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The “Don’ts” and “Dos” of Development Agreements

Sep 18, 2014

The contract between a developer (whether they be a software developer, app developer or web developer) and their customer is a very important document – it governs each party’s obligations and, if both parties act properly, can avoid disagreements at a later date.  Get it wrong and both parties could end up walking away from the project without getting what they wanted!

Below are a few tips to help you get it right…

  1. Scope

DON’T attach the developer’s proposal.  This is a sales document and is unlikely to be drafted in a way that is suitable for a contract.

but…

DO include a “Specification” detailing (at the very least) the key features of the end product or “Deliverables”.  This should be as specific as possible.
 

  1. Changes to Requirements

DON’T expect the requirements to stay the same throughout the development project.  It is almost inevitable that one or other party will identify improvements prior to the final version.

so…

DO include a “Change Control Procedure”.  A defined process helps the parties to agree changes in an efficient manner.
 

  1. Intellectual Property Rights

DON’T assume that the customer will own any IPR just by virtue of having paid the developer to create it.  In the absence of any written agreement to the contrary the developer will own everything they create.

DO be clear about the customer’s rights to use the developer’s existing products (if any).  If the developer will be providing an existing product or standard code under licence, the contract must be clear about the permitted use and any restrictions.
 

  1. Customer input/acceptance

DO ensure that you include any requirements for customer input e.g. providing content, ensuring the availability of staff for decision making and acceptance testing and/or providing hardware.
 

  1. Pricing and Payment

DON’T give (or accept) fixed price quotes without being very clear about the scope of work (see point 1 above!)

DO ensure that charges and payment terms are clearly spelled out so that there can be no confusion.
 

  1. Term and Termination

DON’T forget to make provision, if applicable, for some services (e.g. support) and licences to continue after the term of the development project has ended.

DO consider the circumstances under which each party should have the right to terminate.
 

  1. Warranties, Liabilities, Indemnities and Boilerplate Clauses

DON’T assume that they are all standard!  The “legal” bits tucked away at the end of the contract can make a huge difference to your risk.  They are often the most hotly negotiated terms.

DO contact Waterfront!  Whether you are a developer or a customer, we can ensure that your contracts are watertight, keeping your risk to a minimum.
 

If you have any questions about a development contract, or any other type of agreement, don’t hesitate to contact Waterfront’s friendly and experienced Commercial Contracts Team!