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Contract Confidentiality

Discussion in 'Business Fundamentals' started by Lawn Lad, Sep 18, 2003.

  1. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    Does anyone put a notice of confidentiality on their contracts? Not that you can't keep someone from sharing it with others, but in essence you're sharing proprietary information with a prospective customer by giving them your contract. I would think that a confidentiality statement would at least put customers on notice that their may be consequences if they do hand out copies of your contracts to other contractors when shopping you around.

    I haven't had this happen to me, and I know it would be tough to stop... but what do you think of the idea?
     
  2. Mike Nelson

    Mike Nelson Senior Member
    Messages: 637

    Doug,

    That is a great idea. Haven't thought about that till I read this and you are sooo right.

    Thanks
     
  3. wyldman

    wyldman Member
    Messages: 3,265

    It would be a good idea,but hard to enforce.It may make a few think twice though.You've got nothing to lose by doing it.

    I will usually ask for to see their previous contract or bid specs when quoting to point out all the mistake or liabilities.They usually don't have problem producing it.
     
  4. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    That's just it... I ask to see the previous contract and get as much information as I can. I know how invaluable this is to me. I'm just trying to prevent my contract from getting out there. Kinda hypocritical in some ways... but business is business. The worst is that they say no to seeing their past contract and then show yours around.
     
  5. wyldman

    wyldman Member
    Messages: 3,265

    Your right,it is hypocritical.I have never had a problem with anyone showing others our bids or proposals,but it would be nice if we could keep the actual contracts private.
     
  6. JD PLOWER

    JD PLOWER PlowSite.com Veteran
    Messages: 751

    LL its strange that you posted this. I had a sub of mine call me last year saying he was contacted by a property that he plowed for me :angry: . He told me "They showed me your contract, in fact they gave me a copy :realmad: . He's a stand up guy and said he'wouldn't even consider bidding it (the non compete may have had something to do with that) but he just thought I should know. So now I realize my contract went out to most of the contractors in my area. Them knowing my prices doesn't really bother me, its the details of things like a liability clause that has taken me years to put together that bothers me! I talked to a lawyer about this and he said unless its copyrighted material you really can't prevent that. He did mention something along the lines of what your talking about, intimidating the owner into thinking he'll have consequences in divulging your material. If anyone has any ideas I'm all ears :help: .

    Edit: I just realize the proposal I dropped off this morning might be going to the next guy they call :nono:
     
    Last edited: Sep 19, 2003
  7. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    I guess I'm not alone in what I'm thinking. And I guess we all realize that it's tough to enforce.

    I'm wondering what kind of wording I'd use.

    Confidentiality Agreement:
    "By accepting this contract, the Owner or the Agent on behalf of the Owner accepts the following Confidentiality Agreement. The contents of this Agreement (Terms & Conditions) are considered confidential and is considered the sole property of XX Company. This Agreement is considered proprietary information and is intended only for the purpose of extending an offer for services to be performed on the Owner's behalf. At no time prior to, during or after the term of the contract has expired, may the Owner, employees, subcontractors, agents, or customers of the Company, copy, print, distribute, or disseminate any of the contents contained in this Agreement to any individual not employed by the Company and specifcially engaged in the administration of this Agreement on the Company's behalf, no matter if the contract is signed and accepted or rejected by the Owner or Agent of the Owner."

    An additional thought could be added if you didn't want to protect pricing, since that's why Owners share contracts -

    "Schedule A (Pricing) is not covered under the Confidentiality Agreement, and may, at the discretion of the Owner, be used in any manner they see fit."

    How about another way of saying it without so many words? Anyone else have sample phrases/terms they've used for this scenario?
     
  8. wyldman

    wyldman Member
    Messages: 3,265

    That is a great way to word it.I also agree it would be nice to break it into two parts,so they can show others your bids and pricing.I still don't think it would hold up though,who's going to know if they showed it to someone else.
     
  9. JD PLOWER

    JD PLOWER PlowSite.com Veteran
    Messages: 751

    LL that is a well thought out paragraph but one thing I've learned is you need to have a clear penalty that the owner agrees to pay, should they violate the agreement. Then you get into what Wyldman posted about how do you enforce this? I just happened to get lucky when I heard about my problem.
     
  10. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    The problem is that by defining a penalty to the customer - you're really going to set them back. I agree that there is little to no enforcement here. All you've really done is state your expectations.

    If you did put in a penalty clause what customer would want to accept your contract for fear of being tagged with that down the road if some employee inadvertently violates it? Is the customer with a $100 per occurence price going to be discouraged by reading it? What about the customer who you're signing a $100,000 contract with? Perhaps the confidentiality agreement would be best suited for larger contracts. Although, regardless of the size of the contract, the contract will be the same or very similar and is just as worth protecting when writing a $100 contract or a $100,000 contract.

    How does one copyright? Someone told me that all you need to do is put the copyright symbol on your text with the year. Is this accurate? I know registering or getting a trademark is different. But a copyright I think is something that you can place on your text?
     
  11. Mick

    Mick PlowSite.com Veteran
    from Maine
    Messages: 5,546

    Not quite - http://www.copyright.gov/title17/
     
  12. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    Ooof, thanks Mick. I guess I'll have some reading to do. Thanks for the link.
     
  13. Ohiosnow

    Ohiosnow Senior Member
    from Ohio
    Messages: 415

    Lawn Lad

    I've had it in my contracts for almost 15 yrs. ;) I had my attorney add it in after I had my contracts handed out to some other guys :realmad:

    I spent my hard earned money on attorney fees & then they copied my contract word for word :gunsfiring: plus then they undercut my pricing.

    I leave $$$$$$$$$$$$$$$ up to the courts to handle, most don't want to go to court. ;) I've only had it happen 1 time since then & the owner sign a 10 yr. contract at his request so as not to go to court.

    BTW: I still have the contract with him But now it's just a 5 yrs. at a time.


    Almost all the guys in my area all know each others pricing so now it's just about the how& when, how long, how much salt ect.
     
  14. micah79

    micah79 Senior Member
    Messages: 303

    About the copyright. Getting a copyright is a complicated process that involves $$$. It is not so easy, and is probably not worth doing for a plowing contract.
     
  15. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    I haven't read through the copyright stuff that Mick was kind enough to post.

    I'm assuming copyrighting material is different for different things. For instance, periodicals such as magazines and newspapers are copyrighted. So are photographs by professional photographers. These are things you can't copy at Kinkos. Websites all have copyright written at the bottom of the pages.

    Since it's not practical to assume that daily newspapers, magazines, photographs, etc. go through a complicated or expensive copyright process, what makes it so difficult to copyright a snow plow contract?

    I guess I'll have to research it some more since I can't believe it's that complicated.
     
  16. micah79

    micah79 Senior Member
    Messages: 303

    Its not that difficult if you are willing to pay the money to have it filed for you. Its just that from experience, that I kinow that the US copyright office is not a pleasure to do business with. Long waits, red tape.... Newpspapers and magazines have an umbrella type copyright setup. Their way of doing it is way different then it would be for one of us to just go and get something copyrighted.
     
  17. Lawn Lad

    Lawn Lad Senior Member
    Messages: 407

    What about websites? My website person put copyright on ours and I didn't file any paperwork. I own the site and the design, even though they did the work. I see every other site with copyright marks on it.

    I understand what you're saying about the umbrella type, which makes sense. I wonder if websites operate similarly.
     
  18. micah79

    micah79 Senior Member
    Messages: 303

    My website hosting company, charges a fee if I want my site copyrighted. I was assuming that they would handle the red tape since they are charging a fee. I'll do some research, on the web stuff, because I want to get my site www.brightonservices.com copyrighted I designed it and maintain it myself, but I do nothave redundant high speed servers with high bandwidth to do a professional hosting job. I run personal site for fun off of my server at home through my cable modem, but it is not reliable enough for a business site. I oay $13/month for the hosting, so I am happy.

    p.s. trademarks are also a hassle. I am in the process of getting my logo trademarked and it isn't very fun.. I've been waiting a while and have already sent in over $200 and I'm not done yet.
     
    Last edited: Sep 21, 2003
  19. murphy4trees

    murphy4trees Member
    Messages: 62

    In order for a contract to be valid there has to be "consideration"... that is usually $$$$... So the contract is valid for services because the consideration is spelled out... However, what is the consideration for keeping the contents confidential... Unless that is specified I doubt confidentiality would hold up in court... Though that may be less important than actually making it clear to the potential client that you expect confidentiality.
    AS far as copyrights go.... If you wrote it, you own it... Years ago it was necessary to put a liitle "c 2003 Daniel Murphy" on the writing, but that is no longer needed..... However, there is a big difference between OWNING a copyright and REGISTERING a copyright.... I believ the copyright is not enforceable until it is registerred... And registration is no big deal.... Go to the library and get a book on copyright... Whereas trademarks are much more complicated to register...
     
  20. micah79

    micah79 Senior Member
    Messages: 303

    You don't have to have seperate consideration for confidentiality. The confidentiality clause is part of the contract. If the contract has consideration, then its contents are also binding, providing they do not break the law. Are you saying that you would need seperate consideration for a limitation of liability clause as well....Or what about a payment schedule. All contents of the contract are considered part of the contract if it is properly written. No need for additional consideration. You need a copyright in order to bring suit if your document is reproduced without your permission. If you don't hold the copyright, then you can't legally prevent someone else from using it, or bring suit for damages.