I ahve given my client his LOEs and he has come back saying he doesn't agree with two points and wants them changed. Has anyone had this happen? Have you changed the details to suit your client? Have you managed to come to a compromise?
Could someone help me with the wording if I need to change it?
It really depends on what the client wants changed, if it's something simple like payment terms from 30 to 45 days then generally I would accept the change. If it's something which reduces the clients liabilites then it would have to be a judgment call on your part.
Has the client suggested how they would like them changed ?
These are the things I have in the LOE that he wants changed:
1 : All accounts, statements and reports prepared by us are for your exclusive use within your business or to meet specific statutory responsibilities. They should not be shown to any other party without our prior consent. 2: This letter and the Bookkeeping Services Form comprise the complete and exclusive statement of the agreement between the parties, superseding all proposals oral or written and all other communications between the parties.
This is what he has said:-
1. Third Parties Im sorry but I can not agree to the 1st paragraph here, all work done by you (once paid for) is my intellectual property so I would prefer not to have any restrictions on the usage.
2. Agreement of Terms your agreement has the provision that it supersedes any other agreement, however, in our case my agreements on confidentiality and intellectual rights would supersede your engagement letter.
Would you change them? If you stand by whats in your LOE how would you explain it to the client or reassure them?
On 1 he has a point that you are preparing accounts, statements and reports on his behalf so once the work has been paid for he can share them with anyone he likes. You could add a bit that says that he can share them with a 3rd party once you have have been paid in full for this work.
On number 2 and from other LOE's I've seen they usually state this is the exclusive agreement, unless changes have been agreed in writing by both parties. As sometimes an LOE covers a number of periods and changes do need to be made after signing, so rather than writing a whole new LOE you can accept changes so long as both parties approve.
Not sure what he means by "my agreements on confidentiality and intellectual rights " have you agreed something else with him ?
Personally I would make the change on point 1 saying one payment has been made and on number 2 I would change to say any modifications to the terms of this LOE need to be in writing and approved by both parties.
The client values showing the accounts to third parties. You need to know who are they? Why do they need to see them? What exposure (if any) is there for you?
He uses the word "prefer" as opposed to "want" or "need" which could indicate there is not too much value. So, you could offer same terms and then a one-off price of £200 extra to show them to third parties if he wants/needs to.
Paul, I agree with the first point and think I will add, until payment has been made in full. With regards to the second point, it is a dental practice and holds the same confidentiality laws as a doctors so I had to sign confidentiality agreements for it. I need to maybe word that section differently to show my LOE works in conjunction with the agreements I signed for him but not sure how to.
Bob, the client, or at least my contact, isn't the business owner; his wife is. Plus being a dental practice I believe there are third parties, such as his accountant, the NHS, etc that need to see copies of their accounts, so I do believe he is right, and I will be changing it. I can only prepare monthly reports based on the information he gives me so if they aren't comprehensive then its not going to be down to me.
I use the following paragraph in respect of your point 1. Seems to cover most bases.
Any reports are made solely to the company's directors in accordance with our terms of engagement. They have been released to the directors on the basis that these report shall not be copied, referred to or disclosed, in whole (save for the directors' own internal purposes or as may be required by law or by a competent regulator) or in part, without our prior written consent. Our work has been undertaken so that we might state to the directors those matters that we have agreed to state to them in these reports and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's directors for our work, for these reports or the conclusions we have formed.
My clients sign a professional services agreement, which is pretty much an LOE.
I had mine checked by a solicitor and below.
The clause 2.14.4 would seem to be the bit you need to cover point 2, so feel free to use as you see fit.
Hope this helps
Paul
2.14 Legal Construction
2.14.1 This Agreement constitutes the complete and exclusive statement of the agreement between the parties with respect to the subject matter hereof and supersedes all proposals, understandings and agreements, whether oral or written.
2.14.2 Clause headings are inserted for convenience only and shall not affect the interpretation of this Contract.
2.14.3 A person who is not a Party to the Agreement shall not have any rights under or in connection with it.
2.14.4 The expression "this Agreement" means the Statement of Services, the Statement of Price, the Professional Services Terms and Conditions and any other document the parties expressly agree and designate to form a part of this Agreement and includes any variations thereto which shall have been agreed in writing by the Parties.
2.14.5 English Law shall govern this Contract and the parties hereby submit to the jurisdiction of the English Courts.
That is fantastic Paul as it covers the confidentiality agreement I signed for them, and shows they work in conjunction with one another rather than one superseding the other.
Will contact the client with the revised points.
Thanks everyone for your help, especially Paul. No wonder Shamus has a ten-page LOE, as I'm guessing all these things will have to be altered to suit each clients needs.
I use the following paragraph in respect of your point 1. Seems to cover most bases.
Any reports are made solely to the company's directors in accordance with our terms of engagement. They have been released to the directors on the basis that these report shall not be copied, referred to or disclosed, in whole (save for the directors' own internal purposes or as may be required by law or by a competent regulator) or in part, without our prior written consent. Our work has been undertaken so that we might state to the directors those matters that we have agreed to state to them in these reports and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's directors for our work, for these reports or the conclusions we have formed.
Liz, this is really great and would probably work for another client but in this particular instance I don't think my client will be happy unless I change mine to put until payment is made in full. Thank you very much, I may borrow some of the wording though, if that is ok.
That is fantastic Paul as it covers the confidentiality agreement I signed for them, and shows they work in conjunction with one another rather than one superseding the other.
Will contact the client with the revised points.
Thanks everyone for your help, especially Paul. No wonder Shamus has a ten-page LOE, as I'm guessing all these things will have to be altered to suit each clients needs.
No problem at all, glad we could help you with this one.
I used to work for a top 20 accountanty firm and their LOE was 15 pages! As with most of these things they start off quite small and over time as clients find loopholes they get added too.
