Terrorist attacks trigger legal review of meeting contracts. (Eye on the Industry).

Immediately following the September 11 terrorist attacks, association meeting professionals were placed in the unenviable position of having to postpone or cancel meetings at the last minute after months or years of planning. Legal protection afforded to associations by their meeting contracts quickly became the focus of the association community's attention (see "Revising Hotel Contracts" in the March 2002 News & Know-How column).

The legalese of meeting contracts hasn't always received this much attention. ASAE's industry and market research department queried more than 1,000 associations about numerous subjects, including meeting contracts, in the summer of 2001. The data reveal that only 35 percent of organizations routinely entering into meeting contracts with hotels and convention centers had legal counsel review those contracts. This phenomenon appears to be true for associations of all budget sizes (see chart). For organizations with budgets of $500,000 or less, 19 percent had a lawyer review their meetings contracts. Among organizations with budgets of $15 million or more, only about half (51 percent) of responding organizations sought legal advice.

Surprising? Not necessarily. Associations with smaller budgets may choose to use their funds for matters deemed more urgent than legal review of meeting contracts. Affording legal advice is not an issue for many organizations with larger budgets, which may choose instead to rely on their ability to recruit seasoned meeting professionals with experience in contract negotiations.

Barbara Dunn, a partner in the Chicago law firm of Howe & Hutton, Ltd., who specializes in representing associations, also observes that because organizations of all sizes have not encountered major legal problems related to meeting contracts, legal review might not have appeared to be necessary.

September 11, however, has changed the perspective of almost everyone involved in planning association meetings. Suddenly, the language of attrition, cancellation, and especially force majeure (also known as acts of God) clauses mattered. Post-September 11, many are still unsure as to whether these clauses cover cancellation of meetings due to acts or threats of terrorism. What is clear, however, is that future studies will undoubtedly see a dramatic increase in the number of associations seeking legal review of their meeting contracts.

For more information about legal review of meeting contracts and other information relevant to planning conventions and meetings, call 202-371-0940 or 888-950-ASAE to obtain copies of ASAE's Association Meeting Trends and 2001 Policies and Procedures in Association Management: A Benchmarking Guide.

Submitted by Janel S. Schuh, research associate in ASAE's Industry and Market Research Department. E-mail: [e-mail].

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