Question:

    Want to ask you about something that has been on my mind for quite some 
time.  If we have installed a security system for a homeowner and we have them 
under contract (using your monitoring contract) and the homeowner notifies us 
they are moving.  We attempt to sign up the new owner but some times we are 
not successful.  We have de-programmed the communicator so the system is no 
longer monitored.  What is our liability regarding the new owner since we never 
contracted with them.  What if they use the alarm locally and it fails, do we 
have any liability?  Should we disable the alarm totally instead of just disabl
ing the communicator? 
Thank you!! 
Mark Rosa 
Director of Service 
Business Electronics Inc. 

Answer:

    For purposes of this answer I assume that you have a Sales contract with 
your subscriber, the former home owners, as well as the Monitoring contract 
that you mention.  You should also have a Service contract.
    The Sales contract covers only the installation and the warranty work; no 
recurring revenue is found in the Sales contract.  The Monitoring contract is 
terminable by you in the event of the subscriber's default in payment.  The 
Monitoring contract is also not assignable by the subscribe without your 
permission.  In your case your subscriber has no doubt defaulted and remains liable 
for the balance of the contract.  You could have also placed a lien against 
the security equipment if you have the UCC clause in your monitoring contract.  
But let's assume that the balance owed in not significant and you don't want 
to pursue the subscriber.  What duty do you owe the new owner?  None, unless 
you do something that could be construed by the new owner that you are 
continuing the alarm monitoring service.
    Once you learn of the new owner you must terminate service immediately 
and unequivocally.  The monitoring should be shut down and no service provided.  
The new owner needs to be treated as a new prospective subscriber, and you 
should not be providing any monitoring or service to a prospective subscriber 
until your contracts are signed and that prospective subscriber becomes a 
subscriber.  Your notice to a new owner that your service in not being provided can 
be by mail or telephone, which should be recorded.  Certified mail is not 
necessary.  
    You have no right to "totally disarm" the alarm system.  I am assuming 
that your subscriber purchased the equipment.  You are only providing 
monitoring, and you lease the communication device, and your contract permits you to 
terminate the monitoring service.  If you have an updated Monitoring contract it 
also provides that you will release the code or password only upon completion 
of the monitoring contract, so absent some local law requiring you to release 
that code, you don't have to, but the local system is not yours and you have 
no reason to disarm it.  
    Here is another idea.  I don't see why you can't program a message on the 
control panel stating that no monitoring is being provided.  That message 
could be programed for a short while.  I don't suggest other messages that may 
contain other words that may be offensive.