AGENTS AND AGENT AGREEMENTS
For some types of books, authors often find that it is helpful, if not essential, to retain an agent. An agent typically performs three functions. First, the agent will locate publishers who might be interested in the author's work, and will present the author's work to those publishers. Second, the agent will negotiate the terms of a publishing agreement. Third, the agent will review royalty statements and collect royalties for the author.
Attorneys differ from agents in two respects. Most publishing law attorneys do not "shop" manuscripts or otherwise assist authors in locating publishers. In addition, attorneys are generally compensated on an hourly fee or project fee basis, whereas agents receive a commission on all earnings from a work for the entire life of the work. Authors who already have a publishing contract in hand may find that it is more economical to work with an attorney; authors who need assistance in reaching publishers may prefer to work with an agent.
An author who is retaining an agent should always insist on a written contract.Agent agreements range from formal written contracts to informal engagement letters. In some cases, the only written agreement between an author and an agent will be a clause in a publishing agreement in which the author appoints the agent and authorizes the publisher to pay all royalties directly to the agent. However, regardless of the form that an agent presents as his or her "standard" agreement, an author who is retaining an agent should always insist on a written contract that at least addresses the following issues:
- What is the scope of the agency? Does the appointment cover only one specific work of the author, or does it apply to all works that the author may write during the term of the agency? Will the agent's authority extend to all rights in the works covered by the agreement, or will it be limited to certain specified rights, such as English language publication, audio book and/or film rights only?
- What is the term of the agreement? In most cases, the author will want the term to be as short as possible, and may want to include a right to cancel if the agent does not place any of the author's works with a publisher by a certain date. Some agents will permit the author to terminate the agreement at any time, subject only to the payment of commissions for projects that are completed or in process at the time of termination. Other agents will require a fixed term, which will usually range from one to three years.
- How does the agent get paid? The agent will receive a commission on all amounts earned from the works that are covered by the agreement. The standard commission rate is 15%, although some agents' rates may be higher or lower. An agent will usually charge a higher commission (e.g., 20%) for film rights, foreign language rights, or any other rights for which the agent uses a subagent. All commissions should be based on amounts actually received rather than on amounts receivable. The agreement should also specify what expenses, if any, are to be paid by the author.
- Is the agency exclusive? Under an exclusive agency, only the agent can secure deals for the works covered by the agreement. If the author or any other person acting on behalf of the author secures a deal for any of those works, the agent will still be entitled to a full commission, even though the agent did not participate in the deal. Almost all agency relationships are exclusive.
- What happens if the author terminates the agency prior to the end of the term? The author has the right to terminate the agent's authority to act on behalf of the author at any time. However, if the author terminates the agent's authority prior to the end of the term specified in the agreement, the author will remain liable for commissions on all works placed during the remaining term of the agreement, even though those works are placed by someone other than the agent. If the author hires another agent, the author may end up paying commissions to both agents.
- What happens if the agency agreement is not renewed at the end of the term? In most cases, the agent will be entitled to commissions on all amounts received from deals negotiated or initiated by the agent during the term of the agreement, regardless of whether those amounts are received before or after the termination of the agreement. Upon the termination of an agency agreement, the agent should be required to give the author a list of all deals and pending deals for which the agent will claim a commission.
In some areas of the publishing business, having the right agent can mean the difference between success and obscurity. However, before committing to any agent, an author should always research the agent's background and reputation, and should insist on a written agreement that clearly spells out the terms of the agency relationship.