While the vast majority of one-time projects and long-term service contracts involving vendors and service providers and their co-op, condominium or HOA clients go smoothly and either conclude or continue without incident, a small percentage of jobs do jump the tracks. Sometimes it’s a contractor’s inability to stay on schedule or stick to an agreed-upon budget that does it; sometimes it’s the quality of work itself that’s not up to par.
Whatever the cause, sometimes it’s necessary for management and building administrators to pull the plug on a contract—and that sometimes can be easier said than done. But before any contracts are signed, experts agree that boards and associations should make sure that all vendors and service providers are properly licensed and have a good record with the Better Business Bureau, for more information log onto www.newyork.bbb.org. Another useful search is your county’s Clerk of Courts office to determine whether the contracting firm or its principals appear in litigation.
There are numerous reasons why a co-op, condominium or HOA manager or board might feel it necessary to break a contract with a vendor or service provider but some are more frequent than others.
“While there are certain contractual warranties implied at law such as merchantability or fitness for a particular intended use, a cooperative, condominium or homeowner’s association would generally have the right to terminate a contract for work or services based upon the breach of a particular provision of a contract,” says Eric Goidel, a partner in the Manhattan-based law firm of Borah Goldstein Altschuler Nahins & Goidel, P.C. “Dependent upon the type of contract (construction or service) such grounds could include failure to perform pursuant to specifications, the failure to deliver materials, the failure to adequately staff or timely perform the work and the failure to timely respond to service calls.”
“Any breach of any material terms of the agreement is the primary reason for a condo or HOA to feel it necessary to break a contract,” adds Eric Frizzell, a partner with the Glen Rock, New Jersey-based law firm of Buckalew Frizzell & Crevina, LLP, who is also licensed in New York. “Failure to perform services properly, failure to be on-site during required periods, failure to respond within required time frames on a service contract. For example, an elevator service contract requires the service company to respond to a report or a complaint within a time frame and failure to respond promptly can be a detriment to the building, especially in a high-rise. Other reasons could be misconduct by workers directed toward homeowners, any type of inappropriate conduct or alcohol on the premises during work hours. There could be all sorts of reasons.”