Monday, 12 January 2009

Paying Back Your Advance

Very occasionally, a publisher will ask a writer it has under contract to pay back the advance that was paid.

This might happen if, for example, the deadline passed months ago but the writer still shows no sign of submitting a finished manuscript; or if the writer submits a vampire novel about World War I instead of the non-fiction book about the history of cockle fishing off the Welsh coast that he was contracted to write.

If a book is published but fails to sell in any significant numbers, though, the advance is the author's to keep. Even if the book doesn't earn out. Despite what many vanity presses insist.


John E White said...

Hi Jane,
Phew! So, I get to keep the four shillings and ninepence I was sent in 1920? I have been hanging onto it believing that I would be asked for it back when they found out I didn't actually write Diary of an Eccentric.

Sally Zigmond said...

Um, John. But if you didn't get round to writing and submitting this most fascinating tome, then the bailiffs WILL be knocking at your door any moment.

Anonymous said...

Just to add a related thought: it's worth knowing that even if your publisher is in dire financial straits, if you have a contract with them to publish your book, they can't cancel it, and they must publish it within the time specified in the contract. (I think eighteen months from delivery and acceptance of the MS would be common?). The exception is if they actually go into liquidation, at which point you won't get published but the rights should revert to you: I think I'm right in saying that they (or a liquidator) also can't assign (i.e. sell) the rights to another publisher without your agreement, though if they sell the pub company outright, your book may go with it. This kind of situation is yet another reason to join the Society of Authors as soon as you start signing things.

Anonymous said...

Is there a U.S. equivalent of the Society of Authors? What does this organization do for the writer?

Jane Smith said...

Emma, I've known a couple of cases where contracted books didn't get published: in each case the publisher had to pay the full advance to the writer, once a publishable mss was delivered: I suspect that if the writer then placed the book elsewhere there'd have been a bit of a to-do about the money (and the original publisher might well have been reimbursed), but I'm afraid I can't remember what happened!

I've also heard of several cases where a publisher went into liquidation: in each case, the writers assumed that their rights would revert to them immediately but the administrators of the company assumed that the rights were assets of that company, and so hung onto them. This despite some of the writers having decent reversion clauses in their contracts--so it's not a failsafe. In the cases I'm thinking of, the rights did get released eventually but it was a difficult time for the writers.

The lesson to be learned here is that if you're certain that your publisher is going down, and it's not yet in administration, see if you can get your editor to write or email you a reversion of your rights. If it predates the date of administration you've got a stronger case.

As for the administrators not being unable to assign/sell those rights on: that's not strictly true, as far as I know. The rights are assets of the company being liquidated and so can probably be disposed of as the administrator thinks best. I'll do a bit of research on this and come back here if I find out anything different: but yes, the SoA is fabulous, especially in times of crisis.

Jane Smith said...

Paul, I don't know if there's a US SoA: I'm pretty sure there's an equivalent organisation but what it's called, or where it's based, I'm not sure. Again, I'll do a bit of research and see what I can find out for you.

There are genre-based organisations spread all over America, though: there's the SFWA and the RNA (or is that the RWA?); and others which escape me now.

Jane Smith said...

Emma, I've found some bits and pieces about what happens to rights when publishers go bankrupt or go into administration: but the briefest is one of Victoria Strauss's comments on this thread here:

If you scroll to just past half-way down the thread of comments to find Victoria's comment dated 1/08/2009, you'll find her summary of the situation.

Anonymous said...

Yes, I remember it being very messy about whether the rights were company assets when The Friday Project went down, and similarly with Sutton. Of course, exactly what you do about it all also depends on where your book is in the publishing process.

A propos of them not publishing, they're contractually obliged to pay the whole advance. And actually, I guess you'd probably be better off getting the book back than pushing them into publishing it, because they wouldn't be supporting it, after all. If you sold it to someone else, successfully, I don't see that they could be miffed, though: it was their decision not to publish and thereby terminate the contract.

Paul, there is an equivalent of the Society of Authors in the US,

Anonymous said...

Hi Jane, although it is a commonly accepted belief, in some cases publishers can, and do, ask for advances (or part thereof) back if a book does not earn out, or for less noble reasons. Whether this is morally right or not, is another question. Kate

Jane Smith said...

Kate, the only time I've ever heard anyone say that advances sometimes have to be paid back is when a vanity publisher is trying to persuade writers to avoid the bigger, mainstream houses.

I don't know any writers who are published by good, reputable, mainstream or independent presses who have ever been asked to pay back even part of their advance if their books didn't earn out--or who have been asked to sign a contract which allowed for this to happen.

I'd be interested to know the names of any publishers you've seen insisting on this clause, and under what conditions the advance would become repayable: because I've never seen a clause which allows that in a contract from a reputable publisher, nor in a contract that a good agent would allow their clients to sign. I do hope that you can't prove me wrong, but would be very interested if you could--because that would be a very unpleasant direction for publishing to take. You can email me if you'd rather keep this private: my address is "hprw at tesco dot net".

Stacia said...

Kate, they may ask for part of the advance back--although I have never heard of it happening and don't know anyone who has heard of it happening--if the book doesn't earn out, but they are not going to get it. There is absolutely no consideration for any such event in any standard publishing contract with any publishing house of any decent size and reputation.

The advance belongs to the author to keep as long as they've turned in a publishable book, no matter if the book sells fifty thousand copies or fifty.

I blogged about this a while ago. Advances are not returned because of poor sales. They're just not.

Anonymous said...

Kate Nash said:
"in some cases publishers can, and do, ask for advances (or part thereof) back if a book does not earn out, or for less noble reasons."

I agree that there are cases when publishers request the advance; if the author fails to produce the manuscript or fails to produce an acceptable manuscript. But no reputable publisher EVER asks for the advance back if the book fails to sell through. Ever.

Publishing is a risk, and we assume all risks that the book is going to sell as well as we believe it will. The advance is based on that belief, and we can't place blame on the author if the book doesn't sell.

If I am wrong in this, I would like to know the publisher and circumstances because I don't believe this for a minute.

Victoria Strauss said...

Like Jane, Stacia, and Lynn, I've never, ever heard of an author having to give back his or her advance if the book didn't earn out. I've never seen a publishing contract with this provision, either. It's a common new writer myth, but as far as I know, it really doesn't have any basis in reality.

Jane Smith said...

Despite spending the last few days frantically searching I've been unable to find any real evidence which supports Kate's assertions: but if anyone has ever been asked to pay back all or even part of their advance because their books didn't earn out, or to sign a contract which allowed for that to happen, I'd love to hear from you. And I'm sure that Victoria would, too.