Snow Business, Nov/Dec2013

legal savvy Simple mistakes complex problems F ollowing are a few scenarios that exemplify how careless or improper actions can open snow ice contractors up to unintended or unnecessary liability and grief Whats in a name Mulla Landscaping and Mulla Snow operated under similar names in the same general area The companies had no affiliation and although the companies owners occasionally discussed changing the name of one of the companies neither was willing to compromise on who should change and nothing was done When an erroneous reading of the contract for services resulted in a lawsuit against Mulla Landscaping for snowclearing services at a location serviced by Mulla Snow the owner of Mulla Landscaping realized the error and threw away the suit papers Many months passed and no one responded to the legal action An entry of default was eventually taken against Mulla Landscaping resulting in a potential monetary judgment Since the owner failed to place his insurance company on notice of the claim there was no insurance coverage for the potential judgment Luckily we were able to clear up the situation and suit papers were amended to replace Mulla Landscaping with Mulla Snow in the legal action The failure of Mulla Landscaping to respond to the suit papers even though the papers were incorrect caused Mulla Landscaping a significant amount of time and expense Takeaway Immediately forward suit papers to your insurance company if you are served Never ignore a legal action even if you are certain your company did nothing wrong and does not belong in the suit Dont give an inch After spending three years working hard to secure the contract for snow clearing and deicing services at Happy Valley Plaza Fuss was exuberant He was so thrilled though that he did not take the time to carefully review the contract A typographical error incorrectly required snow clearing services to begin at 1 inch of accumulation instead of 2 inches The parties to the contract clearly understood services were to begin at 2 inches but the error created significant confusion when a legal claim was presented arising from a slip and fall on a day when there was snow accumulation of just under 2 inches Courts will generally enforce a clear and unambiguous clause in a contract 26 Snow Busines november december 2013 www GoPlow com even if erroneously typed Fortunately the property manager was honest and admitted the error and Fuss was not held responsible for the claim Takeaway Read all contracts before signing them and make sure any errors are immediately corrected Dont ignore administrative needs Harkins Snow Ice worked at Caitlin Commons for five years and was a valued contractor Caitlin Commons recommended Harkins to a neighboring property owner who was also extremely pleased with Harkins work Harkins reputation spread by word of mouth and within three years the company had secured contracts to service almost 50 of the properties in the area Harkins did not have the resources to perform all the work and engaged in an extensive process during the summer months to hire subcontractors Harkins did not however increase his administrative staff On the first storm of the season due to a communication error two subcontractors showed up at the same site One cleared walkways and the other cleared parking areas but there was another site without service for a full day Due to another error in communication Harkins was not made aware of the failure to service the second site When Harkins realized the error the second site was properly serviced The property manager understood the error and allowed Harkins to keep the contract especially after Harkins reduced the service invoice by 25 Nevertheless Harkins and the property manager could have been in trouble if a legal claim had arisen from a potential injury on the untreated site Takeaway As your business grows it is important to expand your companys administrative staff to make sure you have the resources and ability to direct snow clearing services by subcontractors Snow ice professionals open themselves up to suits and headaches by ignoring the little things by darryl beckman insights If served with a lawsuit never dismiss it even if you know youve done nothing wrong Growing operations requires similar administrative growth Read your contracts and fix any errors If you are not a sole proprietor make sure you have a buy sell agreement Engineer your sites and follow the plan Continued on page 28