Web designer not delivered service

anna_l

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Dec 15, 2014
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Hi,

I'm a start-up sole trader and recently hired a web design agency to design my website. We agreed on a price, which was then quoted in writing, and I was told that the project would take 3-4 weeks to complete.

I wasn't sent any terms or contracts and no contract has been signed.

Seven weeks later...

I have only seen a second revision of the homepage

Communication has been shoddy - no response to emails

I received an invoice for a 30% deposit 6 weeks into the project charging me VAT. The original quote does not state that VAT is excluded. The VAT is an extra cost to me and not within my agreed budget.

I have emailed to say that I want to end our business relationship based on the above reasons. They now want to charge me for the time they've spent on my project so far.

Do they have a right to do this if there are no terms and conditions and no contract?

Where do I stand legally?

As far as I'm concerned they haven't delivered the service they said they would, and broke the budget agreement. While I appreciate their time spent, this project has also cost me time and money!

Any advice would be much appreciated. Thank you :).
 

fisicx

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Unless they offered a contract of any type with T&C and payment terms I'd tell them to swivel. They haven't delivered anything (which probably means they can't do the job) so it's difficult to see what they are charging for.

Note: many of these agencies outsource the actual work to India or elsewhere - which means asll you are talking to is a sales wonk not the actual developer.
 
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Newchodge

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    There is a contract. You agreed to pay them to produce your websire at a certain price within 3 to 4 weeks. They haven't kept their side of the contract. Notify them that , because of their failure to fulfill the contract, you will not continue with them.
     
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    anna_l

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    Thank you for your replies. I did wonder whether there was still a contract in place, even though I haven't received any terms and conditions or signed anything.

    And now that they want to charge me for the work they've already done, it's hard to see what they're charging me for because all I have is a second revision of the homepage.

    She said that she would look at how far into the project they are and come back to me with a figure. I'm assuming that she'll then add up the hours, but I didn't agree to pay per hour.
     
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    Alan

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    I'm not a lawyer (I'm a web designer) but your reference point probably is Supply of Goods and Services Act 1982 Part II Supply of Services
    http://www.legislation.gov.uk/ukpga/1982/ which covers implied terms (i.e. not written down)
    Section 14
    14 Implied term about time for performance.
    (1)Where, under a contract for the supply of a service by a supplier acting in the course of a business, the time for the service to be carried out is not fixed by the contract, left to be fixed in a manner agreed by the contract or determined by the course of dealing between the parties, there is an implied term that the supplier will carry out the service within a reasonable time.
    (2)What is a reasonable time is a question of fact.

    Which basically means you are right and they are wrong. Perhaps you want to quote this section in the letter saying that they have done nothing, failed to deliver within a reasonable time etc etc


    p.s. are you SURE there were no terms and conditions, for instance attached to the quote or perhaps a link to their website with T&Cs because only the smallest 'bedroom' developer or someone just starting out would have zeros T&C's published, after all you can buy T&C pack online for a few quid (although lawyers always advise against it)
    We used to put them on our website and reference them on our quotes, however now we tend to have to have custom T&Cs depending on the type of work so send them out with the quote.
    But my main point, is in all standard T&Cs if you cancel WITHOUT CAUSE you would normally be liable either for the cost of work done to date or the deposit whatever is the greatest.

    In your case you probably do have CAUSE, however if you did not give them an opportunity to remedy their issues then that could be frowned upon, i.e. it seems you may have jumped straight to 'end the relationship', whereas you might have been better to demand (in an old fashioned letter) that the xxx was produced by yyy date and if not you deem that they have abandoned your project and you will not etc etc...
     
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    anna_l

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    Hi, thank you for pointing me to the Supply of Goods and Services Act, it's very useful.

    There are no terms and conditions on their website and they didn't attach any terms and conditions to my quote or invoice. I have double and triple checked this!

    When I sent a formal email to explain why I was unhappy with the service, the reply I got was apologetic but with no suggestions to remedy the situation e.g. to improve communication, to take off the price of VAT, and to supply terms and conditions.

    The response to the lack of terms of conditions was that they work with the client until they are happy, but at the same time they were pushing for the sign off of a homepage that wasn't right (and some of my changes that I'd sent by email had been ignored). So I was very unclear about how they work and how many changes I could make before final sign-off. This to me is a very unprofessional way of working.

    In my letter I gave the project manager an opportunity to put things right and said that I was strongly considering discontinuing the project.

    However, after speaking to the project manager today, who got very defensive, I decided that I definitely didn't want to continue with them!
     
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    anna_l

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    Dec 15, 2014
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    Hi,

    The website was a simple brochure website. They haven't started building the website yet because the homepage hasn't been signed off. So the only thing I've received in 7 weeks is a second revision of the homepage. The design work will be their intellectual property and so I would start again with a new designer.
     
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    fisicx

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    They haven't started building the website yet because the homepage hasn't been signed off.
    In which case they were the wrong people for your project. Their way of building a website is dated and in most cases pointless as the design of the homepage should be done after you have built the site and added the content. Until that point your won't know what layout you need for the homepage.
     
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    Alan

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    I think you have had the advice what to do.

    Fisicx is 100% correct in that they obviously, with hindsight, not the right firm for you. Unfortunately, very few firms 'sack' customers that are not a good fit before sale, as many companies are driven by sales targets not customer satisfaction targets.

    A few questions out of interest, feel free not to answer any.

    How much was the quote for this one pager? I'm sure you don't want to say exactly, but was it under £500, £500-£1,500 , £,1,500 - £5,000 , £5,000-£20,000+ (I would expect it to be the lower end of course)?

    How did you come across the web designer? Did they send you an unsolicited email? Did you see an advert somewhere? Did you search for them? Were they recommended to you?

    What due diligence did you do on them before agreeing? Go to their office & meet them in person? Talk to them on the phone? Look them up on a company check website? Check any references? Other?

    sign off of a homepage that wasn't right (and some of my changes that I'd sent by email had been ignored)

    Without going into massive detail, what wasn't right? Why did you have to submit changes, did they get basic things wrong like spelling errors or your phone number or were you directing design (selecting styles / colours / layouts )
     
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    anna_l

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    That is a good point. The problem wasn't just in the design, it was in the functionality too and they were pushing for me to sign off before any of it had been explained properly. All I had was a jpeg file but I couldn't see the homepage in action.

    It was an 8-page brochure website, £1000 and no mention of VAT in our face-to-face meeting or in the quote. VAT was then added when I received the invoice.

    They are a well-known web design agency in the area I live in. While I didn't get references, they have been established for over 10 years and have worked with lots of local businesses. This is why I'm so surprised that I didn't sign something and that they didn't have clear terms and conditions.

    The changes have mainly been visual changes - colours, fonts, layout. They said that they didn't need text before they started the design, as I can drop this in afterwards (it's a Wordpress site). However, now that I'm writing my content I'm seeing the way that content shapes the layout and functionality of the design. Since, I've found out that some designers won't even start the design before they've received all the content!

    So the question now is - what do I do? They will argue that they've spent time on the website and that they are in the right to charge me for that time. I'm not arguing that they've not spent time on the project, but I have also spent time on it and it's delayed my business!

    Also (I forgot to mention before), they set up a holding page for me which is currently hosted by them. Do you think I should pay them for this (if nothing else)? It will be taken down by them once we've resolved this issue.
     
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    fisicx

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    If it's a wordpress site and all they created was a jpeg of the homepage then £1000 was way over the top.

    Wordpress is free and the are thousands of themes you could install for under £50. Functionality is built into the thousands of free plugins.

    They haven't spent any time on the website. You could have installed wordress and a basic theme, added your content and been up and running in 24 hours. Even if you had got someone to do all this for you the total cost wouldn't be anywhere near £1000 (+VAT).

    What do do now? Get some hosting and install wordpress (it takes about 5 minutes). Install a free theme and start adding your content. Once the site is live you can then experiment with different themes and plugins to get something your clients like.
     
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    Alan

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    That is a good point. The problem wasn't just in the design, it was in the functionality too and they were pushing for me to sign off before any of it had been explained properly. All I had was a jpeg file but I couldn't see the homepage in action.

    If they are custom designing a layout, you can only expect a jpeg before they start to code, so it would be unreasonable to expect to see working functionality at a design stage. You mentioned a it is a simple brochure site, so the only functionality I would expect is a contact form, which shouldn't take much explanation.

    If I were an expert witness in your court case, expecting to see the homepage in action in the design stage would be 'unreasonable' and 'not a normal process'. So I don't think that point holds much water.

    It was an 8-page brochure website, £1000 and no mention of VAT in our face-to-face meeting or in the quote. VAT was then added when I received the invoice.

    (as far as I understand) It is only a requirement to identify VAT on retail transactions, whilst if there were T&C's VAT would have been mentioned deep in the contract in term like 'the customer will pay all applicable sales taxes', as a business to business transaction VAT is never mentioned in high level pricing. (personally we do try and make this clear to our clients and produce a quote that has a VAT column just like an invoice).
    However, I think as this is a B2B transactions, you would be on shaky ground claiming you didn't realise that this is the way business operates in the UK because you are only just starting up. I think you need to park this in lessons learned.

    The changes have mainly been visual changes - colours, fonts, layout.
    Hmmm? Isn't that what you are paying them to do, this is part of the design. If the client starts to get involved in design issues then the site always becomes a mess and isn't a great way to work. You should provide your 'branding' style (colours / logos / fonts - for your budget I wouldn't expect the design to include a branding package ) to the web designer and let them produce the best website they can. If you know better, then you don't need a web designer, you need to do the design and hire a developer.

    Since, I've found out that some designers won't even start the design before they've received all the content!
    With a budget WordPress website such as yours, with no functionality apart from a contact form, it is perfectly feasible to design and build without content. The only variables would be the home page layout, inner page layout, navigation style and headers & footers. For that budget, you could only expect a home page mockup which covers headers, footers, navigation and the inner pages / contact pages would just be a simplified version.

    Although no content would be required at that stage, the key sales message (i.e. what is to be promoted on the homepage) would have to have been composed to ensure the home page design meets the sales / conversion objectives.

    With WordPress adding pages / changing navigation menus items within the existing design, when you have the content is simple enough and can be an 'end user' task if required.

    So the question now is - what do I do? They will argue that they've spent time on the website and that they are in the right to charge me for that time. I'm not arguing that they've not spent time on the project, but I have also spent time on it and it's delayed my business!

    They have spent time on your website, and if you are cancelling without cause, then morally you owe them the money.

    The question is are you cancelling without cause?
    - home page mock-up issue - I believe that they are acting in a standard way so to say you are cancelling as you haven't seen a working home page would be without cause
    - VAT issue. Well thats standard B2B, so thats not a reason to cancel
    - You tweaking their colours and design, and them not responding. To me cancelling because you have to tweak their design is not valid (unless they are just 2,000% off target, like your corporate colours are blue and they used orange )

    So that leaves
    - poor communication by them, communication is a two way street and can be argued in many ways
    - project delivery timing 4-3 weeks they said , 7 weeks and you have only got to mid way point - now this ,is in my opinion, your only valid cause to cancel. If you are 100% certain that you were not part of this delay, did you respond to every question in a timely manner?

    From what little I have gleaned is that they haven't managed you well as a client and due to your lack of experience you haven't managed them well as a vendor.

    So they have now invoiced you for £300+VAT. In terms of 'effort' that is very small amount for producing a custom home page design. You could make them a counter offer in 'good faith', or just hang out and say sorry you failed to deliver in a timely manner, see you in court (but I do think time is the only valid grievance you have as it seems they are operating with industry standard practices, so reasonable care and skill doesn't really come in to play ).


    My ... I'll have to stop typing and do some real work, or my projects might get delayed :)
     
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    Alan

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    They haven't spent any time on the website. You could have installed wordress and a basic theme, added your content and been up and running in 24 hours. Even if you had got someone to do all this for you the total cost wouldn't be anywhere near £1000 (+VAT).

    From what understand they have created a custom homepage design mockup with 2 revisions, which isn't nothing.

    Obviously a basic theme / no design / user input content would be well under £1,000+VAT.

    But for a custom design, coding and implementation £1,000+VAT is probably too cheap unless the client has very simple requirements (and in this case the thread leads me to believe that the requirements were beyond simple )
     
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    Alan

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    What do do now? Get some hosting and install wordpress (it takes about 5 minutes). Install a free theme and start adding your content. Once the site is live you can then experiment with different themes and plugins to get something your clients like.

    Actually, as a start up sole trader, you should really be asking do I really need a website? What part of my business strategy will it support, and most importantly who will see it. Trust me here, having a website doesn't mean it will do anything for your business, especially close to zero people visit it.

    Ask yourself, should I have a Facebook page? Should I have a Google+ Local Page? Should I develop a Twitter following? Should a take the £1,000 that I was going to spend on a website and invest it in some social media marketing training for myself.
     
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    fisicx

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    I agree with you Alan up to a point. They could have installed wordpress and loaded up a simple free theme so the OP to demonstate functionality. The homepage mock up is almost irrelevant as the inner pages may require a totally different layout. And the OP did say it was a simple brochure site so I can't see much complectiy there. So I still reckon £1000 is too much. Even £300 for a couple of mockups is a bit steep as a half decent graphic desiner you knock something up in an hour or two.
     
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    anna_l

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    Thank you everyone for your comments. I take all of them on board.

    Yes, I need a website. I gave them a detailed brief and already had a logo.

    I understand that they have already done some work on my website. They have produced a second revision of the homepage. They have not started building the website. They put up a holding page for me which is being hosted by them.

    From a client's perspective, my experience has been:

    Lack of communication on their side, which has delayed completion of the website (now into 7 weeks when I was told 3-4 weeks).
    Changes not incorporated after they had been agreed upon
    No terms and conditions
    Broken agreement on price

    I disagree about the VAT. They don't have any terms and conditions on their website and they weren't included in the quote or invoice.

    If the price doesn't state 'excluding VAT' in the quote, I can only assume that VAT is included. I didn't think to ask because my budget had already been discussed in detail and VAT hadn't been mentioned.
     
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    Alan

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    Regarding VAT you are incorrect, as a business customer you must assume it is excluding VAT. As a retail customer, it is including VAT.

    Thats just the way it is, and is down to your inexperience in business and not the fault of the web design company. My point is, I'm not a lawyer, but if it ever got to court, the VAT argument wouldn't hold any water and just demonstrate your lack of business knowledge which would weaken your other arguments.

    https://www.gov.uk/government/uploa...12-pricing-practices-guidance-for-traders.pdf

    (ii) Price indications to business customers
    2.2.10 Prices may be indicated exclusive of VAT at an outlet or through advertisements from which all of your business is with business customers.
     
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    Does this stand even if there were no terms and conditions and no contract?

    Yes because it is B2B regardless of anything that was said. It's pretty common for a business to quote you the price ex VAT, this is the norm and what other businesses expect.

    You've approached an agency, would you not expect them to be VAT registered? Would you not query it before the project begins?
     
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    Alan

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    Well I'm not a lawyer, I'm a lay person, and I'm sure there are all sorts of cases that have been raised on this matter.

    In any situation, it would point to business naivety that the price quoted would be inclusive of VAT, as for 99% of business VAT is an irrelevant and annoying cash flow issue and doesn't impact price.

    It doesn't take a genius to work out that a Web Design Agency (or any business ) is very likely to be over the VAT threshold if it employs more than 1 person.

    Just look at any business to business website (e.g. domain name sellers / hosting companies) and see that their prices are ex VAT (with a small note for clarity )
     
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    anna_l

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    I knew that they were VAT registered, but if it doesn't say excluding VAT in the quote, I think it's right to assume that the price includes VAT. Plus my budget had been discussed in detail and they were aware that the price they quoted was my max.
     
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    Alan

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    Did you explicitly tell them that you were not VAT registered, nor intending to become VAT registered in the next 2 years, or did you assume that they would instinctively know that?

    Going back to Fiscx's point, they weren't right for you, you went to an agency with a very small budget by agency standards, when what you really needed was a one man band style website creator who would have done you a fairly decent job for half the money and no VAT.
     
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    I

    its-in.london

    and I was told that the project would take 3-4 weeks to complete.
    .

    3-4 weeks for a Wordpress website and not even in wireframe after 7 weeks?. Probably just an outsourcing agency.

    I wasn't sent any terms or contracts and no contract has been signed.
    .

    Since they have not offered you a contract, there is no legal agreement between both parties and you can opt out.

    Happy New Year :)
     
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    As one poster said earlier, there IS a contract. Written contracts are just one form of contract. Contracts can also be oral or even just by a course of dealings (ie: your gardener has been cutting your lawn for 2 years, so regardless of no paper or oral agreement, there is a contract). In this case, there is definitely a contract. The question is how do you get out of it? My own personal advice would be to raise hell and make them perform the contract according to your wishes. Anything else will just cost you more money.

    If that is not an option, they ARE entitled to payment for whatever work they have done - the legal doctrine that covers this is called "quantum meruit". I won't go into it here, but I'm sure Google can provide the background. If you really see no option other than to end the contract, they do have a potential action against you for breach. Whether that potential action succeeds or not depends upon whether they have performed the contract at all, and if so, to what extent. If you really have to extract yourself from this, I would strongly advise you to negotiate with them a reduced fee for the work that they have done, pay them off, and move on. Any legal action will just cost you more money that you won't get back. I'd also let the VAT point go. The presumption would be that the sum was VAT'able. Cheers, Dean
     
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