elements of good association contracts sna national leadership conference colorado springs, co april...
TRANSCRIPT
ELEMENTS OF GOODASSOCIATION CONTRACTS
SNA National Leadership ConferenceColorado Springs, CO April 25, 2008
Jerry Jacobs, Pillsbury Law Firm, Washington, DC
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Agenda
• What is a Contract?
• Special Issues with Contracts
• Special Issues with Contracts for Meetings
• Reviewing Contracts
What is a Contract?
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Preliminary -- Recognition
– Letter/memo/brochure/deck/e-mail offering services or goods if association agrees (“agree” may be implied)
– Written on paper or not
– “Memorandum of Understanding”?
– Terms sheet, deal memo, letter of intent
– Most common non-obvious enforceable contract – exchange of letters or e-mails
– Distinguish “contract” from “partnership”
– ALL CONTRACTS ARE NEGOTIABLE
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Preliminary -- Definition
Understanding* between people or firms that creates a binding relationship; each has obligations; each expects something in return.
* “CONTRACT” = “AGREEMENT”
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Essential Elements
1. Offer
- Conditional promise
- Can be withdrawn before acceptance
- Can have time limit
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Essential Elements
2. Acceptance
- Assent to offer on its terms
- Any means ok unless specified
- Material change = counter-offer
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Essential Elements
3. Consideration
- Value exchanged
- Adequacy not an issue
- If unspecified, no contract
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No Contract without All Three Essential Elements:
1. OFFER
2. ACCEPTANCE
3. CONSIDERATION
Special Issues with Contracts
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Special Issues
1. Modification
- If contract exists, no modification unless all parties agree
- Discussion, assurance, promise, expectation, reasonableness all insufficient
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Special Issues
2. Authority
- Be sure representative has authority
- If representative says so, and is not obviously without authority, that’s enough
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Special Issues
3. Applicable Law
- Most states have equivalent law
- Does not affect jurisdiction
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Special Issues
4. Arbitration/Mediation
- Anything’s better than litigation (unless it’s not)
- Very dependent upon system/personnel
Special Issues with Contracts for Meetings
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Special Issues -- Meetings
1. Their form or yours?
- Rarely an option
- “Adhesion” doctrine inapplicable
- Alternative: addendum
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Special Issues -- Meetings
2. ”Block” vs. ”Reservation”
- Standard -- facility commits to hold space if sponsor commits to promote use
- Alternative: sponsor agrees to use
- Failure to use subject to cancellation/ penalty
provisions
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Special Issues -- Meetings
3. Cancellation
- Usually subject to conditions
- Penalties depend upon timing
- “Force Majeure” excuses cancellation
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Special Issues -- Meetings
4. Attrition
- Penalties if inadequate use
- Mitigation
Contract Review
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Contract Review – W I P I T
1. Warranty
- What precisely will be provided
- Include due dates for performance
- Include standards/criteria
- Include who will perform
- Must rely for breach or leverage
- INSIST THAT IT BE DETAILED
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Contract Review – W I P I T
1. Intellectual Property
- Must include (1) who’s providing copyrights, trademarks, mailing lists, (2) under what terms and (3) who owns what
- For copyrights, use license (permission) or assignment (transfer) unless work-for-hire
- For trademarks, use license and rules
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Contract Review – W I P I T
1. Payment
- Clear statement of payment terms, including schedule
- Consider payments stretched over time of performance
- Retain some amount until performance is concluded
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Contract Review – W I P I T
1. Indemnification
- Vendor/provider will protect association from claims arising from vendor/providers’ services
- Usually mutual, although association rarely has much risk
- If vendor/provider is small or poorly capitalized, consider alternatives – other vendors, insurance, limited engagement, closer scrutiny, acceptance of risk
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Contract Review – W I P I T
1. Termination
- Clear statement of term and end of contract
- Doesn’t have to be equivalent
- Specify return of materials, delivery of partially-completed work, relinquishment of IP whether or not there’s a dispute
- Pro’s and con’s of arbitration/mediation
- Anticipate and address worst case
