A legal drama
28 April 2003
You may never have heard of Stage Technologies, but if you've been to the Royal Opera House, seen My Fair Lady, Chitty Chitty Bang Bang or Bombay Dreams in the West End, or maybe even watched boyband Westlife make a flying stage entrance, then your experience will have been shaped by the company's groundbreaking special effects.
Stage Technologies supplies engineering solutions for the entertainment industry, from console-operated flying harnesses to complete stage-rigging packages. Founded in London in 1994, it is now a world leader in the industry and has just scooped a coveted Queen's Award for international trade. In the past three years, overseas earnings have grown by 130 per cent to an annual £5.5m, representing 84 per cent of turnover. Current overseas projects include Walsh Bay theatre in Sydney, Seattle Opera House in the US and the Opéra de Lille in France.
The task of sourcing legal advice falls to commercial director Nikki Scott. She describes her role as "basically looking after everything that is not engineering" for the company. Scott, a non-lawyer with a background in computing, joined Stage Technologies' founding members in May 1995, after working for theatre lighting specialist DHA Lighting.
Stage Technologies' mix of complex engineering with the creative world of theatre design would make it an unusual client for any law firm. The company initially sought out small local law firms familiar with the construction industry. But Scott says: "We found that that didn't really work, so we went to Trowers & Hamlins. They've looked after us over the years from fairly near the beginning."
She adds: "The difficulty with what we do is that there is very little repeat work. Every job is different so there is very little that we can standardise."
In the early days, lawyer and client bonded over some tough negotiations between the fledgling company and a major US entertainment corporation that shall remain nameless. "Their contract was particularly onerous. We brought Trowers in to help us with the negotiations. It was all quite difficult. The US corporation didn't want to move from its terms. We were very small and it was very big, but we persuaded them in the end."
Other negotiations Trowers has advised on include complex contracts with the Royal Opera House and the Millennium Dome. Construction partner David Mosey looks after the relationship.
"Something like negotiating the Dome contract was hard going and very complicated," says Scott. The £925,000 contract included supplying 48 winches for an aerial ballet. "When you're flying human beings at three metres per second, there are risks involved," she adds.
Getting to grips with the legal issues the business generates has been a steep learning curve for Stage Technologies. Scott says: "We didn't speak the right language. We were very green in the construction world and in the legal world. There's a whole protocol we didn't understand. I think one of Trowers' challenges was to get us to understand that and guide us through the process, which is so far away from putting on a theatre production. We had the creative and engineering skills, but none of us were coming at it from the legal point of view."
Stage Technologies lives by the theatrical mantra 'the show must go on', so if something extra needs to be done its natural instinct is to get on and do it, regardless of what the contract says. "Our philosophy is different to a lawyer's," says Scott. "As we grow up as a company, we have to get better at that, but above all we want to get the show on. We try not to get snowed under with legal points, but to show them a healthy regard. One of the things we've tried to hang on to is that theatre is the end product. We don't want to get sucked into administrative issues to the detriment of the end product."
The extent of lawyers' involvement in any contract varies enormously and lawyers are sometimes bypassed altogether. Agreements can be based on anything from a handshake to a purchase order with smallprint on the back, to hundreds of pages of complex documents.
The company is obviously in a better bargaining position when it is renting out its own equipment and this is one of the few scenarios where it actually gets to use its own standard terms and conditions, drafted by Trowers. But usually, it finds itself bidding for design and supply contracts and is at the whim of the awarding party.
"One of the things that Trowers has been very good at is that rather than helping us negotiate every bit of a contract, it will point out the risks if we accept the contract that is presented to us," Scott says.
Occasionally, the company will decide to bring Trowers in at the early stages of a bidding process. "It depends on the complexity of the contract. If we feel at the tender stage that there is an enormous amount of effort involved and we want to get an idea of the commercial risks, we will go to them first." That decision comes down to Scott and the other directors, primarily marketing director John Hastie and managing director Mark Ager, who co-founded the company.
As its international work has increased, so has its exposure to the EU tendering system and Trowers has occasionally been called on to introduce firms in different jurisdictions.
Live performance being what it is, things occasionally don't go to plan. "Any high technology, complicated piece of machinery can go wrong occasionally," says Scott. "It's not inconceivable that we may be challenged [as to whether we are liable for that]."
Trowers has also shown itself to be more than capable of chasing up the odd bad debt. "It's very good at that," laughs Scott.
Her other key law firm relationship is with Theodore Goddard, where former head of employment Jane Bullen has dealt with the company's personnel work. Scott was unaware of Bullen's imminent move to Salans. "We deal with [Theodore Goddard] so rarely. It does an annual review of our employment contracts," she said. The company has grown from just five permanent staff in 1995 to 45 today and also has extensive dealings with subcontracted individuals.
Scott says that she has not yet looked for any other advisers because both firms provide an excellent service. "We've been so satisfied with the help we've got. If a firm is terribly helpful, one tends not to shop around," she says.
|Commercial director||Nikki Scott|
|Main law firms||Trowers & Hamlins, Theodore Goddard|