Essentials of a Community Association Service Contract
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The document outlines 11 essential elements that should be included in any service contract entered into by a community association to help eliminate common problems. These elements include how contract changes will be handled, points of contact, details of the work to be performed, how disputes will be resolved, insurance requirements, responsibilities of parties, timing details, termination terms, billing and payment procedures, and warranty information. Including these important elements can help create a fair agreement and avoid disputes between the association and contractors.
Essentials of a Community Association Service Contract
- 1. ESSENTIALS OF A SERVICE CONTRACT By Associated Property Management Contracts for goods, services and repairs are a common occurrence for community associations. Yet, even with this common occurrence, there are always problems and disputes that are associated with a contract. Many times, the contracts do not spell out enough of the details that are essential in a fair agreement. In all cases, the association's attorney should review all details and contracts prior to the association executing a contract. By taking your time and making sure that the following elements are integrated into any contract that the association enters into, it should help to eliminate many of the common problems associated with service contracts. 1. Changes to the contract, should be spelled out as to how they will be handled, how they will be executed and paid for by the parties involved with the contract. 2. Who is the point of contact for the parties involved? This should be spelled out in order to eliminate people not in power from interfering. 3. Any details that will help to delineate exactly what should maintained or repaired should be included as an exhibit to the contract. This would include any pictures, maps, photos and drawings helping to clarify the written word. 4. How will any disputes be handled. Will they be addressed through litigation or arbitration? How will pay for the expense of this procedure? 5. Proof of insurance should be provided in a prescribed form prior to any work being performed. Also, as a precaution, the association should be named as an additional named insured in order to be notified immediately of any change of status in the contractors/vendors insurance status. 6. Both the contractors and association's responsibilities should be spelled out in detail. This may include a minimum amount of men or equipment that is required to be on the job. Maybe it includes certain times and days that the association must allow the contractor on the property or certain preparation that the association perform prior to the contractor starting their work. 7. The contract should provide details and specifications in enough detail in order for the work to be accomplished to both parties satisfaction. This would also spell out any
- 2. alternates to the work being performed in cases there could any delays in materials. 8. There should always be a start date and a completion date stated in the contract and what the penalties would be to either party if there was a problem with the start or end performance. 9. The termination of the contract should always be defined by both parties and made a part of the contract. 10. The terms of the contract should always be spelled out and defined. This would include any billing procedures, when any payments are to be made and when any extras to the contract should be billed and paid. 11. All warranties should detailed and spelled out and agreed to. In addition, how quickly will the warranty work be performed. How should the warranty item be declared to the contractor. Any manufacturer warranty information should also be attached. By addressing the above issues and agreeing to the various items with your contractor, an association can eliminate most of the potential problems in your next service contract. 01-01-01