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Comments on ADT dispute resolution / follow up on growing business August 8, 2017

KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Comments on ADT dispute resolution / follow up on growing business
August 8, 2017
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Comments on ADT dispute resolution from July 29, 2017  
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Ken,
     Reading the inquiry from YB interested me - about how ADT handles disputes between dealer-to-dealer - and I thought I would share some interesting information. I worked for ADT-corporate for 8 years in Oregon; since retired.  They set appointments for salespeople and I was required to self generate my own leads as well.  When setting my own appointments, I was to provide all information to ADT-corporate, equivalent to the information they gather from a raw, incoming lead for computer input.  This is how they would track my activity, know where I am, and, who wants an alarm.  Once I obtained a signed agreement (residential or small business) I would call to obtain an installation date while still on site with customer.  Little did I know that if I didn't close the deal on this first appointment, the clock begins ticking. 
     You see, thirty days (30 days) after the initial sales appointment, ADT-corporate turns over all unsold leads to the nearest ADT-dealer.  They include self generated leads, too.  I know, because I found out the hard way.  
     ADT's attitude is if Corporate can't get 'em, we want our Dealers to get 'em.  
     Now I know YB (an ADT-dealer) has issue with another ADT-dealer over same customer, but imagine how an ADT-corp salesperson-who generates their own leads-feels when an ADT-dealer interferes with their own friend!  
     One of my child hood friends wanted her elderly, widowed  mother to get an alarm and entrusted me with the task.  The mother resisted... was afraid of it, (she's old and can't figure out voice mail), and so I didn't push her.   I told her daughter she needed to push her if she wanted her to get one.   A little time went by and one day the mother called me. I thought she was ready to order the alarm. Instead, she said every time her phone rings, the damn alarm goes off.  I didn’t know what she was talking about.   
     Apparently, an ADT-dealer showed up at her front door with my lead/info and he lied to her!  I asked her why she would sign a contract with a stranger, but not me?   She said she asked him about me, and the salesperson said he knew me and that he worked with me "back at the office."  (That was the lie.)  He did not explain to her that he was an ADT-dealer, that he’d be installing completely different equipment, (than what I proposed) nor did he advise/provide the City Alarm Permit application for her as required.  Nor did he display his Alarm Installer License (also required by the City) nor was he licensed by the State as a low voltage electrician, nor did he obtain an electrical permit, as required by the county.  I asked her what she paid and she said it was all free, and said he installed it same day.  
     This is perfect example of why 3-day right of rescission laws were made and he didn’t use or advise the law, nor obtain a signed waiver to proceed.  
     Of course that system was inferior to what I would have sold her.  I explained the ADT-dealer relationship and that different companies sell different equipment and that she definitely bought from an ADT-dealer and THAT action had cut me out of the loop.  I told her she was within her fist 90 days of service and that ADT-corp will require her ADT-dealer, ‘Bob‘, to return to make adjustments.  Bob did not call her back, so she calls ADT-corporate in frustration. They also tell her she is within her first 90 days and that Bob had to come back.  Bob does not ever call back so she calls me, desperately looking for resolve and I have none.  
    I complained all this to my boss.  Where did this dealer come from and why isn‘t he responding to her calls?  Boss told me when I have a lead that I don't want the dealers to get, to just keep resetting the appointment every 30 days, within the ADT appointment setting system that is.  He explained that as long as there is activity, it won’t get filtered.  He explained it buys more time (to close the deal), but once the lead is idle for 30 days, it's always kicked to the dealer.  
     Well, that explained a lot.  I wish I had learned this sooner.  Hopefully some ADT corporate employee(s) reading this, just learned how to keep the dealers away from their leads. Just keep resetting the appt out every few weeks until you get it closed.      
     ADT’s stellar dealer Bob never called her back, so my friend's mother eventually paid the phone company to disconnect her alarm from dial tone just so she could answer the phone without the damn alarm going off!     Because she was under contract, she continued to pay for monitoring services, but because of that inept, over eager, unlicensed ADT-dealer, she never received the protection she paid for.   
     Moral of the story is, YB, ADT doesn't care who closes the lead - corporate or dealer - just so that THEY get another monitoring contract.  
     Sign me, so glad to not work there any more, 
     Cynthia Hart, retired security consultant
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Ken 
    The issue presented by the ADT Dealer is a tricky one for all dealer programs but one that crops up anywhere where 2 dealers from the same program are working the same area. We had the same problem arise between 2 particular dealers while I was at Protectron back in 2006-2007. The rule we put in place was that until the customer had signed a contract with one dealer they were “open season” for others. However, sometimes the customer would not tell the one dealer that they had signed a contract with another in order to get a better deal.
     Often the problem here is that 2 dealers in the same program are fighting it out in the same territory, stealing accounts from one another. And believe me some authorized dealers can find ways to get around every rule you put in place. This kind of problem mostly takes a lot of policing from the dealer rep.
    Regards,
Victor Harding
Harding Security Services Inc.
Toronto, ON   

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Response
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    Arbitration is becoming more and more prevalent.  Federal law has preempted state laws that prohibited arbitration against consumers and in other scenarios [there are still a few disputes where arbitration may be limited or prohibited].  With our courts over run with cases the judges are more than happy to enforce arbitration provisions.  
    Parties have wide berth in designing the arbitration process.  As long as the arbitrator is neutral the process will be enforced.  Those of you using the Standard Form Agreements know that the contracts include an Arbitration provision that gives either side, alarm company or subscriber, to demand any dispute to be decided by arbitration.  The arbitration company is designated and we have selected a company that is familiar with alarm company issues, is less expensive and easier to work with.  If you use our Standard Form Agreement you can engage Kirschenbaum & Kirschenbaum to represent you through the arbitration proceeding.  We are of course familiar with the contract and the process.  We include the arbitration provision in the subscriber contracts, central station contracts, employment agreements, shareholder agreements and most any other agreement we draft for you.  For more information contact me directly.
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follow up on growing business from July 19, 2017 article
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Ken
    Regarding your response to Paul, I find it amazing that while teaching license or continuing education classes or dealing with potential clients, I find so many people in our industry who do not use contracts at all, excepting the ones provided by (and protecting) the CS.  It scares me.  I tell them about the three legged stool and how without one of the legs, you fall over.  Leg one=proper business entity, get a corp. or LLC and have it done properly (lawyer) because without that protection, your personal assets are at risk,  Leg two=contracts, written by an industry expert who will be able to defend them and finally, Leg three=insurance-see the exchange on K&K blog.  Without one of the three legs, you will fall on ...oh you know.   In this business, it's not if you will be in litigation, but when, and like other of life's endeavors, you need protection. 
Joseph Hayes, CPP, PSP, SET
All County Security Inc.
Ossining NY 10562
914-645-1289 
visit our website at www.firealarmdesign. net
We are an independent consulting engineering firm, specializing in fire code consulting and system design. We also provide certified training in the fields of fire alarm and security technology.  As an independent consultant, we work only for our clients on a fee for services basis and are not affiliated with any manufacturer or product.
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Ken
    consult with a psychic?! that's hilarious!
Gene
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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
516 747 6700
www.KirschenbaumEsq.com