Watch Your Language Carefully Drafting Contracts Protects Associations

 The vast majority of both one-time projects and long-term service contracts  involving vendors and service providers and their condominium or HOA clients go  smoothly and either conclude or continue without incident. However, a small  percentage of jobs do jump the tracks in one way or another, and things can get  complicated. 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 condo administrators to pull the plug on a contract—and that sometimes can be easier said than done.  

 Breaking Ties

 Before any contracts are signed, experts agree that an association  administrator's priority is to 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 or check with your county’s Clerk of Courts to determine whether the contracting firm or its principals  appear in litigation. To find out when a contracting firm was formed, visit  

 License and insurance aside, there are numerous reasons why a condominium or HOA  manager or board might feel it necessary to terminate a contract with a vendor  or service provider. “The most typical reason is for breach of contract,” says David Hartwell, a managing partner with the Chicago-based law firm of  Penland & Hartwell. “If a vendor fails to uphold their end of the bargain, for example. Meaning they  don’t do what they are supposed to do, they’re not performing services in a timely manner or they’re not performing the work properly. Associations or boards will try to work  with a vendor first to try to resolve any issues, but for whatever reason, if  the issues can’t be resolved then oftentimes they seek to terminate the contract.”  

 “The simple answer is that the vendor has simply not delivered the goods or  services that they have been contracted for and there has been some type of  communication breakdown where the association believes that the vendor is  incapable or unwilling to fully perform under contract,” adds attorney Steven D. Welhouse of The Sterling Law Office LLC in Chicago. “And that’s why they would seek to terminate the contract.”  

 “The problem usually relates to the quality of work being done by the contractor,” says Mark Rosenbaum, a principal with the law firm of Fischel & Kahn in Chicago. “Anybody who signs a contract with you is a contractor. Sometimes the contractor  doesn’t do things he’s supposed to, or doesn't do things in a timely fashion.”  


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