Understanding the Role of Agents in Contract Signing: An Introduction
Can agents sign on behalf of performers? A client recently asked, “what is the risk of having an agent sign a contract on behalf of an actor or other performer hired for a production?” While the practice of having agents sign on behalf of performers is commonplace, it can carry some risks of which producers should be aware.
The Legal Dynamics of Agent Representation
For starters, an agent is a party who is legally empowered to act on behalf of another party (known as the “principal”) to affect the principal’s legal relations with third parties (e.g. by entering into a contract on the principal’s behalf). Where an agent signs a contract on behalf of a principal, it is as though the principal themself has signed the contract.
Importantly, agents are only able to bind principals where a legal agency relationship exists, and whether or not such a relationship actually does exist is often less than crystal clear. In addition, producers often only communicate with agents and do not receive confirmation from the principal that the agent is authorized to sign on their behalf.
Navigating the Legal Minefield: Assessing the Risks Involved
The main risk for producers is that if a legal agency relationship does not exist the principal will not be bound by the terms of the contract and any assignment of rights, waiver of moral rights or the like will not be enforceable.
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Practical Solutions to Mitigate Risks
To address this risk, it is recommended that producers take one of the following steps:
- Have the principal sign the contract as a party– this is a great option but may not be practical as agents often like to insert themselves between the producer and their client.
- Have the principal sign an inducement acknowledging that they are bound by the agreement—also a great option, but it raises the same practical issue as the first suggestion.
- Have the agent provide a proof of agency—this “proof of agency” could be the contract between the principal and the agent under which the agent is granted their authority, or a Power of Attorney.
Scrutinizing Proof of Agency: A Critical Step
When reviewing any proof of agency, Producers should be mindful of limitations on the agent’s authority to bind the principal. For example, the agent’s authority may have expired, or the agent may only be authorized to bind the principal with respect to certain matters. Ultimately, producers should see something in writing verifying the agent’s legal authority to bind the principal.
If you receive a proof of agency and require help interpreting its limitations or having questions about how to draft proper inducement language, we would be happy to assist.
© 2021 Edwards Creative Law, LLP – Updated to June 14, 2023
Edwards Creative Law is Canada’s Entertainment Law Boutique™, providing legal services to Canadians, and international clients who partner with Canadians, in the Film & Television, Music, Video Games and Apps, Publishing and Literary industries.
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* This blog is for general informational purposes only and is not to be construed as legal advice. Please contact Edwards Creative Law or another lawyer, if you wish to apply these concepts to your specific circumstances.
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