Band Agreements
What is a Band Agreement?
As soon as possible after forming a new band, its members should agree how they will all work together to achieve the best possible success for their careers in the music industry. A proper written agreement prepared by a lawyer can help avoid disputes between band members in the future and can also ensure that a fair deal is struck for all.
For example, by nature of their different personalities members will have different roles to play within the band; - one might be an exceptionally talented singer, another may be better at writing lyrics. One band member may be less artistically talented, but organised and ambitious and therefore able to develop the relationships necessary to secure a good record deal for the band.
What happens if we don’t have a Band Agreement?
Without a proper band agreement, the terms of the Partnership Act 1890 will determine how the ‘business’ of the band is owned and controlled. This 1890 Act imposes the following general provisions in such circumstances:-
- A ‘partnership’ arises when two or more people carry on a business in common with a view to making a profit. Performing live together and recording music with a view to making money will be deemed a partnership in the absence of an agreement or other evidence to the contrary.
- A partnership is not a separate legal entity like a limited liability company or an individual. Partners in a partnership will therefore generally have unlimited personal liability for debts.
- Any profits arising from the business such as tour income, recording and performance income will be shared equally between the partners. This might not be fair where one band member has composed all songs himself or where a member gets into financial trouble and his liability could then end up being shared between the rest of the band members.
- A band member might think he is the founding member and therefore own the name of the band outright. A band name however will be deemed an asset of the partnership, by the 1890 Act, meaning that each band member has an equal right to it and will not be able to continue using it without a leaving band member’s permission.
Types of Band Agreements:-
To avoid the sometimes unfair circumstances imposed by the 1890 Act, it is wise to ensure that key terms are agreed at the outset by the new band. It is always easier to agree these issues whilst you are all getting along together when starting out.
The agreement can be:
- based on a partnership but varying the strict provisions of the 1890 Act. This tends to be the easiest and therefore cheapest option for a new band starting out; or
- alternatively the band might prefer to form a new rights-holding limited liability company, with the shares in that company being split between each band member. A supporting agreement between the shareholder band members can specify how the company will be controlled and how decisions will be made.
Other key provisions in Band Agreements include:-
- The sharing of income and expenses – usually a band member who spends his own money on an expensive guitar will want to ensure that he owns that guitar himself outright even if he leaves the band.
- Leaving member provisions – band members might be happy to automatically grant rights to use the band name when they leave the band, perhaps subject to receiving something in return, such as a certain percentage of income for a fixed number of years after their departure.
Chris Phillips and Mike Shepherd who head up the Media and Entertainment department here at Bolt Burdon are experienced lawyers used to negotiating and advising on all types of music industry agreements.
To find out more about band agreements, please contact us for a free initial consultation on 020 7288 4700.