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5th February 2016

No VIP Treatment: Production Agreements for Reality TV Series are not ‘Special’

In Mr H TV Ltd v ITV2 Ltd [2015] EWHC 2840, Flaux J held ITV2 liable for wrongful termination. He dismissed ITV2’s claims that the need to maintain a positive relationship with the star of a reality TV show does create additional obligations or provide a right to terminate an agreement, unless such terms are expressly set out in its agreement.

Background

The case considered the termination of an agreement under which the claimant, Mr H TV Ltd, was appointed to produce several series of “Peter Andre: The Next Chapter” and one series of “Kerry Katona: The Next Chapter”. The sole director and shareholder of the claimant, Neville Hendricks, had previously had a longstanding business and personal relationship with Claire Powell, the agent for Peter Andre and Kerry Katona.

Following the split between Mr Hendricks and Ms Powell (as well as a falling out between Ms Powell and Ms Katona), Ms Powell wished to replace the claimant with another production company for the Peter Andre series. A ‘twitter war’ broke out between Ms Powell and Mr Hendricks, during which Mr Hendricks also directed hostile tweets at Mr Andre. Mr Andre’s solicitors subsequently wrote to Mr Hendricks stating he wished to have no further dealings with either Hendricks or the claimants. ITV2 were made aware of this correspondence and reacted by terminating the production agreement.

The claimant issued proceedings for outstanding debts and wrongful termination. ITV2 counterclaimed Mr Hendricks’s tweets breached:

  • an implied term the claimant would not damage the relationship of trust and confidence between ITV2 and Peter Andre;
  • an implied term the claimant would use reasonable care and skill in providing the services;
  • provisions of the ITV General Terms and Conditions, which it claimed were incorporated into the production agreement; and
  • a obligation to procure Ms Katona’s exclusive services (breached by her appearance on ‘Celebrity Big Brother’.)

ITV2 claimed these breaches prevented it from performing its obligations as Mr Andre was unable and/or unwilling to work with the claimant. It also claimed Mr Andre and Ms Katona were no longer available to perform the services and therefore the agreement was frustrated.

Decision

Flaux J held ITV General Terms and Conditions were not incorporated into the production agreement. A licence agreement which would have incorporated the ITV General Terms and Conditions was never executed.

In relation to alleged breach of the implied terms, the judge held there was nothing in law to differentiate the production agreement from any other commercial agreement and English law will only imply term of trust and confidence (whether between the parties or to a third party) in a commercial contract in exceptional circumstances. It further held any obligation of skill and care would relate to the claimant’s work in producing and editing the series, not maintaining ITV2’s relationship with the “stars”.

Whilst it was acknowledged Ms Katona’s actions did breach the exclusivity provision, the court held this breach did not deprive ITV of substantially the whole of the benefit of the production agreement as it related to the series starring Ms Katona, and therefore did not justify termination.

The claim for frustration was also rejected. The court pointed out, whilst Mr Andre may have declared he was not prepared to work with the claimant, he had no contractual entitlement to do this. Mr Andre’s refusal to take part in filming breached a separate agreement between his company, PJA Promotions, and ITV2, under which ITV2 could require Peter Andre to participate in filming or sue him for failure to do so.

Conclusion

This decision reaffirms the English courts’ disinclination to imply a duty of trust and confidence into any commercial contract and the very narrow scope of frustration as a reason to terminate. Whilst the arrangements between ITV2 and Mr Andre were not strictly at issue, the judgment makes clear the feelings of celebrities are not worthy of ‘special treatment’ where they have entered into a legally binding agreement. It also highlights the importance of ensuring any obligations and breaches which may trigger a right of termination are expressly stated in the terms of an agreement.

For more information please contact the Hamlins Commercial and Intellectual Property Team.

 

No VIP Treatment: Production Agreements for Reality TV Series are not ‘Special’







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