Every business relationship between a writer and producer should be mediated by written terms that sets out the rights and obligations for both sides in the project they are jointly undertaking. That piece of paper, however, can take several forms. Let’s take a look at them.
What’s Being Contracted: Your Idea In Writing
Call it a synopsis, a pitch document, a story bible or a treatment, it’s the document that offers a snapshot of the plot and its principal characters and hints about the tone and style of the final piece or a full screenplay. Whatever it is, it’s the place where the IP is expressed and is being contracted by the producer. It will be what they take to acquire a commission or soft money from a funding agency like Screen Ireland or a broadcaster.
This piece of writing is effectively free as it will not be paid for retrospectively by any development deal, so it is prudent to write the shortest effective expression of your story.
It’s essentially granting the producer the right to represent the script in the marketplace for a finite amount of time (say 3-6 months) – long enough to prepare and submit funding applications and get a response.
A Shopping Agreement does not give the producer any legal interest in or right to exploit the work. It will however set out the pathway from the agreement through an option to the full purchase of the rights should the project attract market interest or third-party funding. It will usually contain a provision that both parties will enter into such further agreements ‘in good faith’, meaning that the producer who has successfully promoted the project won’t find the writer making a deal with another producer.
Whether a writer agrees to a ‘good faith’ arrangement should be predicated on how much the producer is willing to pay for that security. No fee, no security. The writer has created something of potential value – the very thing that makes it possible for the producer to trade. Why should the writer give away that property for free? To do so, is essentially to grant an Option in everything but name.
An Option is traditionally priced at 10% of the complete purchase price of the Screenwriting Agreement – typically for 1 year or 18 months. It’s important to note that the 10% is discounted against the full price as are any further renewal periods of the option (often in increments of 5% for a six-month extension). So, if the purchase price is €30,000, then the option is worth €3,000, with the balance of €27,000 payable at the point of purchase of the rights.
Because the option amount is defined by the ultimate price, the two documents are usually agreed at the same time and indeed some screenwriting agreements contain an option agreement within a subsection.
We rather favour two separate agreements because it delineates the value of the intellectual property rights as expressed in the foundation document (pitch document, story bible, treatment, script) from the commissioning of further work to develop the idea through its subsequent stages.
Thinking of the option agreement in that way clarifies important elements in the management of the fundamental rights, such as how many rights is the producer actually seeking to acquire? A general rule of business is that you pay extra for add-ons but too often producers (and their legal counsel) will seek to hoover up everything they can for one low price and present it as though this is a ‘standard contract’. We have yet to see a ‘standard contract’ and look forward to sighting this rare beast. In the meantime, we will have to continue to deal with producers seeking to game the naïve and desperate writer out of their fair due.
In WGI’s opinion, that fair due would include (amongst other things) a separation of rights that would limit the rights to, say, a returnable TV drama to one series at a time, with safeguards about the writer/creator’s continued involvement in the project storylines and defined number of episode commissions.
Too often, when an option agreement is signed – often on the foot of the receipt of development funding from a broadcaster or screen agency, the writer finds themselves cast in the role of an employee of the producer – though technically they are an independent contractor – and their own work is being treated as the de facto property of the producer with all ultimate creative authority magically vesting in that person who hasn’t often put in their own money!
We suggest this model is rejected by the writer and re-cast as what it is: a business partnership in which both parties bring their own skillset to the project to enable it to be made.
This sets out the terms under which you will write the screenplay and any supporting documents such as the story bible. It will define how much work is being paid for (two drafts and a polish is common), what the delivery schedule will be, how notes will be given and executed and so forth.
It will also include indemnities the writer gives the producer that the story is wholly owned by them and is original; that it does not feature real people or incidents that have occurred unless that is the premise of the screenplay, and that permissions have been obtained from the subjects. The agreement will set out how the contract can be terminated by both parties and how that notice is to be served.
Even a cursory reading of a contract will demonstrate that – not unsurprisingly – a large amount of rights and very few of the obligations accrue to the producer and the reverse-oddly enough – is true for the writer.
Many contracts exude the patina of authority but contain clauses that are frankly bunkum. This is particularly true of any item that seeks to waive the provisions of the European Copyright Directive that conferred rights to the writer to obtain information about the commercial exploitation of their work in the final production – specifically how much money it makes on an annual basis and to seek additional compensation if it becomes a runaway hit.
We strongly recommend using the Guild’s free contract advisory service or qualified legal practitioner before signing any contract.
Be aware that good will and desperation have caused many a writer to get into business with a producer without a contract.
Don’t. It will end in tears.
Your tears, most likely.
Many producers in Ireland will try to develop new projects as far as possible by paying low or no fees to the writer (or achieving the same goal by offering a deferred fee payable on the twelfth of never). So be clear from the start. Unless you enter into a written contract and receive money commensurate at least with that offered by Screen Ireland development loans, you own your work. You control your work. The producer is entitled to their opinion but you are an equal partner and not an employee.