A Contract for a Five Thousand Dollar Project

Proportionate is the whole point

A twenty-page agreement for a five thousand dollar project is a cost in itself: somebody has to write it, somebody has to read it, and neither party will refer to most of it.

An emailed quote with no terms is the other failure, and it is the more common one.

What works at this size is one or two pages covering the small number of things that actually go wrong, written in plain language.

This is a general description rather than legal advice. For anything substantial, or where the arrangement is unusual, a professional should look at it.

The six things worth writing down

• Scope: what is included and what is explicitly not.
• Price and payment triggers, tied to deliverables.
• Timeline, and what happens when either side is late.
• Revisions: how many, and what happens after.
• Ownership and handover on final payment.
• Termination: how either party ends it, and what is owed.

Almost every dispute on a small project traces to one of those six being absent rather than to a term being badly drafted.

Scope, stated as exclusions too

The most valuable half of the scope section is what is not included.

A list of inclusions is comfortable to write and leaves everything unmentioned ambiguous.

Stating the exclusions plainly, and there are usually five or six, removes the arguments before they exist: content, photography, training, ongoing support, third-party costs, and anything not listed.

Number the deliverables so both parties can point at an item rather than characterising the agreement.

A numbered list of ten deliverables and six exclusions is more useful than three paragraphs of description, and it is quicker to write.

Timeline that acknowledges both sides

Most small project agreements state a delivery date and say nothing about the client's obligations, which is where they fail.

Projects at this size slip because content, feedback, or a decision was late, and an agreement that only binds the supplier is not describing the actual risk.

Write both: what the supplier delivers by when, and what the client provides by when.

Then say what happens if either is late. For the client, that is usually that the timeline moves and the supplier reschedules rather than waiting. For the supplier, it is a mechanism for the client to escalate or to end the arrangement.

Neither side should be surprised by that clause, and both benefit from it existing.

Termination is the clause nobody writes

And the one most likely to matter when a project goes wrong.

Say how either party ends the arrangement: notice, in writing, with what happens next.

Say what is owed at that point, which is usually work completed to date rather than the full amount or nothing.

And say what is handed over on termination, which should include work in progress and access, since the alternative is a client with a half-finished project they cannot continue.

A clean termination clause makes it easier to part ways early when a relationship is not working, which is better for both than continuing badly out of a sense of obligation.

A worked example

A designer and a client fell out over a project a little under five thousand dollars.

The agreement was an email quote listing six deliverables and a total.

The client believed two further pages and a logo refresh were included, having discussed them in a meeting. The designer had priced neither.

Neither party was acting badly. There was simply nothing to refer to.

It was resolved by splitting the difference, with both parties dissatisfied and neither working with the other again.

A one-page agreement with a numbered scope and an exclusions list would have prevented it, and would have taken the designer about twenty minutes to write once and reuse.

What can be left out

Worth naming so the document stays short.

Elaborate liability limitations, indemnities, and warranty schedules are standard in larger contracts and are disproportionate here, although a simple limitation of liability to the value of the contract is common and reasonable.

Confidentiality clauses are usually unnecessary unless something genuinely sensitive is involved.

Detailed dispute resolution procedures specifying arbitration are not proportionate at this value, since nobody will use them.

Governing law is worth one line where the parties are in different places, and does not need more than that.

Who writes it

A practical point that removes an obstacle.

Usually the supplier, because they do this repeatedly and can reuse the same document, which is why a supplier who cannot produce one is telling you something.

A client receiving a supplier's terms should read them rather than assume they are standard, since the balance in a supplier's document is naturally toward the supplier.

Asking to change one or two things is normal and is not an insult. A supplier who refuses any amendment to a two-page document is worth a second thought.

Where neither party has anything, a plain email covering the six items above, agreed in writing by both, is far better than nothing and is enforceable in most circumstances.

How agreement gets recorded

A question that stops people producing anything, because they imagine signatures and witnesses.

For a project at this size, an email saying I agree to the attached terms, sent from a business address by somebody entitled to agree, is generally sufficient and is what most small suppliers work from.

Electronic signature services are inexpensive and produce a tidier record, which is worth it if you do this often enough to justify the subscription.

What matters more than the method is that both parties have the same version. The common failure is a document amended in a conversation and never updated, so each side holds a different understanding of a clause neither has reread.

Send the final version after any changes, ask for confirmation, and keep it somewhere other than one person's inbox.

The counter-case

Formality can be counterproductive at the smallest sizes.

For a few hundred dollars of work with somebody you know, a written summary of what is being done and what it costs is proportionate, and producing an agreement is overhead that may cost more attention than the job.

There is also a relationship cost to leading with a document, particularly with an individual, and starting a small engagement by sending terms can set a tone that outlasts the project.

The way through is to write the scope and payment terms as a clear email and let the formality scale with the value.

What is not defensible at any size is having nothing written down at all about what is included.

The page

1. Number the deliverables.
2. List the exclusions explicitly.
3. Tie payments to deliverables, not dates.
4. State both sides' timeline obligations.
5. Say how many revisions and what follows.
6. State what transfers on final payment.
7. Write the termination clause.

Steps two and seven are the ones most often missing and the ones most often needed.

What a retainer version should contain is covered in what a retainer should include.

Frequently asked questions

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