Common Artist Legal Problems and How to Avoid Them
Selling your art through a dealer, consultant, artist representative, gallery or agent constitutes a business relationship. A successful relationship means negotiating and implementing a contract, agreement or arrangement that works for both you and the seller. Basically, you entrust your art to the seller who in turn, promotes and markets it, sells it, collects the money and then pays you a predetermined percentage of those sales.
This sounds straightforward, but problems arise when either one or both parties doesn't understand the details of an arrangement, one or both parties decides that the arrangement isn't fair or one or both parties doesn't honor the arrangement. Most disagreements can be resolved by simple discussions between artist and seller, but those that can't may require legal intervention and months or even years of litigation and expense. Fortunately, the great majority of problems, legal and otherwise, can be avoided by following a few simple procedures.
For starters, know who you're dealing with. Do not enter into business relationships with people you don't know, no matter how glamorous they seem, what promises they make or how desperate you are to show and sell your work. Artists occasionally get so excited at the prospects of sales and exposure for their art that they send it off into the cosmos never to see or hear from either it or the sellers again.
Always check a seller's references ahead of time, particularly through artists that seller has represented, before entering any negotiations and absolutely before signing any contracts. Learn about the seller's reputation in the art community, how long they've been in business, how promptly they pay, how well they sell, how well they follow through on their promises and so on.
When you decide a seller is good to do business with, your next step is to meet with that seller and discuss possible selling arrangements. Before you can do that, though, you have to know what you want. Make a list of your expectations, and be ready to discuss them, one by one, when the two of you meet. These include details such as what you want your selling prices to be, how much art you would like to sell, how and when you like to be paid, what percentage of retail prices you prefer, and how long you want the business arrangement to last. Sellers, of course, have their own requirements for how they do business, which may or may not match up with yours. Requirements that don't match will have to be negotiated.
Negotiating is not easy for many artists, especially artists who are just starting out. Becoming a good negotiator is more a matter of experience than anything else, so get in there, do your best and learn as you go. Keep in mind that the earlier you are in your career, the less bargaining or negotiating power you have and the less negotiating skills you have. If you're not that experienced, think about hiring a professional art consultant, mediator, or even an attorney for an hour or two to review any contracts or discuss details of any arrangements a seller presents to you. The less negotiable a seller's terms are, the more you should think about hiring that professional in order to make sure you're not putting yourself at any unecessary risk.
A central aspect of every negotiation is money, so don't enter into negotiations unless you have a good idea of what your art is worth. Get a sense of that worth by talking to artists who have representation and/or show at galleries, preferably artists with similar career experience to yours. Find out what percentages of sales they receive (typical percentage is in the vicinity of 50%), when and how they get paid and so on. You might also read Price Your Art Realistically.
Don't be afraid to talk about money. When you're not sure about the dollars and cents details that a seller proposes, ask. If you think you deserve more money for your art than the seller is offering you or you have questions about percentage arrangements, ask. Remember, though, that the less experience you have showing and selling at galleries, the more flexible you should be in your demands.
Have realistic expectations about money and avoid coming to any negotiation with overly inflated ideas of what your art is worth. Just because you're offered a show or a rep shows interest in your art does not mean that you suddenly raise your asking prices. Make sure that the seller is comfortable with your price structure and seriously consider any money feedback they give. If your art is too expensive, it won't sell. That simple.
Understand exactly what happens when your art sells. Know what percentage of a sale you get and most importantly, how and when you get paid. Every business arrangement should include a fixed time period, usually 30 days or less, between the completion of a sale (the buyer pays the seller) and you getting your money.
When you're done negotiating, put the agreement in writing; in other words, write and sign a contract that covers all the basic points. Agreements that don't get written down are subject to a variety of problems, not the least of which is one side remembering it one way and the other side remembering it another. He said/she said types of disputes are difficult to mediate and miserable to litigate. Unless you know the seller or the two of you have a longstanding and successful business relationship, go formal rather than casual.
Before you sign or agree to anything, make sure you understand the relationship from the seller's side. Empathy is an important aspect of any successful working arrangement. Know that every seller you'll ever work with believes in your art, wants it to sell and believes they can sell it.
Maximizing sales means knowing and doing what's expected of you. Deliver your art on time, show up at your openings, meet with prospective buyers and do whatever else you and the seller agree to. Don't make commitments unless you intend to keep them and never misrepresent yourself in any way just to get a show or an agent. The art world is small and word travels fast; you don't want to ruin your career before it gets started.
Also understand that just because a seller takes you on does not mean your art will automatically sell. The fact is that sellers sometimes guess wrong and show art that doesn't sell. If your art turns out to be a bad match for the seller's clientele or fails to sell for other reasons, that does not mean that the seller failed to uphold his or her end of the deal. In instances where your art doesn't sell, end the relationship with dignity and respect and move on.
Once a relationship is in place, stay flexible and be easy to work with. Avoid feelings of entitlement and don't take yourself too seriously or get unreasonable about how events progress. If you're suspicious of every sentence in a contract, for example, critical about how your art is hung or displayed, you constantly bug dealers about whether they're showing your art or about who's seen it, who's interested, or whether or not it's selling, you'll scare them away. Most importantly, don't get a reputation for being argumentative, using lawyers or getting into legal entanglements; that's a sure fire way to crimp your career. Use every means possible to resolve disagreements, short of engaging the legal system.
* Negotiations are not always straightforward. Know what you need, what you can't live without, when to compromise, when to back down. Do your best to understand the other side's interests and what they want. Take the risk if it seems worth the exposure; walk away when it doesn't feel right, you feel like you're being taken advantage of or you sense a lack of respect on the seller's part. Sometimes you take a chance, sometimes you lose, and sometimes you win big. Nothing is a given, but as you gain business experience, you get better at making the judgment calls.
* Register your copyrights, especially when you're concerned about your art being reproduced without your permission. Read more about registering your copyrights here-- and why it's a good idea.
* Decide whether to sell reproduction rights with your art. If you sell reproduction rights and expect to be paid, include that in your agreements.
* Include a mediation clause in your agreements, preferably with nonprofit art advocacy groups such as the California Lawyers for the Arts (all states and countries have such organizations). That way, disputes have a good chance of being resolved without having to hire attorneys or go through the legal system.
* Think about including a bankruptcy clause, especially when a seller has not been in business that long. Make sure your agreement clearly states that bankruptcy proceeds from the sale of your art go to you and you alone, and not to whichever creditors are first in line.
* Ask about and understand any exclusivity clause in any contract. Watch out when sellers demand exclusive rights to sell your art over large geographical areas, particularly if this is a first-time agreement. Limit exclusivity clauses with new sellers to six months or less (certainly no longer than a year), and keep them local or regional, not statewide, not national, not worldwide. Renegotiate the terms if your art sells well and you mutually decide to extend your business relationship.
* Be on the lookout for unreasonable termination clauses that require you to pay back, for any reason or at any time or at the other party's sole discretion, advances or initial payments made to you. Advances are yours to keep (unless you fail to uphold your end of the deal).
* Understand loss, damage, and theft clauses. Know whose responsibility it is to insure your art and/or reimburse you in the event of problems. When responsibility is with the seller, make sure they have enough insurance to cover the value of your art.
* Understand the details of any installment payments, advances, or other creative financing that a seller either offers or proposes.
* Make sure your agreement has an escape clause. This means that if your art doesn't sell after a period of time, preferably six months, the contract is over. Or specify a period after which the contract is to be renegotiated.
* If you have multiple galleries, representatives or agents, make sure you all understand your percentage arrangements. You don't want to find yourself in a position of having to give 80 percent of gross sales to combinations of middlemen handling your art (50% is typical).
* Avoid arrangements where when your art sells, everybody else gets paid first and you get paid last.
* Avoid using attorneys to resolve legal disputes. "Getting justice" or "punishing" someone for doing something to you almost always costs money (and almost always lots of it), wastes time (almost always lots of it), takes your focus off of your art, compromises your reputation and jeopardizes future business relationships. None of this is good.
* Never sign a questionable contract just to get a show or make a sale.
Additional legal resources for artists:
* Nonprofit artist advocacy websites like California Lawyers for the Arts.
To read more about artist/gallery/dealer contracts, go here.
Think you need an art lawyer? Read: When to See an Art Attorney
Thanks to Nate Cooper, lawyer, mediator, musician, and Legal Services and Education Coordinator for California Lawyers for the Arts, for assistance with this article.
Disclaimer: If you need legal assistance, see an attorney. This article is not to be taken or construed in any way as legal advice.
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