It's quite complicated really. I had been their lead developer, having worked my way up over a five year period with the company. My leaving was very cordial. I had been there a long time and they understood me wanting to grow. I started a project on the side for them almost immediately after I left because I knew they needed help.
I had a medical emergency (my tonsils swelled to the point where I could not breathe) and ended up needing surgery, so before the surgery I gave them the work that had been completed (By my estimate 80%) so they could finish the rest. They told me to get better and we would discuss how to handle the partial payment after my surgery.
While recovering, two of my former coworkers quit and took jobs at my current company. I had nothing to do with this. This is when my old company threatened to sue myself as well as them. Sigh. Our cooperate lawyer came back at them about them having no case and they soon dropped the whole thing.
I tried to pursue what I was owed, first emailing my contact and after receiving no response to a handful over several months beginning to loop in lower and lower managers I knew. I'm genuinely not sure if they had all been poisoned against me or if there was just some sort of email filter enacted, but I never heard a response from any of them.
Several years later they declared bankruptcy. I contacted their lawyer who informed me that only debts incurred within the last 6 months were perusable, and the money they owed me was not be perusable. Sigh. They are still in business now several years after the bankruptcy restructuring but on a skeleton crew. I don't believe I have any ability to pursue the money for the project now.
The whole ordeal was incredibly frustrating. It actually really saddens me as I LOVED that job and my coworkers there.
Sorry to hear you had a rough time at it. My original point still stands though. Transfer of code is fine, but if the contract stipulate that IP rights are transferred upon final payment then you have the copyright stick to wield in your fight for payment as they don't actually have a valid license for the software. Obviously I am not a lawyer and you should pay one to draft a generic contract you can use for contract work.
