Web Development Contracts: The Specifics

Business Owners

webDevelopmentContracts are one of those important but annoying necessities of being a freelancer. If you respect them, they can be your best friend; if you don’t, they can ruin you.

I would recommend creating your own one-page contract for smaller clients to sign. But once you get up around $6,000 – $7,000, many clients will hire their own lawyer to create a contract. Here’s what you should know about signing these contracts:

Hire a Lawyer

First, I’d recommend you hire a lawyer to protect your interests. That is by far the best advice I can give here. But if you don’t want to spend all the profits on paying a lawyer, and you’re willing to take a chance at it yourself, keep reading.

Read Them – Every Word!!

The most important thing you need to do is read the contract (and understand it). If you don’t understand a portion, google it or ask a friend. But you have to read it!!! I know it sucks – it’s pages of tiny type of lawyer-speak. I’m pretty sure even lawyers don’t like reading them. I can almost guarantee you that your client never read it. Their lawyer created a contract highly in their favor (that’s their job), sent it to the client, and they forwarded it to you.

So even if you agreed verbally about something, don’t just assume the client communicated that to the lawyer and that the lawyer put it in. Most likely they did not. You have to double-check.

Don’t Be Afraid to Edit

Sure, a lawyer with a big fancy degree created the contract. But that doesn’t mean you’re stupid. If something isn’t right, tell them you’ll need it changed. You can write out the changes yourself  or tell the lawyer what it needs to say and let him figure it out. And then read his edit to make sure it says what you wanted it to say. It’s better to ask for edits through email (written trail…just in case), and if you do ask for edits over the phone, send them an email to confirm.

After they incorporate your edits, re-read the document, confirming that they all are included. When you meet with your client, you need to take two copies of the final document – one original for them, one original for you. If you sign a copy they bring, scan through it again and make sure all the edits are included. Finally, when you do sign, initial the bottom right or left corners of each page of the document, as well as fully sign and date the final page. Also, signing in blue on both documents makes it really obvious that it’s an original.

Never be liable for more then you’re paid

The number one edit you’ll need to add is that you’re not liable for any monetary compensation over what you’re paid:

“Developer may not be held liable to _______ for any amount over the actual amount paid by _________ to Developer.”

This ensures that if they do try to sue you for whatever reason, at least you have in the document that they cannot sue you for more then the price they paid you – limiting their upside. This is hugely important if you own a house or have other significant assets. They can still sue you, serve you the papers, and take you to court, but at least you have the protection to show the judge that you both agreed that you would not be held liable for any more then what you were paid.

Representation and Warranties by the Developer

Clients will often want you to warranty something to the extreme. For example, warranting that the website will safeguard the project from any hackers. While reasonable efforts should take place to make the website safe, obviously you can’t guarantee that the website is impenetrable. Remember, read the language carefully. Anything that sounds like you might be guaranteeing complete safety should be rewritten or clarified.

Clients with Competing Interests

It’s pretty common for a client to ask that you don’t create a website for someone with competing interests. Obviously this can become an issue both ways: if you do, they’re worried you might influence the other person’s website, and if you don’t, you are limiting your income sources.

Usually for small websites, I say this isn’t a possibility; it simply cuts my income sources down far too much. I will take a competitor’s website after or even at the same time. I design and create every website to the best of my ability, even if they are both competing websites. After all, they’re going in my portfolio, so they should all be great.

For larger websites, you’ll need to decide if it’s worth it to not take a competing website at the same time. Many times, for a large website, it is worth it. However, you’ll also need to make sure that the language doesn’t give a time frame – like for six months after you won’t take a competing client’s website. That is really up to you and where your business comes from.

Creative Differences or Breaches of Contract

For both creative differences or breaches of contract, you want to make sure the client doesn’t just have the right to fire you. They MUST provide you with time to fix that breach of contract. It should be a reasonable time frame, but if they can just fire you immediately, then you could lose tons of hours of work for what could be a simple mistake.

Additionally, make sure you add in what happens if they breach the contract. You need to not only be able to get out of the contract if they breach it, but also get paid for the hours you already put in. I generally add language that says they must pay all the hours I put in up to the breach in contract or they don’t receive what I created.

Portfolio Use

Most clients will include something in the contract that says all the material belongs to the client after payment (make sure it says AFTER PAYMENT). Confirm, in writing, that you can add this project to your portfolio online, your resume, etc.

Your Coding

Finally, if you are bringing any of your already-coded functions or “plugins” to the site (like a slideshow, etc.) designate these as Developer’s Tools in the contract and make sure they understand that this coding is yours. You can give them the right, if you like, to edit it, but you retain the rights to use this coding for other sites or give it away for free or for charge.

Summary

Obviously these are only a few items you’ll want to watch out for in contracts. The bigger the money or the corporation, the more important it is to have a lawyer look over the contract for you.  But even if you do have a lawyer look it over, the bottom line is that you are signing this – so READ IT!

Comments