[Entertainment Legal Consultation] Advertisement filmed under verbal agreement, possibility of contract termination and damages

Law firm Veat reviewed the possibility of cancellation and damages claim based on oral contract cancellation and damages claim on behalf of Entertainment A, a client, in response to a request.

Entertainment A requested a review of the possibility of cancellation and damages claim because a dispute arose when they performed obligations according to a contract without signing a contract after an oral agreement between the brand and a model affiliated with A.

Law firm Veat thoroughly reviewed the requirements for the validity of an oral contract, the relationship between the presence or absence of a signature and the validity of a contract, the possibility of damages claim, and the possibility of taking back advertising materials in light of the specific circumstances of this case.

Can an oral contract be valid?

According to the Civil Law, for a contract to be valid, there must be an agreement between the parties on the main terms of the contract, and it is not necessarily required to be written or have a signature. An oral contract can be valid if it meets the legal requirements, and the court has stated that a tender offer can be considered as a contract if there is an indication of acceptance. It has been stated that an offer should be specific enough that acceptance would create a contract, and the acceptance must be for that specific offer. In this case, there are no special circumstances limiting the method of such an indication of acceptance, and it does not necessarily require express statements.

In this case, the brand presented specific conditions and Entertainment A agreed, and not only that, but it can be considered that tacit agreement was made in the situation where obligations according to the contract were actually performed. It was possible to say that a contract was concluded by mutual agreement of the parties. In the case of whether an oral contract is valid, a review from a legal perspective on the specific facts is necessary, so it is a way to respond quickly by discussing with an expert.

Is a signature or seal a requirement for a valid contract?

As explained earlier, a written contract with a signature is not necessarily a requirement for a valid contract. Unless there is a provision requiring a written contract, a contract can be considered valid based solely on the fact that there was a specific agreement between the parties and the performance of obligations according to the contract took place. In particular, if the performance has already been partially completed and the results have been published, there is a high probability that an oral contract is valid.

Even if the brand denies the contract because a signature was not completed, the court will specifically determine whether there was actual intention to conclude the contract, so Law firm Veat reviewed the specific agreements between the parties and the fact that Entertainment A performed obligations to provide specific evidence.

Is it possible to cancel the contract and claim model fees?

There is a high probability that an oral contract is valid and if the parties responded to the shooting in accordance with the negotiated content, it is possible to claim model fees and simultaneously assert the cancellation of the contract in this case.

If the brand delays or refuses to pay the model fees, it can be considered a breach of contract, and Entertainment A may have the right to cancel the contract after going through the usual notification procedures. Even if the contract is terminated, they have the right to receive the model fees for the advertising shootings that have already been completed, and can proceed with the claim based on the premise that the brand cannot unilaterally terminate the contract.

Can a damages claim and a claim for the return of advertising materials be made?

If a party is damaged by a unilateral termination of a contract that is likely to be considered a valid oral contract, a damages claim can be considered. Also, if the brand does not fulfill its contractual obligations, Entertainment can claim the return of advertising materials. Since the advertisement uses the model’s image rights, it can be legally justified to request a suspension of the advertisement or the return of the advertising materials from the brand that has not fulfilled its obligations under the contract.

Law firm Veat has presented specific evidence that can clarify the content and obligations of the advertising model contract, which was conducted without a signature and seal, and has also provided guidance on the possibility of a damages claim and the possibility of claiming the return of advertising materials as a follow-up measure.

Law firm Veat deals with contract cancellation and damages related issues that arise in the entertainment and advertising industries, and provides legal advice optimized for clients based on a deep understanding of complex civil and criminal matters. In particular, Song Do-young, managing partner of Law firm Veat, has been appointed as an arbitrator of the Online Advertising Dispute Settlement Committee of the Korea Internet & Security Agency (KISA) and is actively engaged in resolving various online advertising dispute cases based on deep expertise and years of experience.

If you are experiencing legal disputes while operating an entertainment company, please seek solutions by working with experts from Law firm Veat, who have extensive experience in entertainment legal advice.

Thank you.
Law firm Veat