Harrison's Reports (1929)

sintered as second-class matter January 4, 1921, at tlie post office at New York, New York, under the act oi March Z, 1879. Harrison’S Reports Yearly Snbicription Rates: United States., $10.00 U. S. Insular Possessions . 12.00 Canada and Mexico.. 12.00 Bngland and New Zealand 14.50 Other Foreign' Countries . . . 16.60 26e. a Copy 1440 BROADWAY New York, N. Y. A Motion Picture Reviewing Service by a Former Exhibitor Devoted Exclusively to the Interests of Exhibitors Its Editorial Policy: No Problem Too Big for Its Editorial Columns, if It is to Benefit the Exhibitor. Published Weeltly by P. S. HARRISON Editor . and Publisher Established July 1, 1919 Tel. : Pennsylvania 7649 Cable Address : Harreports (Bentley Code) A REVIEWING SERVICE FREE FROM THE INFLUENCE OF FILM ADVERTISING Vol. XI SATURDAY, FEBRUARY 9, 1929 No. 6 An Analysis of the Reformed Exhibition Contract— No. 6 In resuming the discussion about the arbitration rules — what they mean and what part of them are to your advantage, let me call your attention to the ten per cent penalty imposed on the distributor that fails to abide by the decision of the arbitration board. This provision is contained in the last part of Article 6, of Rule IV. It provides that ten per cent of the total amount of the award shall be added every month from the day it was rendered until the day the recalcitrant distributor shall settle with the exhibitor. Cases have been brought to the attention of this paper in which an exchange ignored the demand of the exhibitor for settlement of the award, iio it is well fof you to know that, in addition to the total amount of the award, you can add ten per cent every month tliat the award remains unsatisfied. And you don’t have to worry about collecting; in case the exchange refuses to satisfy the award and the Film Board of Trade fails to take the necessary steps to force it to settle with you, all you have to do is to notify the American Arbitration Association, or this office. ♦ * I have been requested to treat more clearly of Article 8, of Rule II, which provides that a contract becomes outlawed nine months after a breach instead of twelve months, as was the case under the old Rules, which were revised by the contract committee appointed at the Trade Practice Conference, and which were put into force last May. Some secretaries of Film Boards of Trade go under the assumption that where contracts that were signed prior to May 1, 1928, that is, before the new Rules went into effect, are in dispute, the arbitrators must, in reaching their decision, be governed by the rules that were in force at the time that contract was signed. It is necessary, therefore, to enlighten such secretaries on the subject, and to caution exhibitor-arbitrators not to be influenced by how these distributor-representatives feel but to be guided by a sense of equity and justice: Arbitration rules are not changed unless they are found to be inequitable in practice either to the one class of litigants or to the other. Accordingly, when the rules that were in force prior to May, 1928, were being discussed, the representatives of both groups, producer-distributors and exhibitors, agreed that certain provisions of them were unjust and inequitable, and reformed them. Among the rules that were reformed was also the time limit after which a contract is considered outlawed. Both groups agreed that such time limit should be reduced to nine months after a breach instead of twelve months, as before. In other words, if one of the parties to a contract breaches the contract, the other party loses all right to bring the offending party before the arbitration board if the time that has elapsed from the day of the breach is more than nine months. To hear, then, representatives of the producers, such as the secretaries of Film Boards of Trade are, insist that a contract be judged under unjust and inequitable rules does credit neither to their intelligence nor to their sense of fair play. VVhen you sign a contract containing a provision for arbitration, you give up your rights of trial by jury, the cornerstone of your liberties. The least you could expect from the other side, then, is to have the arbitrators decide your dispute under rules that are just and equitable. One additional reason why your dispute should be decided under the new rules is the fact that you do not appoint the arbitrators for your side; they are appointed by men who often do not really represent you ; you may not even be a member of the exhibitor organization that appoints them. This paper suggests that exhibitor arbitrators be guided hy the new rules in all cases, no matter whether the con tract involved was signed before these rules went into effect afterwards. The Eighteenth Clause, which, as said, refers to arbitration, starts as follows : “The parties hereto agree that before either of them shall resort to any court to determine, enforce or protect the legal rights of either hereunder, each shall submit to the Board of Arbitration ... all claims and controversies arising hereunder for determination pursuant to the said Rules of Arbitration. . . In other words, both the exhibitor and the distributor agree that before either resorts to the courts he shall first submit his differences to the arbitration board. This wording is hypocritical, for, once you agree to arbitrate all differences, you give up your rights of going to the courts, at any time, unless it be for causes so often enumerated in these columns, such as, fraud, corruption of the arbitrators, and other similar causes. It would be more honest for the clause to read, “The parties hereto agree that instead of either of them resorting to any court to determine, enforce or protect the legal rights hereunder, each shall submit to the Board of Arbitration ... all claims . . It is possible that a court may rule, because of such wording, that either party has a right to go to the courts after a board rendered a decision. The matter, however, has not been taken to the courts for test by anyone. So it might not be a bad idea to have it tested. The fact that the second paragraph of this clause obligates both parties to abide by the decision of the arbitration board may be found by the court to be conflicting. The third paragraph of this clause makes the exhibitor agree that in case he should fail to abide by the decision of the arbitration board the distributor may demand, as additional security, a sum of money, not to exceed $500. As explained in a previous article of this series, the distributor that has a grievance against an exhibitor may demand $500 from him, if he sees fit, as additional security, but the matter differs when an equal amount is demanded by every member of the Film Board of Trade. In such a case, the act becomes a conspiracy, because more than one company imposes the same penalty on such exhibitor. The members of the Film Board of Trade violate the law still worse when the theatre of the exhibitor they have penalized is in a different state, as is the case with film zones that serve exhibitors in two or more states. Let it be said here that a criminal offense is an offense against the people of the United States, when Federal laws are violated, and comes under the jurisdiction of the Federal authorities. So when an exhibitor that lives in a different state from that of the film zone finds himself penalized by the members of the Film Board of Trade for disputes that do not concern them, he should bring the matter to the attention of the Attorney-General and demand the prosecution of the offenders. He might enlist the aid of his Senator, or of his Representative, so that the matter might be brought before the proper U. S. official. Clause 19: “This contract is complete and no promises or representations have been made by either party to the other except as set forth herein.” This means plainly that no matter what promises the film salesman has made to you in order to induce you to sign the contract, unless such promises have been put into the contract, you cannot force the distributor to recognize them. It seems as if, after what has been said on the subject repeatedly, it would be unnecessary to waste any more valuable space to tell an exhibitor that nothing is recognized unless it is in the contract ; but, alas 1 such a thing is necessary, for there are still exhibitors who continue to take the oral promises of a distributor’s representative (Continued on last page)