
Tech Talent Hunt Tries New Venue: Middle School - e15ctr0n
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wallacecollins
Judicial Approval of Contracts With Minors In The Tech Industry by Wallace
E.J. Collins III, New York Law Journal

Technology start-ups and other computer software companies often employ young
teenage whiz kids to write code or create new apps. With media giants like
Disney and Viacom creating shows featuring younger and younger performers, and
YouTube, Spotify and other online companies hosting content by eager young
creators, content from minors is in ever-increasing demand by corporations.
All of this raises the predicament of employing or dealing with a contract
which involves a contracting party under the age of 18.

A minor may disaffirm a contract at any time during minority or upon reaching
majority. Without a valid written agreement the employment is "at will" under
the law of most states which means the minor can depart at any time. Copyright
law, which is applicable to computer code, requires a signed writing to
transfer copyrights and applies to authors of all ages, so without a valid
written agreement the content created by the minor may not be validly
transferred from its author to the employer. The dilemma created by a minor's
ability to disaffirm a contract is that it may seriously jeopardize the
employer's financial investment in the services of the minor.

The mere exercise of having the parent or guardian of the minor co-sign,
approve or "guarantee" the contract does not resolve the problem. The minor
may still repudiate the contract on the ground of infancy, asserting that the
parent or guardian lacked authority to make the contract. In some
jurisdictions, courts deem it against public policy to even enforce such
guarantee language against the parent or guardian since it would subvert the
purpose of the laws concerning the judicial approval of contracts with minors.
So-called "working papers" under state law might work for purposes of a fast
food chain or similar hourly wage employment but probably are insufficient for
a tech company's purposes.

Although many tech companies may rely on the fact that they believe the minor
is an employee creating intellectual property for the company, this may not be
sufficient to transfer rights to the company in the computer code written by
the teenage whiz kid as, for example, "work made for hire" under U.S.
copyright law. It is beyond the scope of this article to address all of the
factors courts consider when determining the issue of work for hire and the
ramifications of the various outcomes of the cases concerning employers and
computer programmers. Suffice to say that relying on the work for hire
doctrine is an uncertain path for a tech company (all the more so when dealing
with a minor).

State Laws Several states, including New York and California, have laws
specifically concerning judicial approval of contracts with minors. New York's
Arts and Cultural Affairs Law §35.03 provides for judicial approval of certain
contracts for services of "minors" under the age of 18. The procedure involved
can be somewhat arduous to navigate, and may prove to be a difficult gauntlet
to run for a lawyer inexperienced in this area. However, tech and media
companies employing minors or contracting with minors should investigate the
efficacy of pursuing court approval to protect their investment.

Once the court judicially approves the contract, the minor is held to a
standard of adult responsibility for its contractual obligations assuring the
employer company that it will get what it bargained for and that the contract
is legally valid.

As a practical matter, a proceeding for judicial approval of a minor's
contract in New York is commenced by the filing of a verified petition. It can
be filed by a parent, the guardian, a relative of the minor or any interested
person or entity such as the employer. The petition must contain a statement
of the length of the employment term, compensation, and all other relevant,
material terms of the agreement. A complete copy of the proposed contract must
be annexed to the petition together with affidavits from the parents and/or
guardians which consent to the petition and support the facts. In addition to
identifying the details of the nature of the minor's employment and the
compensation to be paid, the petition must also contain a statement of who,
other than the minor, is entitled to the minor's earnings and facts regarding
the property and financial circumstances of the parent or parents so entitled.
The petition may nominate a person to be appointed as limited guardian solely
for purposes of establishing a trust account for the proceeding and should set
forth the reasons why the person nominated would be proper and suitable.

Although a lawyer is usually appointed, a parent or other petitioner is not
precluded from being appointed as limited guardian by reason of his or her
interest in any part of the minor's earnings or in the contract provided such
interest is disclosed. The court will designate how much is to be set aside
and saved for the minor under guardianship until the minor becomes 18 years
old. The court also has the option to appoint a special guardian to represent
the interests of the minor at any time after the petition is filed.

As directed by the court, before the time at which the petition is noticed to
be heard certain persons (other than the petitioner and anyone who has joined
in the petition) must be served with an order to show cause why the petition
should not be granted: (1) the minor; (2) the parents of the minor; (3) the
minor's guardian(s); (4) each party to the contract; (5) any person having the
care and custody of the minor; (6) the person with whom the minor resides;
and, (7) the minor's spouse.

An order granting judicial approval of a contract for the services of a minor
will rarely be granted on the papers alone. Usually a brief hearing is held at
which the minor, the parent(s) and the various other interested parties may be
questioned by the judge regarding the contract. Courts may require provisions
in the court's order concerning how many hours the minor can work and may
require that the employer provide tutors if regular schooling will be
disrupted by the employment. Most terms and conditions of each arrangement
will be affirmed as long as they are found by the court to be reasonable and
not contrary to the best interests of the minor. Once the court does grant
approval, an order will be issued which will, in effect, declare the minor an
adult for purposes of fulfilling his or her contractual obligations.

California law concerning the judicial approval of minors' contract for
artistic or creative services (Ca. Family Code §6750, et seq.), although
similar, differs in certain respects. For instance, under California law there
is no limitation on the length of the term of a minor's contract whereas in
New York the limit is seven years. A hearing is usually required in California
as in New York but under California law a maximum of only 50 percent of net
earnings will be set aside until the minor becomes 18 years old whereas New
York has no limit on what portion the court can direct to be set aside.

Once the court does grant approval, an order will be issued which will, in
effect, declare the minor an adult for purposes of fulfilling his or her
contractual obligations. Then all the results of the minor's services,
including any copyrights in code or apps created by a minor during employment
by the start-up or tech company, will be properly transferred as bargained for
by the employer.

Wallace E.J. Collins III is a New York lawyer practicing primarily in the
areas of entertainment and intellectual property law. T: ((212) 661-3656;
www.wallacecollins.com

*reprinted with permission of The New York Law Journal 2014 [http://www.newyorklawjournal.com/expert-analysis/id=12026676...](http://www.newyorklawjournal.com/expert-analysis/id=1202667640206/Judicial-Approval-of-Contracts-With-Minors%3Fmcode=1380566174563&curindex=0)

