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Question:

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Ken

    I have potential liability on following problem:

    I serviced account for another local company and customer accuses me that I opened the window and the water pipe burst in the basement.  I did not work on that window at all or did not run any wires through it or installed anything on it.

    Since it's a service only for another company I obviously don't have any contract with customer.

    The only thing that was signed by customer on MY end was your completion certificate form (which I purchased from you) but I changed the limitation from $250.00 to $50.00 or 10%, whichever is greater.

    Also should your service contract be used, which I also purchased (and slightly modified for servicing of other's accounts) and signed with each customer  when doing service ?

    Should there be another point added to your Completion certificate that customer has checked for all open windows and doors and confirmed that they are closed and locked?

    Honestly this is the last thing I have expected something like that and finger pointed.

    What are your thoughts on situation like this in general?

Thanks

Robert

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Answer:

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    The completion certificate is not a substitute for a service contract.   Yes, it's better than just a hand shake;  I haven't defended a case yet relying only on the Completion Certificate.

    As a subcontractor who does not have a direct contract with the subscriber, you need to make sure that the alarm company hiring you has a properly executed Service Contract - and if it's not my Standard Service Contract then tell them to get it because you will then take comfort knowing that you are protected for your subcontracting work. 

    The Service Contract has all of the necessary protective provisions permitting the alarm company to contract away liability for its own negligence.  One provision extends that protection to the subcontractors.  If that contract is in place then you are protected from liability for the issues raised in your question.

    All alarm companies need to be concerned with liability, and the only barrier between you and your subscriber's claim is your contract.  Both you and your insurance carrier, assuming you have one, will depend upon the contract.  While it would be nice to be able to prove that you didn't do anything wrong, and therefore have no liability, that's a much longer and harder process basing your defense on the contract terms.  In fact, arguing the facts of the case will require a trial.  The contract defense can usually be established early in the case by motion for summary judgment.

    As a subcontractor another contract you should have is the Subcontract I offer as a standard form.  You need an agreement with the alarm company hiring you, and my form is industry specific, clear and easy to read. 

    The completion certificate provides that the alarm was in working condition when you completed your work.  That's all it needs to say.