If you didn't pay for the programming is it ethical for the dealer to turn you off? - AVS Forum
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post #1 of 28 Old 02-21-2009, 04:19 PM - Thread Starter
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Assume for the sake of discussion the system's working correctly. Not operating correctly, or not meeting the original agreement for programming work, is an entirely different story. You're just out of money at the end of the job.

Cross posted at RC to stir the pot.
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post #2 of 28 Old 02-21-2009, 04:21 PM
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Quote:
Originally Posted by buckswope View Post

Assume for the sake of discussion the system's working correctly. Not operating correctly, or not meeting the original agreement for programming work, is an entirely different story. You're just out of money at the end of the job.

Cross posted at RC to stir the pot.

Why not? If you didn't pay for the amplifier, doesn't he have a right to repossess it or sue you for it?

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post #3 of 28 Old 02-21-2009, 04:50 PM
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Not only would I turn you off, i'd file a lawsuit and lien against your house/garnish your wages. Based on how much money was due, I'd also call your employer and warn them that this is coming.

Finally, I'd give your name to every crestron and a/v dealer in the 25 mile area as a known deadbeat.

How's that for having the pot stirred?

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post #4 of 28 Old 02-21-2009, 06:32 PM
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And how is the programming different from any other product?

You don't pay...you don't enjoy.
And since the work is very likely custom...and not highly reusable....he has the right to sue for payment in line with other creditors.

An Amp has some potential resale as a used piece...the software not likely.

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post #5 of 28 Old 02-21-2009, 06:34 PM
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well it depends. firstly, did the dealer give out a total price for the contract, and then it ended taking more time and money? if that is the case, then too bad for the dealer. should have given a better quote. if however, you agreed on a contract price, everything works fine and there is no reason why the customer shouldn't pay you for the agreed upon price, then get a lien. its that simple. too many rich people making money during these hard economic times of poor souls. its sad that the rich get richer during these times and the poor, poorer. economic slowdown is not a reason to go back on an agreed upon price.

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post #6 of 28 Old 02-21-2009, 08:54 PM
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Actually my favorite action would be to remote in and set the alarm system to set itself to "away" every five minutes. If that didn't get the client's attention (and it would), set the DA to blare old school Black Sabbath at 3:07 am. Every morning. Deadbeats are one thing. Wealthy deadbeats are the ultimate scum of the earth.
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post #7 of 28 Old 02-21-2009, 10:13 PM
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Is it ethical to not pay for a programming you requested??

We have never got to this, but support and the release of the code will not happen.
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post #8 of 28 Old 02-21-2009, 11:22 PM
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i simply ADD more programming to any clients who don't want to pay their bills.

random timers that turn tvs on and off... change the channel etc.. lots of fun stuff
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post #9 of 28 Old 02-22-2009, 01:24 AM
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1. I would suspect that legally you no more have the right to just turn someones system off because you can any more than the bank has the right to pull money out of your account because you aren't paying the mortgage. Now IF you have something in your contract that states that programming will not be permanently activated until the bill is paid, that is a different story.

2. Taking legality and right and wrong out of the equation, whether I would want to turn the programming off (which has nothing to do with whether I would, I might want to tell a good looking woman's on the street that I'd like to see her naked but that doesn't mean that I do, I'll leave that up to the hooting construction workers ) would depend on why the bill wasn't being paid. I see a world of difference between the occasional crook who purposely doesn't pay people (and whose programming I might want to turn off) and the person who runs into genuine money problems. Why the heck would I want to turn someones system off because they are having money problems if they genuinely want to pay? I'd prefer to work out a payment plan with them.
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post #10 of 28 Old 02-22-2009, 03:28 AM
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We have a local contractor here that treats his subs like $hit. His way of getting people to do things for him on demand is to always hold back some of what he owes you and pays you that when you start the next job. He porked many of my friends that way. My turn came when he needed a special commercial oil fired warm air furnace and I was the only one who had one in stock. The installed price was $7,800.00 and I would require a deposit before I started. He whipped out his checkbook and said "no problem" how much? I said "$7,800.00

Current owner of the last/best AmPro on the planet. The mighty 4600HD, and it's still running...better than Barco's, especially southern ones.
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post #11 of 28 Old 02-22-2009, 04:02 AM
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Quote:
Originally Posted by buckswope View Post

Assume for the sake of discussion the system's working correctly. Not operating correctly, or not meeting the original agreement for programming work, is an entirely different story. You're just out of money at the end of the job.

Cross posted at RC to stir the pot.

Right I think some people are misunderstanding the OP's question. The way I am reading it is this:

Client agreed the functionality of a system. The CI has delivered both the hardware and the software. The agreed system is in place and 100% working.

The Client due to other factors such building costs over budget, lost his job, whatever, doesnt have the money to pay the CI the full and agreed amount.

In this case, if I were the dealer I would withold the programming AND remove any hardware/installation items (interconnects etc) that was not covered by any amount already paid by the client.

End of. The CI held up his end of the bargin, they installed and programmed the system to the agreed spec at the agreed price. The client now, for funding reasons, doesnt want to pay. This being the case, the client should not expect to take delivery of the system in a working state.
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post #12 of 28 Old 02-22-2009, 08:35 AM
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Quote:
Originally Posted by Syphon Filter View Post

Right I think some people are misunderstanding the OP's question. The way I am reading it is this:

Client agreed the functionality of a system. The CI has delivered both the hardware and the software. The agreed system is in place and 100% working.

The Client due to other factors such building costs over budget, lost his job, whatever, doesnt have the money to pay the CI the full and agreed amount.

In this case, if I were the dealer I would withold the programming AND remove any hardware/installation items (interconnects etc) that was not covered by any amount already paid by the client.

How do you withhold it if it is already installed and working? Are you logging in remotely and erasing the software?

Take the amp example. You give me an amp. I take it to my home. I then don't pay you. Do you think you can walk into my home and take the amp away if the front door is open?

Quote:


End of. The CI held up his end of the bargin, they installed and programmed the system to the agreed spec at the agreed price. The client now, for funding reasons, doesnt want to pay. This being the case, the client should not expect to take delivery of the system in a working state.

Again, you summarized correctly that the delivery was made. So it is not the case of "not expected to take delivery." Does the bank send someone to burn your house down if you don't pay your mortgage payment? Causing destruction after the fact is not a solution in my opinion.

Keep in mind one of the best lessons I once learned about legal matters. Don't ever be in a situation where you pay for your lawyer fees and the other does not. If the guy considers your act as theft/destruction of property and complains to district attorney and he/she goes after you, you will be out a lot of money defending yourself even if you think you are right. And if not, really bad things could happen to you. And imagine how much business you will be able to get in the future while defending yourself in criminal court!

In addition, if a customer is bankrupt, there is a very strict order of who gets their money first. To the extent you have delivered something of value and there is a construction loan, that bank gets to take whatever of value first, sell it and once they are satisfied, other creditors can get the leftovers. If they house is finished with automation system, the courts and lender would want to preserve the full value of that and sell the house for maximum dollar to satisfy their lien.

So to the extent you go in and reduce the value of the assets in the home, that is also another no-no. It might be shocking news, but if the homeowner is to file for bankruptcy, he cannot give you your equipment back even if he wants to. His lawyer would advise of the above rule and he is bound by it.

I personally would not go in and damage anything in the customer's house if he doesn't pay. I would talk to my lawyer first and be sure at all times, I am in the right and the customer is the one who looks bad in the eyes of the law and the judge if it comes to that. I would gain nothing by pulling software back. It is not like I can sell that to someone else. I would leave it there. Yes, it doesn't seem right. But we have the laws for a reason.

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post #13 of 28 Old 02-22-2009, 02:22 PM
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I see what you are saying amirm but I don't think I would stand for it. It's quite common (in the UK anyway) for subcontractors or builders etc to pull off a site completely if payments were being witheld.

Maybe removing hardware is the wrong way to go about it but programming, I would definitely remove, especially if remote access was available.

There would be no way to prove that the program was erased or in fact ever loaded in the first place. It would be case of hte clients word against yours. Also you could easily say that the loaded program etc was just a testing program and not ready for use. A Beta if you will. The Beta was removed etc with a view to putting a release version onto the system, but as you heard that the client was now in financial difficultly you have put a hold on that contract.

The other way is to stop visiting site etc for maintenance reasons etc. Leave the client totally unsupported. Also if this situation were to arise, the source code etc would be made totally unavailable to the client.

If the client then paid in full, the programming etc would be released to them and that would be the end of the relationship.

This is assuming the client witheld payment without first trying to come and reason with you. I am sure everyone out there would be reasonable and extend payment terms etc or create a payment plan. But if the client was straight up unreasonable and just said point blank they're not paying the programming costs then I tough **** I think you would be well within your rights to withold that aspect of the proudct.

The company I work at employs a strict payment on delivery system. As soon as any hardware is delivered it is invoiced, as the kit gets installed, the installation costs are invoiced, as soon as programming/commissioning is underway bits of it start to get invoiced.
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post #14 of 28 Old 02-22-2009, 03:25 PM
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50% down, 40% on equipment order and balance due upon commissioniing is our policy. Seems to work fine and you aren't financing the clients job for him. There is a big discussion going on over at Remote Cental about programming in time bombs and whether it is legal or not. Crestron discourages it but it is done......
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post #15 of 28 Old 02-22-2009, 03:55 PM
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I kind of like the idea of a "time bomb". If it's written in the contract that there's a X day trial period and a key needs to be downloaded to keep it active. That key comes from making the final payment. It would be kind of neat to have a screen pop up showing a bomb with a fuse burning and a count down timer just below it to get their attention

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post #16 of 28 Old 02-22-2009, 10:15 PM
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There should definately be a clause in your contract that says that the programming is beta and will only last for 60 days upon move in and the permanent solution will be loaded once this bill is satisfied. There is a fine line that is usually crossed when customers believe they should pay. IF THEY SIGN A CONTRACT THEY SHOULD PAY AT THE DATES AND PHASES IN THAT CONTRACT. The only one payment I think customers have a legitimate arguement with is Final payment (hopefully no one is end loading contracts, potentially screwing themselves) because customers and CI's always have a difference of oppinion about when somethings done.

ex. I have a customer who is witholding pay because his sat boxes keep locking up. We did not install them and use discrete power to control them. since he loses control via the crestron system he insists that the problem is ours and now we end up playing middle man to directv. I say do everything you can to satisfy the contract then be the first to file a lien/lawsuit. We'll gladly play middle man for you on a T&M basis ... had you paid the bill and asked us to do it we probably would have done it for free

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post #17 of 28 Old 02-22-2009, 10:32 PM
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Quote:
Originally Posted by Dahwoo View Post

ex. I have a customer who is witholding pay because his sat boxes keep locking up. We did not install them and use discrete power to control them. since he loses control via the crestron system he insists that the problem is ours and now we end up playing middle man to directv. I say do everything you can to satisfy the contract then be the first to file a lien/lawsuit. We'll gladly play middle man for you on a T&M basis ... had you paid the bill and asked us to do it we probably would have done it for free

Yeah that's a good way to play it. All support of the client/site is on hold until the balance is settled.

People soon get the message.
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post #18 of 28 Old 02-23-2009, 09:41 AM
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I used to set the light sto turn on 100% and lock out the keypads in 6 weeks if I felt the client was going to be a deadbeat. It worked a few times.
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post #19 of 28 Old 02-23-2009, 05:35 PM
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There certainly needs to be some middle ground that doesn't leave the CIs or the customers with too much unfair exposure.

I was a Baumeister customer and their going out of business certainly has left a sour taste in my mouth. They were very well known and respected in the industry. I was lucky and had all of my equipment in house. They charged me about 70-80% before any major equipment was in my home. Many of their other customers had large equipment orders paid for that was never delivered. Now they have very little shots of getting the equipment or money back.

From the CI POV 50% down, 40% on equipment order may make sense, but the customers may raise eyebrows as more and more companies feel the economic downturn and start going out of business.

The best solution I see is to start using escrow accounts to hold the money for a project and have it disbursed as each phase in the project is completed. It ensures that the customer can and will pay and that he will get his money back if the CI fails to deliver. I don't know how feasible it is for the CI to lay out the large sums of cash to order the equipment before getting paid, but stories of CI bankruptcies and customers losing money will certainly have an impact on the industry as a whole.
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post #20 of 28 Old 02-23-2009, 06:10 PM
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Originally Posted by ks-man View Post

The best solution I see is to start using escrow accounts to hold the money for a project and have it disbursed as each phase in the project is completed. It ensures that the customer can and will pay and that he will get his money back if the CI fails to deliver. I don't know how feasible it is for the CI to lay out the large sums of cash to order the equipment before getting paid, but stories of CI bankruptcies and customers losing money will certainly have an impact on the industry as a whole.

Escrow accounts aren't a bad idea but they aren't really a great idea either. and who would pay the escrow fees? (I'm assuming the customer) Escrow is only a good Idea if there is someone from escrow who can verify that things are really done per contract and if he has the authority to release the funds once he see's fit and not the customer. Otherwise, you've just added another speed bump to the process.

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post #21 of 28 Old 02-23-2009, 06:29 PM
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Originally Posted by Dahwoo View Post

Escrow accounts aren't a bad idea but they aren't really a great idea either. and who would pay the escrow fees? (I'm assuming the customer) Escrow is only a good Idea if there is someone from escrow who can verify that things are really done per contract and if he has the authority to release the funds once he see's fit and not the customer. Otherwise, you've just added another speed bump to the process.

I would think that the customer would have to sign and authorize the release of the funds. The customer wouldn't be allowed to reclaim the money without the CI firm's signature. My thought is the escrow account wouldn't fix the deadbeat customer issue but rather the bankrupt client or firm issue. Both sides would state if either party were to file Chapter 7 or 11 (or any other form of) bankruptcy at any point in the process, all funds would be distributed to the other party.

I realize that this will never happen, at least anytime soon. The real benefit here over the current structure is to the customer (I am a customer who got screwed after all), and the CIs are the ones who will set the policy. Since my issue at Baumeister a selling point of a CI is if they provide the code after completion. In time I see something like this as a selling point for a CI.

"With CI X you will need to pay 75-90% money before any equipment is installed and be exposed if they go under. With us all of your money will go in an escrow account until we deliver each step of the proposal other than a 10% up front charge. You will then release 15% on wiring completion, 45% on equipment installation, 20% on completion of programming and the balance on reasonable project completion" Or something like that.

With deadbeat customers who won't pay up, you at least have the comfort of knowing that they can't get their money back either while you take legal action to get at the money you are owed.
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post #22 of 28 Old 02-23-2009, 07:02 PM
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Originally Posted by ks-man View Post


From the CI POV 50% down, 40% on equipment order may make sense, but the customers may raise eyebrows as more and more companies feel the economic downturn and start going out of business.

I'm in the unique position where we are too busy to quibble over the customer's desired payment schedule. I don't finance their entertainment needs and my terms are my terms. If they don't agree with the payment terms, that's a big red flag to me!! Move on to the next CI is what I always tell them......
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post #23 of 28 Old 02-23-2009, 07:48 PM
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I'm in the unique position where we are too busy to quibble over the customer's desired payment schedule. I don't finance their entertainment needs and my terms are my terms. If they don't agree with the payment terms, that's a big red flag to me!! Move on to the next CI is what I always tell them......

That is obviously your right. I got burned but not nearly as bad as some of the other customers. Supposedly there were a handful each waiting for six figures worth of equipment to be delivered. I will certainly be interested in payment schedules moving forward, not because I'm looking to bail on the bill, but I understand that even the best integrator can fall prey to the failing credit markets.

A firm that is ignorant of today's troubling times and sees themselves as too established to fail is a big red flag to me!! I would gladly move on to the next CI.
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post #24 of 28 Old 02-23-2009, 08:26 PM
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This has slightly gone astray... but I believe, the payment structure once agreed upon should be paid at the times stated ... period. It is the customers responsibility to make sure that the payment structure is fair. If a company is not willing to work with you on a payment structure thats one thing but if you sign off on one and get burned then you should be held accountable because most companies will allow you to modify payment structure.. Now if they wont then you most certainly have the option of finding someone who will.

I feel sorry for people who are getting burned but (now this is going to be a stretch) I hope it happens to more of the people that put this economy in the state its in.

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post #25 of 28 Old 02-23-2009, 08:47 PM
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Quote:
Originally Posted by Dahwoo View Post

This has slightly gone astray... but I believe, the payment structure once agreed upon should be paid at the times stated ... period. It is the customers responsibility to make sure that the payment structure is fair. If a company is not willing to work with you on a payment structure thats one thing but if you sign off on one and get burned then you should be held accountable because most companies will allow you to modify payment structure.. Now if they wont then you most certainly have the option of finding someone who will.

Agreed, you learn from your mistakes. My mistake was not having the issue of code ownership addressed in my contract. Now I know for next time.

Thankfully I got my equipment which was the more expensive piece to the puzzle. Moving forward I will make sure I am comfortable with how much money I am laying out before deliverables. I realize that CI firms won't purchase equipment on my word that once you put it in my home I will pay you for it. They need to protect themselves as well. It will be my job and their job to figure out a solution that works for both of us. Hopefully my prudence due to past experiences won't be seen as being a lousy customer. I am certainly willing and eager to pay for the goods and services I am looking for, I just want to protect myself.
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post #26 of 28 Old 02-23-2009, 09:26 PM
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[quote=

Thankfully I got my equipment which was the more expensive piece to the puzzle. Moving forward I will make sure I am comfortable with how much money I am laying out before deliverables. I realize that CI firms won't purchase equipment on my word that once you put it in my home I will pay you for it. They need to protect themselves as well. It will be my job and their job to figure out a solution that works for both of us. Hopefully my prudence due to past experiences won't be seen as being a lousy customer. I am certainly willing and eager to pay for the goods and services I am looking for, I just want to protect myself.[/QUOTE]

I understand what you are trying to say here. Once burned...twice shy. I don't know who you used and it is unfortunate that you got burnt. There seems to be alot of that going on out there lately. For us, this recession as it is called, will certainly clean up alot of the trunk slamming that is going on in the industry. And that's a good thing.

Even though this is going on, we stick to our guns on payment. The reason we stick to our guns is that we are well known for our quality of work. We aint cheap and as the saying goes...you get what you pay for!!!!

Anyway, enough ranting......Good Luck with it!!! Cheers
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post #27 of 28 Old 03-05-2009, 10:28 PM
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If you're considering putting this functionality into a system, you probably want to consult a lawyer first. There is existing legal precedent in the United States that would go against you if were to try this approach.

Consider these scenarios -

1) Disable the lighting system - customer falls and is injured because they couldn't turn the lights on.

2) Small child can't be heard when they cry for help because audio volumes were up and controls were locked out. Something happens to the child (medical, kidnapping, etc.).

3) You disable programming remotely (outside on the house via WAP, etc.), customer calls police that you are "beaming" some of signal into their home, law enforcement will assume that it is some type of weapon.

You will likely lose any legal battle in this case. Best bet is to not let the customer get to this point. If you have to go into the home to delete code, work with local law enforcement to do so (sheriff, etc.). It's not worth risking your business or livelihood over.
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post #28 of 28 Old 03-06-2009, 10:44 PM
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Quote:
Originally Posted by thezodad View Post

If you're considering putting this functionality into a system, you probably want to consult a lawyer first. There is existing legal precedent in the United States that would go against you if were to try this approach.

Consider these scenarios -

1) Disable the lighting system - customer falls and is injured because they couldn't turn the lights on.

2) Small child can't be heard when they cry for help because audio volumes were up and controls were locked out. Something happens to the child (medical, kidnapping, etc.).

3) You disable programming remotely (outside on the house via WAP, etc.), customer calls police that you are "beaming" some of signal into their home, law enforcement will assume that it is some type of weapon.

You will likely lose any legal battle in this case. Best bet is to not let the customer get to this point. If you have to go into the home to delete code, work with local law enforcement to do so (sheriff, etc.). It's not worth risking your business or livelihood over.

Which is why you build into the contract that it is beta software until final payment and will expire at XX/XX date. therefore they have made themselves liable for the house not functioning.. I personally would leave the lights alone but please beleive they would not be able to watch a lick of TV or listen to any music!

"I'm just a dog chasing cars. I wouldn't know what to do with one if I caught it"
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