Legal Question
Discussion
If someone agrees to spend £X on, say, a website.
And the invoice reflects that with their website, they will receive 1 years free web hosting and free domain name. And the client then decides he/she does not want to proceed with the website (6 months later). Is the client legally obliged to pay for the "free hosting and domain name" which were set up upon their request, if they do not proceed with the development website. Bearing in mind the hosting/domain were only free with the website.
I ask, because I am usually speaking to less than 50-100 people at one time, and this happened many times in the past. I now very rarely do anything before a deposit has been paid, but still, on occassions I do invoice a client and set up a holding page when I'm 200% sure that the client IS ready to proceed, and actually aks for an invoice - it still happens from time to time.
People often say they are ready to start, but its very very common indeed, for weeks and months (sometimes a year or more) to pass, before they actually do proceed. Even after they have said yes, we're 100% ready to proceed today, invoice us now and register that domain/hosting etc... People just seem to be very good at finding excuses to put off until tomorrow what they dont have to do do today, especially when gathering the information they need to begin the project... it requires effort you see.
And the invoice reflects that with their website, they will receive 1 years free web hosting and free domain name. And the client then decides he/she does not want to proceed with the website (6 months later). Is the client legally obliged to pay for the "free hosting and domain name" which were set up upon their request, if they do not proceed with the development website. Bearing in mind the hosting/domain were only free with the website.
I ask, because I am usually speaking to less than 50-100 people at one time, and this happened many times in the past. I now very rarely do anything before a deposit has been paid, but still, on occassions I do invoice a client and set up a holding page when I'm 200% sure that the client IS ready to proceed, and actually aks for an invoice - it still happens from time to time.
People often say they are ready to start, but its very very common indeed, for weeks and months (sometimes a year or more) to pass, before they actually do proceed. Even after they have said yes, we're 100% ready to proceed today, invoice us now and register that domain/hosting etc... People just seem to be very good at finding excuses to put off until tomorrow what they dont have to do do today, especially when gathering the information they need to begin the project... it requires effort you see.
- Im more curious about the technical legality of the scenario, than how to prevent this from happening.
Edited by Buster Bakdorzin on Thursday 19th June 15:01
This would be a great time to tighten up your T&Cs.
Legally, once an agreement has been made, a service has been offered accepted and a price arranged and accepted, even verbally, then this is in fact legally binding.
When a project the client has cancelled at the eleventh hour after having our documentation and them agreeing a price and us spending hundreds of pounds in preparation, I end up having to explain the commercial realities of the situation.
Sometimes they see your point of view, but I have lost count of the times that people have said to me (and you can even see the smile on their face as they say it):
"We never signed a contract with you so we don't have anything binding..."
And thats just rubbish.
I would say that if you have got to the point where to complete work for them on their request you have booked a domain or hosting, then there is no doubt that there is a contract in place. Should they wish to literally 'buy their way out' of the contract then this is what they need to do, cover your costs.
What I would recommend is spending a few hours and £20 looking over a Business Law textbook. It outlines the basics of contract law, and once you understand the concepts you will be able to change the way you work to cover yourself, and advise clients of the legal position confidently in the future.
At the end of the day, I refuse to let my other good clients cover the cost in my prices for the few who mess you around, and I will always tactfully follow up 'cancelled contracts' where I have expended on their behalf.
Legally, once an agreement has been made, a service has been offered accepted and a price arranged and accepted, even verbally, then this is in fact legally binding.
When a project the client has cancelled at the eleventh hour after having our documentation and them agreeing a price and us spending hundreds of pounds in preparation, I end up having to explain the commercial realities of the situation.
Sometimes they see your point of view, but I have lost count of the times that people have said to me (and you can even see the smile on their face as they say it):
"We never signed a contract with you so we don't have anything binding..."
And thats just rubbish.
I would say that if you have got to the point where to complete work for them on their request you have booked a domain or hosting, then there is no doubt that there is a contract in place. Should they wish to literally 'buy their way out' of the contract then this is what they need to do, cover your costs.
What I would recommend is spending a few hours and £20 looking over a Business Law textbook. It outlines the basics of contract law, and once you understand the concepts you will be able to change the way you work to cover yourself, and advise clients of the legal position confidently in the future.
At the end of the day, I refuse to let my other good clients cover the cost in my prices for the few who mess you around, and I will always tactfully follow up 'cancelled contracts' where I have expended on their behalf.
Yep we have very clear T&C's we quote for a job, if that is accepted we take a deposit, no deposit no start of job.
The deposit is non refundable, does not form any part of the hosting (in T & C's) so hosting will be terminated if the client pulls out. The deposit covers domain name cost price, photography and admin.
99% of our clients are serious about getting a site done, the 1% who mess about will technically loose the deposit although in most cases we will refund at our discretion.
The deposit is non refundable, does not form any part of the hosting (in T & C's) so hosting will be terminated if the client pulls out. The deposit covers domain name cost price, photography and admin.
99% of our clients are serious about getting a site done, the 1% who mess about will technically loose the deposit although in most cases we will refund at our discretion.
I did buy a legal textbook and am slowly reading it (slowly, because its in the bog) but would like another which goes into more depth. After writing off a sizeable chunk of dead money each year, Im finally starting to take people to court. Got my first hearing next month, and am looking forward to it, because in the past I always shied away from the Bureaucracy of it all.
Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
Edited by Buster Bakdorzin on Friday 20th June 00:39
When I was in private practice the clients who were the biggest pains who always wanted everything done immediately (when it was not patently urgent) were always the ones who paid last and grudgingly.
Oral contracts are more difficult to prove than written ones, but the Courts can examine the surrounding circumstances including any other documents/emails passing and weigh up what they make of the personalities of the people giving evidence.
Oral contracts are more difficult to prove than written ones, but the Courts can examine the surrounding circumstances including any other documents/emails passing and weigh up what they make of the personalities of the people giving evidence.
Buster Bakdorzin said:
I did buy a legal textbook and am slowly reading it (slowly, because its in the bog) but would like another which goes into more depth. After writing off a sizeable chunk of dead money each year, Im finally starting to take people to court. Got my first hearing next month, and am looking forward to it, because in the past I always shied away from the Bureaucracy of it all.
Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
It might be easier and cheaper in the long run to get a lawyer to draw up some T&C which make it clear what they are signing? That might mean less bad debt but also mean you get less contested court cases as they will be advised to pay up if the T&C are tight enough. My philosophy is that me spending time being an accountant, lawyer, debt collector, software developer, publisher, marketeer and salesman detracts from what I am good at and what makes me money and although I do bits, bottom line is I think I should leave the difficult stuff that has to be done properly to the specalists (as I hope my clients are doing when they come to me).Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
Edited by Buster Bakdorzin on Friday 20th June 00:39
Buster Bakdorzin said:
I did buy a legal textbook and am slowly reading it (slowly, because its in the bog) but would like another which goes into more depth. After writing off a sizeable chunk of dead money each year, Im finally starting to take people to court. Got my first hearing next month, and am looking forward to it, because in the past I always shied away from the Bureaucracy of it all.
Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
I agree with all of that.Its not about the hosting money at all, nor the huge amount of time spent with this particular client (lots, over 18 months) and I dont mind in the slightest that we are not doing business, in fact I believe I threw his contact details away long ago... But I dug them up online this week after realising this was a classic case of someone not paying for something he should have, so have decided to pursue it as an exercise.
Its a case of me strongly disliking of the flippant manner in which he (representing all bad clients) feels he owes nothing, and on moral grounds (I owe it to myself!) the new-found desire to actually take someone to court, and win a justice. Regardless of the amount of money involved. Learn from the experience, then take the bigger non payers to court after hopefully finding out first hand that court doesnt have to be a scary place to go.
Out of curiosity, on verbal agreements, even though they are legally binding, isnt a verbal agreement virtually useless, if a client contested the agreement itself by denying the agreement was complete and finalised, in court?
I have half a dozen people I should be taking to court, for various amounts of money, and plan to take them all one by one so that I can learn the ropes, and will amend my terms accordingly.
Another thing: Nearly every one of my half dozen clients owing money, Id either write off, discount down by 75%, give an unlimited amount of time to pay or something equally generous... Dont you find that when they try to hide, dont take your calls and dont respond to emails, it only makes you want to nail them all the more.
Edited by Buster Bakdorzin on Friday 20th June 00:39
Most pertinently, are the clients who understood that morally you have been left out of pocket from their actions. In those cases if they play ball we without fail we will work something out with them.
Most annoying are the ones which completely agree with the moral situation, but still tell me on the phone that they will 'Speak to their legal department..' hoping that they will fight their battle or find a loophole. That has happened to me a few times, it has extended things a while but each time got the answer from them that they will be paying in full, usually within hours of my time limit for the final warning to legal action to expire.
My system is simple. I supply a shortish brochure which explains how we work, and the hows and whys cancelling a project will cost the client after it has begun. Also the hows and whys we offer early payment discount, or late payment charges.
Our 'contract' is merely a piece of paper with our company details on it, a description of the work we are doing, and a very short paragraph which states: I confirm that I have received and understood the information pack sent to me and understand this defines our agreement for any work below or in the future.
As it is so short, it is simple for the client to understand and sign it. Secondly, I have never had to actually take a client to court as yet, and that is working with 1000 over the last 8 years or so. I believe the key is simplicity in the terms. Plain english, that is fair for both parties. Not even the best legal eagles will be able to get around that, and in every case my (ex) client has been advised to settle with me, in full.
trunnie said:
Oral contracts are more difficult to prove than written ones, but the Courts can examine the surrounding circumstances including any other documents/emails passing and weigh up what they make of the personalities of the people giving evidence.
Nicely put, and very interesting - I always supposed they wouldnt take much into account unless it was in black and white.Brown and Boris said:
It might be easier and cheaper in the long run to get a lawyer to draw up some T&C which make it clear what they are signing?
Getting a legal eagle to re-write everything properly is a good idea, and on the cards 
Cheers for the replies.
Edited by Buster Bakdorzin on Monday 23 June 19:45
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