There is a wide range of contractual and legal issues that arise relating to works of art, the art market and the art world. Artists, collectors, galleries, dealers, auction houses and museums all enter transactions that should be guided by written agreements. Sound contracts provide clarity and communicate expectations while helping to avoid potential disputes and misunderstandings for both the artists and any other parties involved in an art transaction.
When considering exhibiting your art, working with a dealer, agent, or gallery representation, being commissioned to produce a work, loaning your works or other transactions, an artist should ensure there is a thorough and mutually agreed upon contract drafted and signed by both parties. This not only will foster ethical transactions, but also lead to good working relationships between artist-dealer, gallery, or other institution, and maintain efficiency, resources, and reputation. It will help ensure the alignment of all parties’ needs, fairly.
Contracts serve as a framework of responsibilities, obligations, and requirements for artists and those with whom they enter into a transaction. They may cover compensation and financial obligations, guidelines for how a certain process should be carried out: such as how exhibiting or selling is to be completed, provide start-and-end dates, or other stipulations. Upcounsel suggests including terms on “confidentiality, indemnification, and a hold harmless clause”. A hold-harmless clause, sometimes referred to as a “save harmless agreement”, releases one or both parties from liability and protects against cost, loss or damages. It can also hold a party responsible if there is a debt, claim, or lawsuit as result of the contract.
Artists should also be aware of any severability clause, wherein if an isolated provision of the contract is not met, a court could determine the contract is voidable or unenforceable. It is also important to remember different jurisdictions, including from one state-to-another, may differ in treatment of the mentioned clauses. Before entering into a contract,It is also prudent to have a checklist for your needs, and ensure they are voiced clearly in the contract. If they are not listed, do not hesitate to suggest changes. It is vital that the artist be able to question any terms such as artist rights, insurance, storage, transportation, and shipping of their artwork for their own protection as an artist and of their artwork.
Terms and limits should be stated as clearly as possible in any written agreement, and any words or statements that could be misinterpreted should be avoided. Contracts are more than words on a page and the implications should be understood in terms of how they are actualized in practice. They should be critically thought about by artists before being signed to best protect integrity of their artwork and themselves as artists. In fact, many states, countries, and other cultural capitals have developed regulations and fundamental principles of law that govern art sales and transactions. It is critical that any artist, individual, or entity involved in the art world be aware of these rules and standards as they may differ vastly from one jurisdiction to another, as well as other industry transactions. Thorough research, whether by the artist, attorney, or consultant, anyone can avoid complications and repercussions in the future.
Some artists may fear missing an opportunity to show or sell their work by requesting a contract or making changes or clarifications, but it will undoubtedly serve them in the long term and help ensure success. Indeed, problems can frequently arrive for artists, dealers, buyers, and others in the art market when there is a lack of a written agreement, a verbal deal is made, or when the details of an agreement are muddled. Issues can arise for well known, established artists or their estates, as well as to new, emerging, or mid-level artists. Art Vérité is a company bringing attention to the severity of this problem and other challenges for artists throughout film. In one recent example, as an Art Vérité Film explains, emerging visual artist Rae Wilson was defrauded in a deal and “illuminates artists’ risks when working without legal guidance or contracts”.
In another example, the 1989 Supreme Court copyright case, CCN v. Reid, The Community for Creative Non-Violence commissioned artist James Earl Reid to fabricate a sculpture titled Third World Country and later filed competing copyrights as it had not been laid out in a clear contract. The artists and the non-profit had disputes over the materials to be used, its subsequent durability and longevity, as well as the amount of travel the sculpture would endure in a traveling exhibition. Though they did enter a contract, it was flawed in the sense it did not consider factors that later resulted in these legal disputes between the parties. A contract drawn with these issues in mind could have prevented the case, and maintained a relationship between the artist and commissioning organization, as well as preserved the artist’s work and the integrity and longevity of both the artwork and the non-profit it was intended to benefit. The artwork currently resides in the basement of a shelter.
Any contract an artist considers entering should be reviewed by an attorney first. This holds especially true when dealing with high financial considerations, artist rights, and long-term agreements. Many non-profit and legal organizations offer free reviews to artists or even educational workshops. Local chapters of Volunteer Lawyers for the Arts (VLA) are available across the United States and offer artists guidance through legal workshops, pro-bono consultations, and reduced fees. Art consultants, advisors, and other mediators can help review or create contracts as well. The signers should have a reasonable amount of time to review any contracts thoroughly and may request revisions prior to signing.
While contracts have been important throughout the history of art, they are not going anywhere. Artists and other players in the art market are now seeing “smart-contracts” come into play with NFTs (Non-Fungible Tokens). An underlying contract typically exists underneath the collectible item. Artists and collectors will find it equally as important to review all terms of that contract before making a transaction as in the traditional physical art market. Regardless of the type of art and its form, attention to contracts and their details are important in art transactions for artists and those they work with.