Tip of the Month - June 2008

Independent Contractors

Source: Essential Facts-Real Estate Management
         Joseph DeCarlo-WG&L (Warren, Gorham & Lamont)

Many maintenance tasks are performed by Independent Contractors.  Although there is less liability risk for the Landlord in this situation, he or she should still take care not to be negligent in selecting the Contractor.  When dealing with repairs requiring special skills (e.g., electrical work-repairs to high-pressure plumbing systems), Landlords should select a licensed Contractor, with sufficient bonding and insurance.

 If an unlicensed contractor is used, and an accident occurs, the Landlord can be held liable for any resulting damages.  Furthermore, some insurance policies may not cover damages if the work was not performed by a licensed Contractor.  If, for example, an unlicensed handyman improperly connected a new gas heater which later exploded, injuring Tenants, the insurance company could claim gross negligence on the part of the Landlord, and deem that the damages ensuing from such negligence are excluded from coverage under the policy.

Tip from Crossett Real Estate Services

Take the time to meet with your contractor of choice and discuss the subject and goal of the proposed project: Make sure a clear written job description is presented, including but not limited to copies of insurance for all persons (roof work requires special coverage)-contractors vehicles parked on the property? what about cleanup & disposal? Are utilities needed-water, electric, heat, etc.

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This web page was updated on 05/28/2008.