How to write a penalty clause in a contract?

Question

Freelance

The client offered to conclude a contract for the development of the project. One of the conditions will be a fine - a refund of the entire amount for the project if I do not complete it. The point is certainly hellish, but to some extent fair. But just how should it be written so that there are no pitfalls and loopholes?

Answer 1

It's up to you, of course. But I wouldn't take on such a project. Already burned.
For such clients, "dumping" you without paying is just cost optimization. Why pay if you don't have to?
What is alarming is not even the fact that a fine is envisaged, but namely "the return of the entire amount of the contract." It's too tempting to dump you. It is necessary to at least break the project into stages, and take each stage separately. After acceptance of the stage, the money for it is not returned. Staged development is important for both the developer and the customer - so that neither one nor the other loses too much time in case of failure. If the customer does not think about such things, then he is either incompetent or scammed. Decide for yourself who he is.

Answer 2

If the word "fine" appears - after payment, you can score in general :) He will lose any court. "Penalty" in the competence of state bodies - any mention in contracts will not have legal force.
So, he will most likely write a "forfeit" for not fulfilling the agreements, but which agreements - you should already look in the contract.

Answer 3

> double losses.
Hammer the bolt. No one in their right mind writes this in development contracts. Too vague.
Even if you do everything, they will come to you and tell you that because of a bug they lost N thousand rubles.
Of course, there is a second option - they simply copied some of their usual contracts and did not think, but then they will agree to remove this clause or replace it with something more acceptable.