Liability Clause in my new contract

**chicane** · 14 May 2007, 20:42

Does the contract define 'defects'? Do you have a written agreement with the client of the scope of the work to be delivered?

There's a fine line between "features we wanted you to put in but you haven't" and "features you've put in that are genuinely broken".

Especially when you're dealing with clients on the less educated end of the spectrum.

**Lucifer Box** · 14 May 2007, 21:09

That is part and parcel of operating as a real business outside of IR35 I'm afraid. Posit: you contract a local building firm to install a bathroom in your house and some defects are apparent when they finish. Would you expect them to put right those defects at their expense or at yours?

Of course, if you are sitting within IR35 you should negotiate this clause away altogther as there is no point in accepting risk under such a regime. If not, you need to ensure that what constitutes a defect is contractually defined (including the possibility of mandatory arbitration if necessary), along with suitable time limits, sign off protocols and so forth.

**Gonzo** · 14 May 2007, 22:16

It sounds like the contract is trying to be IR35 friendly. This will be a good thing unless you are using an umbrella company.

**Vito** · 15 May 2007, 07:29

Sounds perfectly reasonable to me...just means that you will need to ensure that your documentation is bang on throughout...i.e. scope, requirements, anything they do that prevents you from doing something in a certain way...

Agree with what others have said about IR35, this is ideal...(and it could just be a clause that they have no intention of enforcing but is there to attract contractors who want to be IR35 friendly)...

And yes...take out insurance...for he sake of a couple of hundred quid, you should have it anyway

**Paddy** · 15 May 2007, 11:30

Originally posted by eng123

Im hoping you may be able to help.

The new contract I am looking at taking has the following clause.

'You shall be liable for any defects arising out of the work you have done and shall rectify such defects which are capable of remedy at your own cost and within a reasonable period from notificationof such defects'

Does this mean I have no choice but to take PI insurance if I accept this?
Do these clauses usually have a limitation?
Any suggestions on where I could find an alternative to this clause to propose that would make me less liable?

Thanks for your help

cheers
Nick

As long as you work through your own limited company your fine. At the first hint of litigation because of a balls-up you wind the company up and start again

**chicane** · 15 May 2007, 11:34

Originally posted by Paddy

As long as you work through your own limited company your fine. At the first hint of litigation because of a balls-up you wind the company up and start again

That's a little cocky and off the mark. It's not unknown for litigation to be targeted at the individual rather than the company in particularly nasty cases. Unlikely as this is, you should at least consider the possibility of saying goodbye to your house, car and savings.

**scon_ead** · 15 May 2007, 12:37

I Thought developers/coders only made bug free software anyway...

(Yep...I'm from the testing fraternity)

**cykophysh39** · 15 May 2007, 21:10

Originally posted by scon_ead

I Thought developers/coders only made bug free software anyway...

(Yep...I'm from the testing fraternity)

I've never written bug free code in my life, why do you think I always get contract extensions

**Gonzo** · 15 May 2007, 21:17

Originally posted by scon_ead

I Thought developers/coders only made bug free software anyway...

(Yep...I'm from the testing fraternity)

It depends on how far behind schedule the project is. When behind schedule it is not unheard of for the PM to tell the developers to deliver code to system test now matter how unfinished the developer thinks the code is.

It hits a milestone and that is all the PM is concerned about.

Liability Clause in my new contract