Event Organizer's Obligation Overlooked: Potential Legal Fallout from Wizkid's Non-Performance
It's that jolly time of the year again, and Accra, Ghana, is bustling with tourists and locals alike, as Christmas festivities take over. While the town is adorned with dazzling billboards promoting a plethora of events, it's this time of the year again when show cancellations seem to be inevitable.
Just a few days ago, on December 11th of 2022, headlines announcing Wizkid, the Essence Hitzmaker, and the headline act for Live Hub's "Wizkid Live Concert," along with King Promise, not showing up sent shockwaves across the entertainment industry and music fans. This no-show, coupled with previous instances of high-profile artists like Shatta Wale and Kizz Daniel, has become a recurring theme in the industry, causing financial and reputational damage to event organizers.
Arguably, this lackadaisical attitude towards contracts stems from a mix of arrogance, insensitivity, and vanity displayed by artists. The concerning part is that there are rarely any legal consequences for these breaches. The public's quick acceptance of flimsy apologies and short memories have led to this issue persisting and even escalating.
This is a pressing concern for event organizers, creatives, the entertainment industry as a whole, and the general public. Legal professionals have often described discussing this matter as beating a dead horse, as event organizers and members of the entertainment industry are hesitant to seek legal counsel. Furthermore, some education on the subject is necessary in this sector due to the increasing complexity of these issues.
In the following sections, I will elaborate on the importance of a written contract, suggest essential clauses to safeguard both parties' rights, discuss feasible conditions that can be considered breaches of the agreement, and recommend remedies for the relevant parties— primarly focusing on event organizers and artists.
The Necessity of a Written Contract
From casual agreements to complex business deals, contracts are essential in governing our lives. Once promises are exchanged, and obligations are met with an exchange of money or other consideration, a valid agreement is formed. However, not all agreements translate into legally binding and enforceable contracts. A contract is a legally enforceable agreement containing obligations.
In the entertainment industry, verbal agreements are all too common, except they are often not legally enforceable. Some event organizers might download contract templates from the internet, alter them to suit their needs, but this practice represents a significant oversight. The primary mistake here is the failure to acknowledge the need for a formal, written contract.
At law, a contract must consist of the following elements:
- A lawful offer
- Acceptance of the offer
- Intention by the parties to create legal relations
- Lawful consideration
The importance of these fundamental principles cannot be overstated. They form the bedrock of every legal and binding contract and underscore the criticality of having a written contract to clearly outline all parties' obligations and expectations.
The Inclusion of Standard Clauses
In every commercial agreement, there are standard terms known as 'boilerplate' clauses. These clauses, when drafted with care, can offer some measure of legal protection to both parties. Key boilerplate clauses include:
- Scope of the agreement
- Jurisdiction clauses
- Notice clauses
- Confidentiality clauses
- Arbitration clauses
- Amendment clauses
- Choice of law
- Termination clauses
- Force Majeure clauses
It is strongly advisable to have a lawyer review some of these agreements to ensure they are watertight.
Protective Clauses for Event Organizers and Artists
Cancellations and non-appearances at concerts and shows are becoming increasingly prevalent in the entertainment industry. As such, I propose three essential clauses to safeguard the interests of all parties: cancellation clauses, penalty clauses, and indemnification clauses.
Cancellation Clauses
Cancellation and termination clauses are often misconstrued, as they cover different aspects of contract termination. Termination generally encompasses the power to cancel events due to unforeseen circumstances beyond the control of the parties. These clauses can be consolidated, but for the sake of clarity, it's crucial to separate the events.
Artists sometimes pull out of events at the last minute without providing advance notice, causing frustration and financial loss for event organizers. To prevent similar situations, it's crucial to include a cancellation clause in the contract. This clause should explicitly define valid cancellation scenarios and the required notice length.
Penalty Clauses
Event organizers may bear the brunt of financial losses when artists cancel, especially when it comes to mobilizing logistics, investing in human resources, and covering other expenses. Including a penalty clause in the contract can offer some protection against these losses.
A penalty clause could be liquidated, unliquidated, or propose a refund of the deposit. A liquidated penalty clause determines a specified sum to be paid in the event of a cancellation outside the scope of the contract's provisions. An unliquidated clause establishes general liability for payment upon cancellation, while it may also be wise to consider a refund of any deposit payment made to the artist before their performance at the event.
Indemnification Clauses
Indemnification is a standard clause in most commercial agreements, but surprisingly, it's often absent in event contracts. Indemnification clauses provide protection for one party against losses or damages incurred due to the negligence of the other party.
In the event of a cancellation, the furor that ensues among fans can lead to potential class-action lawsuits against event organizers. While Live Hub, the event organizer in the Wizkid Live Concert case, has committed to refunding fees for all attendees, the situation highlights the widespread anger among music fans when artists fail to perform as contracted.
Indemnification clauses can provide some measure of protection from such legal actions. While Live Hub cannot be held accountable for Wizkid's no-show, an indemnification clause would offer additional protection in such situations.
Conclusion
There are many ways to tackle a problem, and the tumultuous relationship between event organizers and artists in the entertainment industry is no exception. It is essential to inject a term of professionalism into the scene, starting with the creation of written contracts. The indomitable spirit of concert-goers demands that we put an end to the disregard by artists towards event organizers and fans. The solution lies in implementing written contracts, including protective clauses like cancellation clauses, penalty clauses, and indemnification clauses.
The writer is an associate at Sustineri Attorneys PRUC, with an interest in Commercial Transactions, Intellectual Property, Energy & Mining, ESG, and Dispute Resolution.
[1]Gizmodo, "Why Canceled Shows Have Gotten So Insanely Expensive," accessed on July 22, 2023, https://gizmodo.com/why-canceled-shows-have-gotten-so-insanely-expensive-1843394340[2]Live Nation, "Refund Policy for COVID-19-Related Cancellations," accessed on July 22, 2023, https://www.livenationentertainment.com/covid19/[3]AEG, "Refund Policy & Info," accessed on July 22, 2023, https://www.aegworldwide.com/us/terms-guard/refunds/[4]Bloomberg Law, "U.S. Senate Confirms Lina Khan as FTC Chair," accessed on July 22, 2023, https://news.bloomberglaw.com/technology-and-privacy/us-senate-confirms-lina-khan-as-ftc-chair
- The necessity of a written contract is crucial in the entertainment industry, where verbal agreements are common but often not legally enforceable.
- A valid contract should contain fundamental principles such as a lawful offer, acceptance, intention to create legal relations, and lawful consideration.
- Standard boilerplate clauses, such as scope, jurisdiction, notice, confidentiality, arbitration, amendment, choice of law, termination, and force majeure clauses, can offer legal protection to both parties.
- Protective clauses like cancellation, penalty, and indemnification clauses can address issues such as artist cancellations, financial losses, and potential legal actions related to concert cancellations.
