Terms for a software house doing fixed-price projects

A fixed price is a bet that the scope will stay still, and the terms are what a software house has when it does not: assumptions the price depends on, change control that turns a new requirement into a new price, milestones that pay for work as it is done, acceptance that cannot be withheld indefinitely, a cost for the client's own delay, and a warranty and a liability cap in proportion to the fee. I draft those terms for a fixed fee of £995, delivered in five working days.

Who this is for

Software houses, development agencies and consultancies in England and Wales that quote fixed prices for defined projects, from a single integration to a full platform build, and want standard terms every statement of work sits under.

What matters in terms for fixed-price projects

The scope and the assumptions the price rests on

The terms should provide that each project is defined by a statement of work containing the scope, the deliverables, the timetable and the assumptions on which the price is based (the client's systems, data quality, availability of client staff, third-party APIs behaving as documented), and that where an assumption proves wrong the change control procedure applies; a fixed price without stated assumptions is a fixed price for whatever the client turns out to need.

Change control and what triggers a price change

The terms should set a change control procedure: either party may propose a change, the software house prices its effect on cost and timetable, the client approves in writing before work starts, and no change is binding without it; the terms should say that requests outside the statement of work, changed requirements, incorrect assumptions and delay caused by the client are changes, so that the argument about whether something is 'in scope' is resolved by the document rather than by memory.

Milestones, acceptance and payment

Payment should be by milestones: a deposit on signing, stage payments on delivery or deemed acceptance of each stage, and the balance on delivery of the final stage, with acceptance by defined tests within a stated period, deemed acceptance if the client does not respond or uses the deliverable in production, and correction of material defects rather than rejection as the remedy for minor ones; interest under the Late Payment of Commercial Debts (Interest) Act 1998 and the right to suspend work for non-payment should be stated.

Delay on the client's side and its cost

The terms should list the client's dependencies and say that where the client is late with content, decisions, access or testing, the timetable moves by at least the period of delay, the software house may charge for idle resources at stated rates or re-plan the project, and the fixed price may be revised through change control; a project that stalls for months at the client's request is a cost the price did not include, and the terms should say who bears it.

Intellectual property on payment, and the software house's materials

The terms should assign the IP in the bespoke deliverables to the client on payment in full for the relevant stage, in writing as section 90 of the Copyright, Designs and Patents Act 1988 requires, with the software house retaining its pre-existing materials, frameworks and tools under a licence to the client for use with the deliverables, moral rights waived, open source components identified with their licences, and the software house free to reuse general techniques; until payment the client has a licence to test and nothing more.

Warranty, the defect period, liability and termination

The terms should warrant reasonable care and skill under section 13 of the Supply of Goods and Services Act 1982 and material conformity with the statement of work for a stated period after acceptance, with correction as the remedy and exclusions for the client's changes and environment; liability should be capped at the price of the project with consequential loss excluded, tested under section 11 of the Unfair Contract Terms Act 1977; and termination for breach or insolvency should leave the client paying for work done, receiving what it has paid for, and the software house keeping IP in unpaid work. Third-party rights are excluded under the Contracts (Rights of Third Parties) Act 1999.

What it costs

SaaS or technology contract, £995. One contract drafted for how your product or service is sold, delivered and supported. Five working days.

Buying online forms the engagement on payment. The scope is what the saas and technology contracts page describes, you accept the Terms of Service at checkout, and I email you within four working hours to get started. If you would rather ask something first, email me.

What you get

• A bespoke contract drafted for how your product is sold, delivered and supported
• Service levels you can meet, with remedies that are proportionate rather than aspirational
• A liability position that is defensible and will survive enterprise procurement
• IP and data provisions that fit together rather than contradicting each other
• A commercial note on where you will get pushback and what is worth conceding
• One round of amendments

What is not included

• Negotiating individual enterprise deals, which I quote separately
• Advice on the law of jurisdictions outside England and Wales
• Technical security certification or audit
• Regulatory advice for regulated sectors such as financial services or health

Questions I am often asked

The client says a feature was implied by the brief even though it is not in the statement of work. Who is right?

The statement of work, if the terms make it the whole scope and route everything else through change control. Implied features are what fixed-price terms exist to exclude.

The client has delayed testing for three months. Can we invoice?

If deemed acceptance applies after the stated testing period, the milestone is payable. The terms also allow the software house to charge for idle resources or re-plan, which is the point of stating client dependencies.

Can we cap our liability at the project price?

For business clients, a cap at the price is a position the courts have accepted as reasonable where the software house's insurance supports it. The terms set it there with the exclusions that make it work.

Related guidance and services

• SaaS and technology contracts, £995, the service this page describes
• Contract review, £495
• Data protection agreements and privacy terms, £795
• Software development agreement for an agency
• Terms for a software house working on time and materials

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: September 2026. Email geoffrey@caesar.co.uk.