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UNLICENSED SALESPERSON - UNENFORCEABLE CONTRACT
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Ken
Can a customer opt out of a contract from a system that was sold by a unlicensed salesman? Typically door to door salesman who are not licensed to sale.
Tony M
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Response
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When it comes to consumer laws [contracts that pertain to residential or personal and family use] one of the typical penalties is that the consumer cannot be held to the contract. This is accomplished by laws that prohibit an unlicensed contractor from suing on the contract covering work that required a license. It's a pretty potent penalty, though plenty of rogue companies may be out there selling and not really caring if they can sue on contracts because they have no intention of forcing subscribers to continue performance.
Some jurisdictions require both the company and employees to be licensed or registered. The penalty for non-compliance is likely that the contract can't be enforced. This means by the way that the consumer can cancel at any time without penalty; can't be held to the contract for further performance. It most likely does not mean that if there is a loss and the subscriber sues you that you can't rely on the contract. Since the subscriber will be claiming a contractual relationship with you the contract itself will be presented by the consumer.
If you're thinking that you don't care too much about enforcing the contracts for collection issues, so it's OK to fail to comply with licensing requirements, think again. You are also affecting, in a very negative way, the value of the subscriber contract and the equity build-up in your business. Informed buyer are not going to be interested in your accounts if you've been non-compliant with licensing laws. And there is nothing good about thinking you have a company worth one million dollars only to find out that it's worth $250,000 if you're lucky. Get with the program.
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COMPETITION FROM SIMPLISAFE
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Ken
I'm running into Simply Safe where the house has my system still live in the house with smoke detectors. The new owners said they brought their Simply Safe with them and have no intention of using my system. I'm in TN. Can I tell them Simply Safe is not licensed in Tn. They definitely are not. Is this legal or proper for me to say ?
PM
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RESPONSE
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Sounds like you don't have a contract with the new owners so you should terminate service for that system. You might have contract with old owners and could pursue them if still under contract. Lot's of home owners forget they are under contract when selling their homes, which is surprising because all of them point out the alarm system when marketing the house.
I don't know if SimpliSafe is licensed to monitor in TN. If it does contract to provide monitoring service, other than self monitoring [meaning that it has professionally monitored systems with dispatch to first responders] then I believe it needs an alarm license. If it doesn't have one then you could convey that information to someone without liability; just make sure you are correct on your facts.
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LICENSE QUESTIONS
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Ken,
Is Florida requires licensing to install security cameras?
Also, if I'm licensed by the state (IL, for alarm contractor) can a local jurisdiction requires additional license for low voltage?
anon
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RESPONSE
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In Florida If cameras are used for monitoring and dispatch then you need an alarm license. The Illinois alarm license is statewide and preempts local law that requires a license for the same work. Kevin Lehan, Executive Director for the Illinois Electronic Security Association confirms:
Ken, the IESA has been very successful in educating units of government that they CANNOT regulate alarm contractors by requiring registration or contractor fees and/or surety bonds from licensed alarm contractors.
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