Article by Media Editor Nicola Solomon published in The Author of Summer 2008 Vol. CXIX No.2. Leading literary lawyer Nicola Solomon is a cnsultant with solicitors Finers Stephens Innocent (179 Great Portland Street, London W1W 5LS, tel. 020-7344-7652). She has kindly given AKME permission to reproduce this article, and can be e-mailed at nsolomon@fsilaw.co.uk.
The article is reproduced without any comment or editing by AKME.
One sign of an impending recession is that book projects get cancelled. Being asked by The Author to revisit my advice on what to do about a publisher who falls to publish a book is a sure sign of trouble ahead.
The reasons for cancellation are many: the sale or merging of publishing houses resulting in the axing of lists, financial constraints which limit publication to sure-fire bestsellers, or simply that the editor who was so keen on the project has left and their successor has other priorities.
An author's remedy will depend, first, on whether a contract has been signed. Sometimes an author submits a manuscript to a publisher who shows interest in publishing it but asks for major revisions, or a publisher discusses a project with an author but refuses to enter into a contract until an acceptable first chapter has been received.
Some publishers, particularly academic presses, are expert at such flirtation without providing definite proposals. The author carries out a large amount of work but finally finds that the publisher rejects it either without giving a reason or on spurious grounds of 'unsuitability', perhaps backed up by the opinion of an anonymous outside reader. It may be difficult to claim any compensation. The publisher will argue that the writing was simply a speculative venture and there was no implied promise to publish. Unless a promise can be proved from a written contract, exchange of letters (or even taped conversations), a judge may well agree. The golden rule is to ask the publisher for a contract at an early stage, or at least to give a guarantee that one will be given if a specific amount of rewriting is carried out satisfactorily. In some circumstances you may also be able to ask for payment of expenses and a set fee for rewriting, whether or not work is finally accepted for publication. At the very least, ask for a clear statement, in writing, of what is requested and what you will get in return.
If you are offered a contract, do not immediately assume that your work will be published. Instead consider its terms carefully. Some contracts do not contain any specific obligation to publish, and it is possible that a judge would find that a publisher's only obligation was to pay the advance on delivery. It can, however, be argued that where a publisher has signed a contract there is an implied obligation to publish, particularly if there was no advance, if a lot of rewriting has been carried out, if it is a field where publication is more important to the author than royalties (such as academic publishing or poetry) or if there has been correspondence promising publication.
Specific Performance
If it can be proved that a publisher has failed to publish, in breach of a contractual obligation, an author can apply to the Court asking for 'specific performance' forcing the publisher to publish. However, the Courts are very reluctant to grant this as specific performance is a discretionary remedy, and the Court may decide that the author can be adequately compensated by financial damages. A judge may take the view that a publisher who refuses to publish is doing so for good commercial reasons and should not be forced to make a financial loss. The author may claim that the book would have been a bestseller and would have made the publisher a large amount of money, but judges are likely to be more impressed by the evidence and views of a publisher - after all, the skill and profitability of a publisher depends on its judgment of which books are likely to be profitable (this is why most contracts allow the publisher to have complete freedom to decide when to publish).
Specific performance will be ordered only if the contract sets out the publisher's obligations in detail. Even when a contract contains a specific obligation to publish it will seldom commit to a minimum number of copies, or marketing or promotion of the work. Unless these details have been agreed or can be proved by reference to outside evidence (e.g. the book is being published in a standard format), the Court will not order specific performance since it would be worthless: the publisher could simply print two copies of the book and leave them lying in its back room. Specific performance will never be ordered if there is still editing work to be carried out; a judge would not want to be in a position of having to second-guess a publisher's professional opinion.
Compensation
Normally, therefore, the author's remedy for failure to publish is a sum of money to compensate for any loss. There is a widely held assumption that the only sum that can be claimed for failure to publish is the amount of the advance. This is not correct. The amount to which an author is entitled is the sum needed to put them in the position they would have been in had the book been published.
How is that decided? First one calculates likely royalties. If an author is able to point to a clear market for the work that existed at the time when the book should have been published it may be possible to obtain more than the advance. However this loss can be extremely difficult to quantify. Many authors, and particularly authors of fiction, write books in the hope that they are writing a bestseller, but most books are not bestsellers and indeed usually do not earn out the advance. A judge will base an award on what the author would have obtained if the publisher had carried out its minimum obligations. This speculative figure is likely to be based only on average earnings of the sales of previous works by the same author (or even similar works by the same publisher), although it will also take into account any money the author could reasonably have expected to receive from potential secondary sales - for example US, subsidiary and electronic rights. A very useful source of proof will be any sales forecasts and estimates of possible earnings given by the publisher when the contract was signed. An author may also claim loss of other revenue such as TV or lecturing fees that would have arisen because of publication. However these would have to have been foreseeable by the publisher at the time the contract was signed and be more than speculative; for example the author must be able to point to written contracts or offers for such appearances which were withdrawn when the work was not published.
A publisher will sometimes claim that no loss has been suffered by the author, and will simply offer to return the rights, saying that if the book is worthwhile the author will find another publisher. This can put the author in an impossible situation; if another publisher is willing to take on the book, it can be argued that the author has not suffered any loss. If no other publisher shows interest, this will suggest that the book was not commercially viable and the author would not have earned royalties even if it had been published.
To counter this, the author would have to prove that his inability to obtain another publisher was due to the original publisher's breach, perhaps by showing that the book was written specifically for that company and could not be resold without substantial amendment, or that its market had disappeared making it obsolete, or a competing work had in the meantime been published - or simply that the original publisher's failure to publish was widely known and undermined the book and the possibility of finding another publisher.
In addition to compensation for lost earnings, authors can claim compensation for the loss of opportunity to enhance their reputation. This can be useful in fields where publication is more prestigious than financially rewarding, such as education, particularly if failure or delay in publishing has rendered the book out-of-date or allowed a competing work to be published, preventing the author from publishing elsewhere.
Minimising the risk
Unfortunately it is not possible to claim damages for fees lost in respect of offers of other work turned down because the author was working on the rejected book - or for hurt feelings, loss of self-esteem, lack of self-confidence or the sheer time wasted in chasing one's publisher. Damages for failure to publish will almost never be enough to compensate for the actual damage suffered, and often all a lawyer can do is negotiate a return of the rights together with payment of agreed expenses and any outstanding advance.
You should therefore take steps that will help if your work is axed. In particular, check your contract carefully before signing and, where possible, ensure that it contains the following:
1. A grant of a copyright licence rather than assignment of copyright. Luckily in most subject areas, and largely because of the efforts of the Society of Authors, it is now rare to see book contracts that contain a total assignment of copyright rather than simply the grant of an exclusive licence to the publisher to publish the work. However such contracts are still common in book packaging, academic and multi-author projects. If you have assigned copyright for a one-off fixed fee you will have no redress if the work is not published, since the publisher's only obligation is to pay the fee.
2. Expenses. Ensure that you are paid expenses for research and revision, whether or not the book is published. In particular ensure that the publisher is responsible for any permission fees in the first instance even if it is entitled to recoup them from royalties payable to you later on.
3. Advance. Try to negotiate as large an advance on royalties as possible to cover the initial expense of writing and rewriting. If a publisher has paid a large advance there is an incentive to publish and recoup the investment. Furthermore, a large advance will allow you to claim more damages since you will be able to argue that projected sales of the work would have been high.
4. Delivery. Do not give the publisher the subjective right to reject a work if it is not acceptable. Ensure that it can only be rejected on objective grounds such as not meeting the original specification or not being of a similar standard to your previous work.
5. Obligation to publish. Ensure that the publishing contract contains an obligation on the publisher to publish the work at least in a hardback edition in the UK within a specified date from delivery of a satisfactory manuscript. Twelve months should be sufficient for most books. Ensure that the contract states that if the work is not published within that time you may cancel it by notice to the publisher and have all the rights revert to you. UnfortunateIy, even if you have terminated the contract by proper notice, it may be impossible to persuade another publisher to accept your work for fear of litigation if the original publisher refuses to accept that the contract was terminated (even if you offer the second publisher a guarantee and an indemnity that the rights belong to you). You would then have to apply to the Court to obtain a declaration that the rights have actually reverted to you.
6. Minimum publication. A counsel of perfection but, if you can, ensure that the contract states a minimum first print-run and details as to format, cover and price. Then if the publisher falls to publish you will be able to estimate with a good degree of precision the minimum amount you would have earned had the book been published.
The key point is always to keep in close contact with your publisher in the hope that problems can be averted at an earIy stage and so that you are not forgotten. In the fast-moving publishing world a new editor is unlikely to be interested in a project nurtured and encouraged by a predecessor, and close personal contact with more than one member of the publishing house can avoid you being a casualty of your editor's redundancy or job change.
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