Protecting Yourself Legally as a Wedding Planner

Sep 6

The legal side of your business can sometimes get neglected. Sometimes the legal aspects aren’t our favorites, and we tend to neglect them because of that. In episode 125 of Weddings For Real, I sat down with Girija Patel of GBP Law. In 2020, the pandemic led to many questions for wedding planners. We wondered things like: Can we charge for postponing? Can we keep the deposits? How can we ensure we’re protected from the next disaster? I’m covering those questions and more in this blog post about protecting yourself legally as a wedding planner.

Where It All Began

Girija began her career by working for the District Attorney’s office as a prosecutor. She ultimately left that job to work for her family business. While working for her family business, she attended a conference for creatives and found that they needed help with the legal side of their businesses. It was then that Girija formed the idea of GBP Law and her mission to provide readily available and easy-to-understand legal guidance. She believes that every business owner should have access to basic legal advice for their businesses. Girija offers legal advice for small businesses, mainly in the creative industry, through consulting, templates, and her blog.

Having Business Covered

The pandemic wreaked havoc on the event industry in 2020, and we as wedding planners are still feeling the repercussions from it. It put the spotlight on the need for a solid contract and a set way of working with clients and vendors. It made planners aware that we need clauses that are preventative versus reactionary. We learned the hard way that clauses in our contracts don’t really mean anything until they’re needed — especially clauses like force majeure clauses. Many planners were stuck with legal contracts with their clients that didn’t include force majeure, and sometimes planners were dealing with so many moving parts that it was difficult to reschedule or cancel previously booked weddings. It was heartache from all sides, and there was conflict on all sides. In situations like we dealt with throughout 2020, and that we’re still dealing with in 2021, it’s important to walk into conversations with an open mind to hear what the other side is saying, and it’s also important to have all sides of your business covered in the case of disasters and pandemics.

Girija’s Top Legal Tips

Girija highlighted the importance of understanding the legal deficits in our businesses and knowing where we need to pay attention in the short and long runs. Legal templates and generic contracts are great in some cases, but personalization for your unique business is key. This is especially true for wedding professionals. As we step into the future, here are Girija’s top legal tips for wedding industry professionals.

1. Contract — Ensure your contract reflects the way you’re running your business. Have the contract set up in a way that the payment terms, refunds, payment schedule, rescheduling, party of contract, force majeure, and other relevant clauses are clearly outlined. Have addendums or clauses that cover things like, “If your dad is paying but won’t pay, you are responsible for the outstanding payment.” Be sure to pour extra attention into your contract so that you’re covered in the case of a disaster, lack of payment or difficult client.

2. Onboarding process — The onboarding process isn’t a legal component of your business, but it adds to the aspect of normal business routines and expectations. Be sure that you have the hard conversations before the contract is even given. Diffuse issues before they read the contract to ensure you’ve explained in your own voice and tone before the client reads it. Focus on the important issues of the contract as they relate to your specific business, before they sign the contract.

3. Effectively communicate your contract — A client is more likely to want to sign the contract when you’re confident and competent. Be ready to review the clauses and sections if you are to get a question.

4. Entity formation — How is your business formed? Are you a sole proprietor or a limited liability company? An LLC is the perfect hybrid between sole proprietor and corporation. You aren’t double taxed and you’re getting protection on personal assets if something were to go wrong. Sole proprietorship and general proprietorships don’t have that protection. On a related note, if you have a business partner but you don’t have a contract with them, you should. Many times in a business partnership, something gets in the way (usually money) and everything goes downhill and neither person is able to think clearly because emotions get in the way. If you have a contract, it’s very clear how to handle certain situations without bringing emotions into the picture.

5. Insurance — Insurance is not not necessarily legal, but it protects you like your legal contracts do. Indemnity clauses may not fully cover you once an argument is taken to court. Insurance helps to protect you from things like this. For example, I have general liability insurance for up to two million dollars in errors and omissions in professional liability. There are certain issues that we can predict or anticipate, so look into your insurance policies to see if they will cover it. For example, most insurance will not cover pandemics like Covid-19. It’s important to talk to the insurance provider about what the policy covers and have email records of those conversations. Another idea is to have your clients get insurance on their own. I actually require that my clients get event insurance. Insurance is an investment in your business just like finance, accounting, and marketing are. You may not see it in the short end but you will see it in the long run.

Know Your Risks

Overall, if you’re just starting out with your business and are in the first year of operation, be sure that you do the following.

Look at the risk exposure you have in your business. If you feel uncomfortable, get an LLC to provide a layer of protection. Invest in good contracts either via a template shop or a one-on-one consultation with a lawyer. A one-on-one with a lawyer can cost anywhere between $1,500-2000, but it varies by state.
Look at your website because you’re likely getting clients from it. Websites must comply with privacy policies. Your terms and conditions signify how users are allowed to use your website, so ensure it reflects how you run your business.

Girija offers everything from one-on-one unique contract creation to LLC formation expertise. Additionally, she offers templates and consulting for small business owners to better understand the legal side of their businesses. It’s important that our business operations and legal aspects all work hand in hand to protect us while providing a great experience for our clients.

Additionally, if you’re looking to level up your business and learn from industry experts, check out The Planner’s Vault. The Planner’s Vault is an online community and education platform for wedding planners. Each month, wedding industry experts like Girija host a members-only webinar to discuss different business topics. Learn more about The Planner’s Vault here!