Freelance work with no contract - who owns the code?

Question

In a situation where code ownership was not mentioned and no contracts were signed who would you assume owns the code? The company or the freelancer? If it was taken to court is there some kind of legal precedent where it goes to one party if nothing was said?

Answer 1

In Canada, if the freelancer is considered to be an external company, then the code intellectual property belongs to him. If the freelancer could be considered like an employee of your company, then the code belongs to your company.

This is different in the US.

Answer 2

Did they pay him for the work?

I believe this varies by state, and IANAL but the code typically resides with the person who writes it until they assign it to someone else. Except... if they paid for it, they have some expectation that it is theirs.

Obviously they need a lawyer. Its probably just a consult.

Answer 3

This is an old article but might still be valid from a legal point of view:

http://www.channelregister.co.uk/2005/11/10/outlaw_consultant_software/

And here's another article:

http://www.kelek.com/freelance/ownership.html

Answer 4

Obviously no one can give specific legal advice on your particular situation without getting a full briefing on the facts of the particular case - everyone involved should consult a lawyer who knows about software an intellectual property. This is something that comes up more often than you might think and this is one of those cases that the law doesn’t necessary do what common sense would suggest - if there is no contract (written or oral), at least as the copyright rights in the code, the result (in the US) is pretty clear: the freelancer owns the code and the company has, at most, some kind of hazy implied license.

When bringing someone in on a contract basis (i.e. not as an employee) it is always important to get a written contract that addresses this issue.

Answer 5

Depends of contract, but in most of case company have all rights on the code.

Answer 6

Your situation is sticky because there is no written contract, but I think a court would have a hard time accepting that the freelancer wrote the code for himself while being paid by your company. That said, it's possible he may still retain some sort of copyright that would allow him to redistribute or sell the code to a third party. However, a court would most likely determine that it was a work for hire, and that the company owns it in full.

Answer 7

The best idea is to consult a lawyer for sure.

Whether they own the code or not could possibly simply depend on how the verbal contract (it is still a contract) was made. That is: Did they pay the freelancer for producing the code for this project or was he paid for giving the company the complete product and source? The difference is small, but could be juristically important.

Answer 8

I would suggest getting real legal advice. From my understanding, work created "for hire" is owned by the customer ("your company"). This should always always always be agreed upon before work is started and way before money is exchanged for the work.

Thankfully, if it is on your webserver you can archive a copy of it and although you can't modify it you can keep what you have paid for.

Answer 9

This would depend on which country you are in.

Answer 10

Some answers mentions “work for hire.” It is important to note that under US copyright law, “work for hire” only applies to employees acting within the scope of their employment and to a very specific list of types of copyrighted materials, which does not include software. In a non-employment circumstance (i.e. freelance) in the absence of a contract, the party commissioning the work will NOT own the copyright, the freelancer will.

Answer 11

A good resource: http://www.1099.com/home.html Trust me on this, its always BEST to consult an attorney, have a good contract written up and agreed to, and then hope that things go off without an hitch. Always stay in touch with the business/legal end of things.

Answer 12

In my experience I've often written those rules into the contract itself.

If I'm coming on board to achieve a particular solution or task I may have code which I would like to use to speed up the project timeline, or enhance the overall stability and effectiveness of the application - in which case I stipulate that I will be contributing some personal and/or open source cods to the project, of which belongs to said license (i.e. GNU, BSD etc). Therefore, any changes/amendments I make to my code within the contract time period I can take along with me, since the license dictates that it's essentially open source.

However, I should stipulate that this setup only really works on projects where i'm the sole developer. When working with clients/companies in a team environment (i.e. i'm just writing a fuse in the fusebox) they request that I don't use my libraries which mean that all intellectual property and code belongs to them.

In your case, where no contract was signed, I would break down the relationship you have with your client/employer:

• If you approached the client with an idea, and they payed for development since it had benefits to their business, then I would argue that you have a right to the code.
• However, if you were hired to build a site (or something) where by they briefed you on the idea and you simply developed the application then I'd argue that they own the code.

Obvious caveats of the above arguments exist if the application is a business critical business application or contains innovative IP. I.e. if you wrote a new, innovative application for a business which gave them a competitive advantage, then OBVIOUSLY they won't want you to share it with 3rd parties! (even if that's not your intent)

Overall, learn from the experience and ensure you write and conform to contracts which both you and the client are happy about. Be sure to make your intent and post-project involvement clear so that surprises like these don't arise in the future.