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.
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 www.chicago.bbb.org 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 www.CyberDriveIllinois.com.
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.”