Development Agreements for Producers – This Option or That?

When producing a film or TV programme, it is important that the production company has the necessary rights to do so.

This starts in the development stage of a project and is crucial for the financing and exploitation of a production. This article gives a general overview of some of the common types of contracts used by producers in this situation.

Underlying work

If a project is based on a work that has already been created (such as a book, play or an existing script), an ‘Option and Purchase Agreement’ with the author or owner(s) of the work is generally the preferred type of contract to use. However, an ‘Assignment Agreement’ is another type of contract in which ownership of rights can be transferred from one party to another.

An Option Agreement grants the producer the right to develop the project, with the ability to purchase the rights if they wish. This allows a producer to “test the waters” without committing wholly to buying the work straight off and can reduce the upfront financial cost and the risk that the project may not go anywhere. The option will be for an initial period (it should be long enough to allow the producer to have a script written and to try to arrange financing), with the ability to extend the option period if required.

It is important to remember to negotiate the terms of the purchase component of the Option and Purchase Agreement at the same time as negotiating the terms of the option. This ensures that the terms are clear and settled from the start, avoiding surprises and the risk of not being able to reach agreement later.

New and original work

If a producer is instructing a writer to prepare a completely new and original script or treatment, then a ‘Writer’s Agreement’ is likely to be the most appropriate type of contract to use. In this agreement, the producer commissions the writer to write the script on the producer’s behalf with the producer owning the script.

Summary

It is also worth noting that there will be a range of other rights a producer will need to obtain throughout the production stage of the project, in relation to music, stock footage and so on.  

Getting early legal advice specific to your project is important. Keep in mind that it is much easier to ensure the contracting for the rights is done correctly from the beginning, rather than needing to have agreements varied and re-executed later down the track.

For More Information:

 For further information or to arrange an initial consultation with one of our Wellington-based media lawyer, contact Andrew Stewart, email andrew.stewart@morrisonkent.com, phone (04) 495 8921.