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When you have to sign a vendor contract / ISC round tables
July 1,  2021
ISC round tables
            I have round table discussion groups scheduled for July 19, 20 and 21.  Topics and availability will be announced in the next few days.  Please contact Stacy Spector,Esq at 516 747 6700 x 304 or to reserve a spot or initiate your own round table discussion group [we have a few timeslot openings as of now on July 21]
When you have to sign a vendor contract
            If you do commercial work you have been asked to sign a vendor agreement; it's the contract presented by your customer.  From the customer's perspective it's perfectly reasonable and they are hesitant, resistant and sometimes implacable when it comes to modifying their contract form.  Never mind that the contract form is used for all contractors the customer engages, from cleaning service, parking attendants, floor-waxers, exterminators, painters, etc.  The form certainly doesn't seem to address the issues that arise in a commercial fire alarm or even security systems.  You're faced with signing the vendor form or losing the job.
            These vendor forms all have similar provisions and alarm companies need to be very careful before signing these form contracts.  While many of the provisions are acceptable, many are not, and if you do agree to the provisions you need to at least know about them and be certain that you are in compliance with them before doing your work.
            What you can expect in all of these vendor contracts are minimum insurance requirements with specific details on which insurance companies you can use, the amount of coverage, sometimes particular endorsements, and additional insureds required.  The insurance provision requires review by not only your insurance broker, to make sure you have the coverage, but a lawyer who can assess and explain just what you are agreeing to, because the insurance requirements are almost always tied in with the indemnity provision, but not enough to protect you, and that's where legal advice is most needed.
            The indemnity provision will be broad and inclusive.  It can transcend your actual work and expose you in exactly the type of situations alarm contracts contract away liability. The indemnity provision needs to be reviewed by an attorney. 
            Payment provisions can be arduous.   You may be required to prepare and submit requisitions approved by architects or owner representatives, prove that you have complied with all vendor contract requirements, such as Prevailing Wage, minority owned or hiring, no foreign equipment and a myriad of other social issues having nothing to do with your actual work.  There may be a retention and you may have to wait for that money until the entire job is completed, not just your work.  How would you like to find out that the vendor contract requires you to make a specific percentage contribution to a charity that the vendor likes, and you may not?  A lot of provisions can be included in a contract and you have to be careful to read these contracts.  I am asked to review a vendor agreement at least weekly and it's usually the same "ask" by my alarm client:  "can I take a quick look and let me know if there's anything I need to know".  Sometimes it's comical because the vendor contract is more than 50 pages of fine print; sometimes it much shorter and incorporates other agreements, terms and documents that I don't have and which would add many more pages to review.  Finally, how am I to know what you might want to know?  Maybe you don't mind making a charitable contribution or paying prevailing wage or waiting years until a project is completed or not getting paid if the projected financials don't pan out.  The point is, every vendor contract is antithetical to the terms in the Standard Form Agreements, and those are the agreements you need to be using.
            Vendor contracts are typically presented by larger potential customers and therefore it's worth negotiating the terms, assuming the vendor is willing to modify the vendor agreement.  Too often you are dealing with someone who has been given the vendor contract, told to use it, and hasn't the authority or energy to modify it.  Then it's a matter of your bargaining strength; how desperate is the customer to make a deal with you.  A great example is a commercial fire system that's leased and a new owner takes over the building.  A new fire alarm will be very costly to install so it makes sense for the customer to bend a bit on its required vendor contract to get you to continue to lease the system and provide the fire alarm services.  Other times you have the expertise and personality and the vendor wants you and is willing to negotiate and accommodate. 
            You will find that vendor contracts are most acceptable for the installation stage, but not the after-install services.  That is usually where I draw the line and almost always vendors will agree to sign the All in One for the after-install services because they recognize that the vendor contract is designed for the installation phase when it comes to contractor doing installation work.

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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