Athletic Contracts

In the world of sports, the glitz and glamour on the field often obscure the intricate dance that happens behind closed doors. These meticulously crafted documents serve as the lifeblood of the athlete’s career, intertwining ambition with accountability, and money with milestones. From soaring multimillion dollar deals that bring dreams to life, to the delicate clauses that can make or break a player's future, you can trust us in assisting you in these matters.

What is a contract?

A contract is a legally binding agreement between parties. It is crucial that the terms of the deal be set forth precisely to help ensure performance by all parties and prevent disputes later on. In the sports world, contracts may be necessary for a multitude of reasons. This ranges from a professional service contract between an athlete and a team to endorsement deals or appearance fee agreements between an athlete and a company.

The Elements of a Contract

1. An agreement

An agreement occurs when an offer made by one party is accepted unconditionally by another party. This is often referred to as “a meeting of the minds.” 

2. Between competent parties

Only people with legal capacity can enter into a legally binding contract. In California, this generally means that minors are precluded from entering into such agreements. The main rationale is to protect against potential carelessness and to prevent others from taking advantage of their inexperience or unsophistication. If a party does enter into a contract with a minor, the minor can disaffirm the agreement prior to turning 18, making the contract unenforceable.

There are exceptions, however. Under California law, a court can approve the contract if it’s an employment contract for artistic or creative services, or a contract where the minor agrees to provide services for an athletic endeavor. Under these circumstances, the contract, once approved by the court, becomes legally binding. Typically, the minor’s guardian petitions the court for approval of the contract in these circumstances.

With amateur athletes now being allowed to monetize their name, image, and likeness, it is important for parents to understand their role in ensuring a contract is valid. 

3. Based upon the genuine assent of the parties

What happens if one or both of the parties find a mistake in the agreement after both parties have signed it? Generally, if the mistake was unilateral, meaning it was made by only one party to the agreement, it will not void the deal. If both parties made the same mistake and performance of the contract can no longer be performed, it may be voidable. 

What happens if a party signs an agreement without reading the fine print and later realizes an issue? With few exceptions, the signer is still bound by the contract terms. The law places an expectation that competent adults will either read and comprehend the terms on their own or seek assistance in understanding certain terms where needed. As such, it’s always helpful to seek legal guidance when reviewing a contract.

4. Supported by consideration

Consideration is the main part of a contract and is often referred to as the “bargained-for exchange.” Simply put, it is the benefit that each party gets in exchange for what it provides. Without it, a contract is not enforceable.

Further, consideration must be something worth bargaining for, must benefit each party to the agreement, and must be something of value. Most people often associate consideration with money, but it can also come in other forms, such as a service or promise.

A common example in a sports context is where an apparel company pays an athlete to promote its product on social media: the money paid to the athlete is consideration as is the athlete using his or her influence to promote the apparel in an attempt to boost sales.

The word “consideration” does not need to be explicitly stated for a contract to be valid, but it is still important to have an experienced attorney review the draft contract and/or review the contract to ensure that it satisfies each requirement. 

5. Made for a lawful objective

If the core purpose of the contract is illegal, then it becomes void. Using an NIL example, if a university promises to pay an athlete for attending its school (in addition to allowable benefits from a full scholarship) but then reneges on the agreement, the athlete would likely have no recourse against the school for breach of contract because under NCAA rules, universities are not permitted to pay athletes directly. Therefore, it is important to know the rules and/or law underlying the agreement prior to entering into it to prevent it from being enforceable.

6. In the form required by law

Generally, a contract may be written or oral. In California, certain types of contracts must be in writing to be enforceable. These include but are not limited to: an agreement where the terms cannot be completed within a year, certain provisions pertaining to selling or leasing real estate, and where the agreement cannot be performed during the lifetime of the promisor. Whether you need assistance interpreting or drafting a contract, we handle all aspects to ensure your rights are protected.

What happens when one party breaches the contract?

In that instance, the plaintiff (i.e. the non-breaching party) may file a civil breach of contract case. In order to prevail, the plaintiff must prove (1) the existence of a contract, (2) the plaintiff’s performance of the contract or excuse for nonperformance, (3) the defendant’s breach, and (4) the resulting damages.

Generally, contract damages are limited to those that were contemplated by the parties at the time they entered into the agreement, or were at least reasonably foreseeable. The idea is that the plaintiff should be made whole as if the defendant had performed its end of the deal. Damages beyond the expectations of the parties, known as consequential damages, are typically not recoverable.

Why Choose Us?

Expertise and Experience

Our firm has successfully assisted numerous clients in the entertainment and sports industries. This includes extensive experience in contractual matters, intellectual property protection, and personal injury claims. We stay up to date with the latest changes in the law and in the industries in which our clients operate to ensure our clients receive accurate and relevant legal advice.

Tailored Solutions

Our approach to whatever sports legal issue that may arise is highly individualized. We strive to understand our clients’ specific business goals and provide tailored solutions to match those objectives. Our dedication to personal attention ensures that each of our clients’ matters receive the best possible legal support.

Client-Centered Approach

At Phillips, Erlewine, Given & Carlin, our clients are our top priority. Our client relationships are based on trust and clear communication. Our team takes the time to understand our clients’ concerns, answer their questions, and guide them through the complexities of their rights. We ensure that our clients are well-informed at every step in the process.

If you require assistance with any aspect of sports law contracts, please don't hesitate to contact us to discuss your options.

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