Contract Essentials for Event Services

Often in the event production services industry, vendors will operate without formal contracts between themselves and the producing party. I've seen loosely worded caveats at the end of a quote that in effect outline general terms that serve, more or less, as a binding agreement. Mostly less. The usual elements include only one signature (client), fifty percent deposit due immediately, specified fees and costs the client is responsible for, and preferred payment methods. The main reason for such a limited number of terms is that for smaller shops their production service jobs occur at a rapid pace with high volumes. Small business owners don't have the time to edit and review lengthy contracts. These limited agreements work most of the time, especially when the client is a long-term trusted partner who relies on the vendor for consistent service. But what happens when the company grows to provide many more services or a new untested client comes along? The small business owner will find that the lack of a formal contract soon becomes a risk-inducing component to the health of the business.

In general terms, a contract is an agreement between two parties to exchange things of value for mutual benefit. It includes a time and place for the exchange. It defines the items of value, called "consideration", to be exchanged. For example, if a moving light fixture is rented for $500, consideration is both the light fixture and the $500. It contains spaces for both parties to sign and date. And it contains various terms and condition necessary for the nature of the transaction. A rental car contract will differ greatly from a production services contract in the terms, but the basic elements above will be included.

The dangers of operating without a standard ("boilerplate") contract in the production services industry are many and varied. I've seen so-called agreements that do not specify cancellation terms that leaves the vendor absorbing hard costs when an event is cancelled. Often elements like the identification of the agreement governing jurisdiction is missing which leaves the vendor with no court to pursue non-payment. And one company I contracted with has a boilerplate contract that, while rich in terms, doesn't clearly define the two parties' consideration, basically rendering the agreement useless. Nefarious producers love these types of vendors.

Safe harbor statement here, I'm not a lawyer nor am I giving legal advice. Small businesses should make the investment in having a formal boilerplate drawn up by a lawyer, preferably one in this industry. What I'm suggesting below are some key contract elements that a production services vendor should consider. And I suggest small businesses owners find a legal workshop or take a community college law course. I took a semester of business law at the University of Central Florida while earning my marketing degree and it has been as useful in my career as my knowledge of rigging standards and media file formats.

Key Elements:

Define your services - Your consideration is the set of services you will provide for the client's consideration of an agreed upon dollar amount. Tip: If Excel or Google Docs is the platform for creating quotes and contracts, a boilerplate contract can reside on a hidden tab. That tab remains hidden when creating a quote but included in the print/PDF when creating a contract. The boilerplate verbiage will refer to contracted services as "Exhibit A - Services" so simply labeling the quote as "Exhibit A - Services" will connect the two.

Indemnity - This protects the vendor from damages as a result of the client's and subcontractors' actions

Force Majeure - Known as the "act of God" clause, this protects the vendor when, for example, a hurricane causes an event to cancel. The vendor will be paid regardless or at least some amount of payment will be received to cover unrecoverable hard expenses.

Cancellation - So the promoter decides to cancel two days before the event and has not paid the balance. What do you do? With a cancellation clause you and the producer have a set time table for the producer to cancel with agreed-to percentages. Here's an example:

1. Services canceled 60-90 days prior to production = 15% cancellation fee of the projected total Production price.
2. Services canceled 30-59 days prior to production = 30% cancellation fee of the projected total Production price.
3. Services canceled 16-29 days prior to production = 50% cancellation fee of the projected total Production price.
4. Services canceled 0-15 days prior to production = 100% cancellation fee of the projected total Production price.

Copyright Protection - This puts the liability of playing copyrighted media or including copyrighted materials in print on the client. Say you are producing a hybrid event that is shared via a YouTube live stream. The client provides a video that has royalty-free music but has a 4-second video segment from a some obscure televised program from the 70's that gets flagged by YouTube. (Yes, that happened.) The stream gets shut down immediately. You are not liable for that stream loss under this clause. Tip: test all media in a test stream way ahead of time and don't allow changes.

Payment Terms - While this may be obvious, it is often overlooked. There's nothing like chasing a producer to his hotel room and standing outside demanding payment before he leaves town.

Change Orders - Creating a system of approved additions to the budget will ensure both parties maintain the integrity of each's consideration. Require a pre-approved list of authorized client staff who can make changes. Also require double signed forms with both additional services and costs clearly defined. In payment terms, clearly define these chage order payments. I suggest a credit card be kept on file so that changes can be singed for immediately. Again, there's nothing like chasing a producer to his hotel room and standing outside demanding payment before he leaves town.

Subcontractor Payment - Include a clause that basically states the you will not make payment to a subcontractor unless the payment is covered by payment from the client.

Reimbursement of Expenses - This clause will require the client to pay expenses not outlined in the services consideration that MAY be incurred regardless of a change order. For example, if rehearsal goes late you may have to arrange for a last-minute crew meal. That expense will be covered by this clause.

I'm sure there are more and I invite everyone to submit those in the comments.

Good luck!

## Scott Justis a thirty year veteran in the events industry providing consultation, production, and management of live events.