Legal Risks in Museum of New Zealand Te Papa Tongarewa’s Terms: Key Contractual Pitfalls and Solutions | Erayaha

## When We Examined Te Papa Tongarewa’s Legal Framework: Four Risks That Could Cost Millions

Imagine a scenario where a single ambiguous clause exposes your organization to copyright litigation, or a missing safeguard leads to six-figure indemnity claims. Our analysis of the Museum of New Zealand Te Papa Tongarewa’s Terms & Conditions reveals four critical areas where legal and financial risks are heightened—each with the potential to result in substantial losses or regulatory fines.

1. Copyright Ownership Ambiguity: Who Bears the Risk? The T&C state that the Licensee is solely responsible for obtaining copyright permissions, even when the Licensor provides the material. This creates a significant risk of inadvertent infringement, especially with international copyright laws (e.g., US DMCA, EU Copyright Directive). A single infringement claim can result in statutory damages up to $150,000 per work in the US.

Legal Analysis

high Risk

Removed

Added

The Licensee is solely responsible for obtaining permission from the copyright holder for use of the Licensed Material, except where the Licensor expressly represents and warrants that it holds all necessary rights. Where possibleThe Licensor shall provide all available information regarding copyright ownership and, where the Licensor will assistis unable to confirm ownership, this shall be clearly disclosed to the Licensee by supplying the copyright owner’s contact detailsprior to delivery. In no event will Te Papa be liable for any failure by theThe Licensor and Licensee shall cooperate in good faith to obtain requiredresolve any copyright authorisation for Licensed Materialissues that arise.

Legal Explanation

The original clause places all risk on the Licensee, even when the Licensor may have superior knowledge or control over copyright status. The revision clarifies shared responsibilities, improves transparency, and aligns with international copyright risk allocation standards, reducing the likelihood of inadvertent infringement and costly litigation.

2. Indemnity Clause: Uncapped and One-Sided Exposure The indemnity provision requires the Licensee to cover all damages and legal fees for any breach, without any limitation of liability or reciprocal indemnity from the Licensor. This exposes Licensees to potentially unlimited financial liability, which is commercially unreasonable and could deter business relationships.

Legal Analysis

critical Risk

Removed

Added

LicenseeEach party shall defend, indemnify, and hold harmless the Licensor, its content providers and their respective officers, directors and employeesother party from all damages, liabilities, and expenses (including reasonable outside attorneys'’ fees), arising outfrom their respective breaches of or asthis Agreement, subject to a result of claims by third parties relatingtotal liability cap equal to Licensee's use of any Licensed Material outside the scopegreater of NZD $100,000 or the total fees paid under this Agreement. Neither party shall be liable for indirect or any other actual or alleged breach by Licenseeconsequential damages except in cases of this Agreementwillful misconduct or gross negligence.

Legal Explanation

The original clause is one-sided and uncapped, exposing Licensees to unlimited liability. The revision introduces mutual indemnity, a reasonable cap, and exclusions for indirect damages, aligning with industry best practices and reducing the risk of catastrophic financial exposure.

3. Termination for Non-Payment: Immediate and Disproportionate Remedy The agreement allows for immediate termination and demands the return of all materials at the Licensee’s cost upon late payment. There is no cure period or proportional remedy, which could result in abrupt business disruption and loss of investment in Licensee Work. Industry standards typically allow a 10–30 day cure period to avoid unnecessary losses.

Legal Analysis

medium Risk

Removed

Added

Failure to makeIf payment on or beforeis not received by the due date shall terminate this Agreement and, the Licensor shall be obligedprovide written notice to immediatelythe Licensee and allow a cure period of 15 business days. If payment is not made within the cure period, the Agreement may be terminated and the Licensee must return or delete the Licensed Material unused to the Licensor at the Licensee’sits own cost.

Legal Explanation

Immediate termination for late payment is disproportionate and commercially unreasonable. The revision introduces a cure period, providing a fair opportunity to remedy non-payment and reducing the risk of abrupt business disruption and loss.

4. Limitation of Liability: Absence of Cap Increases Litigation Risk The T&C expressly exclude Licensor liability for any loss or damage, direct or indirect, arising from defects in Licensed Material. However, there is no reciprocal limitation on the Licensee’s liability, nor any overall cap on damages. This imbalance could result in multi-million dollar claims for relatively minor breaches, contrary to global best practices (e.g., caps at 1x–2x fees paid).

Legal Analysis

high Risk

Removed

Added

TheExcept for liability arising from willful misconduct or gross negligence, the Licensor’s total liability under this Agreement shall not be liable for any loss or damage sufferedexceed the total fees paid by the Licensee or any third party, whether directly or indirectly, arising from any alleged or actual defect in anyfor the Licensed Material or its caption or in any way from its use in the. The Licensee Work’s liability shall be similarly limited, except in cases of willful misconduct or gross negligence.

Legal Explanation

The original clause excludes all Licensor liability but imposes no corresponding limitation on the Licensee. The revision introduces balanced, reciprocal caps on liability, aligning with global standards and reducing the risk of disproportionate claims.

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Conclusion: Proactive Legal Protection is Essential Our examination shows that Te Papa Tongarewa’s current terms expose both parties—especially Licensees—to disproportionate legal and financial risks. Addressing these issues with clear, balanced, and enforceable clauses can prevent costly disputes and regulatory penalties.

Are your contracts exposing you to unlimited liability or copyright claims?
How often do you review your indemnity and termination provisions for enforceability?
What safeguards are in place to ensure compliance with global copyright and consumer protection laws?

This analysis is for educational purposes only and does not constitute legal advice. For actual legal guidance, consult with a licensed attorney. This assessment is based on publicly available information and professional legal analysis. See erayaha.ai’s terms of service for liability limitations.