Where and when to use userdefined functions (scalar)

I have a few developers working on creating functions.
What are the best practices on when and where to use them.
Can you use it in the From, Where, Select clause or are there places you shouldn't use function?
One of the developers mentioned that they had created a function, but was using it in the wrong place and it caused a performance hit.
Thanks in advance for your help

Yes, udfs are good and bad...it depends on the usage...if you use in the where clause you may get performance issue...
Check the following...
http://www.databasejournal.com/features/mssql/article.php/3348181
http://forums.microsoft.com/MSDN/ShowPost.aspx?PostID=491984&SiteID=1