This is my first blog posting ever. For those of you who don't know me, I am a lawyer specializing in the electronic security and life safety industries. You can check me out on my law firm's web page. My practice is devoted to representing electronic security and life safety providers coast-to-coast. Since I started out as an industry lawyer defending an alarm company in a multiple fatality residential fire claim (a mother and her children) and because the case had such an impact on me, I thought I'd first blog about fire detection.
The case I worked on was tragic. I was the junior associate (the name given to lawyers working in a law firm that have not yet made partner) doing research and writing in support of a senior associate and trial partner and senior business relationship partner. The client and their insurance company were taking this one seriously, employing a team of lawyers to defend their interests. The case was nearly 20 years ago but I remember the young children were found in their bedroom closet after the fire having tried to "hide" from the smoke and flames. The case sticks with me to this day. Forgive me if I take fire very seriously. But I think it's merited. In my opinion, fire detection should be taken with the utmost degree of professionalism. There's too much riding on it.
So let's start a discussion. To begin, here are a couple of items you should know from a legal perspective when dealing with the possible risk of loss resulting from fire detection.
First, I can write the world's greatest contract but the rules for fire very well may differ from the rules for intrusion. While I am confident I can enforce a well written indemnity or limitation of liability clause in an intrusion related lawsuit, I am less confident in seeking to enforce the same clause in a fire-related loss. Unlike the lawsuit arising from a burglary, the lawyers on the other side of the fire loss case will argue that the court should not enforce event the most well-written risk shifting clauses because the state has an interest in regulating companies engaged in the business of fire detection and allowing a negligent provider of fire alarm services to escape liability, they will argue, is not in the best interest of the state or its citizens. There are cases that support this position. The bottom line is that contract can only provide so much protection and when we're talking about fire, your contract, including its risk shifting clauses are likely to receive greater scrutiny.
Second, if you provide any form of fire detection, whether commercial or residential or both, you can never buy insurance. Business owners in the industry ask me all the time "How much insurance do I really need?" I tell them that if they are not using someone who specializes in insurance for the industry then they are making a mistake. One possible measure of how much insurance you may need is to look at the replacement cost of the most expensive building and contents where you provide fire detection services. (That's a number that may keep you awake at night.) If you are providing fire detection services to one occupant in a multi-occupancy premises (for example, a condominium, townhome or apartment building) you may face claims from the occupants of adjoining premises even though you do not provide services to such persons. (This comes through a black letter rule of common law in many jurisdictions known as "Duty to Third Persons.")
Let's keep the discussion going. The point here is not to scare you but to educate and allow you to put your company in the best possible position to protect its interests in the event of a fire-related loss. I'll follow up with more soon. In the meantime, I welcome your comments.