How To Avoid Common Agent Contract Missteps (Part I)

Some of you may not need much of an explanation about the role an agent typically plays in the commercial publishing world.

Others of you may not understand the first thing about what an agent is supposed to do for a writer. Maybe you’ve been to a conference or two and always wondered why there are long lines of sweaty, hand-wringing writers waiting to have two minutes in front of an agent to pitch their manuscripts. I hope I will be able shed a little light on an agent’s role and the legal document (the “agency contract”) by which you and your agent will become bound (if you elect to have an agent).

Publishing Contract Versus Agency Contract

I will be referring to two types of contracts in this post. The “publishing contract” is an agreement between you (the writer), and a publisher. For the publishing contract, you (or your agent) will negotiate with a publishing house the terms of publication, whereby they will publish your book in exchange for payment made to you.

The “agency contract” is an agreement between you (the writer), and an individual acting as your agent who will not pay you. Rather you pay the agent (typically a “commission,” which is a percentage of what the publisher pays the writer pursuant to the “publishing contract”).

Once you’ve entered into a contract with an agent as it relates to your manuscript, the agent’s job is to take the manuscript, and submit it to particular editors (who work for various publishing houses), with the hope of selling them the right to publish the work in exchange for a copious (or even just a modest) amount of money. At least that is the hope.

It should be noted that not all published writers of commercial fiction have agents. Some writers attempt to bypass the agent’s customary role in the process and work directly with a publisher. Other writers self publish their work without any help from an agent. This can be done and some people have earned many shades of green self-publishing their own works.

However, if you want your manuscript published with a traditional publishing house, your chances are typically much improved if you have an agent out in the market trying to find a buyer for your work. Before you get to the moment where the copious amounts of money flow from the publisher to your bank account, you will have to make some important decisions and certainly take some legal actions as it relates to your agent and the publisher. In light of that reality, I’ve outlined some mistakes you want to avoid when it comes to decisions about your agent. I will cover one potential mistake this week and additional mistakes in part two of this post next week.

Mistake 1: Thinking You Have No Use For An Agent

I have a friend who, like me, is an attorney and an aspiring writer of commercial fiction. We were chatting recently and he told me he hopes to avoid using an agent. His rationale was that if he sells his manuscript to a commercial publisher without the assistance of an agent, he won’t have to give the agent a cut of his royalties. Seems simple enough. He is a smart guy and I am sure he has the legal acumen to negotiate a binding legal contract with any publisher that might want to publish his book. But he may be making a mistake because an agent does much more than ensure the publishing contract is legally enforceable.

When you sign a contract with an agent to represent you, there are two important legal concepts that should control how the agent operates. First the agent has a duty to promote your professional interests. This means that she or he should be pursuing opportunities that are in your best financial interest. The best agents will also look beyond just what is best for your immediate financial interest and will consider what is best for your future development as a writer. If you have offers from two publishing houses, and one has a fantastic editor eager to work with you, while the other can afford to pay more upfront but might not be as good of a fit for your long-term progress as a writer, the agent should take that into consideration in the advice they provide.

The agency agreement also typically gives the agent some legal authority to take actions on your behalf. In this regard, you want to make sure their legal authority is limited. They should not be able to sign a publishing contract on your behalf without your express written consent.

How else does an Agent help?

Having one more person on your team, helping guide your career, is beneficial. This is especially true in a career that is largely practiced in isolation.  Also, some agents can provided editorial comments to your work. Not all agents will do that, but if that’s something you want, you might keep it in mind as you consider possible options. An agent can also help a writer navigate the negotiation and contract process preceding the sale of foreign rights to a manuscript (sometimes working with a co-agent who specializes in the international market).

Most agents, (unless they are relatively new), have established relationships with editors working for various publishers. These editors should trust that when the agent submits a manuscript to them, the agent is doing so because the manuscript is a good fit for that editor and their imprint. At every writer’s conference I attend, I am reminded that editors receive submissions so numerous that they cannot possibly read them all. Often, completed manuscripts sit in what are sometimes referred to as “slush piles” for months before getting even a moment of attention from an editor. In fact many are deleted or tossed in the bin before the second sentence is read.

Once your agent has put your manuscript in front of the particular editors that are looking for manuscripts similar to yours, your agent should advocate for your work to make sure it is given sufficient attention.

Ultimately, if the editor is interested, your agent should also have the experience in the industry to negotiate the best deal possible. And they will have incentive to strike the best deal they can because . . . well, you will have to read Part II of this post next week to get the full explanation of their proper motivation.

What services will the agent perform in exchange for the right to be paid a “commission”? The agency contract should certainly oblige the agent to use their commercially reasonable best efforts in marketing your manuscript. This doesn’t mean that they have to jump in front of a moving car to get the attention of an editor who is behind the wheel, but it does mean they should make legitimate efforts to market your work and should be diligent in following leads and corresponding with potential editors.

The contract should also call for the agent to track the royalties and make sure you are getting paid all that you are entitled to. Although you should be able to trust that they are carefully monitoring the payment of the royalties, it is still a good idea to make sure your agency agreement allows you to have access to the payment and royalty records so that you (or your accountant) can audit the records to make sure everything is being done properly.

Tune in next week if you are interested to hear about what writers should understand when it comes to how the money flows in the contexts of an agency contract as well as some other details to keep in mind when reviewing a proposed agreement.

Please submit any questions or comments about this post below. I’d love to hear from you.

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