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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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I am looking at buying a fully operational website currently

Customer Question

I am looking at buying a fully operational website currently seems to be earning profit and seems to be going good price.
Is there a the risk that one could buy a unknown or disclosed liability such as copyright infringement. If so who would be liable?
Submitted: 2 years ago.
Category: Law
Expert:  Ash replied 2 years ago.
Alex Watts : my name is ***** ***** I will help you with this,
Alex Watts : please let me know whether you will be signing any contract and if so what does it say about copyright liability?
Customer :

I am buying it through flippa.com and at the moment I have failed to find any terms and conditions or contract

Customer :

it appears that I just bid and the highest bidder gets it

Customer :

the seller then transfers the details as stated in the listing

Alex Watts : Ok, let me think about this and get my response ready
Customer :

any progress?

Alex Watts :

I have researched copyright law.

Alex Watts :

The ONLY way of making sure that you are protected is to get an indemnity clause.

Alex Watts :

That is they agree to indemnify you and hold you harmless against any and all claims arising out of breach of copyright.

Alex Watts :

If you dont get this clause then you are liable.

Alex Watts :

But if you get this clause, if there is a claim against you, you can counter claim against them

Alex Watts :

But you MUST get it, otherwise you are not protected.

Alex Watts :

Can I clarify anything about this today please?

Customer :

1. Does the same apply to other types of liability such as a undisclosed lawsuit. example: website that sells a service that could have a negative impact when purchased or failure to deliver a product or service. Another example would be forex trading where someone loses money as a result of using the service provided and is about to or is in the process of taking the person to court.

Customer :

2. How would I go about requesting agreement to an indemnity clause? Given the fact that it is a website purchase not a business purchase.

Alex Watts :

1. You would need to have a clause that said this yes. Otherwise you would ned to ask the question before purchase to make sure there were no pending claims

Alex Watts :

2. You would get your own Solicitor to add the clause or speak to the other side and insist on it before you purchase

Alex Watts :

Does that help?

Customer :

thanks that helps, can it be done by a specific question and answer or does it have to be an agreement between both parties?

Alex Watts :

I would do both. Ask the question and then ask clause to be in the contract

Alex Watts :

Can I clarify anything else ?

Customer :

1. What is the situation when it is non-UK, could this present any issues?

Customer :

2. how do I cover possibility of a fake address?

Customer :

if the other party was not traceable would I then become liable again?

Alex Watts :

1. If its non UK you can ask that the agreement be governed by UK law

Alex Watts :

2. Fake address, you cant do anything about that

Alex Watts :

3. No

Alex Watts :

Does that help?

Customer :

If I can produce a document would you be willing to scrutinise it?

Alex Watts :

Yes. I can offer an additional service.

Customer :

Yes thanks would be useful.

Customer :

have got an example off LawDepot.co.uk

Customer :

don't know if it's any good

Customer :

not paid yet, but will do.

Customer :

How do I send it?

Customer :

please be free to make any adjustments, additions, amendments etc. However please do make it clear what you have changed.

Expert:  Ash replied 2 years ago.
Our chat has ended, but you can still continue to ask me questions here until you are satisfied with your answer. Come back to this page to view our conversation and any other new information.

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If you haven’t already done so, please rate your answer above. Or, you can reply to me using the box below.
Expert:  Ash replied 2 years ago.
Please email to***@******.*** and then it gets forwarded to me.
Thanks
Ash and other Law Specialists are ready to help you
Expert:  Ash replied 2 years ago.
Sorry delay, it does take admin a few days to forward documents on.
The agreement generally seems fine. However I would add the clauses I have mentioned above.
One of the most important things is that the law of England applies and any disputes are settled here, that is in the contract.
So apart from the changes I previously suggested, everything looks in order.
Does that help?
Alex
Customer: replied 2 years ago.

Are you able to help with the wording? Tried to find some examples without any success so far.

Expert:  Ash replied 2 years ago.
All you need to say is something like this.
(seller) agrees to indemnify and hold harmless any and all claims arising out of intellectual property made against (buyer).
That is it!
Alex
Customer: replied 2 years ago.

Is this okay? Does it also cover against previous breach of contract etc?

The Seller agrees to indemnify and hold harmless any and all claims liabilities, costs, expenses, damages and losses arising out of intellectual property or legal claims made against Purchaser.

Expert:  Ash replied 2 years ago.
Yes. This covers you.
I may add that:
the seller warrants that there are no claims pending or outstanding against the site.
Alex
Customer: replied 2 years ago.

I have adapted the contract, would you be of to scrutinise it one last time? or is the extra cost involved?

Expert:  Ash replied 2 years ago.
Sure.
Alex
Customer: replied 2 years ago.

Thanks, ***** ***** forwarded it as before. Would appreciate feedback ASAP.

Expert:  Ash replied 2 years ago.
Ok
Alex
Customer: replied 2 years ago.

do I need to verify the seller's address?

is such as hellosign.com okay the documents?

Expert:  Ash replied 2 years ago.
You should get a copy driving licence or something.
Alex
Customer: replied 2 years ago.

is it necessary to be witnessed?

Expert:  Ash replied 2 years ago.
No, I dont think so.
Alex
Customer: replied 2 years ago.

Any progress on any progress on the document?

Expert:  Ash replied 2 years ago.
Have you sent it again? What do you need me to check this time around?
Alex
Customer: replied 2 years ago.

see post 28 January 2015 14:11 EST

The main things I need checking are

11. Seller's Representations and Warranties

16. Purchaser's Representations and Warranties

25. Employees - could this one be removed?

34. Non-Solicitation - could this one be removed?

38. Non-Assumption of Liabilities

Expert:  Ash replied 2 years ago.
Might I ask you to resend it please so that i can check?
Thanks!
Alex
Customer: replied 2 years ago.

Sent

MT

Expert:  Ash replied 2 years ago.
Thanks. It may take a day or two to get it forwarded to me.
Alex
Customer: replied 2 years ago.

Ok thanks

Expert:  Ash replied 2 years ago.
Thank you!
Expert:  Ash replied 2 years ago.
Everything else appears to be in order.
Alex
Customer: replied 2 years ago.

What you think about removing the paragraphs, as I suggested? Will it impact too much.
Obviously, it is buying a website not a business.

Expert:  Ash replied 2 years ago.
Indeed I agree. You can remove them.
Alex