How about this scenario: Agent sells author's first novel to a well-known house and a well-regarded editor. Agent then leaves agency for another line of work, and is succeeded by another agent from same agency, who is not nearly as committed and energetic. Editor who bought book jumps to another house without taking the book with her. New editor clearly doesn't understand the manuscript, dislikes it and sends a lengthy letter essentially demanding a stem-to-stern rewrite with major changes to key characters that will destroy intent of said novel. Agent is useless and apparently has not even read the manuscript. After some more dicking around, editor cancels contract.
Heard that one often?
Usually when I'm answering questions, they're not so much theoretical as situations the author is in or heard about. Here we have a situation that's pretty far gone in the theoretical area, but I'll look at it anyway. The situation is: author gets book contract via agent, and then both agent and editor abandon her.
(1) The agent. You can fire your agent if you don't like them. Most agents work only off a verbal agreement with their clients anyway (though a contract is not unusual) so all you have to do is say, "I don't want you to be my agent anymore." The tricky thing here is that the agency's name is undoubtedly on the contract. The agent represents the author, so though the author's name appears on the contract and it requires the author's signature, somewhere in the first few paragraphs of a typical contract is a notation making it clear the author is represented by the agency, and all monies will go to the agency address and not the author's address. If you have a legitimate reason to fire your agent, but their name is on a contract, they may fight to keep it there and collect their 15% on future royalties. I'm not actually sure how you would go about solving this situation if you felt the 15% wasn't deserved, as I've never had this come up before. In this case, though, the 15% is deserved, as the agency did make the deal, even if it wasn't that particular agent at the agency who made the deal.
There's some issues between agents that go on for years, usually not involving the author. For example, my boss used to be a subagent at another agency when she was starting out. Her boss got a cut off her earnings. When the contracts were signed, they had the agency name on them. Now it's been a few years, but there are still some royalties being earned by authors who have followed my boss when she formed her own agency, but as her old boss had a part in the original contract, the money still goes through her old boss and has to be passed on to her. We get a lot of mail with that agency's letterhead on it. You would think agents wouldn't fight over pennies (in this case it's not a fight; it's a completely mutual agreement that does not subtract from the author's cut in any way) but sometimes they're not pennies. You never really know if a book is going to succeed wildly or get a second wind (especially if it's a political book) and royalties are going to be rolling in; the agent and their old boss have it worked out as to who gets what and where before the check is cut to the author, still at the rate of 15% for the agent(s).
(2) The editor. This may be a problem and it may not be. If the book was fairly far along in the process, it might not be a big deal. Editors work on things they don't care for all the time, either because they got handed someone else's workload or because they're an assistant to a bigger editor or a long list of other reasons. Editors are editors; their responsibility is to edit, which can be as minimal as "let's see if there's any huge inconsistencies before it goes to the copyeditor." If the deal is done, and the advance has been paid, and the publisher has already invested money in publicity for the book and hours of editorial, then the publisher has a good reason to go forward with the book and the editor has a good reason to just do their job and push the book to the copyeditor's and be done with it. If the editor decided to kill the book, there would need to be a really legitimate reason to justify all the time/money already spent on it. If the editor doesn't care for working on the book, they'll probably rush it to the copyeditor, who usually has no emotional investment in the book and is simply doing their job, which is to copyedit the hell out of the manuscript before it goes to layout. Once it's in the copyeditor's hands, it's pretty much going to be published unless something unusual happens, like the company goes bankrupt.
EDIT: So I'm now told this was not a theoretical; it happened long ago. Says the person who emailed me:
It wasn't a theoretical situation -- all of it happened several years ago. The book had already been scheduled (as a paperback original) and the cover design was being discussed. The author in question did drop the agency. A portion of the advance had been paid, and the author was never dunned for it. I've had writers and agents tell me this is the worst publishing story they've ever heard.
I'm not going to change whole post around, but yeah, that is a pretty bad situation. It also is very rare, I'm assuming.