Legal Question in Business Law in Washington

Are company has built a web base platform. We are launching the product next week. We have a resellers agreement in which they will be on a 1099. To make it easy for the contractors we will be billing there clients. The checks will come to us and we will then in return take our flat fee for the use of the platform. The contractors will be using our company name to sell the product.

My question: although we have some verbiage in our resellers agreement (limitation of liability) are we liable as a company for actions from a contractor on a 1099?


Asked on 6/03/14, 7:32 am

1 Answer from Attorneys
Charles Cruikshank Cruikshank Law Office-Since 1975

The fact that your resellers are "1099" is just a tax issue.

Any liability issues that arise will be resolved by the law of Contracts, as the 1099 designation is not binding on the IRS or anyone else if your legal relationships and actual activities with the resellers are inconsistent with your designation of the resellers as "independent contractors".

The phrase "limitation of liability" is not precise and could cover all, only a few, or none, of the actual issues that may arise in your business relationship with your resellers.

Your reseller's agreement should be reviewed for all possible liability issues.

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Answered on 6/03/14, 8:36 am


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