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Request to sign Owner contract after your contract is signed; battle of the forms
June 24,  2021
Request to sign Owner contract after your contract is signed; battle of the forms
          This happens all too often:  You get your All in One signed.  Before work is begun, and sometimes after work has begun, your subscriber tells you that you have to sign its form agreement.  Invariably the subscriber’s form agreement is antithetical to your All in One.  Not only that, but it adds a bunch of other provisions that shifts risk your way, requires you to carry insurance you don’t have and makes you jump through hoops to get paid.  What the heck?  You started the job thinking you had an agreement that you were familiar and comfortable with; now you’re threatened with termination or worse, not getting paid when you finish the job, or you want a lot more business from this customer and the battle of the forms needs to be resolved.
          You are in a different position than if you are starting negotiations to get the job.  You could take the position that you have a contract and you’re not willing to change it.  Signing the owner’s form would be a major change, a complete re-negotiation in fact.
          Here’s what the likely differences are going to be:
1.  Customer wants to own the passcodes and programming.  This isn’t something you’re going to want to give up, especially if the system is proprietary and only authorized dealers get the codes and programming.
2.  Customer wants you to provide indemnity.  No thanks; it doesn’t work that way in the alarm business.  We can relax this position for installation only, not for after-install RMR services, and only if you name the customer as additional insured for the installation phase.
3.  Customer wants you to carry insurance you don’t have and maybe can’t get for reasonable cost, some of which doesn’t even make sense, such as automobile coverage when you’re not even driving onto the customer’s premises.  This added expense may not have been calculated in your numbers when figuring the job.
4.  Customer wants you to name customer as additional insured on your insurance policies, and wants your policy to be primary and non-contributory.  If push comes to shove this might be OK for the installation phase only, but not for the after-install RMR services.
5.  Customer wants you to be responsible for any loss.  We can entertain this only for installation phase, but not for after-install RMR.  In other words, the Exculpatory Clause and Limitation of Liability provisions in the All in One agreement must govern the after-install RMR services.
6.  Customer won’t permit subcontractors and if it does you must be responsible for the subcontractor’s negligence.  This may not consider the reality of the services because you may subcontract out monitoring and other services.  The general rule of law is that you are not responsible for the negligence of your subcontractors, though you may be liable to your customer for breach of contract.  Don’t give in on this paragraph because your subcontractors rely on your All in One to protect them and they may not, if smart enough, want to work with you if you put them at risk.
7.  To get paid you need to get sign-off from architect, owner’s representative, owner’s bank and who knows who else.  Maybe payment is after 60 days and only once the entire job is finished, not just your work.  Be careful what terms you agree with.  There may be prevailing wage minimum wage requirements, minority worker requirements and who knows what else, and you’ll be stuck with these requirements when it comes time to get paid.
8.  Customer wants you to agree to jurisdiction and venue for disputes in foreign jurisdiction.  Rarely agree to this.  The All in One calls for jurisdiction in your state and provides for arbitration forum which is relatively inexpensive and resolves disputes timely in most cases.  If you are in CA with your customer it doesn’t make much sense to agree to Delaware for disputes and most arbitration companies cost much more than going to court and take just as long, so they aren’t acceptable.
          A great deal of effort went into preparing your All in One.  Once you have it signed you should be leery making changes or agreeing to an entirely new agreement, especially when you know the terms and conditions are going to be much less favorable to you.  You should always have experienced legal counsel when negotiating contract changes and you should join the K&K Concierge Program to encourage you to have counsel and save money.  Contact K&K’s Concierge Program Coordinator Stacy Spector,Esq at 516 747 6700 x 304 or

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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