Tips for Dealing with Contractors Gone Bad

April 23, 2010
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This week's tip offers advice for HOA boards that are disappointed with contractors. If you're considering severing ties, follow these rules:

  1. Beware urban legends. Know the law.

    If you think you can always cancel a contract within a certain number of days, you're wrong.

    "There's nothing in the law that says a contact must be cancellable," says Bob Tankel, principal at Robert L. Tankel PA in Dunedin, Fla., a law firm that advises associations. "I just got a question the other day, 'Don't all contracts with condo associations have to have a 30-day out?' I said, 'No. That's an urban legend.'"

  2. Have a sit-down before a firing.

    "This might sound self-serving, but we have 700 employees, and if I ever find out someone was terminated without process, I get upset," says James Donnelly, president and CEO of Castle Group, a property management company in Plantation, Fla., that manages 55,000 association units. "You should deal with a contractor in a similar process you would use to terminate an employee.

    "Know the terms of your agreement, make sure they're complied with, and if they're not, communicate that. You need direct and real-time communication with your vendor, and you should give the vendor a chance to remedy. We always say to our board clients, 'If you have a problem with contractors, meet with them, give them a chance to cure, and if they don't succeed in curing, then terminate them.'"

    Robert Galvin, a partner at Davis, Malm & D'Agostine PC in Boston who specializes in representing condos and co-ops, agrees that it's best to consult with a contractor before terminating--in some cases. "It depends on your relationship," he says.

    "If you feel the contractor has been very good for a long time but has slipped recently, you might want to call and say, 'You've been very reliable, and we've been pleased, but you've really sloughed off. What's the problem? If you don't improve, we're going to have to terminate you. If you don't have that history, look at the contract."

If you're about to pink-slip a contractor, read our new article first: 6 Tips for Properly Firing a Contractor.

Best regards,
Matt Humphrey

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