SFWA Contracts Committee Advisory on No-advance Contracts

WANAL, but SFWA offers some suggestions regarding no-advance contract

Recently, SFWA’s Contracts Committee was made aware of a situation in which a well-liked publisher canceled the publication of a number of books it had contracted to publish. The publisher said the decision was made because of “unexpected changes” at the company.  The Committee has reviewed the contract in use, which lacked a provision for such a cancellation.  The Committee believes that canceling a contracted book that satisfies the author’s obligations is at odds with the spirit of the contract. Making this situation worse is the fact that these were no-advance contracts.  Because no advance was paid, the publisher could make this decision without financial penalties. The authors’ books, were, in effect, put in limbo for many months and the authors received nothing but an apology.  Besides depriving the authors of the ability to sell the books elsewhere during this delay and putting off any income from the books into the indefinite future, the authors’ careers suffer as a result.

Publishers of all sizes may find themselves unable to live up to their contractual commitments for a wide variety of reasons, some of which could not have been reasonably anticipated. Hence, the Contracts Committee urges writers to think carefully about signing a contract that provides no advance, or only a nominal advance, while tying up their work for a lengthy period of time. Critically, payment of an advance gives an indication the publisher actually has the financial resources to meet its obligations. Publishers who do not pay advances or pay only nominal advances should include language in their contracts specifying how they can cancel a book and what happens if they should cancel a book, including a specified amount of compensation to the author.

SFWA Contracts Committee

October 25, 2019

Legal Disclaimer: The contract alert should not be understood to be legal advice.  The issues presented by contract law are complex. Authors should consult a competent attorney familiar with the business of publishing as well as contract law before signing any contract.

This article was originally posted on
https://www.sfwa.org/2019/10/sfwa-contracts-committee-advisory-on-no-advance-contracts/

Editor’s Note:  File 770 offers some additional insight here (Item #2)

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