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Tuesday 15 March 2016

Lights, camera, action! Property owner beware - Real Estate Committee newsletter article, April 2016

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Lights, camera, action! Property owner beware film location release agreements

UNITED STATES

Matthew V Wilson, Arnall Golden Gregory, Atlanta
matthew.wilson@agg.com

Philip G Skinner, Arnall Golden Gregory, Atlanta
philip.skinner@agg.com

 

The film industry in the US state of Georgia is booming. As of June 2015, Georgia ranks third in the US for film projects behind only California and New York. The state, with its temperate climate and picturesque landscapes, bolstered by a highly successful tax-incentive programme, has proved irresistible to Hollywood production companies and filmmakers alike. On any given day, from Savannah to Decatur, film crews can be seen shooting in public spaces, local businesses and neighbourhood homes.

Before any private property can be portrayed on film, however, the filmmakers must secure various rights from the property owner or the owner’s authorised agent. In industry-speak, the right to access, record and depict private property is secured through a ‘location release agreement’.

As one might imagine, the length, scope and complexity of these agreements often varies depending on the needs of the parties, their relative tolerance for risk and overall transactional sophistication. 

The rise of the film industry in Georgia is a relatively recent phenomenon, so most property owners know little about location release agreements. The purpose of this article is to briefly outline some of the issues that a property owner should consider, whether their property is located in the state of Georgia, in the US or elsewhere.

In addition to addressing access and publicity rights, most location release agreement forms originating from the filmmaker’s camp will include a litany of legal concepts designed to favour the filmmaker. Accordingly, it is important for a property owner to appreciate the legal landscape associated with filming and the movie industry generally, and to work with experienced counsel to help rebalance what is likely a one-sided agreement.

For example, a business owner seeking to minimise the disruption to business activities should insist that the agreement specify the precise date(s) and time(s) that filming will occur. Similarly, the property owner will want to protect the condition of the property and be indemnified for any losses arising in connection with the use.

In some instances, image-conscious owners may want to consider how the property will be portrayed and restrict any uses that may be deemed embarrassing or defamatory, or simply not in keeping with the character or image of the property. The creativity displayed in some location agreements can match, if not eclipse, the efforts of big-budget Hollywood screenwriters.

The use of a single-family residence will present a bundle of potential issues and concerns: ‘Who will take care of my personal property and belongings?’; ‘Do I have to pack anything up and put it away?’; and ‘Will they need to paint or change anything, and if so will they put it back the way it was?’ All should be answered before handing over the keys.

In contrast, the issues that emerge with the use of a multi-tenant commercial property as a filming location are somewhat more complex. For example, a building owner might ask:

  • ‘What do my tenant leases say about this?’
  • ‘Do I need to inform my mortgagor and/or seek their consent?’
  • ‘Should I let my insurance carrier or agent know?’
  • ‘Whose insurance will apply if property damage occurs or someone is hurt as a result of the use of my property for filming?’
  • ‘Do I have to use the licence fees or rental payments received to reduce or offset operating costs, or pay them to my lender?’
  • ‘Will this interfere with my tenants’ use of their premises or of the common areas? If so, do I need my tenants’ permission? And what do I need to tell them about the filming so they don’t interfere with things?’
  • ‘Do I want my building’s or project’s name published or displayed in the film?’
  • ‘What am I going to get paid for putting my property and my tenants through this inconvenience?’

Based on the above, you can see that a property owner’s questions that might arise as they consider entering into a location agreement can vary tremendously. The portrayal of a home, business or other location or structure in a feature film, commercial or television show may enhance the value of a property, but could leave the owner with post-production headaches that could have been avoided with a little work on the agreement beforehand. Consequently, the prudent owner should ensure that both they and their property are adequately protected.

As they say in the film industry, ‘That’s a wrap!’

 

Note

This article presents information on legal matters of general interest in summary form. This document should not be construed as legal advice or opinion on specific matters.

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