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On March 12, 2020, the American Society of Media Photographers (ASMP) held a webinar with General Counsel Thomas Maddrey entitled “Potential Business Ramifications of Coronavirus (COVID-19).” Maddrey covered a variety of topics, including cancellation clauses in photographer contracts. Given the large number of cancellations suffered by the photo community in the past few weeks, and the fear of future cancellations for newly assigned work, we followed up with Maddrey for additional information.
Note: The answers below are for general informational purposes only, and does not constitute legal advice.
You mentioned that if a photographer takes a deposit for a job and doesn’t end up delivering photos for any reason, they need to return those funds. Can you elaborate?
Legally, a deposit is a payment that is intended to go towards a future service. If there is no service then there is no payment due, and absent language to the contrary, you have to return the money. Even “non-refundable” deposit may have to be paid back if the photographer is found to be the one who breached the contract. Deposit can be a loaded term.
Is there a legal difference between a retainer and a non-refundable deposit?
In short, yes. While a deposit is a payment that is intended to go towards a future service, a retainer is a payment made to retain future availability for services. Almost always, retainers are non-refundable. Essentially, you are saying that the money you pay as a retainer is only to ensure I am available on the date and time of your choosing. Retainers are “earned” when you take them, and deposits are not “earned” until the service takes place.
Some photographers have understandably caught flat-footed with cancellations during this “black swan” event. As they review and reassess their contracts, should they be working with a lawyer? Is there a template that you think is generally applicable?
This is an incredibly tough time for all photographers, freelancers, and small businesses. But we will come out of it, and one of the best things you can do after some of the dust settles is to spend time making sure that when we do come out of it, you are ready to go with contracts in hand that you can trust. I am encouraging all my clients to use this time to catch up on copyright registration and reassess their contracts.
There are many document templates out there, and many of them are good – but bad ones can be quite dangerous! It’s important to note that the law is different from state to state, so by working with an attorney, you can get a document that is custom to your situation in your state with your requirements. I know that’s not always feasible. This is why it’s great to be a member of a professional association like ASMP. I regularly do webinars on contracts, members can submit requests and talk with us on the phone for free, and we have many great documents on the site for you to use.
That being said, I think that every photographer should have two people they can call when they have questions: an accountant and an attorney. This doesn’t mean you have to pay a ton of money, or get a monthly bill, but you do need to have a pre-existing relationship with professionals who can help you when the need arises. Many of my clients talk to me once or twice a year… but it’s comforting to know who to call when you have an issue.
Photographers sometimes have to sign their client’s contract. Given these uncertain times, are there specific contractual items that photographers should be aware of if they get a job?
Often, a client will give you a contract and expect you to sign it. The bigger the client, the less chance you have to negotiate. But rule #1 in contracts is that you can make changes! You don’t have to sign something just because they handed it to you. Now real life dictates that if you make too many changes, or make changes to things the client thinks are requirements, they may walk away, so you have to balance the legal options with your business sense.
When reviewing a client’s agreement given to a photographer, I always look at the basics: who is doing what for whom, when is it going to be done, how much is being paid, and what do they expect in return. That should be right at the top in very clear wording. Next, I will look for who owns the intellectual property (i.e. copyrights) and see if it is a “work-for-hire” contract. Finally, I will examine the worst-case scenarios, and see what happens if either party needs to terminate or cancel. I guess I should add that force majeure clauses will be top of mind moving forward, and I expect to see quite a bit of new case law regarding when these are upheld and when they are struck down.
About the Author
Allen Murabayashi is a graduate of Yale University, the Chairman and co-founder of PhotoShelter blog, and a co-host of the “Vision Slightly Blurred” podcast on iTunes. For more of his work, check out his website and follow him on Twitter. This article was also published here and shared with permission.