Season 05 Episode 12
– Jun 14, 2022
30:54 Show Notes
Contract Opinions From Not a Lawyer
We talk to Tim Scollick about working with freelancers and agencies both using and not using a contract.
- Tim's history as a freelancer.
- Contracts are super important but they don't always have to be legally binding.
- Break work into smaller chunks helps to build trust.
- Lawyers are expensive.
- Non competition clauses
- Small claims court
- Red flags
Accuracy of transcript is dependant on AI technology.
Hello and welcome to another episode of the website 101 podcast. This is a podcast for novice web developers and small business owners who want to learn more about running and optimizing their websites.
This is season 5, episode 12. I'm one of your hosts, Mike Mele, and with me is Sean Smith. Hi, Sean. How you doing? I'm doing great, Mike. Happy to be here. And Amanda Lutz. Amanda, hello. Hello.
Sean, this is a nice, long intro, but I get a hello. Amanda, hello. Are you up for regular heaven magic? Okay. Thanks. So I'll work on that. Greetings in salutations. Right. Oh, it's a hazel, right?
She's new. I'll tell you what, you get to introduce our guest today. Tell us who's on the show. Okay, I'm going to show you how to do a proper introduction, Mike. I appreciate that. You're welcome.
Today we're going to be talking about contract opinions from not a lawyer. And not a lawyer who is joining us today is Tim Scholic. Tim has a lot of contracted opinions because he's been on both sides.
He's been both the freelancer, these former freelancer. And now he's got a he's startup founder of AdChat and other companies. Hi Tim, how are you? Hey, hello everybody, nice to meet you Mike and Sean.
Welcome to the show Tim. Yeah, this is going to be first of a series perhaps of episodes about contracts because we know people want to hear a lot about it. We're going to get Tim's opinion about how contracts should work
regarding the work he does and all that. Yeah, so Tim, tell us about how when you started. Tell us about some of the freelance work that you were doing, how you got into it, and if you had contracts, if you dealt with them.
Bye. you felt about them back then? Sure. OK. Well, I started in development working at e-learning companies, and then I moved to ad agencies. And I really was a flash developer. And that was back in the day when flash development was really,
really, really in demand. So you could set your own price and get as much work as you wanted to. I didn't like the agency life because it was just all the way. We had to do basically do the work to people at that time
because there just weren't enough trained people for the amount of work. And it was getting to the burnout point and someone. MUSIC approached me on starting a startup, so I did that for a few months,
and then that kind of burned out just due to the wrong partnerships, and maybe my somewhat green skills at the time took on a bit too much. People just didn't, it wasn't going well, and one partner left, and then I quickly followed.
So I found myself kind of out of a job at a time when my skills were in high demand, and what kind of happened, and I think you guys alluded to this is how you got started too, but that friends started asking you to do things, and.
Before I knew it, I had realized that doing things for friends and working on my own was much more profitable than actually working at an agency for salary. So I was then a freelancer and I started with a sole proprietorship quite accidentally
and I kind of, I think at that point, really didn't know what I was doing so I definitely didn't use contracts. I barely even knew. That isn't the beginning. I barely knew I was in business. I feared the CRA would be knocking at my door at any time to take home.
my things away. Every year, every year in April, I still get very panicking. Yeah, totally totally. So I'm sure you guys could really know, I actually thought they were going to come take me away because the just how much money you make versus being
on a salary. I was a little surprised when I learned that. So it's too good to be true, I guess. But so yeah, that's that's kind of the way it was. And I don't think I did use a lot of contracts. I definitely signed a lot of
You know, if a non-scclosure agreement, if one of those was put in front of me, I'd barely read them and would just sign them back. Yeah, I would just sign them back. Right? So that would definitely, that happened quite a bit because I was working through some producers
for large agencies. Yeah. So now that you have, I don't want to say advanced, now that you have evolved and moved on up in the world, and now you are the co-founders of the company. You are running the company.
So... Tell us about some of the companies that you've got and how that evolved and how do you feel about contracts and now that you're the boss. When I was freelancing, I started working for one client
and the more I work for them, the more I work for them and then it just kind of made more sense to bring me on as a partner. In the business, and I brought some of my friends to that business that was called Lollipop
and that's actually where Amanda and I met Amanda. I think maybe you came on after me or maybe you worked for them before me. I think maybe actually you worked there before I did. I think I was there before you were, because I remember being a little bit jealous and pissy when they made you partner.
Oh, were you awesome? I think I was a little bit. Oh, wow. I mean, it worked out in the end. I'm happy with, you know, with, you know, the trajectory and stuff that I've taken. But, and I mean, working more and more with Tim after he was brought on as a partner, Tim's wicked smart.
So are you Amanda? I am, but Tim is super smart. We can turn off the microphone and we can, I can tell you about. why you got the sweet around that deal. So, uh... We'll talk after. Post-show ramble.
But, uh, yeah. So now that you are the boss and you have to deal with the contractors and the freelancers, has your opinion changed about contracts? Um, I mean contracts are super important, but they don't always have to be legally vetted,
I think. Hm, in that a contract is like an agreement between two parties. And I think that's really important to have an agreement before you start. Yeah. But I don't know that I ever get a lawyer to look at a contract with an independent contractor.
There's a lot of levers that can be pulled between contractors and the company they work for, particularly in terms of payment, in terms of delivery of work. And everybody has to get along in that scenario where things can go really haywire fast.
And I think open communication right starting from the very beginning. Totally. Transparency is very important. Yeah, totally. Do you ever get a freelancer that you work with who pushes back and says like no
No, I want to pro contract with the lawyer and all that stuff I while you got it, you know, and if you did that get someone like that would you just tell him to hit the bricks or How would that go? No, no, no, no, of course not. No, that never happens. It has happened before with
Subcontracting companies where we'll hire like a dev shop to do like if we'll have a bigger application build I think that's happened and Could have been a red flag actually I think the project went okay
But they ended up taking a bit more time maybe or something. I don't remember it was a long long time ago that that happened and I remember thinking wow these guys like are really buttoned up is that cool is there something is
there something hiding in here that I don't know I want to step back a bit because sure sure it seems like you said that wanting a contract is a red flag or maybe I miss red but you said could you go into yeah yeah no no I know I mean
definitely want like a legally vetted contract is a red flag for us and and I'll explain why Sean it's not because I respect anyone who wants to do that and that's the way they run their business but the way that that our clients typically roll and is disorganized
chaotic and really high pressure that if there's a Super Bowl campaign coming up and it's December 20th and they're gonna need it to run by January 21st. I just don't have time to have subcontractors contract that it and we need to work
with you know partners and there's always lots of money for those rush projects right so you know, we can share the wealth and that's always what we try to do. And so I guess, yeah, it is a bit of a red flag and not in that you shouldn't have a contract
just but in the way we work and the way with our clients, it's almost always a rushed job. And we barely have time to do the project let alone. Wait to hear back from the lawyers. Yeah, getting to lawyers and paying for lawyers.
And honestly, you'll, you'll, we'll have to pay less money because if I spend the last time I paid for a lawyer, it was $350 an hour. or $450 an hour and if I need that lawyer, she needs to look at over four hours,
then you know that's $1,500 coming out of your pocket. And if you don't agree to the job, it's $1,500 coming out of my pocket. So. Yeah. It's a fair point because yeah, it really does slow things down.
You have to have a contract written up very often, when I've dealt with clients, I have my own contract. But to be perfectly clear, I don't always, you know, that it's a fair point. force contracts either. But I would have my own, the client would have their own. And suddenly
they're of lawyers like, Oh, wait a minute, we're going to have to look at both of these then and combine them into a new contract. And it just can get really out of hand for a while there where it's like, you know, suddenly two weeks can be eaten up by just going through
this contract and getting it in place before the project even starts, right? Right. And I mean, I can work with developers to say like, if it ever got to that, it'd be like, well, let's just start small and I'll give you a thousand bucks if you give
me a login system with two roles, right? And then we can. take it from in this particular CMS or whatever it is, and then for the next task, you break it into small chunks. And if you really didn't trust each other enough to deliver it,
you could break it up into small pieces. And I respect anyone who, if you've never worked with someone, you've got to make sure you get paid for sure. But it's pretty rare you don't get paid in my experience,
at least with the people we play with. I think it's happened once. Speaking for myself, I'm kind of hit and miss with contracts. Sometimes I use them sometimes. I don't. I have a number of agencies that I do work for. And each of the agencies,
I had a contract with the initial job. And then everything else is just like my email, because we have this original agreement. We have an understanding. There's a history. But when I work with like an individual business, sometimes I have a contract.
Sometimes I don't. It just depends how quickly things roll. So I'm a little inconsistent. And I do like having a contract. I did have a contract that was vetted by a lawyer. And so I use that. And if somebody pushes back on a clause, I might read it myself and say,
yeah, okay, I agree or disagree. I haven't gone back to that lawyer because, like you said, it's expensive. Yeah, right. Right. And same thing. If I get a contract or an NDA from somebody, I'll read through it
and I'll push back on something I don't understand or I disagree with. And I actually turn down one job because. they wanted to say that I was not able to work in that industry for like five years.
Oh, right. Oh, totally. Totally. No, I'm sorry. I'm not going to work with you. And they were like, they were, they were, honestly, they were a little surprised. And then I never heard from them.
So did you tell them it was because of that clause that you rejected? I did. And we went back and forth for two or three weeks on it. And I said, I don't need a lawyer to read this clause because it was in pretty plain English.
I am not agreeing to anything that has this clause. And it got to the point where Even if they had agreed to remove it, I probably would have turned down working for them because they were so resistant on it.
Yeah, a total red flag. Yeah, non-competition clause, I think it's called. Sorry, there was no question on there, but it was more of a ramble rant. It brings up an interesting point because, I mean, that's where we do pay for legal,
is when we work for Big Bad Car Company X or, you know, massive, giant, British-owned conglomerate that owns almost all the advertising agencies in the world and sends. you this giant document and they're like, here you need to sign this first and it's like sometimes
that that's when you do get lawyers to look over things. Although in that particular case you're not the first or there's probably been 100 agencies that assign that document so it's been pretty well vetted but you know we do receive from a lot of our clients that's when that's when we use legal
is like what are we signing but as far as like an independent contractor the other thing about independent contractors is that and this from freelance perspective too is Like, you can't use the course to collect $15,000.
It's like you can maybe use small claims from what I know. Actually, Amanda has a story. Can you? Oh, oh, here we go. Amanda's got a small claims story. Hi, Sean here. Hope you're enjoying this episode of the website 101 podcast.
We'd love it if you'd give us a review on Apple Podcasts or wherever you get your podcast. These kind of reviews help new listeners find out about us and allow us to keep doing. the show. Thanks. I was doing a project with a designer that I'd met up with
randomly and she thankfully had her she had some stuff more put together because she was a designer like even her her proposals looked very fancy and very nice and and the cost estimates looked very nice and very put together.
So we went and met with this client who had it was like some kitchen gadget store and the whole meeting quite frankly looking back was just full of red flags. 2020 is hindsight is 2020. And so we agreed on the cost for the project. And then she had like an
addendum in this like little time estimate that was like, this does not include entering products. If you want us to enter all of your products, that will be a separate cost. And we told him that and multiple times and he signed it. So it was like, great. So we went through, we did the project,
we got the project done or almost done. And we were like, okay, it's time to give us some money. Because that's another thing that I'm really bad at is getting a deposit. I'm just excited to get in and start working.
And oh yeah, we're about to go live. You should give me some money now. That's usually how I end up rolling. Never after launch, always before. But anyway, so we were about ready to launch. And it was like, we're done, look at it, reviews,
everything is great. And he's like, there's no products in there. And we were like, well yeah, because extra cost. He's like, I'm not paying anything extra. And it's like, well, that's, but you signed this.
He's like, well then I canceled the project. And was like, okay. And so I don't know if she just stuck this in or if somebody recommended it to her, but she had a little, like a single foot note and it was sweet.
like if the project is canceled, client is still responsible for paying as much as we've got done. And we're like, great, project's done, you wanna cancel it, pay us anyway. And you're like, I'm not paying.
So we took him to small claims court and it was a long ordeal. I feel like this is like a whole conversation that should happen in a different episode. But yeah, we ended up winning. And then he appealed it and we ended up winning the appeal.
The dude ended up having to pay us all because this one. It was just it was a piece of paper that I'm sure was not legally vetted at any point But it was something that he signed so I mean like and and maybe that's the difference
Maybe it's like if you have the email agreement, maybe if you have the the sort of DIY I wrote some things down. She got a paper trail of something. There's got to be some sort of paper trail and that's gonna cover your butt
Mm-hmm a man to have a question for you about that. So you won the appeal and the original one did that include your costs? It included the court costs. It included the costs for the actual for the first initial trial.
We used a legal aid. No, not a legal aid. What is it? Not a lawyer. Paralegal. Thank you. We used the paralegal. It covered that cost. And then for the appeal, we decided to get like a lawyer because we were just tired of this bullish BS by this point. So it included all of those
court fees and legal fees as well. I can't imagine how stressful that was. It was stressful and it lost money on it, didn't it? Oh, it. I think that it probably all told it was probably about a year and a half, two years.
Wow. So. For $10,000 because it was the maximum you could get in small claims court at that time. Yeah. So I know the wait times, I can't tell you why I know this, but I know the wait times for Superior Court right now in Ontario are like three to four years.
Especially because of COVID. So just, you know, almost fingers crossed, hoping COVID, yeah. So right now, that doesn't surprise me. So. And, you know, like I say, no contracts with, with. with independent consultants, but we definitely always have a statement of work that's very
detailed and has our terms of payment and what we believe we deliver at the time supposed to deliver, which is always a moving target. It's almost always a moving target. I think that's very important. I think if I look back on my independent contracting days,
I think that scoping works were probably something I wasn't really good at and payment was something I was terrible at because at the time. time my my income just jumped so much and I was working so much like payment was the last of my
worries. It's kind of like, you know, and again trusted friends. I knew I'd get the money, but I was just trying to like fulfill, fulfill contracts, you know, eventually the money would come. So we talked a little bit about red flags earlier. Do you have any sort of things that you really
do watch out for, given that you try to keep things a little bit casual as far as contract work goes? Do you know, is there anything that happens that makes you just go oh wait this is not going to go well, we better tighten the strings or whatever.
Anything like that? Yeah, they're like code smells though. You can't really always like detail them, but when you see them, you know, it's, uh, yeah, it's like things like overzealous creatives, I think are always a total
danger because we work for, or we have in the past, we haven't recently, but we were for some of the like the best creative made agencies in the US and their creative departments are just by design, but I just pull.
can be bullying and can be very, very aggressive because they're, you know, hotshot. Madison Avenue, $300,000 an hour creative director, or sorry, $300,000 or your creative directors and they want things the way they want things. So I
mean, sometimes you can see red flags there. I find with designers, designers like, because I'm a developer can really kind of wreck your day. And I find true on the other side of the coin that designers that don't have a lot of
experience can be a problem as well because they don't always design for mobile or they don't understand a bunch of things, right? And honestly, the way I can test that out is Photoshop files. Is that bad problem?
Mac designers always have unorganized layers. Yes. Have this blue doesn't match that blue. Yeah. This little letting is different from this letting in the margins here or wrong. When I see that, then it's, it's, it's almost always that.
And on the other side, when you have a really good creative graphic. develop designer, they never care about their files either because they just don't care about people. I have no empathy, right? So, it's like, wow, this looks great, but it's only one layer. Or, you know,
it's there's no, yeah, it's 200 layers and they're all called like EQ4 and, you know, XX 2, Z5. Level 1, level 2, level 3. Yeah, right, right. So there's lots of things like that and there's tons of them on the battery.
I don't know, they're kind of too numerous to mention. Legal is definitely a problem. Like if you see a lot of legal from a client, you're gonna be like, you might be in firmware for a rough ride,
particularly for the job starts. Yeah. So, going back to when you were freelancing or an independent contractor, I'm sure that you had some situations where you needed to have a contractor, you'd feel safer about it.
How did you do that yourself? Did you kind of do a DIY contract or did you actually hire a lawyer? Yeah. No, no, I don't know. I think I hired a lawyer because I thought I was a Hired a lawyer at one point for an hour because I had thought I had some liability on something that I can't really describe
But it wasn't involved with project work and And I asked them and we spent 20 minutes talking about it and then he was like do you have any other questions about that and and I didn't and he's like well you're here for an
Hour what else do you need to know and so then I asked him this like and I still remember it was it was in that building Above the keg on New York Street in Toronto and I just remember being like well
It's been 400 an hour, the 500 bucks now, and just like peppering the sky for like an hour. That's hilarious. So maybe that's a good time. And I could even go out to like, okay, who do you live with?
You know, are you married to her? And she's coming properly, like we're getting, she's like, yeah. I think he just like, he just like spelled out all the legal liability, a 31 year old dude could run into, you know.
And so, yeah. Make it a matter of same question to you guys. Do you have a contract that you got legally vetted? I had one that there used to be a thing in the WebDev community. I forget who it was that did this, but a popular sort of Web celeb from the UK released a
contract like a plain English kind of WebDev contract. And he said, here, everybody can just use this if you don't, and I started using that. And I realized later, this is probably never going to hold up in the court thing, especially
here in Canada. made in England somewhere. But I used to use that for years where I would just send it. Better than nothing? Yeah, exactly. Then, Sean, you shared some of your contract. I was thinking of the last, but yeah.
Yeah, yeah. So I started incorporating that. But this is part of the issue with contracts, because half the time neither party knows fully what the contract is saying. And there's been times for me where
I have this one clause in my contract that says that I own the work that's been done. being done. I don't do work for hire. So technically, if I make a website, I own the code, I own the graphics, and I'm licensing it to the client for lifetime, like forever.
They get the, you know, but technically they can, it's to protect me from them hiring a guy at half my price to do the same thing for a second project that I just did, right? Or also to prevent prevent them from saying you can't use it. You can't showcase your
work. It's like that. So, but, but the truth is there's been times when I've been in a situation. where the clients, like I say, the lawyer or whatever, suddenly pushes back about that particular clause,
like, oh, we hired you to build a website. So we own the website. They just think of the website as if I built them a table or something. So when they do that, I just usually just go, okay, fine, let's take that one out.
And the reason being that I'd rather get paid the $20,000 for that project than turn it down because, oh, how dare you declare that you've owned the site that I built for you? It gets all weird. There's some flexibility with contracts.
I've also removed the clause once or twice. but I have a general, like a longer thing, which I'll talk about after Amanda goes. I have nothing. I'm just, I'm so excited to like get in and start solving it.
That's why Tim's your guest. Yeah, we have a lot in common. And start playing with the code. And like I even said previously, it's like, you know, I always forget to ask for the, for a deposit before I start working.
I just want to start going and playing and doing on a recent project Sean, Sean gave me a statement of work. and I modified that a little bit to fit what I was doing and it worked out fine. But here's a funny little aside. You really have to be careful with even the boiler plates.
My partner Andrew and I have a child and when he was being born we decided to be adults and get wills. So Andrew's uncle is a lawyer and so it's sent us just this basic boiler plate information and thank God Andrew actually sat down and read all of it because there was something in there about
legitimate children. Andrew and I are not married. So, like that was, and it was the fact that it was like, you know, so he had to contact his uncle and be like, this, like, and the uncle was like, oh, yeah, you're right? Gonna change it? It's
just always been in there. So sometimes you still have to be careful with these you know, boiler plates that have been around forever. Everyone's been using them. It must be okay. And if you didn't change that, your uncle would have gotten
your entire estate instead of the game. No, no, no, no, no. No, because shut up. No, because the kid is listed as beneficiary on all of the individual things, but it's like if we'd gotten a new life insurance plan and hadn't spelled it out that way, then
who knows what would have happened with that money? Mm-hmm. Yeah. Yeah. Yeah. Yeah. So to go back to my contract, like Mike, I had cobbled together some stuff from the internet and also a web celebrity, but it was an American-style template.
And I'd used that and added in some other things that I'd seen on forums. And then... I was part of a Chamber of Commerce for a year. I didn't end up liking it that much so I left. But during that year, I talked with this lawyer
and he needed a little bit of help on his website and I wanted my contract vetted. So we just did a exchange. I spent an hour on his website and he spent an hour and vetted my contract and said, make these changes.
This is good. This is not, we need to adjust this so it works in Canada. So I have a vetted contract but this is from three or four years. ago, so things may have been changed. And that's where Mike took. He took that from me.
Yeah, I got some of that information. That's right. So, but like I mentioned earlier in the episode, I don't use the contract consistently. I started working with a new agency here in Toronto. I built an entire website for them,
didn't sign a contract, got a statement of work. I agreed to a new website with a contract statement. in a work that I'll be starting at the end of it next month. So I'm inconsistent. Like Amanda, I really want to get into it.
But sometimes I slow down and I was like, yeah, I think it's good to have this. But it's something to do. Like Tim and Amanda, I can tell that you've worked well together because you both have the same philosophy.
Tim, you alluded to earlier that you'd rather just have someone eager to do the work and not eager to sign a contract kind of thing. And that you just like to get your hands dirty and all that. Like there's some value in that and knowing that okay, we both the client and the contractor
Just want to get this work done and get get started and rather than you know Worry about what's gonna happen when it doesn't work You know there's something to be said for that right right and I think like I'm gonna go back on what I said earlier
You know if either you know Mike or Sean came to me with that contract I mean I would definitely look at it if there wasn't anything like really weird in it. I would sign it I would probably have a problem with I would have to have a problem with that cause you were talking about Mike
Yeah, you know we don't have a the code because and it's just like because our clients make us sign a lot of times that yeah that we like we can't throw them that clause so I can't you know you couldn't make claim to your work for
me to make claim to them you know what I mean sure sure yeah but that's where flexibility and negotiation on the contract go in like Mike said he has pulled it out before and in the in a case where he's working for you he probably would again I mean yeah thanks Sean's hooking me up with new
contract work on every speed live on the podcast Tim is mine back off That's not the work, so. This has been a really great conversation and informative and not at all legal. So thank you, Tim, so much for joining us
and sharing some of your thoughts and opinions about contracts. For those interested in learning more about you, share where they can find you. Sure, I think probably the best place to contact me
is on Twitter at Timsco, T-I-M-S-C-O. Six letters, OG Twitter handle I'm still proud of. Yeah, that's very impressive. I like it. So I don't publish much content. mostly but if you want to DM me I think my DMs are open or just follow me I'll
probably follow you back because I don't know what going on and then our site is adchat.ai and wonderthing.co. Excellent excellent thanks so much for coming out yeah really nice to meet you guys and maybe someday soon in the real real world
someday soon in the real yeah I'll bring my contract you can sign it before you meet me totally I'd love to see you just email to me thanks a lot Tim yeah this was really good likewise guys The website 101 podcast is hosted by me, Amanda Lutz.
You can also find me online at amandalutz.com. Recording from a secret lair while plotting world domination, I'm Sean Smith, your co-host. One of your hosts today was me, Mike Mela. Find me online at belikewater.ca or on socials at likemela.
Have a question for Sean, Mike, and Amanda? Send us an email.
- 1 Meet your Host - Sean
- 2 Meet Your Host - Mike Mella
- 3 Wes Bos - Your Web Boss
- 4 Tailwind CSS with Adam Wathan
- 5 Starting my own Website with Bill Campbell
- 6 CSS is Awesome with Kevin Powell
- 7 Meet Your Host - Amanda
- 8 11 Things to avoid doing on your website
- 10 Hiring Junior Devs and How to Stand Out from the Crowd
- 12 Contract Opinions From Not a Lawyer
- 13 Talking to a New Dev