If you’re a member of a band, set ground rules early in your relationship to prevent legal and financial problems down the road.

Being a member of a band is not much different from being a member of a professional sports team. You’re part of a group of individuals united in the pursuit of a common goal, where each person plays a unique and integral part in achieving a dream. At least in theory, the motto is “All for one and one for all.”

But unlike the sports world, where professional teams expect young athletes to meet extremely high standards before drafting players, young bands often form simply because the members are friends who share musical tastes. Unfortunately, this common denominator is not enough to create a successful band. Personality differences as well as opposing views of how business and legal matters should be handled eventually rear their ugly heads. The result: a band may call it quits, kick out a member unfairly, suffer setbacks because of the group’s revolving lineup, or become entangled in an ongoing legal battle among members. But if a band establishes strong criteria for choosing its members and drafts a band membership agreement up front, it can preempt such unfortunate and potentially costly squabbles. All band members must be on the same page and ready to work as a unit. Although playing music should be fun, a serious band is a business, and it should never be regarded as anything less.

Choosing Band Members

At first, when all band members are excited and eager to get things rolling, character flaws and differences of opinion are often overlooked. But if problems are ignored with the intention of addressing them later, they may come back to bite you. So it’s crucial to consider both the personalities and goals of the people with whom you’re about to get involved. Do so by using a personality questionnaire and a time line of goals.

A personality checklist may help you spot underlying problems among band members and determine whether you should proceed together in the music business. Include all issues you believe are crucial to the band’s long-term success, from loyalty to addiction. That’s not to say you should present these questions to potential band members the moment you meet. Wait until you’ve jammed together and have decided to move the relationship forward. As you interview potential bandmates, here are some sample questions to ask.

• If the band is still unsigned in three years, would you remain a member?

• Are you willing to hold a part-time rather than a full-time job to keep your schedule flexible?

• If the band decides that it is necessary, would you relocate to another city?

• Are you open to experimenting with and/or changing your visual image?

• Do you drink, smoke, or do drugs?

• Could you drop everything to go out on the road for several weeks at a time?

• Would you object to traveling cross-country in a small passenger van and sharing a hotel room with other band members with little compensation?

• If your significant other asked you to choose between staying in the relationship and staying in the band, which would you choose?

• If you could be in the ultimate band, would that band be your own solo project?

Although these questions are intense enough to scare off potential band members, trust that it will scare off only those musicians with whom you should never partner. Remember, no matter how similar a potential member’s tastes in music may be or how cool he looks, different and conflicting personalities will inevitably create problems. The last thing you want is to fire someone, have someone quit, or have the band break up after you’ve spent months or years building your band from the ground up.

Goals and Time Line

Another method to ensure that your band is composed of the right members is to agree on a time line for the band’s goals. This time line identifies what the group intends to achieve over a specific period of time (usually six months to a year). It also helps to identify problems concerning commitment, dedication, and career strategy. If you don’t uncover these problems up front, a band is quite likely to fail. Here’s a sample time line for a one-year period:

Months One to Three

• Rent a rehearsal studio and meet four times a week.

• Write 20 songs and hone the band’s sound and direction.

• Demo the best compositions and get feed-back.

• Define the band’s image and meet with a fashion consultant.

Months Four to Six

• Create a band press kit, including a professional photo.

• Hire a webmaster to design a professional website.

• Book live performances and create a buzz locally before expanding into other territories.

• Assign promotional responsibilities to each member.

Months Seven to Nine

• Hire a songwriting coach and/or find a producer.

• Pay to professionally record the best songs.

• Manufacture CDs and band merchandise.

• Sell CDs and merchandise at shows and on personal and community websites.

Months 10 to 12

• Attend and showcase at networking conferences and conventions.

• Enter songwriting competitions.

• Contact music libraries and music supervisors who can place your music in films or TV

• Seek a music business consultant’s advice on career direction.

Remember, the point is to ensure that a band shares similar goals and strategies and that all members agree on how they intend to accomplish these goals. Surely, new opportunities will present themselves and goals will evolve, but at least they can be derived from core, agreed-upon principles.

Band Membership Agreements

Once all of your members are in place and it’s established that everyone shares similar goals, you need to draft a written agreement that defines the terms of your business and legal relationship. A band membership agreement compels a band to deal with important issues before they become problems. The terms of the agreement should include language that stipulates the following:

• how income, such as that earned from record royalties, music publishing, concerts, merchandising, and so on, will be divided;

• how the band will make decisions (by unan-mous or by majority vote, for example);

• when and whether members are required to invest money in the band;

• if a band member leaves the group, how his share of assets acquired by the group (such as equipment) will be apportioned;

• who owns or controls the rights to the band name and its continued use;

• the guidelines for hiring and firing band members;

• which responsibilities and services are expected of each band member;

• how disputes will be resolved (in a court of law or out of court);

• whether a unanimous or a majority vote will determine decisions and how terms of the agreement can be amended; and

• whether the negligence of one member legally affects the others.

Legal Documents

Bands have some common excuses for not creating a preliminary band membership agreement. One is that they simply don’t have the money for attorneys’ fees in the early stages of their career. Although it’s best to have an attorney draft such an agreement, several resources, including the websites LegalZoom (www.legalzoom.com) and Nolo (www.nolo.com) offer adequate and inexpensive form agreements. Alternatively, a band can simply draft a deal memo on a plain sheet of paper, then bring it to an attorney to create a more formal document when the group has the money.

Second, bands often fail to create preliminary membership agreements because they believe that an agreement isn’t necessary at the beginning stages of their careers when they haven’t made money. But if a band has aspirations of one day procuring a record or a publishing deal, such shortsightedness can cause serious problems later.

While an agreement won’t prevent a band from breaking up or running into conflicts, it can define members’ desires and perspectives from the outset of the band relationship. Without a written agreement, state partnership laws may ultimately dictate issues regarding band control or allocation of profits. As soon as two or more people (such as a band) come together and are willing to share in the profits and losses of their business, they are already recognized as a legal partnership. State partnership laws vary, but if a band does not have a written agreement that stipulates anything to the contrary, all members may be presumed to have (1) an equal right to the profits and financial losses of the band, (2) an equal say in making decisions, (3) the right to use the band name should they decide to leave the group, and (4) liability for the other member’s negligence while conducting business. And the list goes on.

Though most groups are usually fair in wanting to share in the profits and losses equally, sometimes members will want to break up the relationship based on their individual feelings. The earlier these issues can be addressed in a written agreement, the better off everyone will be in the long run.

So whether you’re in a band that has just formed or in a group that’s already on the verge of signing your first record deal, if you don’t have a band membership agreement, schedule a meeting and create one. An attorney is recommended, but one is not always necessary in the early stages of your career, as long as everyone understands the agreement’s terms.

Key Members or Minority Partners?

Members of a band do not always agree to share equally concerning control over their business or profits. One member may believe that he deserves greater compensation than others because he has done the bulk of the work. Sometimes the founder, the lead singer, or the main songwriter is the only member who owns the rights to the band name or who controls the vote and has the final word in making business decisions.

In fact, should the band progress to signing with a record company, the label may even view these individuals as the group’s “key members,” those most important to the functioning of the band. In some instances, a nonkey member or “minority partner” may not even be signed to the initial recording agreement. If you’re not a signatory, the benefit is that you can walk away without any financial or recording obligation to your record company. As a minority partner, you have the freedom to leave and start your own group. Your status doesn’t negate your original band membership agreement. There may be a clause in your band agreement, for example, that says you have the right to quit the band if you’re unhappy, but not in the middle of a tour when the band can incur a loss as a result.

Conclusion

Success is something most bands dream of. But without laying the proper groundwork from the outset, the dream can turn into a nightmare. If your goal is to succeed in the music business, approach your band like a business. Before your band makes it big, discuss and work through as many issues as possible to avoid ruining friendships and legal and financial problems later.