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  1. #1
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    Client Cancelled Project, Refusing to Pay for Work Already Performed

    OK, I know I should probably just take a deep breath, chalk this up to a "lesson learned", let it go and move on. But I'm interested in your opinion of the situation...

    A non-profit organization approached me to design and build a web site for them. I presented a written proposal, detailing everything I would do. The proposal also stated payment terms: 50% up front, 25% after the design review, 25% immediately after launch. They accepted the proposal, but I didn't have them sign a contract (my first mistake). They paid the deposit, and gave me some non-specific requests regarding the design ("fun", "kid-friendly", "not boxy", "good use of white space", etc.). I came up with three designs, and we had a review meeting. They didn't like any of them, and gave me some slightly more specific feedback: use drop shadows, give it a more 3-dimensional feel, incorporate our program's images, put an animation on the splash page, etc.

    So I go back to the drawing board, and come up with a design I think is fantastic. Not only does it meet every criteria they stated, but I spent the better part of a week getting the trickier stuff to work in IE6 (png transparencies, liquid / fluid design, accordian navigation, etc.). The site is pure xhtml / css - I've got an auto-expanding, hover-only nav working with *no* javascript (thanks Stu Nicholls!), a css-only imagemap, text that reflows as the viewport and/or font size is changed, etc. I put a *huge* effort into this.

    At the review meeting, it gets mixed reviews. The key player was not there, and several others were missing, too. So I put the site up on one of my servers, and grant them access. They look at it later, then contact me and tell me they're going to get a different designer. Huh? What happened? They now claim that it's just not what they're looking for. OK, fine. Web design can be like art - it's an aesthetic, subjective thing.

    So I send an invoice for the 25% due after the design review. They refuse to pay, and say they're being "generous by letting [me] keep the deposit." They say I failed to deliver what they wanted. I tell them I believe I did everything they asked me to do, and said they should be specific about what I missed. No response.

    I'm sure they're not going to pay. This is roughly US$1,000 we're talking about. So it's big enough to piss me off, but perhaps not big enough to warrant a small claims court case. I don't have a signed contract - only an e-mail trail and my notes from the design review meetings. Do I have any recourse, or should I just move on (right after I come up with a contract to use with future clients)?

    Thanks...

  2. #2
    SitePoint Evangelist
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    The point of a deposit is to minimize the risk on both sides. Don't expect any more if they're not going to continue with it.
    - Robert

  3. #3
    SitePoint Evangelist altyfc's Avatar
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    I don't think it matters too much that you didn't get something signed, but in future and with the benefit of hindsight, that's obviously good practice.

    You sound like you've bent over backwards to accommodate - to me it sounds like they've just found someone cheaper, I don't know... just speculating. Presumably you would have tried again if further changes were requested (even if they conflicted with some of the earlier changes).

    Part of me says... pursue them for it. I'm a man of principle often, even if it's not worth the hassle. But to be honest, it probably isn't worth the hassle. You have half the money for a job that's not been finished - that's not so, so bad. I'd move on, put it down to experience, and get on with the new job, I think...

  4. #4
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    1. I've gone to small claims court for less than $1000. It only takes a couple hours of your time and $50-100 to file the suit. If it's a sure-win, do it.

    2. The proposal states "25% after design review." Without reading the actual proposal, it sounds like they might have to approve the design to have to pay the 25%. If this actually went to court, it would definitely be a judgement call (by the judge) and you're definitely not guaranteed a win.

    3. What happened with the process that led to this? I'm going into more detail on this point. Read on....

    Why did you go ahead and code and entire website using a revised design that wasn't even seen by the client, much less approved by them? It sounds to me like you made some changes to your initial comps and then just went ahead with the design instead of getting feedback first.

    I think you might have a few problems outside this particular client issue. It's obvious they're not happy with the design. Either you haven't done your job of beating out of them what they really want (kidding, but getting this information is our job) or they're just impossible clients and are being too vague and ambiguous.

    If the latter, you should have seen red flags ahead of time, and requested further clarification before coding the entire site and uploading it to a server.

    Without knowing more about the situation, I'd probably just chalk it up to a learning experience and be MUCH more thorough next time. Have the clients fill out a questionnaire, then delve into their business even further to find out exactly what they want/need before ever lifting a hand or clicking a mouse.

  5. #5
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    Thanks for the comments. My proposal stated "25% after design review" but didn't say anything about design *approval*. So that raises a question regarding future clients: If the client doesn't owe the 25% until after he *approves* the design (because the proposal / contract explicitly states that -or- the client just assumes that's the case), what's to prevent him from saying, "I don't like it...Do another design", over and over and over?

    On one hand, I don't want to say, "the contract allows for three designs and I'm not making any changes or coming up with new designs" because that'll just lead to an unhappy client and an unpleasant relationship. But on the other hand, I need to protect my time, and avoid scope creep..."Oh, could you make it blue...and what about three columns instead of two...and could you change the font and the images and the colors..."

    How do you successfully walk that line between keeping your client happy and spending more time on a project than you budgeted?

    To answer some of the other questions raised by 'beley', I didn't actually code the whole site. I just did the splash page, one interior page, and then made placeholders for the other pages. But even that was a huge effort due to the design requests and cross-browser compatibility needs. "What happened with the process..." Well, I presented three original designs, and they said they weren't what they were looking for. OK, fine. I asked what they wanted (since they had never stated it in the beginning, and I neglected to ask (my bad)). They listed a few general things (drop shadows, less boxiness, etc.) which my final design took into consideration.

    What I've learned from this is:

    1) Get much more specific guidance up front on what the client is looking for. My plan is to create a questionnaire as well as have them point me to some other web sites they like, and tell me what they like about them.

    2) Get more feedback, early and often. My only reluctance to do this up to now is that *some* clients don't "get" wireframes or not fully constructed templates. So even putting in an "image goes here" or "lorem ipsum" text doesn't help them see what the page would look like.

    Anyway, I appreciate people reading my gripe and letting me vent a bit. I could *probably* win in small claims court, because even an oral contract is enforcible and my proposal is quite detailed about deliverables and payment terms. But I have to ask myself if it's worth the hassle and stress. Probably not, and the best thing is to realize it's been a good lesson.

  6. #6
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    Quote Originally Posted by njwebwiz View Post
    what's to prevent him from saying, "I don't like it...Do another design", over and over and over?
    If providing fixed fees, you simply define how many designs and revisions you will provide for the price, say two concepts with 2 minor revisions of chosen concept.

    As Beley suggests, why are you actually coding the design before it is approved? only code the design when the design concept (i.e. photoshop graphic) is approved.

    As someone else points out, taking a 50% deposit upfront should really be enough to cover these kind of issues - this is another good reason to avoid jumping into the coding before approval. Before this, the 50% deposit should cover your time.

    On one hand, I don't want to say, "the contract allows for three designs and I'm not making any changes or coming up with new designs" because that'll just lead to an unhappy client and an unpleasant relationship.
    Offer two concepts and then give a price for each additional, or simply bill by the hour for any extra work.

    How do you successfully walk that line between keeping your client happy and spending more time on a project than you budgeted?
    lol, most clients are never happy, no matter what you do


    Get much more specific guidance up front on what the client is looking for. My plan is to create a questionnaire as well as have them point me to some other web sites they like, and tell me what they like about them
    Yes, definitely, If you create everything to that spec, they cannot argue you didn't do everything asked of you. Of course it's a wonderful selling point if you offer a money back guarantee in these situations, especially in today's ultra-competitive market, but that's another discussion...

  7. #7
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    I think that you will probably have an issue with the terminology of '25% after the design review' if you took the legal road, as it is fairly general. They probably think that because they haven't decided on a design that this stage hasn't been finalised, and therefore isn't payable.

    You, on the other hand, think that because you have come up with several designs that they have 'reviewed' that this process is complete and they should be happy with all the work you have done and pay for it regardless.

    I would probably look at the wording of your proposals to make your progress payment points more tangible, such as '25% upon signed approval of design concept'. Reduce the possibility of misunderstandings by either party.

    For this project I would move on and as you say 'chalk it up to experience'. You got a deposit, which at least gives you some compensation for the work performed, and you get to keep your designs (make sure they realise that the designs are owned by you and that they don't have the right to use your designs for another programmer).

  8. #8
    SitePoint Zealot kosh's Avatar
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    I think you're very lucky to learn this lesson so easily. You got paid the installment, and now it's over. Take the 50% and run. If it doesn't cover your costs, then make a more cautious bid on the next project. Always assume that at any payment point the client could opt out and you'll be stuck only with what you have. So protect yourself.

    50% is good. Next time get the contract signed.
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  9. #9
    Internet Toughguy Kevin Boss's Avatar
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    When you presented your designs, did you offer solid reasons for your mockup ideas? I find that even when my clients disagree with my initial designs, they come around after I give very good reasons for everything on that mockup.

    Then again you can't always count on your clients to do what's best for their website

  10. #10
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    Talking

    If you ever get a client that listens to what you have to say, doesn't interfere with your design & development processes, and pays you on time, be nice to them...!

  11. #11
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    Quote Originally Posted by njwebwiz View Post

    What I've learned from this is:

    1) Get much more specific guidance up front on what the client is looking for. My plan is to create a questionnaire as well as have them point me to some other web sites they like, and tell me what they like about them.
    If you like I can send you a questionnaire that I use. It is fairly lengthy and detailed but it gives me a great idea of what the client wants. Also it makes the client think about exactly what they need before they waste any of your valuable time. I have had no problem with rejections of designs or website functions and I only ever do one design "period". In the beginning I used to do 3 mockups but in such an ever competitive industry this was a complete waste of my time. This questionnaire works and saves me a lot of time and money as it puts the onus on the client to detail every requirement.

    If you want it let me know where to send it.

  12. #12
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    I agree that a pre-contract survey is the best way forward. It forces the client to really focus on what they need and it gives you clear paramaters within which to develop your design solution.

    However, my approch is to sit down with the client and go through the survey with them. It gives me the opportunity to ask detailed questions and to explain to the client how the process works. The answers you get from the survey will help you create a detailed website development agreement.
    If the client is reluctant to sit down with you then walk away, chances are you will be wasting your time.

    As for your oringinal problem about non-payment, my approach is to employ a debt collection agency to pursue the client on your behalf. Let them have all of the relevant documentation and correspondence so that they can decide whether its worth pursuing the debt. These companies normally take a percentage of the fee as payment. This re-enforces the principal of business, clients have to pay for your time because that is all you have to sell. If they secure payment on your behalf - great, if not you haven't lost too much time pursuing the payment. You are not going to work for that client ever again anyway.

  13. #13
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    Quote Originally Posted by gripper View Post
    However, my approch is to sit down with the client and go through the survey with them. It gives me the opportunity to ask detailed questions and to explain to the client how the process works. The answers you get from the survey will help you create a detailed website development agreement.
    If the client is reluctant to sit down with you then walk away, chances are you will be wasting your time.
    A good approach, but use with caution if this is being conducted before contract sign - small projects rarely warrant this kind of one-on-one attention (certainly not cost effective) and for large projects genuine propsects would expect to pay for a detailed project specification to be developed for them, so I would charge for this upfront (you can always deduct the cost of it from the final project if you so desire, although I feel its chargeable regardless).

    As for your oringinal problem about non-payment, my approach is to employ a debt collection agency to pursue the client on your behalf.
    Take it to small claims first and have a judge issue a judgement against the client, otherwise the debt collectors are powerless as the client will simply question the validity of the debt - at which point the collection agency has to back off.

  14. #14
    SitePoint Addict Green Moon's Avatar
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    I think you will have a real problem if you try to collect another 25% based on your own language of "after design review". Also, I think in fairness to future clients, you need to structure deliverables in a way that if the client doesn't like any of the designs, they aren't stuck with 75% of the cost of the website.

    I've been on the receiving end of that one. I paid a sizeable deposit and it was clear that this designer simply was not going to come up with anything I was going to like. But instead of taking my loss and finding a different designer, I stuck with him because I didn't want to lose the deposit. Big mistake! I had to spend an inordinate amount of my own time going over minor tweaks to make the site barely acceptable. And in the end, I hated the result.

    To altyfc: you say "to me it sounds like they've just found someone cheaper." That may be the case, but for them to find someone to do the whole job for less than half of the original fee (since that is all it would take to pay njwebwiz to finish what he started) seems unlikely to me. My guess is that they just were looking for something different than what they were seeing.

  15. #15
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    Quote Originally Posted by rmcglinn View Post
    If you like I can send you a questionnaire that I use. It is fairly lengthy and detailed but it gives me a great idea of what the client wants. Also it makes the client think about exactly what they need before they waste any of your valuable time. I have had no problem with rejections of designs or website functions and I only ever do one design "period". In the beginning I used to do 3 mockups but in such an ever competitive industry this was a complete waste of my time. This questionnaire works and saves me a lot of time and money as it puts the onus on the client to detail every requirement.

    If you want it let me know where to send it.
    rmcglinn,

    I am interested in seeing the questionnaire you mention. I think this is a good approach as well and have used it in the past.

    Regards,

    E_Designer

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    rmcglinn > I would be interested.

  17. #17
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    First of all good for you for getting 50% up front!

    I always place a cap on the number of mockups I'm willing to provide - usually specify a maximum number of hours that the design phase, and payment, covers in case I can get it right, or they can't decide on what they want (which is usually the case but will become your fault most of the time).

    Until the design is signed off - never start building.

  18. #18
    Gone Fishing Japhi's Avatar
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    Well you definately did better than the other party. They paid 50% and didn't receive anything.

  19. #19
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    Quote Originally Posted by wwctw View Post
    rmcglinn > I would be interested.
    Here is a useful link for creating client questionnaires from Smashing.

  20. #20
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    To be honest, I think you are just going to have to settle for this one. After all why did you take a deposit in the first place? This is primarily what a deposit is for in case of things like this happening. My advice is just to suck it up man...

  21. #21
    Life is short. Be happy today! silver trophybronze trophy Sagewing's Avatar
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    It's never a good idea to do something on principle. It sounds good, but unless you can specify the exact outcome that you are looking for and why it's beneficial then it's probably not worth it.

    In this case, it sounds like you might be better off by walking away. Then you can focus on the future, and apply these lessons learned to bigger and better clients in the future. It sounds like you have a good understanding of what happened and how to avoid it in the future - go forward and don't look back
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  22. #22
    King of Paralysis by Analysis bronze trophy
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    It's been 2 1/2 years since the OP posted, I'm sure this has been resolved by now.

  23. #23
    Mazel tov! bronze trophy kohoutek's Avatar
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    ^ correct. Thread closed.
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