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All businesses will use contracts regardless of the industry that they work in. Their main use is underpinning transactions and agreements made between businesses or individuals. Contracts are legally binding, so both parties must follow the terms or risk being in breach of it. One contract that many often use in the entertainment industry is an entertainment industry managerial agreement. This article will explain what a New Zealand entertainment industry managerial agreement is and the best clauses to include so that it protects you and your business.

What Is an Entertainment Industry Managerial Agreement?

You can use an entertainment industry managerial agreement to govern the relationship between a performer and their manager. The agreement will determine what the manager can do on behalf of the performer. Therefore, you should ensure your agreement clearly defines the boundaries of a manager’s powers. It should also outline what their responsibilities are under the agreement. 

Key Clauses of an Entertainment Industry Managerial Agreement

Scope of The Agreement

Your entertainment industry managerial agreement needs to clearly state what the scope of the agreement is going to be. This is so that both parties are aware of the powers granted under the agreement. For example, the agreement may indicate that there is an agent-principal relationship between the manager and performer. An agent-principal relationship gives the manager more power to make decisions on behalf of their principal. However, this also means fiduciary duties bind the manager. For example, this includes having to act in the best interest of their principal.

Dispute Resolution

Another important clause that you should include in your agreement relates to dispute resolution. There may be moments where a manager and performer disagree on a certain matter. A dispute resolution clause will outline how you can resolve a problem, so there is no need for the agreement to be cancelled or for the matter to go to court. 

Most dispute resolution clauses will call for both parties to resolve the agreement by finding a compromise. They may do this through negotiation. If this does not fix the issue, then the parties should go through a mediation process.

Mediation is where a third party facilitates discussion between the two parties in the hope that they can come to a resolution. If there is still no agreement, then court proceedings may need to be considered. 

Termination Clause

It is also crucial that you include a termination clause in your agreements. Either party can use the termination clause to cancel the agreement if the circumstances in the clause are met. These circumstances are usually when one party has breached the agreement or if the agreement is not feasible for either party. However, you must make sure you meet the circumstances provided in the agreement before you cancel. This is because any misinformed cancellation could mean you are in breach of the contract, thus leaving you liable for damages. Your termination clause may also state that either party must pay a termination fee if they wish to cancel the agreement. 

Common Issues

There are common issues that might arise with a New Zealand entertainment industry managerial agreement. You should be aware that these issues exist so you can do your best to avoid them. For example, there is a common misconception that a legally enforceable agreement has to be in writing. However, handshake agreements can be enforceable as long as they meet all the elements of a binding contract. This means that you need to be clear on what you agree to before you decide to say you will do something. It is always best to rely on written agreements if you can, as they show evidence of an agreement. 

Written agreements do not always have to be signed to be legally binding. The court might infer that a contract is legally binding even when the parties have not signed it in certain circumstances. However, this will only happen if there is a clear intention that both parties intended for the agreement to be binding.

Key Takeaways

Contracts are the bedrock for any transaction that a business partakes in. A common contract that many use in the entertainment industry is an entertainment industry managerial agreement. This contract determines how the relationship between a manager and a performer will work and the rights and powers a manager has over their performer’s decisions. There need to be some key clauses included in this contract so that both parties are protected, and the manager’s powers are not overbearing.

For legal assistance with managing your contracts, contact LegalVision’s contract lawyers on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

Do I have to follow the dispute resolution process outlined in the agreement?

Both parties must attempt to use the dispute resolution process; however, court proceedings can be commenced if this does not work.

Are oral agreements easy to enforce?

Oral agreements are more complex to enforce than written agreements as there is no physical proof of them. However, there are times when the courts will enforce them.

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