[mikester]

A friend of mine runs a consulting business; they try to book their clients out a few weeks to make sure they have a good stream of income coming in.

When a client signs a contract my friend takes a deposit for a week's worth of work.

This deposit is then applied to the end of the contract.

This deposit reserve's my friend's time. Securing a job takes time and must be done well in advance for the kind of work he does.

My friend is provides some health services so if he is sick he usually arranges for some person like them to do the work with his clients. He has an organization that is sort of like an association of professionals and they are organized to support each other in this manner. So my friend was sick when scheduled to work the first week of a job. He arranged for a fill in which went very well. The clients seemed very happy with the fill in and with my friend (who did do some work for them prior to his own minor illness). The clients however decided that they no longer required my friend's services. The deposit is non-refundable; my friend has it worded that way in the contract because once he has the time booked he's going to turn down other work. If the clients can just ask for their money back the day before he's supposed to start working then he'll be screwed. Cultivating a job usually requires a few months notice and a series of interviews with the clients. Because of this the deposit is non-refundable.

The clients want their money back since they will not be using my friend's services. They of course paid the fill in at the rate my friend would have received had he done the work. Again, his 'association' of professionals worked out here. It's a fairly informal association but they are organized and advertise themselves as such to their clients.

The association wants this to work out positively for everyone and the clients to be 'happy'...this basically means my friend has to suck it up and take it. The contract is pretty simple, though I can't put it up here for you to read.

My friend is pretty irritated about this overall - he knows that he is right in keeping the deposit. He did in fact turn down work for this period of time and now he doesn't have anything else lined up.

I just want to kind of get a perspective and options of what different ways there may be to handle this.

My friend is considering offering them a refund of half of their money.

Personally, I think the contract is pretty clear - they are terminating it early and the deposit is designed for this exact scenario. Unfortunately I guess it isn't that simple.