Legalities 24: Non-competition contracts

Linda Joy explains why you don’t have to sign a new non-competition contract before getting paid for your work

Q. I was hired to do some travel book illustrations for a studio working with an outside publisher. No mention was made of who their client was at the start of the project. It was always referred to by the studio merely as “our client.” I assume that was to protect the studio’s interests. The work is done and my invoice has been submitted.

Weeks later I got a “confidentiality agreement” that the studio admits they should’ve sent me before the job even started. In this forgotten contract I found out that the publisher is a major publisher to whom I’ve sent illustration samples before and plan to again. But there’s a non-competition clause in the contract that states I “shall not solicit [the publisher] for 3 years after completion” of this project I’ve just finished.

What are my legal rights and responsibilities here? Certainly, I have no plans to try to edge out this independent studio in the travel book business; it was just a job I picked up for a little extra cash. But I certainly have plans to continue to send my art to this publisher. Apparently I cannot get paid for the travel book job until this confidentiality form is signed. What next? Thanks.

A. There are a couple reasons why the studio cannot legally make you sign this new confidentiality agreement before they pay you.

1. Contract law

First, the confidentiality agreement was not part of the original contract you made with the studio. In contract law, contracts are defined by the concepts of “offer and acceptance” and “consideration.”

“Offer and acceptance” means that a legally binding contract is made only when one side has made a final proposal, or “offer,” and the other side has agreed to all the same terms in that offer. “Acceptance” can be oral or written, or evidenced by doing the work that the agreement called for. In your case, you have already performed your duties under the contract by delivering the illustrations, and that means you accepted the agreement on the original terms. That created the contract. It’s too late for the studio to change its offer.

“Consideration” means something of value has been exchanged between the parties making the contract. This means each side promises to give something to the other. A contract is not legally valid without this mutual consideration. Usually, the client gives money, and the artist gives illustrations (or more accurately, the right to reproduce illustrations). However, a promise not to compete is also a kind of consideration. It requires you to give up something of value, i.e., your right to solicit new assignments, and thus you are promising to limit your ability to make a living.

So what’s happening here in contract parlance is: the studio is now asking you to give new consideration, i.e., a new promise not to compete. However, you have already fully performed your obligations under the original contract on the original terms. In that original contract, you agreed to a level of consideration from the studio (a certain monetary payment) based on the consideration you were providing in exchange (rights to reproduce your illustrations). That was the offer that was accepted.

The new non-compete agreement is a new contract asking for more consideration from you. As such you have the right to accept or reject it, and if you decide to accept it, you are entitled to new consideration from the studio in return for this new non-compete promise.

Unfair competition law

Second, the non-competition clause interferes with your right to pursue your livelihood as an illustrator. Any attempt to force this agreement on you violates unfair competition laws which protect you against such interference.

I would explain to the studio that you have already complied with your obligations under the original contract, and they are legally obliged to pay you for that work. Explain that you had already been in contact with their client before this project, and you need to be able to continue submitting projects to that publisher. Had you been shown this non-compete clause when the project started, you would not have been able to agree to it.

To facilitate an amicable resolution, you can offer a compromise, for example, you could agree not to submit specifically travel book ideas, but retain your right to continue submitting your artwork for other projects to the publisher.

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Legalities is a service mark of Linda Joy Kattwinkel. © 2006 Linda Joy Kattwinkel. All Rights Reserved. The information in this column is provided to help you become familiar with legal issues that may affect graphic artists. Legal advice must be tailored to the specific circumstances of each case, and nothing provided here should be used as a substitute for advice of legal counsel. Linda Joy Kattwinkel is an attorney, painter and former graphic artist/illustrator. She practices intellectual property law, arts law and mediation for artists in San Francisco. She can be reached at 415-882-3200 or

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