Wales. Whilst similar principles apply in other European countries, and to a lesser extent, in the USA, please do not assume that the law is the same. For example, artists have stronger moral rights in countries applying the Napoleonic codes than in England and Wales. The information provided on this page is general and may not apply in a specific situation. In doubt, please seek legal advice. This information is not intended to create, nor does receipt of it constitute, a lawyer-client relationship. The authors accept no responsibility for the content of this page.

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