Schooled by Contracts

It really troubles me as an attorney when you do great work for a client and then all of a sudden the client feels that he / she doesn’t have to pay you for your time. I’ve been an advocate for putting contracts in writing for so long. (See Contracts 101: Pitfalls to Avoid in your Entertainment Deals – Part 1 (Introduction); and Part 2) In an industry where people want to make hand shake deals, it is so very important to let business be business and friendship be friendship. When it comes to a business deal, get it in writing. Period!High School Musical actress Vanessa Hudgens is getting a dose of business from her former attorney, Brian Schall for over $150,000.00 in fees he earned while building the young actresses career. E!Online is reporting that

A Los Angeles judge has ruled in favor of Vanessa Hudgens’ former attorney Brian Schall, allowing the lawyer to proceed with his breach-of-contract suit filed against the actress in September, in which he claims he’s owed $150,000 in back commission from the High School Musical star. (Source)

However, Hudgen isn’t going down without a fight. She and her new lawyer (I hope he got a big retainer) are challenging the legal contract because she was only 16 when she signed it. According to the article,

Hudgens’ lawyer, Evan N. Spiegel, cited California’s Family Code in the bid to dismiss the lawsuit, which “provides that the contract of a minor is voidable and may be disaffirmed before [age 18] or within a reasonable time afterward.” (Source)

This is generally a true statement of the law. But in most instances of the law, there are exceptions to every rule. The case with minors contracting, they are typically voidable unless the contract is for necessities in life or are later ratified when the minor turns 18. This is the theory the Judge is hammering at Hudgen and her lawyer. As the article states,

Los Angeles Superior Court Judge Tricia Ann Bigelow said in court Wednesday that the debate over the disaffirmation had turned into a “factual issue.” That fact was that the Disney star waited until she was 18 years and nine months old before attempting to void the contract, which cleared the way for the case to proceed to either a motion for summary judgment or a jury decision. (Source)

Aside from the breach of contract claim, Schall is suing Hudgen on an unjust enrichment theory claiming that if the contract is void, he is entitled to recovery based on the reasonable value of his services. This is a tort theory rather than a breach of contract theory that people shouldn’t be allowed to receive free benefits when there is an expectation to pay for the services.

Well, as I mentioned, Hudgen is fighting back and she counter sued Schall for essentially being a bad lawyer. I’ve seen this happen on occasion, which it is why it is so difficult to sue a client over fees. According to E!Online,

Hudgens countered in her own documents that she fired Schall earlier this year after growing weary of his representation, dubbing his services “below professional standards, resulting in a breakdown of their relationship.”

Well, I find that hard to believe, especially when this article reports that “Hudgens earn[d] more than $5 million stemming from her songwriting and recording career and that [Schall] advanced her expenses and costs during the time they worked together.”

Things that make you go hmmmmm….. She made $5 million by the time she was 19 as a result of this lawyer. You tell me if that was below professional standards.

(Read the E!Online Article)

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One response to “Schooled by Contracts

  • Susanne Joslin

    See how money changes a person? This situation just appears to be now that Vanessa is making the money, she doesn’t want to part with it, so suddenly her attorney provides services that are “below professional standard”. She made her money because of the work her attorney accomplished on her behalf. I wonder which is more work..arranging the work and negotiating the contracts or actually performing the “work”?

    Why was she allowed to enter into a contract at an age of 16, did she have contractual capacity?Why didn’t Vanessa’s parent(s) sign the contract on her behalf? The exceptions to California law that a contract can be considered valid if there are necessities in life for the minor or the contract is later ratified when the minor turns 18 do not appear to apply in this issue. Was what they contracted for a “necessity” to her? In order to ratify the contract at 18, a reasonable amount of time after she turned 18 needed to occur. This did not happen, instead, it appears that she tried to get out of their arrangment, which had grossed her $5 million, and potentially out of paying her former attorney.

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