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Letter of understanding

Discussion in 'Legal Issues' started by Weirfire, Nov 11, 2004.

  1. #1
    I am about to enter into my first contractual agreement and was wondering if those of you that have had experience in this field could give any examples of the type of things that I may wish to include in the letter of understanding?

    So far I have noted down

    • Obligations from both parties
    • Pay rates
    • Length of time of the contract

    Are there any others which you can think of?
     
    Weirfire, Nov 11, 2004 IP
  2. SEbasic

    SEbasic Peon

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    #2
    Maintenance of the sites is important.
    Payment dates from the client
     
    SEbasic, Nov 11, 2004 IP
  3. Trance-formation

    Trance-formation Peon

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    #3
    Conditions under which either party may withdraw from the agreement/termination?
     
    Trance-formation, Nov 11, 2004 IP
  4. Weirfire

    Weirfire Language Translation Company

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    #4
    Thanks guys

    I'm going to discuss terms tomorrow so this information will certainly give me a bit of foresite before the terms are discussed. ;)
     
    Weirfire, Nov 11, 2004 IP
  5. nevetS

    nevetS Evolving Dragon

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    #5
    If bills are late you are allowed to charge a certain percent of interest by law. (believe it varies per state), but man o man. I wish I would have figured that out earlier. Find the law, and spell out the terms you want in your agreement. Don't be friendly on this matter and start out with net 30. Then you end up giving the guy a grace period and it's all of a sudden three months later when you get paid.

    Bills are payable on receipt, 30 day grace. Interest charged on all items unpaid within time frame. IN a dispute place money in reserve and work things out through binding arbitration.
     
    nevetS, Nov 11, 2004 IP
  6. Weirfire

    Weirfire Language Translation Company

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    #6
    ok now I'm scared :eek:
     
    Weirfire, Nov 12, 2004 IP
  7. jarvi

    jarvi Well-Known Member

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    #7
    Just think of everything that can go wrong and make sure there is a plan for how to deal with them. That's the reason many lawyers are pessimists, because they have to think of the worst case scenarios when drafting contracts and agreements.

    Regarding the interest on overdue accounts, make sure you check the local laws. Here in Australia I think there is a problem under certain circumstances where you can be classed as a credit provider (if you charge interest), and then you fall under a whole other set of legislation which often makes it not worthwhile charging the interest in the first place. May be better just to stop work until it is paid (if it's for progress payments) or come up with some other disincentive if they don't pay.
     
    jarvi, Nov 12, 2004 IP
  8. Trance-formation

    Trance-formation Peon

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    #8
    Don't worry... in UK it's not all that complicated... invoice payable within (say) 30 days and in terms and conditions just state you reserve the right to add interest (state amount) on any debts not paid within that time (check the wording, its a long time since I did anything like this). I could send you over a copy of terms and conditions back from my recruitment days if you want.... different service, but you could see how we worded the contract re payment and invoicing.
     
    Trance-formation, Nov 12, 2004 IP
    Weirfire likes this.
  9. Weirfire

    Weirfire Language Translation Company

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    #9
    Yeah that would be great TF :)

    I have to negotiate the commission rate first before any contract gets written up. :eek: That's my first problem as I dont really know how much my target price is.
     
    Weirfire, Nov 12, 2004 IP
  10. FCM

    FCM Well-Known Member

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    #10
    Make sure you take at least a 15% deposit down for the work you are going to be doing. I usually take 50%
     
    FCM, Apr 2, 2010 IP
  11. WizardRSS

    WizardRSS Peon

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    #11
    FCM, this topic was started 6 years ago ;)
     
    WizardRSS, Apr 2, 2010 IP
  12. Law-Dude

    Law-Dude Active Member

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    #12
    Talk about a testament to DigitalPoint's timelessness! :D
     
    Law-Dude, Apr 4, 2010 IP
  13. FCM

    FCM Well-Known Member

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    #13
    Well regardless of how old this thread is it is still relevant.
     
    FCM, Apr 16, 2010 IP