Deposit refund?

Edward Phillips · February 16th, 2009, 08:45 AM

The best that can be gained from all this is that 1. Don't spend the money earned from a yet to be complete project. 2. Demand more precise details and deadlines when taking on a project. That $1000 probably sounded like easy money at first but it may be the most aggravating money you ever earn. Like it was stated earlier there should have been a set time frame, no exceptions, the $1000 could be a deposit to keep you for 30 days, 3 months, whatever, but it needed to be set. 3. Never feel guilty about doing business even if it means a loss to the other party. I've done projects for rather wealthy clients and they can make it feel like you're putting them in the poorhouse having to give you a meager sum to do a project. That's how some people act to get ahead in business. Communicate with your client.
He signed a contract. You'd be happy to do the project for him. Don't lie about the deposit not being there anymore. Tell him you took it on the grounds that you would do work for him and that since the deposit was made you had business expenses as you were on this "open-ended retainer".

If I remember Kell, you had some doubts about this client from earlier threads correct?

Craig Seeman · February 16th, 2009, 12:22 PM

Here's my simple farthing on the issue.

As long as Kell is willing to follow through when the client is ready she's upholding her end of the contract.

Client signed KNOWING it was non refundable.

Client signed KNOWING there was no specified deadline.

Kell should only pay back the money if Kell decides to back out.

It's none of the client's business how you manage your business's funds but you would be responsible for returning the money if you back out.

There's nothing wrong with a contract in which dates aren't specified if BOTH parties agree to that IMHO. I've done it. I've had clients who simply aren't sure when elements will be ready. This does NOT mean I drop everything when they are ready. Open ended works both ways. If either the client or the facilities WANTS dates they can specify in the contract.

Contracts are TWO WAY and if both parties agree to the terms without coercion and there's nothing illegal about the transaction then it generally should be a good/valid contract.

Basically if Kell remains committed to the job and to the open ended nature and the client has agreed to it, they shouldn't get their money back. They need to deliver the elements at some point. The "risk" involved is that if it's years later then the costs involved may change. That's a very different (but related) kettle of fish.

Jim Andrada · February 16th, 2009, 09:14 PM

I am not a lawyer. I never wanted to be a lawyer. I still don't want to be a lawyer.

On the other hand, I've had a lot of exposure to contracts - as a juror in contract dispute cases, as a marketing guy selling contract consulting services, as a project manager executing consulting contracts etc etc etc.

There are lots of good basic books on contracts, and it might be worthwhile reading one.

As I recall (pure lay person's recollection) it takes three things to form a contract - an offer, an acceptance, and a consideration, which can, but doesn't have to be, monetary. It can be, for example, an action taken by a party to the contract, or the forbearance of an action (ie one or both of the parties agree not to do something they might otherwise have done.)

It sounds simple, and in principle, it is. The devil, as always, is in the details.

In this case, it would seem that there was a monetery consideration as well as an offer and an acceptance, so to this non-lawyer, it would seem that there is at least a reasonable basis for believeing that the contract is valid.

Considering that the cost of litigation would probably be far more than the $$$ involved, it seems unlikely that anyone would go to court over it - unless it were small claims court.

But having said all that, if it were me, I'd be inclined to refund the money if I were asked to do so since nothing has actually been done on the project and you haven't turned away any paying work because of the contract.

Marco Leavitt · February 25th, 2009, 03:57 AM

Obviously you need a lawyer, but is there enough money at stake for it? $1,000 won't go very far in attorney's fees.

February 16th, 2009, 08:45 AM	#16
Edward Phillips Regular Crew Join Date: May 2008 Location: Memphis, TN Posts: 118	The best that can be gained from all this is that 1. Don't spend the money earned from a yet to be complete project. 2. Demand more precise details and deadlines when taking on a project. That $1000 probably sounded like easy money at first but it may be the most aggravating money you ever earn. Like it was stated earlier there should have been a set time frame, no exceptions, the $1000 could be a deposit to keep you for 30 days, 3 months, whatever, but it needed to be set. 3. Never feel guilty about doing business even if it means a loss to the other party. I've done projects for rather wealthy clients and they can make it feel like you're putting them in the poorhouse having to give you a meager sum to do a project. That's how some people act to get ahead in business. Communicate with your client. He signed a contract. You'd be happy to do the project for him. Don't lie about the deposit not being there anymore. Tell him you took it on the grounds that you would do work for him and that since the deposit was made you had business expenses as you were on this "open-ended retainer". If I remember Kell, you had some doubts about this client from earlier threads correct?

February 16th, 2009, 12:22 PM	#17
Craig Seeman Inner Circle Join Date: Feb 2004 Location: Brooklyn, NY, USA Posts: 3,841	Here's my simple farthing on the issue. As long as Kell is willing to follow through when the client is ready she's upholding her end of the contract. Client signed KNOWING it was non refundable. Client signed KNOWING there was no specified deadline. Kell should only pay back the money if Kell decides to back out. It's none of the client's business how you manage your business's funds but you would be responsible for returning the money if you back out. There's nothing wrong with a contract in which dates aren't specified if BOTH parties agree to that IMHO. I've done it. I've had clients who simply aren't sure when elements will be ready. This does NOT mean I drop everything when they are ready. Open ended works both ways. If either the client or the facilities WANTS dates they can specify in the contract. Contracts are TWO WAY and if both parties agree to the terms without coercion and there's nothing illegal about the transaction then it generally should be a good/valid contract. Basically if Kell remains committed to the job and to the open ended nature and the client has agreed to it, they shouldn't get their money back. They need to deliver the elements at some point. The "risk" involved is that if it's years later then the costs involved may change. That's a very different (but related) kettle of fish.

February 16th, 2009, 09:14 PM	#18
Jim Andrada Inner Circle Join Date: Feb 2007 Location: Tucson AZ Posts: 2,211	I am not a lawyer. I never wanted to be a lawyer. I still don't want to be a lawyer. On the other hand, I've had a lot of exposure to contracts - as a juror in contract dispute cases, as a marketing guy selling contract consulting services, as a project manager executing consulting contracts etc etc etc. There are lots of good basic books on contracts, and it might be worthwhile reading one. As I recall (pure lay person's recollection) it takes three things to form a contract - an offer, an acceptance, and a consideration, which can, but doesn't have to be, monetary. It can be, for example, an action taken by a party to the contract, or the forbearance of an action (ie one or both of the parties agree not to do something they might otherwise have done.) It sounds simple, and in principle, it is. The devil, as always, is in the details. In this case, it would seem that there was a monetery consideration as well as an offer and an acceptance, so to this non-lawyer, it would seem that there is at least a reasonable basis for believeing that the contract is valid. Considering that the cost of litigation would probably be far more than the $$$ involved, it seems unlikely that anyone would go to court over it - unless it were small claims court. But having said all that, if it were me, I'd be inclined to refund the money if I were asked to do so since nothing has actually been done on the project and you haven't turned away any paying work because of the contract.

February 25th, 2009, 03:57 AM	#19
Marco Leavitt Inner Circle Join Date: Jul 2002 Location: Albany, NY 12210 Posts: 2,652	Obviously you need a lawyer, but is there enough money at stake for it? $1,000 won't go very far in attorney's fees.