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Software Development Agreements

Software Development Agreements And Problems That Arise After A Project Is Done

By Software Agreements, Software Lawyer

software developmentAfter you completed a software development project, very often you’ll discover that there are issues that remain unresolved, whether you’re the developer or the client who retained the developer for this project. That’s because software development agreements often have holes in them.

Here are some common app issues that need to be addressed, ideally within the software development agreement, so that you can avoid misunderstandings and even lawsuits after the project is completed.

Intellectual Property Ownership

First, who owns the application’s intellectual property?

Does the developer own the code? Does the client own the code?

Did the developer borrow code, such as open-source code or public domain code, and incorporate it into the project?

Was other third-party code licensed and used within the project?

Your software development contract should clearly identify what’s being used and who owns what.

Protect yourself as app developer or client so that there are no mistakes and misunderstandings.

Software Support

What about software support after development?

Is the developer obligated to provide any support whatsoever? If not, who will provide the support when it’s needed?

App Maintenance

Who maintains the software after the project is over? Will the developer do it or a third party?

Is it included in the development contract? And if it is, will the application developer be paid an additional fee (e.g. on an ongoing basis) in order to maintain the software application?

Software Development Agreements and Upgrades

At some point, the software that’s been developed will need to be upgraded to future versions, perhaps with even additional features and bugs fixed.

Is that included within the software development agreement? Is it even addressed?

Is there any duty whatsoever for the developer to come back, perhaps for a certain amount of money, in order to make upgrades?

If so, for what period of time is the developer obligated? 90 days? Six months? One year?

If you don’t know the answers to these questions and they’ve not been answered within your software development agreement, it’s time to sit down with the other party after speaking with an experienced software lawyer and iron out these issues with a supplemental agreement.

4 Keys To Successful Software Development Agreements

By Software Agreements, Software Lawyer

software development agreementsWhether you are a software developer, or your business outsources app development, you’ll need software development agreements to protect your legal interests. Many business owners think they can simply copy and paste agreements they find online, but this is a recipe for disaster.

Why is it risky to “borrow” a Software Development Agreement Template?

Borrowing an agreement drafted by and for another company can lead to serious legal repercussions. App development contracts are considered intellectual property and can only be used under license from the copyright owner (usually the lawyer or firm who drafted the contract). If you have not paid for the right to use the agreement (or worse, if the legal form generator you are using doesn’t explicitly own the forms), you could face hundreds of thousands in legal damages.

Also, legal agreements are unique and will vary depending on your (and the other party’s) needs. Even if you download a template with legal permission, you could unintentionally omit clauses which you require or subject yourself to unnecessary obligations.

There are four essential things you should know before creating a software development contract:

  1. the standard items you need to include in your agreement;
  2. how to handle ownership of intellectual property;
  3. when you’ll need additional contracts; and
  4. how you will handle maintenance of the app after development.

1. Standard Items You Must Include in Your Software Development Contract

While your contract should be tailored to your unique situation, there are some common issues you’ll want to address in any Software Development Agreement. Be sure to discuss the scope of work you will be performing for the agreed-upon cost and how you will handle change orders. You also want to outline key milestones and deliverables.

If the client is not satisfied with a deliverable, will you agree to any edits? If so, describe how much time your client has to request a change and how many changes you will make.

If you plan on outsourcing work to third-party coders or programmers, make that clear in your contract.

Also, detail payment expectations and any warranties you are willing to provide for your client.

2. Intellectual Property Ownership: How to Balance Competing Interests

One of the most important aspects of your contract will be defining ownership of the intellectual property you are creating. Consider whether you or the client will maintain ownership rights or if you will be granting a license to use your software.

Software developers often want to keep ownership of the code used to create a client’s software so they can recycle the code for future projects. Clients, on the other hand, often want to own the intellectual property subject to a software development agreement to prevent the developer from re-selling the software to potential competitors.

Fortunately, there are creative ways to balance these two competing interests by creating a software license with non-competition provisions. This enables the developer to retain ownership over intellectual property while also restricting the purposes for which the code can be recycled.

3. If You Are Developing Multiple Apps for a Client, You Need a Master Service Agreement

A Software Development Contract is typically utilized for a single project only. However, if you are anticipating an ongoing relationship and multiple projects for a single client you will also want to execute a Master Services Agreement.

This Agreement should outline the essential terms that apply to all apps being developed and additional agreements for each project should be attached as “work orders.”

Related Article: How To Modify A Software Development Agreement

With each work order, you can reference the key terms used in the Master Agreement or you can make exceptions to certain provisions based on the unique needs of each project.

4. You Need to Plan for Maintenance, Support, and Upgrades

Virtually any form of software application will require bug fixes and upgrades to keep the program up-to-date and functioning properly. A well-written software development agreement will detail who is responsible for maintenance of the application, additional costs involved (if any), and how to request support for bugs and glitches.

Developers who maintain ownership over the intellectual property and merely license the software to the client often take responsibility for ongoing maintenance, support, and upgrades: but it is imperative that these details are clearly outlined in your contract. Ironing out all of the details of your agreement will go a long way toward preventing disputes, ensuring a good working relationship, and keeping clients satisfied.

Software development agreements are highly detailed, unique legal documents. It is wise to seek the counsel of an experienced software attorney to prepare development contract templates that you can use repeatedly while still protecting your best interests.

Our software attorneys prepare app development agreements on a flat fee basis. To learn more, check out our Software Development Legal Protection Package.

Software Development Work Orders: What You Need To Know

By Software Agreements, Software Lawyer

Software Development Work Orders: What You Need To KnowSometimes called a Scope of Work (SOW), software development work orders define project work.

Also important, a project’s work order excludes tasks. That’s essential to avoid misunderstandings between client and developer.

Master Services Agreements And Work Orders

Work orders are common when there’s a master services agreement. For example, the developer will do more then one app project in a year.

These master agreements are flexible. Because they allow either party to walk away with advance notice, for cause, etc.

And they’ll often renew for another term if there’s a good working relationship.

Of course, the underlying software development agreement will favor one party. If you hire the software lawyer to prepare the contract, it will favor you. Because terms and conditions make a difference.

Software Work Orders Versus Change Orders

It’s important to note that work orders are different than change orders.

  • A work order defines the original scope of work.
  • But a change order modifies that scope during the project.

Work Order Signatures

Of course, work orders (and change orders) should be in writing. And signed by authorized parties. Either on paper or electronically.

Now an experienced software attorney often prepares software development template work orders and change orders for client use.

Where To Get Software Development Work Orders

Are you a software developer? Or a business owner who retains them to develop applications?

Software Lawyer Mike Young can prepare a software development agreement that’s right for you. Plus software development work orders. And template change orders. Check out the Software Development Legal Protection Package to learn more now.