[thelist] Selling a site on eBay when a client doesn't want to pay...

Martin Burns martin at easyweb.co.uk
Sun Jun 15 18:11:07 CDT 2008

On 15 Jun 2008, at 18:41, Nadeem Hosenbokus wrote:

First off, Hassan's right: talk to a lawyer.

That said (and IANAL, but I deal with this kinda stuff), some thoughts  
which may be applicable:

> We have an overseas contact who deals with a client who wanted to  
> build a
> property website. We started it late 2006 with a 2 month delivery date
> aiming for the site to be up and running early 2007. The  
> requirements were
> fairly sketchy and we were fools to agree to it but we did.

No, you were fools to take a fixed price contract without a firm scope  
and most importantly: a Change Control Process :-)

> It is now about one and a half years later and the project is still  
> running.
> Every time we uploaded a preview, the client added a few changes  
> here and
> there.

For each requested change, there should have been an instant response  
of "We will produce an impact assessment on the time and cost; if you  
want the change, you'll need to agree to the IA". Testing & defect  
fixing time is of course part of the impact.

> Initially these weren't a problem

Yes they were - they established a precedent.

> Now the client wants the code without making any further payments.

Key question that your lawyer will ask: did your contract explicitly  
assign ownership of code to the client?

If not, then your response can be summarised as: "Hahaha, pull the  
other one, mate - it's got bells on"

> He says
> he'll take us (or the middleman rather) to court otherwise because  
> we've
> taken too long to deliver.

Too long by what definition? There's not a court that would hold you  
to the original timeframe when the scope's been so uncontrolled.

> So I have some questions for those who may have had some similar
> experiences:
> 1. If we were to take the code and offer it on eBay would we be  
> violating
> any laws like intellectual property laws: the site basically allows  
> users to
> create an account, upload the details of a property, have a solicitor
> assigned to it and then sell/buy online - but the unique parts of  
> the site
> (that allow interaction between solicitors and users) haven't been  
> built
> yet. All we have currently is a site that allows users to create an  
> account,
> upload a property and make an agreement with another user to sell or  
> buy.

Who would want to buy such code? I'm not convinced there's enough  
value there to sell to anyone but the client.

> 2. How much liability would the middleman have if we sold the code?  
> Could he
> defend himself in court if we don't deliver?

Who is your contract with? Are you contracting to the client, or sub- 
contracting to the middleman? If the latter, what are the middleman's  
responsibilities to *you*? If the latter, then I think they screwed up  
in not managing the client. If the latter, then the terms of their  
contract with the client could make life a little interesting for them.

If it's the former, then it's not their problem (unless part of their  
contract with the client is to manage you).

Either way, I'd be asking: why is it your problem what liability the  
middleman has? Everyone is responsible for their own outlook.

> 3. How would you end a project like this? It seems to be in limbo: the
> project hasn't reached the stage where the next payment is due but the
> client has said that he wants the code now without paying anything  
> more. Do
> we ask him for a formal statement to the effect that we can stop
> development?

Here's a thought: sounds like you've created something that isn't  
actually useful without more work being done on it. They can't simply  
take your work and launch. So here's a suggestion (that assumes you  
got your original 40%):

Go back to the original scope (pre the changes) - you *should* have a  
copy of your code that was pre all the changes (and pre-testing too).  
Give them that code as they've not paid you for any changes beyond it.  
Call it quits at that. Write off the rest and *learn* from it about  
how to handle scope and change.


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