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Shortening time to sue or start arbitration / webinar tomorrow - see below
May 2,  2022
Shortening time to sue or start arbitration
          All lawsuits need to be based on a “cause of action”, such as breach of contract or tort.  In a tort action the cause of action arises when the incident causing the damage occurs.  In breach of contract actions the action arises when there is a breach of the contract.  Every state has laws that specify the outside date an aggrieved party can start a lawsuit [or arbitration] which is the “statute of limitations”.  The statute of limitations is state law and can differ among the states.  Generally the statute of limitations for tort [negligence] is three years and statute of limitations for breach of contract is four to six years.
          With some constraints, the parties to a contract can agree to shorten the time to bring a lawsuit; shorten the statute of limitation period.  The shorten time needs to be reasonable and not unreasonable deny a claimant the opportunity to redress a wrong.
          Alarm companies don’t want to wait for the running of the statute of limitations to be sued, so they shorten the time in the alarm contract.  The Standard Form Agreements shorten the time to bring suit to one year from accrual of the cause of action.  For the most part this means that when a customer suffers a loss – say from burglary or fire – and blames the alarm company because the alarm didn’t work as expected, the customer has one year to sue the alarm company.
          But what’s good for the goose is good for the gander.  The provision shortening the time to start a lawsuit applies to both parties, so the alarm company has only one year to sue the customer if there is a breach of contract. 
          K&K recently had a case where this provision came back to bite the alarm company.  The customer defaulted in payment.  The alarm company didn’t send the matter to K&K for two years.  Arbitration was commenced and the customer offered as defense that the one year time period passed.  The arbitrator agreed and the arbitration award was for the customer.
          I’ve consistent advised alarm companies to start their collection process within the 60 to 90 day window, and more to the point, as soon as it can be determined that the customer has fallen out of its routine payment practice.  That means that if a customer pays your invoice days after receipt like clockwork then you need to be concerned when you don’t get timely payment.  You don’t need to wait 90 days, and you shouldn’t wait 90 days.  On the other hand, if you have a customer who routinely pays 120 late, and you’re used to it, then you don’t have to be concerned until the 120 days passes without payment.  Keep in mind that not all buyers of your accounts will be interested in accommodating “late paying accounts”.  They will either, exclude the account from the purchase price calculation, reduce the purchase price during the guarantee, or take the account for free without paying for it in the first place.  None of these options should be appealing to you as the seller of the accounts.
          Do not delay sending the customer in for collection.  You are only hurting yourself, and if you wait long enough you will be precluded from pursuing your claim.
          Just a reminder, Concierge Clients get a free collection letter monthly as well as a half hour free each month for contract review and negotiation.  Sign up today for the Concierge Program.

Webinar on assistance getting licensed
Webinar Title:  Filing for and renewing your alarm license
Topic Details:  Once you know where you need the license and what license you need, and you know you’re qualified, The Cmoor Group handles the minutia details filing for the license and has the software to monitor for renewal compliance.
When:  May 3, 2022 at 12 PM ET
Presenter:  Connie Moorhead, President of The CMOOR Group. or call 502-254-1590, ext. 101
Hosted by: Ken Kirschenbaum,Esq
Who should attend:  license holders, license compliance officers, owners, managers
Register Here:
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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