Legal Dispute? Here's How to Avoid Hassle in the Event of Business Disputes
A misunderstanding about copyright, an unclear agreement regarding payment, or a disagreement over mutual responsibilities—these are situations that can arise more quickly than you might think. And if proper agreements haven’t been made, a small problem can escalate into a major conflict. That not only costs time and energy but can also damage the relationship between creators or partners. In this article, you’ll learn how to prevent legal conflicts and what to do if things do go wrong. Because a good start isn’t just half the battle—it also saves you a lot of hassle down the road.
By Chiara de Jong, attorney and founder of Simply Legal —lawyers for the creative sector.
What is a legal dispute?
There is no crystal-clear definition of the term “legal conflict.” But legal conflicts all have one thing in common: they cause headaches and sleepless nights if left unaddressed. Legal conflicts can arise anywhere and be about anything. In the creative sector, consider the following situations.
Inequitable distribution of rights among creators
When you create something together with another creator, you may both hold the copyrights to the resulting work. This also means that, in principle, you can only exercise those rights jointly, unless you agree otherwise.
However, if you do not set this out clearly and understandably, disputes may arise later about which of you is actually allowed to do what with the work. This could even lead to one of you actively hindering the other by refusing to cooperate with or grant permission for the use of the work.
Breach of Contract
There are always people who cut corners, even if you’ve laid everything out in black and white. If someone else fails to honor the terms of the contract, it can lead to unpleasant situations. Think, for example, of a breach of confidentiality, failing to show up for appointments, or late delivery of materials you need for your work.
Use of a Protected Work Without Permission
When someone uses your creative work, they generally always need your permission. If that person nevertheless publishes or copies your work, it is called “infringement.” That person is then doing something that violates your rights. Conversely, you are also not allowed to use someone else’s work without their permission, unless there is a legal exception.
Prevention of Publication by Subjects Portrayed
As a photographer, producer, or artist, you often need to depict people in a way that makes them recognizable. However, under certain conditions, the person depicted (the subject) can invoke the right to privacy. This means that the subject can object to the disclosure of his or her likeness and thus prevent or completely block its publication.
When Your Customer Fails to Pay Invoices
As with any organization in any given sector, there are also clients in the creative and cultural sector who do not pay the invoices they’ve been sent. This means that the client is not fulfilling the agreement. Therefore, this also constitutes a breach of contract.
How can you prevent conflicts?
There is no one-size-fits-all solution for legal disputes. However, you can take the following steps to prevent legal disputes as much as possible.
1. Clearly document agreements
You can avoid a lot of hassle by clearly setting out all the terms in advance. Putting the terms in writing also forces you to take a critical look at all rights and responsibilities. This not only gives you a stronger negotiating position later on, but also ensures that mutual expectations are clear from the outset.
In a contract, you can specify, among other things, payment obligations, liability, the allocation of rights, and the permissions granted by the subjects of the portraits. Depending on your situation, you can set out these agreements in general terms and conditions, a collaboration agreement, or another type of contract. By establishing consequences for failure to comply with the agreements, others will be more likely to honor the terms that have been agreed upon.
2. Take a critical look at other people's contracts
In practice, sometimes you’re not the one drafting the contract yourself, but rather you receive a contract from the other party. This is usually the case with projects or collaborations involving large organizations. In such cases, it’s advisable to carefully review the other party’s contracts, including the fine print in the terms and conditions. These contracts will likely be drafted solely from one perspective: that of the other party. To protect your rights and mitigate risks, it’s a good idea to request amendments or additions where necessary.
Sometimes, the agreements you make with one party can also affect your contracts with another party. Examples include limitations of liability, the transfer of intellectual property rights, or certain indemnities or warranties. So, in these cases as well, it’s important to know what your obligations are and how they impact other business relationships. If in doubt, consult a lawyer to review your contract.
3. Communicate clearly and set your boundaries
Aside from the agreements set out in writing, it’s important to clearly set your boundaries and communicate them effectively. So speak up if someone is constantly late or fails to show up for appointments. Or if your client has once again paid the invoice far too late. Or if your client is once again asking for too many changes to your work, even though this isn’t included.
You can also set deadlines. By setting a deadline, you ensure that someone sticks to the agreements made. This is especially important for ensuring compliance with contractual obligations, because then (in the worst-case scenario) you can later prove that the other party failed to meet the deadline.
What if things do go wrong?
Some conflicts are inevitable. So it’s a good idea to have a Plan B in case you’re unable to prevent the conflict. In that case, you can take the following steps.
1. Keep communicating (in writing)
Don’t cut off contact with the other party right away. It’s still a good idea to maintain contact yourself at first and try to resolve the conflict together. Be sure, however, to communicate in writing as much as possible—for example, by email. If necessary, a lawyer can help you draft a legally sound email that you can send to the other party yourself.
2. Sit down together at the table
Sometimes it helps to sit down face-to-face again and communicate openly with each other. Ultimately, no one benefits from a conflict. Just make sure you don’t rely solely on verbal commitments from the other person. If they end up changing their mind again, you’ll have little recourse to enforce the agreements you’ve made.
Tip: By taking notes during the conversation and sending a summary of the conversation and the agreements reached afterward, you can still put things in writing. Especially if the other person agrees to the summary of the agreements via email, you’ll have a more solid basis to rely on going forward.
3. Consult a lawyer
If a conflict proves to be unavoidable, it is wise to consult a lawyer to resolve it. The lawyer can, for example, draft a demand letter to defend your rights. The lawyer will therefore handle all further communication with the other party. Since most organizations want to avoid legal proceedings, this increases the pressure on them. Negotiations usually take place via correspondence. If the negotiations lead nowhere, it is possible to initiate legal proceedings. However, this should always be a last resort.