any legal issues I might face by partnering for company registration?

[Zorrro]

One of my close relative contacted me asking if I can do a 'Shore Interface'(used on ships for management) project for him in .net after that he started talking about registering a company under us, saying "if required we can hire someone for coding". Which makes me feel he only contacted me so he can register company with my help.

My concerns are, previously he did same project with his colleagues which never worked for them. These guys had big salaries, 2-3 times of well paid people. Initially they had contacted me to work on it but later they hired developers by paying them less than 1/4th of their salaries. Plus I don't even think they had any original ideas for this project, as I was given account of their "future competition" and they simply planned to copy it. With this they planned to invest one time in development and probably thought of earning millions.

The guys they hired had 10 year old coding style, they used table for front end template, had 'this website works best on IE at xx resolution' at bottom, their template had fixed sidebar navigation which will push half of content out of screen. Later I got to see the code and database, they used college level login where they check two textboxes without much validation and passwords were not encrypted.

So my first concern is what kind of legal troubles I might face just by partnering in company registration especially if he hires somebody like those developers plus he has no respect for copyrights when using images etc on front end.

I am thinking that I will ask him to pay me certain amount for first six months just for development. If he goes ahead with it and wants to register company under us, I am not sure what kind of contract it will be. If I am not developing then I won't be taking risk of registering either. I am not sure what will be the best way to say it to him.

[diafol]

Not sure how you expect people to advise. You've listed a number of things that would prevent me from working with or for somebody, let alone go into partnership / start a company with them, e.g.

he has no respect for copyrights

Sounds like a chancer, possibly a crook. Sounds like you could do all this yourself if you wanted. Did you sign a non-disclosure? Why do you need him?

[Zorrro]

@diafol I will be honest with you, I don't want to do anything with him. He is just very close to rest of my family. So I just want to make an excuse and I thought legal issues will be a good excuse.

He and his previous partners are kind of people who earn real good salaries, they planned to start business where they will pay developers what these guys can earn in a day or two and half of what any developer will deserve. They have this idea of 'bug free software' where they will pay once and start their business on it.

Long story short, I was expecting someone to comment that if you mishandle sensitive data it can land all parners in legal trouble etc. I mean these guys had built web app for handling data like, all people present on ship, ship's location, travel route, destinations everything, other data related to engine, boiler room etc. without any security standards.

[rproffitt]

Here's a similar reason I bailed on a company like that. I didn't tell them outright why but it was the company had ripoffs of almost every software they used. Such a company would likely (and did) have no respect for the creators in the company. They imploded a year later and probably best for all that could to be clear of the blast zone.

Today I think the following when someone wants help with cracked software.

Help me jack this.

Nope.

[AssertNull]

I don't want to do anything with him. He is just very close to rest of my family. So I just want to make an excuse and I thought legal issues will be a good excuse.

Like they say, you can choose your job, but you can't choose your family. Think about the first part. As for the dilemma of "How do I decline without giving the real reason I am declining in order to preserve harmony?", I'm thinking this is a better question for "Dear Abby" (is she still giving advice?) rather than a technical forum.

Long story short, I was expecting someone to comment that if you mishandle sensitive data it can land all parners in legal trouble etc.

Yes. It can. And does.

I mean these guys had built web app for handling data like, all people present on ship, ship's location, travel route, destinations everything, other data related to engine, boiler room etc. without any security standards.

Yep. They can get sued. And potentially prosecuted and locked up. And since you are already aware that's how they operate, it's hard to feign innocence. If you participate, you're either a co-conspirator or at the very least, your reputation will be mud if the facts come up. Who would hire you?

They have this idea of 'bug free software' where they will pay once and start their business on it.

Hiring folks like you say they hire tends to result in lots of bugs. The premise is that these guys suck at what they do.

I am thinking that I will ask him to pay me certain amount for first six months just for development.

Get the money up front. Save most of it for the inevitable rainy day that comes from working for people like this.

I am not sure what will be the best way to say it to him.

Say no.

Either make up a BS excuse that allows absolutely no wiggle room or tell him flat-out you don't want anything to do with him. As far as avoiding awkwardness, you are eventually going to have an awkward conversation with him (especially if you end up working for him), so just get it over with with an unambiguous no and let the chips fall where they may. Anything LESS than an unambiguous no will just prolong everything. It's like a woman who is asked out by a sleazeball guy she wants nothing to do with. If she tells him she's busy Friday, he'll ask her if she's busy Saturday. Then Sunday. Eventually she wears down and goes out with him or finally has to give the firm "never" she should have given in the first place. Nice people get the hint and stop asking, but guys like your relative just view it as weakness on your part. As such, don't worry about his feelings because he doesn't give a damn about you or anyone else.

[Zorrro]

Took your advice and told him I wouldn't be partnering unless I am going to develop and you will have to pay me for my time. He responded with

I don't agree with any of condition above.
When I said doing together means equal ownership where idea is mine and development skills yours. If you think you can more money working on other projects please go ahead. No hard feelings.
About the security and all the Jazz you can develop the way you want . So far you or your company is not well known in the market where developing on application will tarnish your reputation in the market.
Ideally you should have been asking the details coz last time you were involved in only 5% of what we did and the project is running successfully its me who wants to separate.

Don't know why he thinks I will invest time on something that has already failed once and saying the project is running successfully, that project is running successfully with all domains expired.

And he responded thinking I am concerned about reputation shows he just don't understand the importance of security to company or clients.

[JamesCherrill]

You made the right decision - his reply just confirms that.

[diafol]

This is the problem with muddying "personal" and "business". Although it's really hard, don't let "personal" affect business decisions - you can often get left with dogshit on your hands.

Good result though :)