The Court of Appeal has upheld the High Court’s decision that Shaun Ryder’s contract with his former managers was valid. This means that Ryder (ex of the Happy Mondays and now of Black Grape) must pay damages of around £160,000 for breach of contract.
Ryder claimed that he signed the contract under undue influence and that its terms were in unreasonable restraint of trade.
The managers ignored amendments to their draft contract suggested by Ryder’s solicitor and presented it in its unamended form to Ryder for signature at a time when they knew he was stoned. Ryder signed the contract without reading it.
The High Court had found that:
- The term of the agreement (potentially 7 years) together with an entitlement in perpetuity to post-term commission at full rate, including on material released after the end of the term, meant that the agreement was in unreasonable restraint of trade.
- The managers’ behaviour meant that the agreement was not free from undue influence.
But, the court noted that:
- Ryder’s solicitor had doubted whether the contract was enforceable, but kept his views to himself because he thought it was in his client’s best interests to keep the managers on board.
- Also, Ryder’s solicitor had worked closely with the managers as Ryder’s spokesman and advisor and had behaved throughout as if there was nothing wrong with the contract. One example of this behaviour was that when a dispute arose over the commissioning of tour income, he relied on the terms of the signed contract, and only claimed that it was unenforceable after negotiations had failed.
The Court of Appeal confirmed the High Court’s view that Ryder could not deny the contract’s enforceability as, through his solicitor, he had acquiesced in its terms, in spite of their unreasonableness.
This decision shows that when an artist (or his/her representation) has acted as if a contract is valid, it will be difficult or impossible to claim later on that it is unenforceable. In this case, even though the courts thought that the agreement was in unfair restraint of trade and tainted with undue influence, they let it stand.