Subscriber's death and contract enforcement / more on smoke detectors

March 8, 2011

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Question

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Ken,

We recently had a subscriber pass away. Does this automatically terminate the contract? Does it pass to heirs or estate?

Please advise.

Thanks,

Brandon J Smith

VTG Security Specialists

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Answer

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Dracula [the famous vampire] said "there are far worse things than death". Dying and having your alarm company chase after you may be one of them. Hard to believe, but your alarm contract is treated like any other contract [almost - we'll get to that] and death does not excuse contract performance, generally. Unless the alarm contract provides that the subscriber's death terminates the contract, the subscriber's performance obligation [making the payments] passes to the estate of the deceased.

When a person dies a legal representative has to be appointed to represent the estate. A person dying with a will dies "testate" and in the will names an executor [in some states called "personal representative" or something else]. A person dying without a will dies "intestate" and an administrator, or personal representative has to be appointed by the Court. Before you can sue a deceased subscriber, or continue a suit already started, there must be an estate and executor or personal representative appointed. Before a deceased's heirs can recover their inheritance all of the creditors of the deceased should be paid. That does not include life insurance that is payable to anyone other than the deceased. It also does not include jointly held property which will pass to the survivor of the jointly held property. [I am simplifying this a bit - it's not a law review article]. Only the deceased's assets are attachable.

I know that you sometimes think that your subscriber died just to get out of paying for the alarm system - and you may be right. Unless the amount owed is enough, you may not want the hassle of pursuing a decedent's estate. By the way, in most places you can simply file a claim against the estate [if there is one] and wait to get paid.

One exception comes to mind. PERS contracts. They are terminated on the death of the subscriber.

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