By Thompson H.B. No. 539 77R248 CLG-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to arts, entertainment, advertisement, and sports 1-3 contracts entered into by minors. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Part 5, Chapter XIII, Texas Probate Code, is 1-6 amended by adding Subpart H to read as follows: 1-7 SUBPART H. CONTRACTS IN ARTS, ENTERTAINMENT, 1-8 ADVERTISEMENT, AND SPORTS 1-9 Sec. 901. DEFINITIONS. In this subpart: 1-10 (1) "Advertise" means to solicit or induce, through 1-11 print or electronic media, including radio, television, computer, 1-12 or direct mail, to purchase consumer goods or services. 1-13 (2) "Advertisement contract" means a contract under 1-14 which a person is employed or agrees to advertise consumer goods or 1-15 services. 1-16 (3) "Artist" means: 1-17 (A) an actor who performs in a motion picture, 1-18 theatrical, radio, television, or other entertainment production; 1-19 (B) a musician or musical director; 1-20 (C) a director or producer of a motion picture, 1-21 theatrical, radio, television, or other entertainment production; 1-22 (D) a writer; 1-23 (E) a cinematographer; 1-24 (F) a composer, lyricist, or arranger of musical 2-1 compositions; 2-2 (G) a dancer or choreographer of musical 2-3 productions; 2-4 (H) a model; or 2-5 (I) any other individual who renders analogous 2-6 professional services in a motion picture, theatrical, radio, 2-7 television, or other entertainment production. 2-8 (4) "Arts and entertainment contract" means a contract 2-9 under which: 2-10 (A) an artist is employed or agrees to render 2-11 services in a motion picture, theatrical, radio, television, or 2-12 other entertainment production; or 2-13 (B) a person agrees to purchase, secure, sell, 2-14 lease, license, or otherwise dispose of literary, musical, or 2-15 dramatic tangible or intangible property or any rights in that 2-16 property for use in the field of entertainment, including a motion 2-17 picture, television, the production of phonograph records, or 2-18 theater. 2-19 (5) "Consumer goods" means goods that are used or 2-20 bought for use primarily for personal, family, or household 2-21 purposes. 2-22 (6) "Sports contract" means a contract under which an 2-23 athlete is employed or agrees to participate, compete, or engage in 2-24 a sports or athletic activity at a professional or amateur sports 2-25 event or athletic event. 2-26 Sec. 902. CONSTRUCTION. This subpart may not be construed to 2-27 authorize the making of a contract that binds a minor beyond the 3-1 minor's 18th birthday or the date on which the minor's disabilities 3-2 of minority are removed for general purposes, whichever is earlier. 3-3 Sec. 903. APPROVAL OF CERTAIN CONTRACTS OF MINORS; NOT 3-4 VOIDABLE. (a) A court, on petition of a party to the contract, 3-5 may enter an order approving for purposes of this subpart an arts 3-6 and entertainment contract, advertisement contract, or sports 3-7 contract that is entered into by a minor. The court may approve 3-8 the contract only after the party requesting the petition provides 3-9 to the other party to the contract notice of the petition and an 3-10 opportunity to request a hearing in the manner provided by the 3-11 court. 3-12 (b) A proceeding under this section may be brought in the 3-13 county in which: 3-14 (1) the minor resides; 3-15 (2) the minor is employed; or 3-16 (3) a party to the contract has its principal office 3-17 in this state for the transaction of business if the minor does not 3-18 reside and is not employed in this state. 3-19 (c) The approval of a contract under this section extends to 3-20 the contract as a whole and any of the terms and provisions of the 3-21 contract, including any optional or conditional provision in the 3-22 contract relating to the extension or termination of its term. 3-23 (d) A court may withhold approval of a contract under which 3-24 part of the minor's net earnings under the contract will be set 3-25 aside as provided by Section 904 of this code until the guardian of 3-26 the minor executes and files with the court written consent to the 3-27 making of the order. 4-1 (e) An otherwise valid contract approved under this section 4-2 may not be voidable solely on the ground that it was entered into 4-3 by a person during the age of minority. 4-4 (f) Each parent of the minor, if a managing conservator or 4-5 guardian has not been appointed for the minor, or the 4-6 court-appointed managing conservator or guardian of the minor, is a 4-7 necessary party to a proceeding brought under this section. 4-8 Sec. 904. NET EARNINGS OF MINOR; SET ASIDE AND PRESERVATION. 4-9 (a) In this section, "net earnings" means the total amount to be 4-10 received for the services of the minor under the contract less: 4-11 (1) the sum required by law to be paid as taxes to any 4-12 government or governmental agency; 4-13 (2) a reasonable sum to be expended for the support, 4-14 care, maintenance, education, and training of the minor; 4-15 (3) fees and expenses paid in connection with 4-16 procuring the contract or maintaining employment of the minor; and 4-17 (4) attorney's fees for services rendered in 4-18 connection with the contract or any other business of the minor. 4-19 (b) Notwithstanding any other law, the court may require in 4-20 an order approving a contract under Section 903 of this code that a 4-21 portion of the net earnings of the minor under the contract be set 4-22 aside and preserved for the benefit of the minor in a trust created 4-23 under Section 867 of this code or a similar trust created under the 4-24 laws of another state. The amount to be set aside under this 4-25 subsection must be a reasonable amount as determined by the court. 4-26 Sec. 905. GUARDIAN AD LITEM. The court may appoint a 4-27 guardian ad litem for a minor who has entered into an arts and 5-1 entertainment contract, advertisement contract, or sports contract 5-2 if the court finds that appointment of the ad litem would be in the 5-3 best interest of the minor. 5-4 SECTION 2. This Act takes effect September 1, 2001.