Ur-Text: Writers, Understand What You're Signing Before You Sign It

One of the reasons I became a lawyer was self defense.

As a 24 year-old aspiring writer, transplanted from Akron, Ohio, to New York City, having recently dropped out of an MFA program, I signed a contract with a literary agent to co-author (with a friend of mine) a book of purported humor.  A first book for both of us, it was unexpectedly successful.  Only when a sizable advance came in from the paperback publisher did I pay any attention to a key clause in my contract with the agent.  The contract provided that my co-author and I would receive the revenues from the book, less the agent's commission, and less a "pro rata share of [the agent's] cost of operations."  When I signed the contract, I was clueless about what that clause meant. If I read the same clause today, I still would not know what it meant, but I would surely realize that its ambiguity spelled potential litigation.

When the check from the paperback publisher arrived, the agent first deducted what he regarded as the "pro rata share of [his] cost of operations," then he applied his commission against the remainder, and, finally, he split the remainder two ways between me and my co-author.  He calculated his "pro-rata share" as follows: