Are constant changes to a projects requirements a sufficient reason for terminating a contract?

Question

I have serious problem with one of my clients and I am trying to determine if I should terminate the contract or not.

I am doing web site and application design for a client. I estimated the project to be one month (which was more than enough) and it's now the end of third month and we're still only half way through.

There have been around 20 revisions so far and the design got out of the control. This is because they see things on other websites and want them integrated into the design, so it looks like an awful patchwork. Also, they take my designs and photoshop them until they are satisfied, even though they have less than basic skills, and I see their behavior as insulting to my expertise (you hire me to do the job and then you do it instead of me, sending me the message that my knowledge is not valid).

I've politely warned them several times of the implications of such an approach to the project, and even though I made sure they understand it, they continued to behave in the same way. I've been paid 50% so far, but I cannot sustain having this project as it affects my work, budget, and other projects.

So are the ever-changing requirements by the client a sufficient reason to try and terminate a contract? And why or why not?

Answer 1

I'm making assumptions based on your comments and the small amount of the story in your post, but from my outside perspective it sounds like the client isn't your problem. Your contract is the problem.

It sounds like you wrote a contract with a fixed price and no clear constraints on how much work you would do for that money. In this situation almost any client is going to eat your lunch on change requests. You have set up the situation where they have zero incentive (other than how long it takes to get to the final deliverable) to constrain feature-creep. The client you have is extremely typical and not the exception. It doesn't even sound like they are being unreasonable.

You won't want to hear this, but your best option now is probably to come clean with them and admit you underbid the project and attempt to renegotiate. If they won't go for it you should offer them a refund and an apology and refer them to another developer. It might hurt to lost all that money, but consider it a down-payment on your education for how to protect yourself when writing a consulting contract. I'm pretty sure that most developers-for-hire have learned this lesson the hard way at least once in their careers.

TL:DR - The contract language decides what is a sufficient reason. If you didn't write that in, then the answer is no.

Answer 2

First, I would recommend talking to a lawyer to see if you can legally terminate the contract without having to worry about getting into trouble.

Assuming that a lawyer says it's legally OK to do so, then I suggest you do it. From what you've written this client is causing many problems and is not very easy to manage. I'd recommend ending the relationship and turning over whatever resources (code, database, PSD files) you are required to to them and wish them luck. Maybe as a good-will gesture (because some clients get really nasty when they realize they're being "fired"), don't demand the remainder of the money unless you need it and have a legal basis to do so. The only situation I'd recommend keeping them is if they are your only client and you need the money OR if the value of the relationship transcends the project (such as they are a father/mother-in-law and you want to remain on good terms with them, or they are a good network connection that will probably lead to better projects in the future).

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Addressing recent edits in the question:

Are the ever-changing requirements by the client a sufficient reason to try and terminate a contract?

If the contract specified a system that has features A, B, and C, and can perform function D and the client later decides that they want to add new features, change the nature of feature A, and remove feature B, that sounds like a point where the contract must be re-examined with client to remind them what they initially requested and what is being developed. If the client insists on the changes under the terms of the old contract, I would say that could be good grounds for investigating (with the help/consultation of a lawyer) termination of the contract. Why? The client is insisting on more/extra work and constant changes that may be beyond the scope of the contract for a pre-determined/fixed amount of money that was based on an estimate for different work. There is no reason to let a client push you into doing work that is far beyond the contract. Unless you want to be a "nice guy" but that probably won't help you pay the rent.

Answer 3

It sounds like you have been taken for a ride.

Your fixed bid contract is a big matter of risk vs. reward. If you do the work faster, you get paid more. If you are taking more hours, you get paid less (hourly).

The contract you have written has posed a risk distribution problem here. You're setting the price, but when they kept requesting revision after revision, they have put most of the risk back on to you. As far as I'm concerned, this is unethical, and you are clearly being taken advantage of. If your client is trying to take complete control over the direction of your work, he is purposefully getting free man hours out of you.

If you want to be tough on your client, next time he wants a quote, start billing an hourly rate. Balance the risk by putting some of it back on him, and explain to him why the project isn't yet finished.