Contracting with minors in the entertainment industry can be a legal minefield. From talent bookers and modeling
agencies to technology start-ups and other computer software companies, the
predicament of employing or contracting with a party under the age of eighteen has
become an increasing problem. The minor is not bound by the contract and may
disaffirm the contract at any time during minority or within a reasonable time
after reaching majority. Without a valid written agreement the employment is
“at will” under the law of most States which means the minor can depart at any
time. The dilemma created by a minor’s ability to disaffirm a contract is that
it may seriously jeopardize the employer’s financial investment in the services
of the minor whether it is the ongoing efforts of an agency to develop the
career of a young talent or the technology company’s expectation that is owns
the copyright in the code created by the teenage whiz kid it employs.
The mere exercise of having the
parent or guardian of the minor co-sign, approve or “guarantee” the contract
does not resolve the problem. The minor may still repudiate the contract on the
ground of infancy, asserting that the parent or guardian lacked authority to
make the contract. In some jurisdictions, Courts deem it against public policy
to even enforce such guarantee language against the parent or guardian since it
would subvert the purpose of the laws concerning the judicial approval of
contracts with minors. So-called “working papers” under State law might work
for purposes of a fast food chain or similar hourly wage employment but are probably
insufficient for talent agent, modeling agency or technology company purposes.
Several States, including New York and California ,
have laws specifically concerning judicial approval of contracts with minors. New York 's Arts and
Cultural Affairs Law §35.03 provides for judicial approval of certain contracts
for services of "minors" under the age of 18. The procedure involved
can be somewhat arduous to navigate, and may prove to be a difficult gauntlet
to run for a lawyer inexperienced in this area. However, a company employing
minors or contracting with minors should investigate the efficacy of pursuing
court approval to protect their investment. Once the Court judicially approves
the contract, the minor is held to a standard of adult responsibility for its
contractual obligations assuring the employer company that it will get what it
bargained for and that the contract is legally valid.
As a practical matter, a proceeding
for judicial approval of a minor's contract in New York is commenced by the filing of a
verified petition. It can be filed by a parent, the guardian, a relative of the
minor or any interested person or entity such as the employer. The petition
must contain a statement of the length of the employment term, compensation,
and all other relevant, material terms of the agreement. A complete copy of the
proposed contract must be annexed to the petition together with affidavits from
the parents and/or guardians that consent to the petition and support the
facts.
In
addition to identifying the details of the nature of the minor's employment and
the compensation to be paid, the petition must also contain a statement of who,
other than the minor, is entitled to the minor's earnings and facts regarding
the property and financial circumstances of the parent or parents so entitled.
The petition may nominate a person to be appointed as limited guardian solely
for purposes of establishing a trust account for the proceeding and should set
forth the reasons why the person nominated would be proper and suitable.
Although a lawyer is usually appointed, a parent or other petitioner is not
precluded from being appointed as limited guardian by reason of his or her
interest in any part of the minor's earnings or in the contract provided such
interest is disclosed. The Court will designate how much is to be set aside and
saved for the minor under guardianship until the minor becomes 18 years old. The
court also has the option to appoint a special guardian to represent the
interests of the minor at any time after the petition is filed.
As
directed by the Court, before the time at which the petition is noticed to be
heard, certain persons (other than the petitioner and anyone who has joined in
the petition) must be served with an order to show cause why the petition
should not be granted: (1) the minor; (2) the parents of the minor; (3) the
minor's guardian(s); (4) each party to the contract; (5) any person having the
care and custody of the minor; (6) the person with whom the minor resides; and,
(7) the minor's spouse.
An
order granting judicial approval of a contract for the services of a minor will
rarely be granted on the papers alone. Usually a hearing is conducted at which
the minor, the parent(s) and the various other interested parties may be
questioned by the Judge regarding the contract. A Judge may require provisions
in the Court’s order concerning how many hours the minor can work and may
require that the employer provide tutors if regular schooling will be disrupted
by the employment. Most terms and conditions of each arrangement will be
affirmed as long as they are found by the Court to be reasonable and not
contrary to the best interests of the minor. Once the court does grant
approval, an order will be issued which will, in effect, declare the minor an
adult for purposes of fulfilling his or her contractual obligations.
Once a Court does grant approval, an
order will be issued which will, in effect, declare the minor an adult for
purposes of fulfilling his or her contractual obligations. Then all the results
of the minor’s services, including commissions due on the bookings by a talent agent
or modeling agency and any copyrights in code or apps created by a minor during
employment by a tech company, will be properly transferred as bargained for by
the employer.
WALLACE E.J.
COLLINS III, ESQ. (Tel: 212 661 3656) is a New York lawyer practicing primarily in the
areas of entertainment and intellectual property law. He was a songwriter and recording artist for Epic Records before receiving his law degree from Fordham Law School . T: (212) 661-3656; www.wallacecollins.com
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