Recently got scammed out of $1000, the client charged back after most of the work is done. So i am think of having a TOS which says they give up their right to chargeback and service is provided on best efforts basis and refunds are at my sole discretion etc.... Any one here an attorney or can point me to one?
Your credit card processor or paypal reserve the right to do chargebacks under set situations. Your own policy cannot negate the terms you agreed to when you agreed to accept payments from the processor. It is going to be impossible to eliminate the possibility of any chargeback, under all circumstances. Each processors has their own requirements when it comes to what you must do to limit refunds and you should contact each processor individually to find out what you specifically must do for a "no refund policy". For example, some visa/mc processors require that a person must sign a receipt which states that there is no refunds, and it must be within 1/2 inch of where they sign, and that the policy must be in a certain size font, etc. The customer is usually favored in a chargeback situation - especially when there is a delivery or quality dispute. Making sure the client has a clear understanding of what is going to be delivered is much better than trying to fight a chargeback. Even if you are successful in defending a chargeback, there is nothing stopping the client from taking you to court. Requiring a "cashiers check" or wire would obviously eliminate the chargeback option.
Thanks mjewel, so if i have the client sign a contract which states no refunds and he does a chargeback, i can take him to court and win the case and make him pay my lawyer fees?(i.e. if my contract says he will be obliged to pay my lawyer fees in case of that situation) or there are any laws against this type of contract and courts can make my contract invalid ?
You can have a contract with a "prevailing party" clause which will award legal fees to the party that wins. There is an implied warranty with most good and services, so the other party could argue over this. Suing someone for a $1,000 or so is usually not something you want to bank on. You'll have to put up thousands of dollars in advance for your attorney and court fees, and even if you do win, the courts aren't in the business of collecting for you. If you sue a deadbeat, or someone in another country, collecting a penny can be virtually impossible. You might want to consider breaking up a larger contract into different levels of completion - each requiring a percentage of payment and an acceptance of the work.