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Can there be contract default if RMR payments are current but per call charge outstanding
April 23, 2024
Can there be contract default if RMR payments are current but per call charge outstanding
          Customer is the owner of a multi-tenant commercial building on a KK Fire All in One contract and has been current in paying quarterly invoices for installation, monitoring, service and inspections, and recurring fees.  Customer performs renovations to the building necessitating significant modifications to the fire alarm system, all of which are documented via riders which are signed by both parties and referenced and attached to the existing KK fire alarm contract.  Fast forward a few months, renovations and fire alarm system modification is complete, customer has continued to pay monitoring/inspection/service fees, however is in arrears for the invoices for the system modifications.  Under the Ts & Cs of our KK fire alarm contract, can we terminate monitoring service and notify the fire marshal (or threaten to do so for leverage), for non-payment on the system additions, even though the payments for monitoring are current?
          This issue comes up frequently, though not as often as you describe.  A simpler question would be what if all RMR payments for monitoring are up to date but customer fails to pay a per call repair bill. 
          It’s same answer as in your scenario, the customer is in default; in breach of the contract.  A breach triggers a default and that triggers the Legal paragraph which specifies your remedies; your options when the customer breaches the agreement.
          The consequences are severe, and they are decisive. They are also immediate and they are irreversible, meaning once the customer is in breach it cannot cure if you have declared the default.  One of the consequences is that the balance of the RMR payments are due and customer is liable for 80% of the balance. 
          This reminds me of what I thought comical story that occurred couple of weeks ago.  An alarm client who has been using K&K contracts for decades finally sent in a collection matter. We demanded $36K and wound up settling about 2 weeks after the client sent us the case for $27K; it was all for future RMR on a monitoring contract, which of course had been terminated and services were no longer being provided.  My collection department advised me that the client was, of course, pleased and exclaimed “holy shit these contracts really work”. 
          Well how’s that for an endorsement.  Get your K&K contracts or update your existing K&K contracts today.  I look forward to your first revelation.   

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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