IP is a programmer. What are the financial risks?

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beono2011-10-25 19:52:03

Individual entrepreneur

beono, 2011-10-25 19:52:03

Everyone knows that an individual entrepreneur is liable with his property for all obligations.

It remains unclear to me when exactly these obligations may come about.

Assume a situation where a programmer, as an individual entrepreneur, has performed certain work for a customer.
As a result of an error in the program, the customer suffered direct financial losses.

Can the customer claim damages?
Is it possible to insure against such cases by the relevant clause in the service agreement?

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4 answer(s)

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MikhailEdoshin, 2011-10-25
@MikhailEdoshin

Software licenses (which are the essence of the contract) usually state that the developer does not guarantee the absence of errors in the program and does not take responsibility for any damages from its work (or lost profits from non-work), and that in any case the amount of compensation is not may be more than the amount paid for the program. Accordingly, the other party agrees to this condition. Since Microsoft and others are selling their software here with such agreements, why not include the corresponding clause as well?

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Napseg, 2011-10-25
@Napseg

Register an LLC, it will be easier.

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edogs, 2011-10-25
@edogs

Insure clause in the contract, be sure. If you have been a freelancer for more than a day and plan to work seriously as an individual entrepreneur, immediately order a normal “fish” for yourself from a lawyer, do not postpone it for later.
"Insurance" (good, not ridiculous) against financial loss caused by the programmer usually adds a hefty price to the order, often more than the price of the order itself, and must always be negotiated separately.

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Alexey Sundukov, 2012-08-02
@alekciy

>Can the customer claim damages?
To claim damages, you need to prove the legitimacy of the billed amounts. How can this be done in the context of the program? For a huge amount of software, none (because there are no criteria in the law by which software can be classified as a product of proper/improper quality).
And the offices that actually receive permanent money from the software will already offer the necessary clauses in the contract that guarantee them compensation for losses.