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It is a constant source of surprise to me how many web design and other IT professionals do business without written contracts. The amateur sociologist in me recognizes the cultural differences at play here. New media is innovative, entrepreneurial, fast-moving, and client driven -- in contrast to the plodding, minutia-obsessed scriveners in my own legal profession. Web designers in particular are often individual enterprises or small businesses, organized informally with respect to everything except a focus on executing their work and delivering good product. Client relationships are personal; invoices get paid; who needs legal niceties? Indeed, most of the time things move along swimmingly, or at least satisfactorily, and the presence or absence of a written contract is irrelevant. But if you are in business long enough, and deal with enough clients and client expectations, sooner or later something will go wrong. The invoice will not be paid; the work will not be accepted; extravagant bells and whistles entailing extra work will be claimed as part of a "project." It is when things go wrong, that a written contract provides valuable protection. When a deal or a client relationship falls apart, even a short, well drafted contract can protect you in several ways. Most fundamentally, the writing is a memorandum of what the agreement between the parties actually was. The importance of this in simplifying any legal proceedings can hardly be overstated. In the absence of a writing, the court is essentially faced with a Peoples Court - type swearing contest. "The price was $XXX.00." "No it wasn't. I never agreed to pay that." "She promised that the site would have XYZ functionality." "No I didn't. That wasn't in the scope of the work." Without a writing, the resolution of the dispute turns on the court's assessment of the parties' relative believability, based on subjective, personal impressions and the surrounding circumstances of the case -- needless to say, an uncertain business. From an evidentiary standpoint, a written agreement is an invaluable tiebreaker in any such dispute, and the courts love them for just that reason. Whether you are prosecuting a claim for payment, or defending a claim that you didn't perform agreed work, you want that tiebreaker on your side. Indeed, the existence of a writing is so powerful that it prevents many disputes from ripening into court cases, and leverages resolutions outside of court. Moreover, aside from the substance of the agreement itself, a written contract can go far in shaping the procedures by which disagreements get decided. The traditional court system is no longer the only alternative. Both federal and state laws allow and encourage contracting parties to mediate or arbitrate contractual disputes. Your contract can provide that any dispute be arbitrated and not brought to court -- often a simpler and less expensive procedure. Additionally, the contract can specify where court or arbitration proceedings will take place, and specify which state's law will apply. While many web designers serve largely local clienteles, the internet enables work with a broad, potentially limitless geographical reach. The farther from home your clients become, the more it makes sense to keep the choice of forum and choice of law close to home, in order to limit the risk of a dispute proceeding in another city or state. In short, written contracts for website development are like insurance policies. You don't need them on good days, but on bad days they can be worth their weight in gold. In future columns, I will comment on the various provisions that can go into a well crafted website development agreement, and the concerns to be addressed in drafting them. However, for starters, it is not difficult for even the smallest web design business to have a standard written contract covering the basics, and capable of being modified as circumstances require for particular clients or projects. Such a contract need not be onerous; it can be written in plain English; and it need not be off-putting to clients. As the poet Robert Frost rightly observed, "Good fences make good neighbors." Paul O'Flaherty is an attorney with the Chicago firm of Cheely, O'Flaherty & Ayres, concentrating on Internet law and litigation matters. Visit him at http://www.lawchicago.net/.
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