Young pop hopefuls must get early legal advice or face the bitter and costly courtroom fate of The Smiths, writes Roger Pearson.
The value of getting early legal advice in business arrangements was illustrated in Joyce v Morrissey & ors, the recent Court of Appeal case involving ex-members of 1980s pop icons, The Smiths.
A long-running and acrimonious dispute between members of the group has been fought through the High Court and Court of Appeal, and may yet end up in the House of Lords.
At the end of the High Court action legal costs were said to be in the region of #300,000. But that figure will not be confirmed until all costs are finally assessed, including appeal bills.
Ronald Taylor, managing partner of Manchester firm Rowlands, is representing Mike Joyce, the ex-Smiths member, who has so far been successful with claims that he was short-changed by the group's founding members. Taylor says an investment of #1,000 on legal advice in 1982, when the group formed, would have saved "hundreds of thousands" in eventual legal costs.
He sees the case as a warning to musicians and other businesses, that they should formalise business arrangements – even though music is their primary concern.
And, he says, even if band members are relaxed about the business, their managers and record companies must ensure binding agreements are drawn up from the outset.
Taylor, a guitar playing music enthusiast, says of the recent appeal decision: "This really goes for anyone starting out in any sort of business. It is impossible to say which groups or businesses are going to become huge successes, but whenever people get together in this way, they should take professional advice and get arrangements fully documented.
"If that had been done in this case, the saving in legal costs, among other things would have been huge."
The recent appeal was brought by Stephen Morrissey who, along with fellow group member Johnny Marr, had been found by the High Court to have short-changed two other group members, Joyce and Andrew Rourke.
The Smiths was founded in 1983 by Morrissey, the group's singer-songwriter and Marr, the lead guitarist. Joyce was invited to join as drummer and Rourke as bass guitarist. The band broke up in 1987, but its records still sell well today.
After the High Court proceedings, Morrissey and Marr were left with an estimated pay-back to Joyce of #1m. Rourke did not stand to benefit from the ruling because he had earlier accepted an #83,000 settlement for a similar action.
The row centred on division of the group's profits – Morrissey and Marr took 40 per cent each while Joyce and Rourke received 10 per cent each. Joyce claimed this was unfair and that the division should have been equal.
In the High Court, Judge Weeks agreed with Joyce and now the Court of Appeal's Lords Justices Gibson, Thorpe and Waller have upheld the decision.
It was argued in the Court of Appeal that Judge Weeks reached his conclusion against the overwhelming weight of evidence and on the basis of a narrow view of what was fair. But Lord Justice Waller said Judge Weeks had examined all points and was right in his assessment on dividing profits.