Agreement terms
Thread poster: Tom Skold

Tom Skold  Identity Verified
Sweden
Local time: 16:53
English to Swedish
+ ...
Jul 26, 2012

I have contact with a translation agency in Taiwan, and I have done a translation test (English into Swedish), and now they want me to sign an agreement regulating my obligations and so on. Then, at the end, they have a paragraph about Liability of breach, where it says that " ... "Party B [my business] shall agree to pay Party A [the translation agency] the liquidated damages equivalent to 10-100 times the translation fee as penalty for breach of agreement, ... ". Is this fair? Is this normal? Is there anyone here versed in this kind of legal matters?

Thanks for your help in advance,

Tom


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Stanislav Pokorny  Identity Verified
Czech Republic
Local time: 16:53
English to Czech
+ ...
Not entirely fair Jul 26, 2012

Tom Skold wrote:
"Party B [my business] shall agree to pay Party A [the translation agency] the liquidated damages equivalent to 10-100 times the translation fee as penalty for breach of agreement, ... ".

It's fair to agree a contractual fine, but under the following conditions:

1. All other provisions under the Contract should be reasonable and feasible
2. The penalty shouldn't exceed Party A's costs resulting from Party B's breach.

If things go really wrong, they could sue you for not catching a single typo in a 500,000 words translation worth € 5,000,000 and require you to pay them € 500,000,000. This is exaggerated, of course, but I can imagine that there are companies that will just take the chance.

In my country, for example, a contractual fine that equals to 100 times of the job value would be considered immoral, and therefore most probably null and void anyway.


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Phil Hand  Identity Verified
China
Local time: 22:53
Chinese to English
Unreasonable Jul 26, 2012

I've never seen liquidated damages as high as this, and I think it's very unreasonable. It might mean that they have a lot of small jobs, so they have to multiply up to make it even worth trying to collect damages.

I would ask them to change it or cross it out.


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Tom Skold  Identity Verified
Sweden
Local time: 16:53
English to Swedish
+ ...
TOPIC STARTER
Thanks! Jul 26, 2012

Thanks for your comments, Stanislav and Phil. I'll try to talk to them and see if they are willing to change the terms.

Best,

Tom


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Ines Burrell  Identity Verified
United Kingdom
Local time: 15:53
Member (2004)
English to Latvian
+ ...
I would not sign it Jul 26, 2012

I never sign any contracts requesting that I pay more than the job is worth. I am willing to lose the fee but that's the extent of it. Mind you, I cannot see how this clause can be inforced but still - it kind of shows what kind of people you are up against. This would be enough to steer me in the opposite direction.

Ines


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 16:53
Member (2005)
English to Spanish
+ ...
Don't sign it! Jul 26, 2012

Clearly this is a no-go. Let them go to another person, or ask that the clause is changed so that your total liability for any breach of agreement will by no means be higher than a reasonable amount, like for instance the total amount paid to you for translation work in the three months immediately prior to the alleged breach, or maybe three times the total price paid for the defective translation the breach of agreement derives from.

If they are not willing to change the contract, I would not sign the contract. Better safe than sorry.


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Tom Skold  Identity Verified
Sweden
Local time: 16:53
English to Swedish
+ ...
TOPIC STARTER
Thanks again Jul 26, 2012

Burrell and Tomás,

Thanks for your comments. No, I won't sign it as it stands. It's preposterous. One might of course argue that - if the worst scenario is realized - they have no legal means to enforce the debt - I doubt that a company in Taiwan have that kind of jurisdiction in Sweden. But you never know what kind of trouble you might get yourself into.

By the way, Burrell, your image, did you get that from the Swedish evening paper Expressen? Their logo looks like that

Best,

Tom


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