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TexLaw
TexLaw, Attorney
Category: Business Law
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Experience:  Internationational Commercial Attorney
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I have a question. Lets say company-A is working for Company-B

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I have a question. Let's say company-A is working for Company-B that wants door controller software. This company buys software and controller from another company-C. So company-A installs the software on company-b computer. After like a month, there was issue with the software and company-c releases an updated software version to fix the issue. All is good but then another issue happened and company-a informs company-c of this and company-c finds out there is an issue with a bug in the controllers firmware that needs a patch from controller company and schedules a time with company-a to apply this patch. The next day, company-a informs company-c that company-b is going with another system and now demanding company-c a full refund for the software and hardware they ere using for almost 2 months claiming it is not what they asked for. Do you think company-c is liable to pay this refund?
Hi,

Thank you for your question.

Company C will owe the refund if it is determined that Company C did not provide the software functionality promised. In other words, if Company C breached its contract, then it will owe the refund price.

However, if the software was functioning and only required software patches to fix bugs, which is a common issue, then this will not be good cause for a refund. Under the facts provided, Company C has a good defense to claim of breach of contract.

Please let me know if you have any further questions. Please also kindly consider rating my answer positively so that I am compensated by the website for my work on your question. Rating does not cause an additional charge and will not prevent us from further discussing your questions.

Best Regards,
ZDN


Customer: replied 3 years ago.

One other thing. What if their was nothing in writing at all with this transaction. No written contract.

If there is no written contract, then there will be a simple one implied by the court. In other words, the evidence of what the contract is would be the testimony regarding what representations Company C made about the software it was providing. If Company B were able to prove that Company C made promises that it did not keep, then there may be a plausible claim for a refund there.

However, this would be something that would have to be established in Court. Company C could likely simply state that it has a no refunds policy on its software.
Customer: replied 3 years ago.

OK but wouldn't company c have to have that in writing to use that

It would be best if it was in writing, but Company C could still argue that is their policy. Company A and B could both argue that they were promised software that worked to their specifications and thus Company C owes the refund.

Without a written contract there is going to be much more wiggle room for arguments on both sides. Without knowing more, I still would say Company C doesn't owe the refund.
Customer: replied 3 years ago.

Yeah' I think since the refund request is happening almost 2 months after purchase company c probably has upper hand

Let me know if you need anything further.
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