Contract vs. MOU

Discussion in 'Contracts and other Legal issues' started by OldenGray, Mar 25, 2008.

  1. homesight <img src="images/ranks/mod.png" />

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    You guys are all insane!!! Use a notable escrow account, coupled with a contract for those whom you don't know , or they don't know you, and be done with it :)

    Ryan.
  2. turnkeysetup

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    Escrow dont mean anything, and still dont mean you will be paid. Maybe someone used a stolen credit card to fund the escrow, now do you think you going to get that money ??

    I will stick with the way I do it, it works and I do not be ripped off anymore by anyone. Yes I have lost money just like any other honest developer has. I do not lose any money anymore, I do not need a contract just to sell a virtual product.

    James
  3. laughingbird

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    I totally agree with Ryan.
    I sell non-tangible items as well (my software).

    The contract in my case (now) is the "click here to agree" button before installing or downloading the software.

    ... But back in the day, when I did logos and websites for other companies, I would never have gone ahead with a job without a contract along with half up front (and half upon completion).

    I always threw in "unlimited modifications" to make it a nice deal for the client ... and I never charged hourly. I always quoted a flat price for my work. This way, the client never got nervous if I happened to go 20 hours over time. The contracts made the whole project more professional and less scary for the client.

    Contracts go both ways. Good for the service provider, and good for the client so that both feel comfortable with what they're up against.

    I would venture to say, that a client who won't sign no-stinkin-contract will probably be more apt to charge back the card or not pay at all.
  4. homesight <img src="images/ranks/mod.png" />

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    Escrow means a lot! It's a legal binding agreement to get paid, and barring a stolen card you need dual permission to release funds... You dont release the funds till your project is accepted... Anything can be stolen, there is no doubt about that. I haven't got ripped on an escrow payment yet...

    A LOT of freelance sites use this type of service..----> You mentioned you were a part of a few, which ones... I'd be curious to see how other sites are operating...

    Ryan.
  5. turnkeysetup

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    Hey Marc,
    Oh I agree, I do have software license files on all my sites (as all of them are dynamically built sites) which I really dont consider a contract but an agreement.

    I would also agree with the hourly rate, I never charge such. I always have charged a flat rate and support my work for life.
  6. turnkeysetup

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    You are correct alot of freelance sites dont even allow credit cards due to the problems with chargebacks. But escrow even offered through a freelance site does not promise that you will be paid, it is not a legal binding agreement. There is nothing that can force a buyer to release funds, not even the freelance site admin/owner. Fact is even the buyer (just like with credit cards) can request a refund of that escrow, and yes I have seen that done. Not to me ofcourse because I do not use any escrow but I have seen it done by others.

    I am glad you have not been ripped by using escrow but just do know it is not a promise you will be paid.

    James
  7. Topcatz Banned

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    I wasn't going to get into this although I can longer stand aside. I have only done 1 redo and my specialty is 1st timers with a site and I register the domain name in my name, I can allow my client to access the site and review the progress,,,
    The name and site are not transfered until I am made "whole", either by a direct deposit to my bank acct or in rare occasions a payment request sent by me to the client via paypal. I do not mantain a "vendor" acct with paypal
    only a personal acct...
    I've not had an ireconsilable problem yet (knock on wood)...
    Logos are a different story...........
  8. LMullennix

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    Just jumping in here...
    Everyone is making valid points. Let's just remember that a huge reason for a contract is to state each parties' intentions and obligations. With this clearly spelled out, the chances of a disagreement are lessened. Don't we all just want to stay away from the drama in the first place? That's a big fat "yes" for me!
  9. Wicked

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    Man, Another thread I can not belive I have never read.. Give this has a couple months of age on it now but what a valuable read.

    I think its safe to say that there is no safe way of doing business online if you are a developer/designer. Theres a quote for ya. We are all going to get ripped off if you in fact have not already.

    The way turnkey does business I think is good.. Atleast if I was his customer it would give me a warm fuzzy about dealing with a legitimate person. Especially if I was just purchasing a pre-existing virtual product from him.. However from the time the client ask to have everything redesigned it was no longer pre-existing. Thats when the contract should have happend in my own personal oppinion. Whether the contract is of any use in avoiding you from being ripped off it is surely going to scare away a large crowed of people who already plan on ripping you off.. Its kinda like a spam filter.. Do not sign here if you can not meet the requirments I am filtering to you if that makes any sense as a useable metaphore.

    With my new website that has probably only been open with low traffic for 8-9 months I have made about 50 sales give or take 5 Im not sure. I have already ran into the stolen credit card deal. It was charged back and I did not mind.. I blocked the ip the purchased the product but that only stops one person among many out there that will do this to you. It did not really hurt my feelings much for me because for starters it was a 5 to 7 dollar product hence my Cheap To Download site title and I lost nothing that I physically owned as a material state. Since then I have behind the scenes been integrating some new software titles that i will be releasing some time this year one at a time to give them all there spotlight moment.. In these new titles I have a system that tracks the software (no personal details). Basically as soon as someone shares there registration code with somebody else I can go in and deactivate both of there software titles and render them useless.. I think in the future this type of thing could be implemented into scripts and encoded in a hidden place where just the same a script will not longer function correctly. I did not design any such system but it is available to use from the guys who do my software titles for me.. Its a very nice and effective feature.

    The only thing that stops me at this moment from going with another software design company is not having that control over my products. I am trying to talk with two different people now and see if one is able to build the software and the other be able to include it in there virtual products protection system....

    I think a more important thing to consider turnkey is not whether whos wrong or wright or what you can or cant do about it but rather what you have learned from it and what you can do to avoid such things in the future which I believe you have done.
  10. Butler Law LLC

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    Doing business without a contractual obligation is foolish. The law of Contracts is highly complex, and despite the numerous years you may have worked without a contacts or pseudo-contacts you are going to incur a financial loss. While I don't want to advertise my law firm without permission, I have numerous , if not thousands of legal documents that the client fills out and an attorney's reviews for legal validity. Rarely would a simplistic contract cost more than $100, and it is backed by an attorney. You will get burned, and you will lose without a contract. Avoid legalzoom.com like the plague - they are not lawyers. One wrong word or miss-worded clause and you're doomed. This is a litigious society.

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