Essential Points of Web Developer Agreements

Clients of my practice usually either have a website or are planning to get one. From an intellectual property “IP” standpoint, the developer agreement is critical to ensure the right content and code necessary for your business to attract clients and customers. There are many terms to consider including project scope, testing, hosting, ownership, payment terms and deliverable. The developer may have a standard form agreement that seems fairly straight forward, but fails to cover one or more of these. You may believe that upon paying for the website, you automatically own the content. Unless your designer is an employee providing these services in the ordinary course of your business, nothing could be further from the truth. These rights need to be assigned or licensed to you. So let’s focus on ownership of the content including the code. This includes the right to use content, whether consisting of text, pictures, video or audio and the right to make changes to the Site involving programming code. If you’re expending funds for a custom designed site you need to be aware of protecting content so your creation does not become the website du jour.  Here is a list of items for your website development agreement:

  1. If you’re providing confidential, proprietary information relating to your business for development purposes, then you should request the developer to sign a confidentiality and non-disclosure agreement. The developer may be applying for a domain name on your behalf. Be sure the agreement requires the application to be in your name. This will ease renewal down the road and transfer of ownership should you decide to sell your business
  2. Ideally, you would prefer 3rd party software and code not be used in the website without your consent. In the event the developer wants to use such software, request to see the license allowing such use for the operation and update of any changes to your site. There may be limitations on use and further development of this software, so review the license carefully. Often, open source licenses require notification be given the original developer if changes are being made to the source code. Licensing development code from recognized sources, such as Word Press, is less problematic as one can rely on a degree of uniformity with respect to use and development rights.
  3. Receiving an Assignment of Copyright and IP Rights is required for ownership, use and future development of your website. This assignment should be in writing. If the Web Developer desires to retain some rights in your website, such as the right to use code developed from previous assignments, you should be granted a universal, perpetual, and completely transferable license to use this code in conjunction with your site. The same would hold true with regard to other intellectual property rights, such as 3rd party licenses, as the interoperability, maintenance, enhancements and ability to transfer the site will be dependent on the appropriate license.
  4. Your agreement should have appropriate warranty and indemnification language to protect you in the event of Site difficulties and/or content disputes with third parties. You should ask the developer to warrant that all content delivered to your project, including code, files, photos, images and other intellectual property has been either fully licensed for your use or is in the public domain. Further, that the developer agrees to indemnify and hold you harmless with respect to any claims of infringement, appropriation of publicity rights, or other IP related causes of action.
  5. What if your developer goes out of business?  It’s important that any code not provided to you be placed in escrow for this occurrence.  This will allow for a less painful transition to a new provider.
  6.  What are the ramifications of a parting of ways whether involuntary or at either party’s discretion?  In this event, it’s important that you have been granted rights that will allow you to continue with the development, operation, maintenance and/or enhancement to your site. Therefore, you should require that such be transferred to you even if the deliverable has not been provided, or fails to meet the specifications set forth in the agreement. This will allow you to hire another developer to continue or complete the project without starting from scratch.
  7. Know your deliverable.  Does your website appear professional when viewed on multiple browsers?  How does it appear on Mobile Applications, Smart phones, etc?  Do the links and forms work?  What is your arrangement for content updates?  Your agreement deliverable should spell out all items promised.

Here are some practical tips to help avoid problems down the road.  Thoroughly vet the website designer.  View the designer’s portfolio.  Does the designer have experience with your business or profession?  Ask to speak to former customers and clients.   Schedule your payments to ensure delivery on a timely basis.  Request a reasonable period to test the deliverable before making the final payment.  Items discussed in Par. 7 will take time to address.  Make sure all is satisfactory before finalizing.

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