April 18, 2011
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Question
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Dear Mr. Kirschenbaum,
I have just read your email from today regarding network liability for radio and other forms of communication. We are one of those alarm companies that you have referred to, who is creating our own radio communication network. You have advised that we use a new contract to cover our liability in this condition. We are also planning on leasing the communication equipment to the client, rather than what we have been doing in the past, which has been selling our clients all of their equipment.
Would you please let me know which contract you recommend in this new condition of our providing our own radio communication network. We have been using your standard monitoring contract for a base monitoring contract, inclusive of some language required specifically by our central station provider. We are also needing an equipment lease contract for our clients. We will have both commercial and residential applications for both the conditions of lease and monitoring. We have been looking at which contracts you offer and are confused, as well as hopeful that we do not need to purchase as many as it seems that we need. Please let me know what you recommend for both a monitoring contract for limiting our liability when using our own radio network, as well as for the leasing of this radio communication equipment to both residential and commercial clients. We have been considering placing the leasing of equipment and the monitoring of our own radio network into the same contract, as both will occur simultaneously. Do you think we should combine them? At times I will need residential burglary, residential burglary with fire, commercial burglary, commercial burglary with fire, and commercial fire – all via our own radio network. I would love to combine this need into as few contracts as possible.
What do you think?
Sincerely,
Laurie
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Answer
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The Standard Form Contracts that address monitoring or communication states that communication net works are owned by others and therefore the alarm company has no control and no liability for failure of communication.
If however communication is over a radio network that you own and operate, then obviously the statement of non ownership is inconsistent. It's not a complicated modification; only a statement that the radio network is owned by the alarm company - and that the alarm company is still not liable for any loss, etc.
As far as combining contracts, the Standard Form Contracts do that when advisable and practical.