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Understanding Your Contract

Copyright: Cheryl Wright – All rights reserved


 

When Arabella Magazine notified me they were buying “Popcorn Murders” I was ecstatic. After all, everyone was vying to be published in that magazine.

Then they told me to “look out for the contract soon”. My elation soon turned to terror. I knew nothing about contracts! And I sure wasn’t going to hire a solicitor to look the contract over – particularly for a short story contract – so I learned to read the contract myself.

Not a good thing I’m told, but how many writers have the money to rush out and hire a solicitor every time they receive a contract? (The majority of publishers issue contracts for each and every piece they buy these days.) I’ve now got a bulging file with all my contracts, and if I’d hired a professional each time, I’d be down a lot of money, believe me.

Things that should be included in your contract:

Scheduled date of publication

Word count of ms

Title of Story

Author’s name

Rights Sold

Fee (either per word, or for complete works)

Legal obligations of each party

Kill Fee (if any)

Ownership of Copyright

Mediation and Arbitration (if dispute arises)


Some of the above are self-explanatory, so I won’t go into those at all. Others can be quite confusing, so we’ll look at each one individually.

Rights sold:

This can vary from publication to publication, and must be checked thoroughly. Never agree to sell ‘All Rights’ as this means you can NEVER sell the work again. Ever.

With Arabella, I sold first rights, with a clause that I would not allow the story to be re-published anywhere within thirty days of publication. That meant I was free to resell it any time I wanted after the thirty days.

So let’s look at rights:

First rights means it’s the first time the story has been published.

Second rights means it’s the second time it’s been published, and so on.

However, there can be a variation to this. You can sell (for instance) first Australian Rights, or First US Rights, First World Rights, etc. The same applies for second and/or subsequent sales.

Be absolutely sure what rights you are selling when you check your contract.

All Rights:

As mentioned above, selling ‘all rights’ is not a good thing. Basically, you can never sell your story again – not in any shape or form. There is only one way I would do that, and that’s if I was paid mega bucks.

But, there’s a catch. (Isn’t there always?)

If you sell ‘all rights’ in a book contract – for instance – you can lose a lot of money by doing so.

Let me tell you a story: a friend sold her novel to a new publisher in the UK. Her contract stated she was selling them ‘all rights’. This was her first sale, and she accepted that. Around a year down the track, the publication went bust; her novel went down the gurgler with the publisher.

That was two years ago.

She recently found out that her book has been released in large print. That’s good, right? Well, no. Because she sold ‘all rights’ so got absolutely nothing for the subsequent sale.

And if anyone ever decides to make her book into a movie, the same will apply. Never sell ‘all rights’ if you can help it, unless, as I said before, you are being paid mega bucks.

Kill Fee:

A ‘kill fee’ is literally the fee you get if the publication ‘kills’ the story. That is, they decide not to use it after all.

A ‘kill fee’ may also apply if an editor of the publications asks you to do rewrites that you feel misrepresent your own opinions, or in the case of a piece of fiction, distorts the story.

I know someone who had the latter happen, and as he didn’t have the kill fee clause, asked the publication to use a pen name instead of his own.

Copyright:

It is extremely important that writers understand copyright laws. If you don’t, then please, go out and do some research.

In the case of your contract, it should always state that ownership remains with the author. If it doesn’t, you probably have a problem.

If you’ve sold ‘all rights’ then ownership is no longer yours.

Publication Date:

Many contracts will state the date that the publication expects to run your story. They may even give an end date. In my contract with Arabella, it stated that if the story was not run (published) within twelve months, the rights reverted back to me, and I still got to keep the payment.

Strange as it may sound, it actually does happen. I have another friend who sold a story to a major women’s magazine in Australia, and two years after she sold it, the story still hadn’t run. She called them, and was told they’d ‘lost’ the story.

They sent her a letter of confirmation that the rights had reverted back to her. And yes, she sold it again – as ‘first rights’ again, since it was never published.

Other things to look out for:

For book contracts, make sure there’s a clause in case the publisher goes bust. In my contract it states that if the publisher closes its doors, or goes into liquidation (or similar) the rights refer back to me.

This is a very important clause to check. A number of writers have had to wait for seven years for their books to revert back to them after a publisher has gone bust. Some writers have gone to court over the clause, but still had to wait for the period to expire.

Please, for your own peace of mind, ensure your contract includes the liquidation clause. (Remember the writer whose book was sold in large print? She had that seven year clause too. She can’t resell that book, and she’s still got another five years to wait before she can shop it around.)

I also have a clause stating my publisher only has the rights to my book for two years. That means I can shop the book around after two years if I’m not happy with my publisher. Or, if I’m happy, I can renew my contract with the same publisher, and they can continue to sell the book.

Also check that the contract has a ‘release’ clause. If, for example, your book is due for release in February 2005, but still hasn’t been released in December 2005, if it’s covered in your contract, you can pull out from that publisher without penalty. If there is no mention of it, then you’ve got no come-back whatsoever; you’ll just have to wear it. And if that’s the case, and they decide to release it three years down the track instead, there’s not a thing you can do about it.

One more clause that you may wish to consider is in regard to royalties. You need to have the right to have the publisher’s accounts reviewed if you feel your royalties have been paid incorrectly, whether erroneously or intentionally. In most cases, if it is found that the royalties have been withheld, costs are the responsibility of the publisher. If they are found to be correct, costs are paid by the author. (And this should be stated in the contract)

Summary:

Ensure you understand the aspects of your contract. It is desirable that it’s in layman’s terms, and not legal jargon – which will make it impossible for you to understand without legal representation.

~ Check over your contract at least three times.

~ Highlight anything you don’t understand or are unhappy about.

~ Discuss them with your publisher.

~ Keep all correspondence to and from your publisher for future use.

~ Always keep a ‘paper trail’ that can be followed. (Even if it’s on the computer!)

~ If you don’t feel comfortable with something, there’s probably a reason.

 

*The information in this article is not intended to replace your solicitor or legal representative, and is meant only as a guide.

 

About the author: Cheryl Wright is an award-winning Australian author and freelance journalist. In addition to an array of other projects, she is the owner of the Writer2Writer.com website and the Writer to Writer monthly ezine for writers.  Her publications include novels, non-fiction books, short stories, and articles. To keep up to date with her publications and new releases, visit Cheryl’s website www.cheryl-wright.com

   
 
 

         Last updated: August 04, 2008