Many businesses do business every day without a written contract? Why? It simply beats us. A contract records the deal, so that if anything goes wrong, for whatever reason, the intentions of the parties are unambiguous and the matter can be resolved quickly and with minimal cost.
Written contracts should be implemented and thoroughly constructed regardless of the subject matter or sector.
There are a number of points which need particular attention when drawing an I.T contract:
The contract should explicitly state the specification of the products or goods in question. For example, if a website design company has been instructed to develop a website, the contract should list all the components which are to appear on that site such as shopping carts, checkouts, video and sound;
The next key issue is payment. When will payment be made? Will you pay all the costs upfront or on completion, perhaps you would prefer to implement a ‘milestone’ payment structure;
The third critical issue is the acceptance test. How will the client know that all the features are in place and the site works well and has been beta tested? The acceptance test is carried out by the client when the site or product is complete and delivered. The test ensures that it meets the required standards;
Last but not least, consider intellectual property - who will own the copyright, who will receive the exclusive rights to any trademarks designed by the design company or included within the developed product?
Of course these IT specific provisions are in addition to other boiler plate clauses such as service of notices, jurisdiction, and the details of the parties and so on.
If by chance you find some error of law or fact in any Net Lawman information page, do please tell us. We should also welcome your suggestions for new subjects for information pages. These notes:
Do not provide a complete or authoritative statement of the law;
Do not constitute legal advice by Net Lawman;
Do not create a contractual relationship;
Do not form part of any other advice, whether paid or free.
