When the weather turns cold, people start falling down. But some ice- and snow-induced tumbles are more legit than others. As Alvin Wasserman, director of asset management at Fairfield Properties, puts it: “In a bad economy, there’s an increase in slips and falls, people hurting themselves and suing the contractor. In a good economy, you see less of it. There are some legitimate slips and falls, and then there are just people who are looking to collect money and use it as an excuse.”
If you’ve got staff and you’ve got snow, then you’ve got potential liability problems.
“It’s hard,” Wasserman says. “You get these storms where it starts out as rain, right? Then the temperature drops and so the rain becomes a layer of ice. Then the snow falls. You get six inches, eight inches of snow, whatever. You clear the snow and the temperature drops to 20 degrees and you’ve got an inch-thick layer of ice underneath. What do you do with that? You could dump sand and salt on it, but, ultimately, people don’t wait for the salt and sand to go down because they think they have to go somewhere in a blizzard. They slip and hurt themselves on the ice.”
Wasserman adds that when an outside contractor does the work, the contractor is liable if his contract is properly worded, but when the building’s staff does it, the co-op or condo is liable. So it makes sense to hire an outside contractor, right?
Not necessarily. Attorney Ken Jacobs, a partner at Smith, Buss & Jacobs, says that contractors try to pass on the liability in such situations to the boards – or at the very least, limit their own liability.
“This is one of the big issues with snowplow contractors,” he notes. “They strongly fight to limit their liability in their contracts. They fight to limit it to the amount of their insurance coverage – $1 million or $2 million. They’ll be silent, or if the issue is raised, say, ‘Our liability is limited to the scope of our insurance coverage for any accident or occurrence.’”
One attorney, who requested anonymity, notes that boards often don’t question the liability stances taken by the contractors. “I’ve seen a lot of condos and homeowners’ associations that just sign the contract. The contract has no reimbursement, no indemnification, no liability provisions. I am appalled when I see that in some buildings, but everybody shakes hands [on the deal] anyway.”
It’s no surprise that contractors try to limit their liability. If they didn’t, they might have trouble getting insurance coverage. “I have a snow removal vendor that just went through four different insurance companies,” says Pamela DeLorme, president of Delkap Management. “It really wasn’t his fault, but people will go out after a storm – when they shouldn’t be walking outside anyway – and he’s the one that gets caught, he’s the one that gets the liability, because we’ve got the snow contract with him. The whole thing is insurance today. Everything is insurance.”
With that in mind, Lloyd Amster, president of Prime Locations, a management firm, offers two pieces of advice: “You’ve got to have good attorneys. We recommend that the attorneys review every contract, but [they should be extra vigilant with] something like a snow removal [contract] and try to pass the liability on as much as they can. Also, make sure you have all the insurance certificates from the contractor in order.”
Problems frequently arise because the manager fails to involve the attorney. Says Jacobs: “Most of the time the proposal does not get to us for review. Therefore it’s up to the managing agent to require indemnification as well as liability/workers comp/auto insurance via a rider. If the proposal does get to us, we might add a rider.”
The rider is tailored to each building, but generally says:
“(1) In the event of any inconsistency between the provisions of this Rider and those contained in the Agreement to which this Rider is annexed, the provisions of this Rider shall govern and be binding.
“(2) The Contractor will provide the services described in the Agreement twenty-four (24) hours a day, seven (7) days a week, as and when required.
“(3) The Contractor agrees to maintain insurance coverage with a company lawfully licensed and authorized to do business in New York throughout the term of the Agreement for the following: (a) workers compensation and other employee benefit acts in statutory amounts, (b) liability insurance in the amount of $1,000,000/$2,000,000 covering claims for bodily injury and death and for property damage, and (c) automobile collision coverage or comparable coverage with respect to damage to parked or non-driven vehicles. All such coverage shall include the Owner and Managing Agent as additional insureds.
“Proof of such insurance shall be filed by the Contractor with the Owner prior to the commencement of the services. All such insurance shall be non-contributory and primary to any available insurance that may be otherwise available to the additional insureds. Further, any insurance coverage carried by an additional insured party shall not be considered to mitigate or offset the loss resulting from the failure of the Contractor to procure the insurance required hereunder.
“(4) The Contractor agrees to defend, indemnify and hold harmless Owner and Managing Agent and their officers, directors, agents and employees, from and against all claims, damages, losses, and expenses, including reasonable attorneys’ fees, relating to bodily injury, illness, or death, or for property damage, caused by the Contractor, its agents, or anyone directly or indirectly employed by it in connection with its performance of the services herein.
“(5) Either party hereto may terminate the Agreement at any time without cause on thirty (30) days prior written notice.”
Amster, the management executive, offers this tip to avoid liability during icy conditions: Be certain to have “the staff at the building going out any time at night to get started so that the areas will be safe when people start to leave the building in the morning. Also, have them [clean up ice and snow] in the afternoon when the sun is going down, and things start to ice up again. But the best thing that you can do is make sure staff is on top of everything – salting, sanding, and removing the snow.”
Adds Jacobs: “An insurance broker whom I deal with who is knowledgeable about snow plow insurance issues tells me that a few companies offer good insurance to contractors, at relatively competitive rates. However, many contractors carry cheaper insurance that looks good on a certificate, but whose policies actually contain numerous exclusions that expose the association to greater risk.”
Bottom line: read the fine print.