How do I Draft my Creative Agency Agreement’s Obligations and Rights Clause?

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Table of Contents

• Services
• Performance of Obligations and the Agreement
• Approving Activity
• Personnel and Staffing
• Warranties and Representations
• Conclusion

When engaging a creative agency to undertake your marketing work, such as creative advertising content, digital campaigns and generating new ideas for your business, both parties need to be sure that a written agreement clearly sets out their rights and obligations. As both parties will have recorded and agreed to their obligations, a written agreement can help mitigate potential disputes that can arise. Below, we set out some of the rights and obligations your creative agency agreement should include.

Services

Importantly, you should take steps to ensure that the creative agency provides the services described in the contract, and undertakes them with due care and skill. You should also clearly state that the creative agency must comply with any reasonable directions that you give in your capacity as their client. Consequently, you should clearly describe the services so that the creative agency understands your expectations.

Performance of Obligations and the Agreement

As a client, you will be interested in the terms protecting you and your business and minimising your risk. For example, you will need to ensure that the creative agency,

• Satisfies all of their obligations with regards to your business;
• Performs their services adequately; and
• Does not breach any third party rights.

Approving Activity

The creative agency should not undertake any activity without your approval. Your brand and appearance are critical to your business’ success, so you should explicitly state that the creative agency will not undertake advertising without your consent.

Personnel and Staffing

As a client, you should make clear you expectations as to how the creative agency will perform the services. For example, how the agency’s personnel are performing. Your agreement should also address:

• Performance levels you expect the agency to meet;
• Whether or not you will allow subcontracting; and
• Whether you would likely limit the subcontracting work.

If you are considering permitting subcontracting, you should include an additional clause allowing you to approve the subcontracting work.

Warranties and Representations

As a client, you should protect your business by requiring the agreement to address the required warranties and representations of the creative agency. You must also set out that the creative agency will indemnify you in relation to the agreement and the relationship. You should make sure that you limit your liability, and protect yourself against any negligence. For example, you may brief your creative agency for a particular campaign and allocate a specific budget. What will happen if the costs exceed the budget? Who will be responsible? Who will pay the excess spent on the campaign – the agency or the client? In order to preserve relationships moving forward, your agreement should address these potential issues.

Conclusion

Having clear rights and obligations in your creative agency agreement can make the relationship between you and your creative agency easier and prevent issues arising later on.

LegalVision can assist you with other legal needs including drafting your commercial or employment contracts. Our experienced consumer lawyers are also well placed to assist you with any marketing or advertising law issues that you require assistance with.

Questions? Please get in touch on 1300 544 755.