Risk Mitigation Series Article II – Critical Concepts That Must Be in Your Contract

A contract is critical to any successful business relationship.  In the security industry it is a critical competent of a sound risk mitigation strategy.  Every state has laws that govern how contracts are handled.  It is a good idea to research state laws where you do business and select a state that is most advantages to your needs as the state law which governs the contract.  If you end up in court your contract terms will be scrutinized and challenged.  The one thing to remember, if your performance deviates from the contract in any way on a consistent basis then your actions become part of the contract.

For instance, if your contract does not commit your company to distribute information and you do so as a value added service, on a consistent and regular basis, then a plaintiffs attorney will do all he can to to have it viewed as part of the contract.  This may seem harmless on the surface, however it can be very dangerous.  In Georgia for instance, the owner of an apartment complex is responsible for the safety of those that enter upon their premises.  If a security company passes out information to residents on behalf of the property owner then a plaintiff attorney will try to say your company was responsible for notifying residents of latent danger.  In short, your client relied upon you to ensure their residents and guests were made aware of criminal danger that was a threat to their well being and safety.

Lets examine another common practice that security officers perform which increase your risk of being sued.  Officers want to appear helpful and courteous so they develop relationships at the location they patrol.  Again this seems harmless but what do you think happens when your officer tells residents that he is there for their safety?  Imagine what an attorney would do with a handful of residents who claimed the officer repeatedly said he would keep an eye on their children at the playground.  There is an old adage, “actions speak louder than words” which sums up the point nicely.

The first line of defense is your contract.  Below is a list of items you should consider putting in your contract.  This list only covers the most overlooked clauses.  By no means is this an exhaustive list.

• Client shall, within twenty-four (24) hours of request by the Contractor, provide the Contractors’ personnel with access to all areas of Client’s Premises deemed necessary by the Contractor.  If any area of the Premises is to be off-limits to the Contractors’ personnel, Client must notify the Contractor in writing.
• The Client agrees to provide a location onsite for restroom breaks. Failure of the Client to provide a location for restroom breaks will result in Contractor Agents leaving the property to find appropriate facilities.  Client agrees to hold the Service Provider harmless for any and all criminal activity that occurs while Contractor Agents are off the Service Location for restroom breaks.
• Contractor undertakes performance of the Services as independent contractor and shall not be construed as employees of Client, and this Agreement will not be construed to create a partnership, joint venture, agency or employment relationship between the Parties.
• This agreement between Client and Contractor does not have any third-party beneficiaries of this Agreement.  Residents, guests of residents, other vendors, Client employees, or visitors to the property of any sort are not third-party beneficiaries of this Agreement.
• Contractor shall exercise their best efforts to provide the respective Services for Client. Contractor makes no express or implied warranty or guarantee that their efforts will have any specific or general result.  Contractor makes no express or implied warranty or guarantee either that their efforts will prevent physical damage to Client’s property or that will by their efforts prevent criminal activity on the property.
• Contractor is not responsible for securing any breach nor are they responsible for ensuring any breach has been secured by maintenance or other Client vendor.  The Client and the Contractor acknowledge and agree that decisions regarding the use, maintenance, safety and upkeep of the Premises are and will remain the exclusive province of Client.
• Contractor is not responsible for notifying residents, guests of residents, employees of Client or any visitors whatsoever and for whatever reason of any criminal activity or latent danger, that has occurred, will occur or may occur on the Client’s Premises.  Resident, guest, Client employee or visitor communications of any and all forms for any and all reasons is and will remain the exclusive province of Client.
• The benefits of security services are not transferable.
• Client agrees to protect, defend, indemnify and hold harmless the Contractor, its employees, agents, insurers, and representatives (collectively, the “Contractor Entities”), from any and all Claims, including reasonable legal fees and court costs associated therewith (including appeals) asserted against the Contractor Entities as a result of injury and/or death to persons, including employees and subcontractors of Client, or damage to property, including property of employees and subcontractors of Client, occurring by reason of any negligent acts or willful misconduct, including Client’s failure to cure, or provide sufficient warning of, any defect, dangerous condition, latent danger or similar issue of which Client had knowledge at the time the incident leading to such Claim occurred, committed by the Client Entities, arising out of or connected with this Agreement.  Notwithstanding the foregoing, Client shall not be required to indemnify the Contractor Entities to the extent that a Claim results from the negligence or willful misconduct of Contractor.
• LIABILITY LIMITATION AND INDEMNITIES: (a) Client agrees that Contractor is not an insurer and that the amounts payable hereunder are based upon the value of services provided and not the value of Client’s interests being protected or the property of Client or of others located on Client’s premises.  Accordingly, Contractor makes no representation, express or implied, that its services will prevent any loss or damage.
  • Notwithstanding anything to the contrary in this Agreement, Client agrees that in no event will Contractor or its insurers be liable unless due to gross negligence or willful misconduct for any Claim arising from or related to: (i) environmental damages or liability of any nature; (ii) a legal enactment, decree or moratorium, or any regulation, rule, practice or guideline of a public authority; (iii) an intervention of a public authority, an act of nationalization, confiscation or expropriation; (iv) an act of war, a violent or armed action, hi-jacking or act of terrorism; (v) a strike, lock-out, boycott or blockade; or (vi) any circumstance beyond Contractor’s reasonable control.
  • Notwithstanding anything to the contrary in this Agreement, in no event will Contractor be responsible for any theft or other loss of Client’s property not directly attributable to security officer thefts unless theft results from gross and wanton negligence or willful misconduct. In the event of allegation of security officer thefts, Client waives all right of recovery unless Contractor is notified of such allegations within thirty days of Client becoming aware of such theft and Client cooperates with Contractor in the investigation of the facts and Client either (i) presses formal charges and a conviction (whether on the original charge or a related charge or plea agreement) or (ii) settles the matter with the alleged perpetrator.
  • The services provided under this Agreement are solely for the benefit of Client, and neither this Agreement nor any services rendered hereunder confer any rights on any other party, as a third-party beneficiary or otherwise.
  • Contractor does not provide personal protection or security services of any kind for Client representatives and assigns, Client employees, residents, guests of residents, vendors or visitors of any kind at any time, at any location, nor for any reason. Contractor does not provide protection for the personal property of Client representatives and assigns, Client employees, residents, guests of residents, vendors or visitors.  Further Contractor is not responsible for guaranteeing or providing for the safety of employees, residents, guests of residents or visitors of any and all types at any time while on the Premises for any and all purposes.  In no way shall this clause be construed or interpreted to diminish or limit the intent of clause (f) of this section.
• The Client agrees not to enter into any business venture, where the Client becomes a licensed “Private Security Business”, offering the same or similar service and products described in this Agreement.  The Client also agrees that, during the term of this Agreement and for a period of one (1) year following the termination of this Agreement, Client will not attempt to hire Contractors’ employees for the purpose of performing Managed Resident Services, security related tasks, security consulting, or for any other purpose related to security or courtesy patrol work.  The Client and it affiliates agree not to hire Contractors employees for a period of two years after the termination of the contract.
• If any legal action or other proceeding is brought for the enforcement of this Agreement or because of an alleged dispute, breach, default or misrepresentation in connection with any provision of this Agreement, the prevailing Party shall be entitled to recover reasonable attorney’s fees, court costs and all expenses (including taxes) even if not taxable as court costs (including, without limitation, all such fees, costs and expenses incidental to appeals), incurred in such action or proceeding, in addition to any other relief to which such Party may be entitled.
• Contractor officers are not permitted to speak with management or maintenance staff except on official company business.  Communication should be limited to defining problems with the property, documents for distribution, and emergency call response.  All communication of a personal nature is prohibited.  Officers are not authorized to make Post Order changes, nor are they authorized to perform services not specifically defined in this document.  All such requests must be directed to the assigned Field Supervisor or in the absence of the Field Supervisor, to the Tactical Officer in the Security Operations Center.  
• Contractor will notify Client of risks and issues as observed by Contractor Agents. It is the exclusive responsibility of the Client to make required repairs to the property.  Contractor will report issues they observe but they will not perform repairs.  In addition, once Contractors Agents deliver a criminal trespass letter (hereto forward referred to as “CT”) to an individual it is up to the Client to pay the fee to register the CT with the city if required.  Contractor will file the paperwork with the courts as required once payment of fees has been made. Contractor will provide information on observed trouble makers and rule violators however; it is the sole responsibility of the Client to take corrective action to deter repeated offenses.  Contractor will provide testimony in court if such a service is required.  Contractor will approach loitering people and require them to move on however, it is the sole responsibility of the Client to enforce the no loitering policy with repeated resident offenders and resident guests by levying fines or other consequences.
• The Services will be provided at the Premises.  The site consists of all buildings, an outdoor parking area adjacent to the buildings, clubhouse and pool area, laundry room and care facilities, maintenance shops, and storage areas. It does not include occupied resident units, resident garages, resident storage areas, resident vehicles, resident trailers or resident patios.
• The Contractor is responsible for patrolling the area inside the perimeter of the Premises and is not responsible for any activity that occurs at the perimeter or outside the perimeter of the Premises.  Contractor patrols the Premises but is not responsible for securing the Premises or the perimeter around the Premises.  Client is exclusively responsible for maintenance of the Premises, securing the Premises and upkeep of the Premises.  The Contractor will report observed security issues, such as holes in a fence, to the Client or the Clients representative who will have the exclusive responsibility to make required repairs as they deem necessary to secure the property.  Contractor is not a construction company and does not carry insurance for such activity.
• Disperse Loitering when it occurs within legal parameters set by the county, city and state law. Officers will record as much information as they are able to collect from loitering parties and turn this information in to management. It is the sole and exclusive province of management to enforce the no loitering policy through remedies available to them through the lease agreement and by registering criminal trespass letters with the courts.

In addition to these concepts it is just as important to list out what the officer is not permitted to do.  Below are two examples of clauses to consider including in your contract.

• Contractor and its agents are not authorized or required to answer questions about any information disseminated on behalf of management. Officers and Contractor are not responsible for and are not authorized to provide information to anyone concerning the Premises, the condition of the Premises, crime statistics, accidents or incidents that have taken place on the property or of latent danger on or near the property.  Communication with residents or anyone seeking information for any reason whatsoever concerning the Premises, crime statistics, property safety, latent dangers, disseminated information or any communications of any sort is the sole and exclusive domain of the Client.
• The Contractor and its Agents, subcontractors, employees or assigns are not permitted nor are they responsible to provide security or safety training to Client agents, representatives, affiliate, assigns or its Authorized Management Agent employees, representatives, affiliates, assigns or to Premises residents. Such education and training is the exclusive responsibility and domain of the Client.  and or Authorized Management Agent.
• Contractor and its Agents, employees or assigns are not providing personal “Security Services” for residents, vendors, visitors, or employees of the Client, Clients Agents or property. The Contractor does not provide “Security Services” or safety for residents, guest of residents or personal property of residents or the personal property of guests of residents. The Contractor is not responsible for the personal safety of any person on the property at any time.
• Contractor is not responsible for collecting, analyzing or communicating criminal activities that occur outside the Premises or on the Premises. Crime statistics compilation and review is the exclusive domain of the Client.