[UPDATED] A few years ago I wrote How to Write Interior Design Contract / Letter of Agreement blog post. Years later, and this topic is more relevant than ever before.
The industry is going through monumental changes, and an interior design contract is the best way to protect yourself and your business. Our revised guide includes 9 sections to include in your contract + bonus suggestions based on lessons we’ve learned over the past few years.
As a mild disclaimer, templates are a great start, but you really should consult a legal professional to have your contracts reviewed for your specific business and area.
Interior Design Contract or The Letter of Agreement (LOA)
Unfortunately, there are many necessary evils in this world, and it seems like there are even more that rear their head when you are trying to run your own interior design business!
One of the biggest necessary evils?
Covering your butt… and in the business of design there’s only one way to do that – a letter of agreement (LOA) or interior design contract.
What is A Contract or letter of agreement?
It’s a legal document or tool help resolve any disputes that arise in the project, protecting both you AND your client. In plain language, it should present how your company works, and outline your expectations, while being transparent for your client. This document is signed by both you and your client(s).
What is the Difference Between A Contract or letter of agreement?
They are essentially the same thing. These two terms are often used interchangeably.
What Goes Into A Contract or letter of agreement?
Your contract should include:
- An introduction to your company
- A statement of work
- Your purchasing and warranty terms
- Your payment terms and refund and cancellation terms
- A clause for outside consultants and contractors
- The terms for photographs and publicity of your work
- An intellectual property clause
- Termination terms
- A section that outlines resolutions of disputes
You have may noticed that we didn’t include design fees in that breakdown. Depending on the scope of the project, you can include your fees directly in your contract. However, we believe it is best practice to leave them out. Fees and services should be addressed, but this is better suited in your “scope of work” document. Use your contract for “general business practices.”
Get your contracts signed easily by sending them to your clients through the Mydoma Client Portal. When you use the Mydoma Client Portal you reduce administrative work by giving your clients access to all of their project data in one central place. Plus, you can send invoices through the Portal to save yourself the awkward conversation.
The 9 Sections of a Great Interior Design Contract
1. Company Introduction
A friendly, short intro of who you are, your design philosophy, and the magic you bring to your projects. This little intro should get your clients excited to work with you, and get going on the project.
2. A Statement of Work
The statement of work is a short description of the project. This is different from a scope of work.
The scope of work is a detailed agreement where the work to be performed is described. The SOW should contain any milestones, reports, deliverables, fees, and end products that are expected to be provided by the performing party.
When delivering your contract, it’s unrealistic for you to have a complete scope of work at this time. For the contract, all you really need to do is include a simple statement of work. After the contract is signed, you’ll be doing the intake step of a project – which will help you determine a detailed scope of work to be presented and signed off by your client. The contract and scope of work will ultimately support each other.
3. Purchasing and Warranty Terms
This is a very important section of your contract. It’s important to ask yourself a few key questions.
- Who is making the purchases?
- Are you marking up the product?
- Are you extending client designer discounts?
- Is the warranty in your name?
- Can the warranty be transferred to your client?
- Who is responsible for warranty claims?
Unfortunately, there isn’t really a one size fits all solution, as this section is dependent on how you run your design business. The most important thing however is to be transparent, and have an open communication with your client. Honesty will be your best asset to prevent future disputes.
4. Payment and Refund Cancellation Terms
We suggest putting your detailed payment schedule in your Scope of Work document rather than your contract. This is because the fee structure for individual projects may be dependent on the scope. Use this section to explain HOW payment terms will work. So be sure to answer the following.
- When is payment expected after an invoice is sent?
- Are there interest or late payment fees?
- What payment methods are accepted?
- Are there additional fees?
- Do you offer refunds?
- What is a client want to cancels an orders- are there restocking fees?
- Who is responsible for them?
5. Consultants and Contractors Clause
As Designers we don’t know how to do EVERYTHING, nor should we – experts exist for a reason. This clause is used for when you work with outside consultants or contractors to perform work. You may work with them, but you are not responsible for for their work. They are entering into an independent contract with your client. So this section should explain that, and, that you are not liable for them.
6. Photograph, Videography, and Publicity Terms
As design professionals, we work so hard to build a body of work for our portfolios. So there is not much worse than completing an absolutely beautiful job, only to have your client not allow you to photograph it, or use it in any publications. This clause is intended to set the expectation with your client that you will be photographing or taking video of their space (before, during, and after). What’s important here is to explain how you will use the assets, and how you’ll protect your client’s privacy.
7. Intellectual Property Clause
A big, and often overlooked thing with interior design contracts is intellectual property (or IP). There is a surprising amount of IP involved in the design process, including (but not limited to) design drawings, details, permits, 3D renderings etc. These assets are created for the client but are ultimately owned by the designer (that’s you) – and they’re valuable! So be sure to protect yourself by hi-lighting that here.
8. Termination Terms
Of course, we want every project and client to be a match made in heaven. (And if you follow the Mydoma Method, more often than not you’ll have just that!) BUT, from time to time, for a variety of reasons, a contract needs to be terminated. No matter the reason, it’s important to include a termination clause to let the client know how to get out of their interior design contact. This clause protects both you and your client, so be sure to be as clear and transparent as possible to avoid disputes.
9. Resolution of Disputes
Again, with any luck, things will go swimmingly between you and your client. But in the case that there’s a dispute, this is an important section to lay out how disputes on the project will be resolved, and, a disclaimer that no outside or further legal action can be taken against each other outside those terms.
“Mydoma has been a complete game-changer for my client relationships! It’s easy to use and clients appreciate the ability to go into their studio and find what they need whether it be documents, notes, project updates, photos, etc.”
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Covering your butt… and in the business of design there’s only one way to do that – a letter of agreement (LOA) or interior design contract.
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[UPDATED] A few years ago I wrote How to Write Interior Design Contract / Letter of Agreement blog post. Years later, and this topic is more relevant than ever before.
The industry is going through monumental changes, and an interior design contract is the best way to protect yourself and your business. Our revised guide includes 9 sections to include in your contract + bonus suggestions based on lessons we’ve learned over the past few years.
As a mild disclaimer, templates are a great start, but you really should consult a legal professional to have your contracts reviewed for your specific business and area.
Interior Design Contract or The Letter of Agreement (LOA)
Unfortunately, there are many necessary evils in this world, and it seems like there are even more that rear their head when you are trying to run your own interior design business!
One of the biggest necessary evils?
Covering your butt… and in the business of design there’s only one way to do that – a letter of agreement (LOA) or interior design contract.
What is A Contract or letter of agreement?
It’s a legal document or tool help resolve any disputes that arise in the project, protecting both you AND your client. In plain language, it should present how your company works, and outline your expectations, while being transparent for your client. This document is signed by both you and your client(s).
What is the Difference Between A Contract or letter of agreement?
They are essentially the same thing. These two terms are often used interchangeably.
What Goes Into A Contract or letter of agreement?
Your contract should include:
- An introduction to your company
- A statement of work
- Your purchasing and warranty terms
- Your payment terms and refund and cancellation terms
- A clause for outside consultants and contractors
- The terms for photographs and publicity of your work
- An intellectual property clause
- Termination terms
- A section that outlines resolutions of disputes
You have may noticed that we didn’t include design fees in that breakdown. Depending on the scope of the project, you can include your fees directly in your contract. However, we believe it is best practice to leave them out. Fees and services should be addressed, but this is better suited in your “scope of work” document. Use your contract for “general business practices.”
Get your contracts signed easily by sending them to your clients through the Mydoma Client Portal. When you use the Mydoma Client Portal you reduce administrative work by giving your clients access to all of their project data in one central place. Plus, you can send invoices through the Portal to save yourself the awkward conversation.
The 9 Sections of a Great Interior Design Contract
1. Company Introduction
A friendly, short intro of who you are, your design philosophy, and the magic you bring to your projects. This little intro should get your clients excited to work with you, and get going on the project.
2. A Statement of Work
The statement of work is a short description of the project. This is different from a scope of work.
The scope of work is a detailed agreement where the work to be performed is described. The SOW should contain any milestones, reports, deliverables, fees, and end products that are expected to be provided by the performing party.
When delivering your contract, it’s unrealistic for you to have a complete scope of work at this time. For the contract, all you really need to do is include a simple statement of work. After the contract is signed, you’ll be doing the intake step of a project – which will help you determine a detailed scope of work to be presented and signed off by your client. The contract and scope of work will ultimately support each other.
3. Purchasing and Warranty Terms
This is a very important section of your contract. It’s important to ask yourself a few key questions.
- Who is making the purchases?
- Are you marking up the product?
- Are you extending client designer discounts?
- Is the warranty in your name?
- Can the warranty be transferred to your client?
- Who is responsible for warranty claims?
Unfortunately, there isn’t really a one size fits all solution, as this section is dependent on how you run your design business. The most important thing however is to be transparent, and have an open communication with your client. Honesty will be your best asset to prevent future disputes.
4. Payment and Refund Cancellation Terms
We suggest putting your detailed payment schedule in your Scope of Work document rather than your contract. This is because the fee structure for individual projects may be dependent on the scope. Use this section to explain HOW payment terms will work. So be sure to answer the following.
- When is payment expected after an invoice is sent?
- Are there interest or late payment fees?
- What payment methods are accepted?
- Are there additional fees?
- Do you offer refunds?
- What is a client want to cancels an orders- are there restocking fees?
- Who is responsible for them?
5. Consultants and Contractors Clause
As Designers we don’t know how to do EVERYTHING, nor should we – experts exist for a reason. This clause is used for when you work with outside consultants or contractors to perform work. You may work with them, but you are not responsible for for their work. They are entering into an independent contract with your client. So this section should explain that, and, that you are not liable for them.
6. Photograph, Videography, and Publicity Terms
As design professionals, we work so hard to build a body of work for our portfolios. So there is not much worse than completing an absolutely beautiful job, only to have your client not allow you to photograph it, or use it in any publications. This clause is intended to set the expectation with your client that you will be photographing or taking video of their space (before, during, and after). What’s important here is to explain how you will use the assets, and how you’ll protect your client’s privacy.
7. Intellectual Property Clause
A big, and often overlooked thing with interior design contracts is intellectual property (or IP). There is a surprising amount of IP involved in the design process, including (but not limited to) design drawings, details, permits, 3D renderings etc. These assets are created for the client but are ultimately owned by the designer (that’s you) – and they’re valuable! So be sure to protect yourself by hi-lighting that here.
8. Termination Terms
Of course, we want every project and client to be a match made in heaven. (And if you follow the Mydoma Method, more often than not you’ll have just that!) BUT, from time to time, for a variety of reasons, a contract needs to be terminated. No matter the reason, it’s important to include a termination clause to let the client know how to get out of their interior design contact. This clause protects both you and your client, so be sure to be as clear and transparent as possible to avoid disputes.
9. Resolution of Disputes
Again, with any luck, things will go swimmingly between you and your client. But in the case that there’s a dispute, this is an important section to lay out how disputes on the project will be resolved, and, a disclaimer that no outside or further legal action can be taken against each other outside those terms.
“Mydoma has been a complete game-changer for my client relationships! It’s easy to use and clients appreciate the ability to go into their studio and find what they need whether it be documents, notes, project updates, photos, etc.”