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I was employed by an old college friend for building an App. I was paid an advance of 25 percent of the total amount agreed as an advance to start working. Later, I went to his office for a few days to meet up his boss, talked to him but after some days unexpectedly we got into a huge fight and now he doesn't want me to work on it anymore, I also left on same terms. Now he is demanding the money back or incase I don't want to return the money he is asking me to sign the agreement for his audit.

This is not making any sense to me and I don't want to pay him back , as I did give my time to the project and I didn't have any intention to leave the project. I haven't started working yet , I agree but he also agreed that it was his failure to hire me. In that case why is he expecting me to sign or refund. I feel like if I sign I'll be in more trouble.

He started harassing my friends also as I'm not responding, sending them messages on social media platforms. I seek advice as to how to handle this.

P.S. : This is my first time here , if this is not the place to post this kind of question, please kindly direct me to which community.TIA.

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    Was it an advance or a deposit or something different? What did your contract state? You have a contract, right? – Canadian Luke Apr 29 at 19:34
  • The contract was never signed , he called it an advance, i dont know the difference between advance and deposit. But there was no contract , now he wants me to sign the contract. We just had verbal agreement. In the contract he sent, its stated as advance and rest of the money on delivery of product – include required Apr 29 at 20:20
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    I hate to say it, but you need to start signing contracts and getting the deposit/advance before starting the work. This may be a lesson, depending on how things turn out... – Canadian Luke Apr 29 at 21:10
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Is it a lot of money? What are we talking about here? Did you already buy a lambo? Give the money back. Stay friends. Friendship is more important than money. Sounds like there could be more work in the future from this relationship. Lesson learned. Next time will be a better process.

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Since you specify:

  • No contract was signed
  • Everything was verbal
  • You received an advance
  • You haven't completed work

I would suggest giving the money back, and attempt to save your college friendship.

If you want to do the project anyways, sign a contract that both you and the client (notice I call the person you're dealing with "client", not "friend" here) agree to. That contract should stipulate everything relating to payments, mentioning a Scope of Work.

The Scope of Work should be a separate document listing goals and milestones to be completed. This will get signed as well by both parties.

From now on, no more favours to friends or old acquaintances. Always have a contract, scope of work, and a deposit or advance BEFORE any work starts

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  • I agree to the point that , no more working with friends. But if i refund him completely , what about all the time I've spent, also in anticipation of work and payment. I used up the money , since he knows that I cant pay him back, he is asking to sign... Also, even if hypothetically i pay him back , there wont be any friendship... after the fight we kind of agreed to our mutual friends who suggested not to ever talk to each other again. It was an ugly fight. – include required Apr 29 at 21:30
  • Also, im looking at this , in a company-employee relationship way. Tbh he hired me on behalf of his the company he works for and he fired me. So ,if u hire somebody and they arent working, you fire them , but you dont ask him to pay back his salary right? thas the way im looking at it.. idk, am i wrong, i feel at loss here.. since i didnt had any other job, i really was counting on that project. – include required Apr 29 at 21:53
  • You didn't mention you did pre-work. Unfortunately, if you want to maintain your professionalism, the way the question is written, I'd have to stand by what I stated already - no work, no contract = no money – Canadian Luke Apr 30 at 0:03
  • @includerequired if you expect the same protection as an employee, Freelancing is not for you! Forget the employee perspective and start thinking about risk management for yourself. That´s why you get those big hourly rates as a freelancer, because you take all the risk yourself. – Daniel May 1 at 20:10
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I recommend staying stiff, if you feel that you have justified for what was paid(25% as you said), then go for a formal meeting and discuss your efforts against money paid. But be honest !! This is just the beginning of your life into this profession where you would meet much such money-minded individuals/organization. As you have not signed the contract and also you have not taken the complete payment, so it becomes justifiable to justify your efforts. If you learn to bend now, remember you will always bend !! But never ever forget your Honesty !!

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What I´d do in your situation.

  1. Compile a List of all work done on this project by you. If you have a agreed upon rate, multiply by this. If not, find out whats common for this kind of work in your area and use that rate.

  2. Offer to your client to settle the contract for that sum if both sides agree to having no further claims against each other. Provide them with the proof of your work and all its results (planning documents etc.) Give them an invoice for the work done and pay back the rest, if any.

I can´t see you legally just keeping money from someone for work not done (IANAL, though) unless you have a contract stating otherwise.

From now on: If you encounter a client, after initial contract, provide them with your base hourly rate and basic terms of business immediately and state clearly that these terms are applicable for all work you do until agreed otherwise in writing.

Also, start thinking about your own risk management. You are not an employee, and all the employee protection laws do not apply for you. Your hourly rate should factor this in. You need to pay for your own health insurance (with daily allowance for longer sick periods), retirement plan, disability insurance, ... and set aside a fund for quiet times as a from of "unemployment" insurance.

What I like to do when I am in a planning phase with a client: I invoice them for my time helping them to write the requirements with an hourly rate. Once the requirements are clear I can give them an estimate. If they don´t like it, they can look for someone else to do the project and I keep my planning money. If they book the project with me, I give them a discount on the planning costs.

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