KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Comment on Subscriber’s buyer wants its contract form signed
September 27, 2021
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Comment on Subscriber’s buyer wants its contract form signed from September 22, 2021
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Ken
            We have experienced this exact scenario several times in the 55 years we have been in the alarm business.  We simply ignored it, and the demanding new owner was either too inefficient to follow up more than once at the most, or was bluffing as they may have found that few complied.  Some of their proposed agreements are so ridiculous that a sane judge would have probably thrown them out.
Tom
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Response
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            Your subscriber sells its business.  The new owner wants you to sign its contract if you want to continue providing your alarm services and get paid by the new owner.  I suppose some new owners think they are in the driver's seat because you don't have a contract with them; they think they can toss you out.
            They may be right, but you're not without remedy.
  *  Your subscriber still owes you performance under the contract and you will be able to call the subscriber into breach for non-payment if payments stop.  You can also call the subscriber into breach for assigning its contract which is prohibited by the All in One standard form agreement.  The point is, your subscriber owes you on the contract.  An astute seller will be aware of its alarm contract and obligations and will make sure the buyer of its business assumes that contract obligation, with or without your prior consent.  So even though the new owner may not owe you, it may owe the seller [your subscriber]; perhaps agreed to indemnify the seller if it gets sued on the alarm contract.
  *  You may own the alarm system.  Maybe it's a fire alarm system and you own it, right down to the wires, contacts and equipment.  Pull it out and the new owner is looking at having to replace your fire alarm system with a new up to code AHJ approved fire alarm.  Not every new owner plans on that expense.  The Fire Alarm All in One Lease puts you firmly in the driver's seat; some may say the catbird seat.  [The term sitting in the catbird seat originated in the American South, and was popularized by a sports announcer named Red Barber. Red Barber called baseball games in the 1930s through the 1960s, and often used American idioms in his play-by-play broadcasts.]
  *  You can consider requiring the new owner to assume the existing alarm contract or you can require a new contract, or pull your equipment if own it or terminate alarm services if you don't own the equipment.  Keep in mind that if you have a lease you have the right, under the updated All in One Lease, to sell the system for the agreed value in lieu of pulling it out. 
  *  You can consider signing the new owners form agreement, though because you're not doing installation it's not likely that it's wise to sign that form.  Some aren't as bad as others.  Because you're doing after-install services you should have the protection of your Standard Form Agreement which protects you and those that rely on you to use a proper contract.  If you decide to negotiate the owners contract form, or challenges to your form, join the Concierge Program and benefit by getting a free half hour each month for contract review and negotiation.  Joining and using the Concierge Program regularly and often just might save you a whole lot of aggravation and expense later.  Call our Concierge Program Coordinator Stacy Spector,Esq today and join: 516 747 6700 x 304 or email SSPector@Kirschenbaumesq.com
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Another question on topic
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Ken,
            I have a customer with both of your all in one Commercial Fire All in One and Commercial All in One for security services.
            The manager send me this email:
            “Company A has sold to company B effective Sept. 17th.  We will need to get the name and billing address changed on the account. If you have an application or form for this please forward it to me. If not, here is the info.”
            I have sent company B new contracts.  Do I need to do anything else?
 Thanks 
Mike
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Response
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            Yes.  You need to stop providing alarm services to someone with whom you do not have a signed contract.  I've emphasized this many times:  do no alarm work without a signed contract.
            After you stop providing your services check above for your options.  K&K's Collection Dept is waiting for you.  Contact Jessica Bayron at jbayron@kirschenbaumesq.com or call 516 747 6700 x 0
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To order up to date Standard Form Alarm /  Security / Fire and related Agreementsclick here:  www.alarmcontracts.com
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CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY
You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com