From the way you've described what you did, you were a 'work for hire'.
They paid you monthly for your expertise to develop the system,
rather than a lump sum for the "sale" of a 'product'. This usually gives
them the ownership of the I.P. they paid you to create.

However, their (your) failure to have a written agreement would seem
to work in your favour since you still have possession of the 'original work'
that you created. Also, barring any verbal agreements to the contrary,
any implied contract is effectively VOID since they have failed to pay
you ALL the 'consideration' in your implied contract. E.G.
"In consideration of paying you $XX per month, you agreed to develop
a system that ...." and they have failed to live up to their part.
Since presumably nothing was said/contracted
about ownership of the I.P., YOU still own it since they have failed
to fully pay you for it. You have, after all, provided them with a
fully working system, and incrementally improved it (their I.P.??)

Now the tricky part is what I.P. -they- may have contributed to the project.
If they only laid out the problem, and you solved it, you own the I.P.
If they told you in general terms how they wanted to solve the problem,
then they will also have some I.P. rights since you wouldn't have made
this system without their input.

And of course that leaves the issue of whether there is a market for
your I.P. outside of this company. If there is going to be significant
money to be made, I strongly suggest you get a legal opinion from
from a lawyer who SPECIALIZES in I.P. issues. Most lawyers -think-
they know about I.P., when in reality it can be a VERY tricky
mine field. Been there, have the shrapnel to prove it...
NEVER assume that you own your own I.P. unless it's down in writing.
Companies generally have MUCH deeper pockets than you do, and they
can litigate for far longer than you can.

By way of example, a local inventor patented a process for remotely
sending a fax via a mobile phone (back before cellular existed).
Telus, (our local phone company) has been infringing this patent for
decades, and has been fighting this small inventor and his
infringement suit for decades now. He should eventually win (I've read
his patent, and his claims are sound) but he'll be dead/bankrupt
before he gets a dime out of Telus.

As Don Lancaster of Popular Electronics has written MANY times,
"Patents are only of value if you have the money to defend them".
Most inventors don't have the resources to defend them, so there
is little point in dishing out $$$ to get a patent (unless you know
you can sell the idea to someone else whom has the deep pockets).

Robert
IANAL, but having been around the block with them, I've learned a
few painful things.

Jinx wrote:
>
> > At present I hold all the design material (source code, layouts) with
> > me, they have no copies.
> >
> > So, question is.. Who actually owns the designs?
>
> My understanding (e-lawyers notwithstanding) is that you hold the
> authorship copyright unless you explicitly sell or relinquish it to the
> customer. They would not appear to be in a very strong position.
> and you should be able to ***diplomatically *** threaten to with-hold
> services until they get up to date with payments (eg what would
> anyone do if their employer not paid their salary ? Strike ! that's
> what). Claim you have expenses that need taking care of, mouths
> to feed, whatever. Antagonising them is probably best avoided,
> however tempting
>
> A grey area could be intellectual contrbutions to the product
>
> Points such as -
>
> Who's idea was it ?
> Is it unique / patentable ?
> Did you enhance the original idea ?
> What are the possible rewards from putting up with a bit of
> crap and hanging in there ?
> etc etc
>
> Softly softly catchee monkey. If you feel the need to bale, get the
> money first. If you're going to stick around get some paperwork
> done ASAP. Some people feel intimidated (pointlessly IMHO)
> by written agreements, but I tell you it sorts out who's serious and
> who isn't

--
http://www.piclist.com hint: The list server can filter out subtopics
(like ads or off topics) for you. See http://www.piclist.com/#topics