Common use of Sequential Liability Clause in Contracts

Sequential Liability. (Agreement Section ) The sequence of liability set forth herein shall not be deemed terms of payment or a payment schedule and shall not supersede, reduce or limit the Client’s express payment obligations contained in this Agreement’s payment terms and schedule. A Sequential Liability (“SL”) clause in the Agency production agreement provides that the Client – not the Agency – is the party ultimately responsible for a failure to pay under the agreement. Typically, the Agency only accepts primary financial responsibility once it has been paid by its Client. This revision to the SL clause balances the Agency’s desire to avoid liability in cases where it has not received payment from its client with the Producer’s legitimate right to confirm that the SL clause does not xxxxx or negate the agreement’s payment schedule. While the Agency may not be directly liable to the Producer unless it has received payment from its Client, that does not relieve the Client from compliance with the payment schedule.