Selling art is the primary source of income for most commercially successful artists, and is the strongest aspiration of most of up-and-coming artists. It is not surprising that most important legal concern of artists is dealing with buyers, whether individuals or art studios.

Contracts: the basics

Whatever the artist and the buyer wants from a deal, it is vital that both parties have a basic understanding of how legally binding and enforceable contracts are made under Singapore law. The vast majority of problems between artists and buyers stem from one or both party's lack of understanding about the basics of commercial dealings. There is sometimes a sentimental attachment to the notion of having a 'gentleman's agreement' with each other will suffice as they are dealing with honourable people. This attitude is not only arcane but also unrealistic. Nor is it good for business.

In Singapore, a commercial deal is not generally required to be made in writing or in any other prescribed way for it to be legally binding and enforceable (notable exception are deals involving ownership of land or buildings). This leaves the parties free to arrive at their agreements by whatever method they chose: a petrol station is making a commercial offer which is accepted when the petrol is pumped to the customer's car. An offer, once accepted, concludes the commercial deal - it is a valid contract, although not a written one. It is dangerous, therefore, for complex commercial offers to be made and accepted verbally. One or both parties may not appreciate that they have made a legally binding commercial contract; they may not have discussed and settled all of its details, and either or both of them may well forget precisely what they said - several years later when things go wrong. It follows, therefore, that although the law does not generally require a written record of the terms and conditions of a commercial deal (if necessary, the parties' imperfect recollection will be required as evidence in court to prove or defend a case) it is common sense and best practice to do so.

Contracts: good practice

Most commercial deals can be successfully achieved, if both parties follow five basic good practices: (a) prepare; (b) negotiate; (c) record; (d) confirm; and (e) store.

Prepare. Experience teaches that parties contemplating a contractual negotiation are well advised not to jump in firing from the hip, but to prepare themselves for a careful, considered and structured negotiation. Artists are particularly vulnerable in this respect - the less experienced, the more so - and need to prepare themselves thoroughly beforehand. Preparation sensibly includes researching as much hard information as possible about the prospective buyer, especially if they are studios (its owners, track record, successes and failures, and its artists). The internet makes this task a lot easier than it was in the past. Other preparations include working through a checklist of 'must-have' and 'nice-to-have' items that will need to be discussed and settled with, say the studio in the negotiations.

Negotiate. Negotiations may take the form of meetings, phone calls, faxes, emails and letters - all of these things, singly or in combination, will form the basis of the eventual contract. Experience teaches which items are essential or secondary, and artists especially need to ask themselves, and decide, where the bottom line is for them in each respect. It is perfectly normal and good professional practice to take a list of prepared items – an agenda - into all such meetings for these purposes.

Record. Contemporaneous notes should be made of the essential elements of any conversation held between the studio and artist at any time. These can be used as an aide memoire for later negotiations and, in the worst case scenario, in court to assist the artist giving evidence to remember events that took place several months, probably years, earlier. It is sensible, therefore, always to date, time and sign such contemporaneous records when completed.

Confirm. Confirmation to the other party of the details of any dialogue, once completed, is essential. In other words, after a relevant conversation (face to face or by phone) between the parties, each should use their contemporaneous notes to write to the other confirming what transpired. Make it a habit to settle at the end of such a conversation who writes first to whom: “Shall I write to you or you to me?” This practice generates further indelible evidence for future use, if necessary.

Store. Keeping a copy of all letters sent, especially of the kind under discussion, is a golden rule of any business - so often honoured in the breach rather than in the observance. Faxes can be very helpful, but the technological hiccups that can afflict the use of email or other IT transmissions, cause most commercial negotiators to print and file away the hard copy.

If the negotiations are lengthy and detailed or involve substantial obligations including the payment of large sums of money, it is good practice to consider ending a negotiation with both parties finally agreeing that their contract will only come into effect after it has been recorded in a single document signed by both, with each having a signed copy. This is especially important for commissioned works or when dealing with studios.

That is where lawyers will be a useful, sometimes essential, expense. Spending the money at this point of time could save an artist much more if any disagreement results in a court case.

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Sample Checklist

This is just a sample checklist of things to include when negotiating for a studio exhibition. As the situation for each exhibition will be different, this checklist is no way exhaustive nor definitive.

• parties' names and contact particulars.
• artist's promise to provide works for showing (and sale); studio's promise to show (and sell) them.
• venue: dates, places and spaces
• works: which - existing or projected
• delivery: by whom, when, where and at whose expense
• hanging: by whom and when
• collection: by whom, when, where and at whose expense
• damage/destruction/theft: who pays, how much and when
• insurance: who arranges cover, for what amount and at whose expense
• studio opening hours: days and times
• invigilation: by whom, when and how and at whose expense
• publicity; what will be done, by whom, when and at whose expense
• private view: what will be done, by whom, when and at whose expense
• agency: whether the studio is to be given exclusive selling rights before/during/after the exhibition;
• selling prices, discounts (if any), commission to the studio;
• arrangements for written documentation of all sales including: buyers' contact particulars, price, method of payment, whether GST is/is not payable, and the studio's commission.