Should you be explaining the indemnity clause and your contract terms /
comment on ADT class action / Question - Dummy cameras / guns in work place
March 19, 2013
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Question Re: Indemnity
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Ken,
I know that you have touched on this before, but I wonder if you might expand on how to clearly explain the indemnity language of an alarm contract to a customer. It offers protection to no one but the alarm company and a savvy customer who actually reads the fine print of his contract will typically not like that you tell him that he cannot sue you for negligence, even "gross" negligence. I understand the risk and exposure that comes from me removing that language from a contract and I choose to keep it there. But is there a clear, effective way to explain this to a customer other than saying it is an "industry standard" that they just have to deal with?
I would appreciate your input on the subject.
Danny Holmgren, Vice President
Titan Alarm
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Answer
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It's important that you understand the indemnity provision in your contract as well as the other provisions. It's less important, me to anyway, whether your subscriber understands the contract terms.
What is important to me is that you have not done anything to mislead your subscriber or conceal the contract provisions. I think it's a serious mistake for you to undertake to explain contract provisions. You can certainly point to certain provisions in response to questions, such as "what or where is the contract term?", but I think your best response is that you're not a lawyer [even if you are, you're not your subscriber's lawyer] and all you can do is offer the contract to the subscriber and give the subscriber the opportunity to read it and seek guidance from whomever the subscriber likes. I don't have a problem with you reading the contract provisions to the subscriber but you should not offer any explanation, which can only lead to claims that you mischaracterized or misstated the terms of the contract. Obviously you all have to develop your own finesse when dancing around "what does this mean".
You have an obligation, especially with residential subscribers, to present a contract in a form that the jurisdiction requires, which generally means containing certain consumer provisions, in certain font size and formatting, and with cancellation form. You are also obliged to present a contract written in the language that your salesman used to make the sale.
Our Standard Form Contracts are customized to meet your local state requirements. We will also be offering these forms in Spanish. If you need the Spanish translated contract call our Contract Administrator, Eileen Wagda at 516 747 6700 x 312 to see if the form you need is ready. Yes, there is going to be a separate charge for a translated contract - Eileen will have the prices.
So what about the indemnity provision. It requires your subscriber to pay for the defense of any claim against you and any damages that may be awarded against you arising out of your relationship with the subscriber. Yes, you do carrier insurance to protect you from such legal expense and damages, and your insurance carrier hopes to recoup any expense it incurs from your subscriber. That's the clause; don't shoot the messenger.
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Comment On ADT Class Action - From March 16, 2013 Article
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Ken,
Regarding, the ADT class action suit. It is interesting that ADT is being sued for using an “early termination fee” charge for a customer that cancels early during the term of the agreement. Such a scheme was approved by the Contra Costa DA with respect to at least one other alarm company. Of course, there could be differences in the provisions used by ADT and the other company as well as differences in their application and enforcement.
Alan Pepper, Esq
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Question - Dummy cameras
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Hi Ken
I read & really like reading your articles and appreciate your reviews. I recently had a question on dummy cameras and assumed protection or coverage in public areas. Years ago I remember a case on this issue and the suppliers stopped selling dummy cameras . When I went looking for these case’s , I could not find references to them. They were about 10-15 years ago and the company’s we installed for would not install. Could you elaborate on this issue in the industry and what the legal side is .Public vs Private , Assummed Privacy vs expected Privacy. I understand the issues with areas like bedrooms,bathrooms,dressing rooms and the like. What about parking structures,public areas or parks & rec recreation areas. Thank You
Christopher Freeman
Power Protection Plus
Ca.
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Answer
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I did article on this - I don't things have changed. See article here: https://www.kirschenbaumesq.com/article/dummy-equipment-or-systems-for-dummies
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comment on guns in work place
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Ken
This statement by Michael D [that in Virginia the DCJS rules prohibit and electronic security personal from carrying any firearm while working] is wrong. Don't know where he heard this but it is baseless.
Bud Wulforst
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Response
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I'm staying out of this one
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