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Trying to Prevent Lawsuits for PCO's

 

By Greg Crosslin
April 11, 2001

In December, I had the distinct pleasure of speaking at the Florida Pest Control Association's Annual Termite Symposium in Orlando, Fla. It was truly one of the best "termite" meetings I have ever attended, in terms of both attendance as well as the presentations by the various speakers and exhibitors. Although Aventis Professional Products' Paul Bello has already reported on some of the information from my presentation, I've received so many requests for information about the topics that were discussed at the symposium that I thought I should review it here.

I will not try to recreate my entire presentation; however, because of the number of inquiries, I think it's necessary to discuss several items that seemed to receive the most attention. While certainly not magical, I identified a checklist of things to help prevent lawsuits based primarily on common sense and the dictates of good day-to-day practices.

  1. Be thoroughly familiar with EPA and/or your state regulations. While this should go without saying, I recently attended a deposition where one of my client's technicians testified that he had not seen nor read state regulations in a year or so and was not all that "familiar with them." Since regulations are just that and since they determine and dictate our very existence, we need to be as familiar with them as possible.
     

  2. Follow the dictates of our contracts. In virtually every state, the law clearly indicates that contracts are construed or drafted against their maker. Since we provide the contract to the homeowner, any ambiguous term will be construed against the pest management professional. Thus, if we do not check a blank or fill out a form properly and it is our form, we will be held accountable and the consumer's interpretation of the same contract will most likely prevail.

    Thus, it is important to make sure that we have a firm understanding of what our contract says we will do and that we do what we say we will do. It is amazing how many contracts are not properly understood by the pest management professional using the form and by the technicians who fill them out. I have seen contracts admitted into evidence at trial that have contradictory information filled out and that have competing blocks filled out that should have one or the other checked off — but not both.

    I've even seen contracts that have handwritten annotations that clearly alter the meaning of the contract.

    For instance, I recently reviewed a contract presented by a PCO to a homeowner with a house that had a rear deck adjacent to a small private lake in a resort community with about 12 other houses backing up to the same lake. The lake was primarily a reservoir for use by the homeowners in their irrigation system and had a small fountain in the middle. The technician, however, wrote on the standardized contract the following, "Termite warranty void for rear third of house or within 32 feet of water." This was a three-story house. Obviously, the water level in the small lake would rise and fall with rainfall, etc.; thus, it became entirely unclear what type of warranty or service coverage was actually being provided to the homeowner. These types of annotations often lead to trouble and should be avoided if at all possible. Contracts are to be clearly written so that they are understandable by all parties.
     

  3. Do not be afraid to walk away from a job. I cannot report how many times I have heard pest management professionals tell me during conversations (about their lawsuit) that they knew they should not have taken the house in question from the beginning. The old adage, "No good deed goes unpunished" comes to mind. We often recognize problem areas and instead of protecting ourselves, we bend over backwards to provide service to our customers. Sometimes serving the customer is just something we cannot do. For instance, we recently had a case where the pest management professional had a retreat-only service agreement in place for 11 years. Over the course of time, the pest management professional often would go ahead and repair minor damages, such as to a window sill, a door frame, a screen door and a handrail along a back deck for the elderly, widowed customer. She was always very appreciative and often "tipped" the technician with a fresh cup of coffee or slice of cake.

    Unfortunately, after her death the estate tried to sell the home and in doing so discovered a small termite infestation in a deck that was built onto the back of the house, despite objections by the pest management professional and written notice of the conducive condition and potential violation of the contract. Condensing a lot of facts to make a point, however, the estate sued claiming that over time the retreat contract had "evolved" into a repair contract because of the dealings between the parties. Since the pest management professional continually made minor repairs, the homeowner's estate argued that the homeowner had no reason to get a different contract as she was receiving repairs and, therefore, was induced to believe she had higher forms of protection. The judge denied the motion for summary judgment and allowed this to go to jury as a fact question. Clearly, following all the terms of a well-written contract is something that will help to avoid litigation, especially in similar situations.
     

  4. Properly reporting conducive conditions and taking actions on the same. This may be one of the most overlooked areas of inspection practices that later creates problems, claims or lawsuits. No only do we have a duty to report conducive conditions, we must take action when we report them. For instance, we had a claim in the Midwest (which we recently settled) wherein the pest management professional repeatedly notified the homeowner on the annual inspection report of a conducive condition for moisture on the property. This went on for six years and the homeowner did nothing to correct the problem. Of course, when the infestation occurred and massive damage was observed, the pest management professional denied the claim because of the conducive condition. Unfortunately, the homeowner contended that because the pest management professional continued to receive payment for the annual inspection and did not "force" the homeowner to do anything about the conducive condition, they didn't think it was "all that bad," and they didn't make any change.

    The lesson to be learned here is that if we have a conducive condition that is significant enough to warrant notation on a form, then it is significant enough to require further action. Pest management professionals should either refuse to renew the contract, at least until the conducive condition is fixed, or allow a certain period of time (i.e., 30 days) for the homeowner to make the repairs, reinspect and continue service, or at that time cancel the agreement. It does little good to have contract clauses that are not enforced.
     

  5. Customer education. In this growing era of consumer sophistication and litigation-happy individuals, I think it is important to properly educate consumers as to just what services are being provided, how we are going to provide them and what their duties and obligations are in return.

    It is amazing how many homeowners who have spent tens or hundreds of thousands of dollars on a home and take such little interest in the maintenance of their largest investment. Thus, educating consumers as to conducive conditions, periodic inspections and the importance of cleaning out gutters, keeping firewood away from a wall, not attaching fences or decks to a building without notifying the pest management professional, etc., is so critical. By making homeowners partners in the ever-growing attempts to protect their home, they tend to be more informed and less apt to be adversaries.

    From a contractual basis, this can be made a part of the agreement with the homeowner such that pest management professionals can force things such as conducive condition repair requirements, etc., so as to limit contrac tual and other liability claims in the long run. But perhaps, most importantly, it really is a way of developing a better customer service relationship with homeowners, so they understand they're a partner with their pest management professional in their long-term investment. They need to understand that we are more an ally and partner, instead of just a vendor. I've long maintained that a well-written contract, combined with good service by properly trained technicians, is our best tool against lawsuits. It's also our best tool for keeping our clients informed and, perhaps most importantly, keeping them as clients.

INDUSTRY CHANGES

The point that raised a lot of questions after my presentation in Orlando involved the many changes that are ongoing in the new millennium. I firmly believe that manufacturers' roles are dramatically changing — and that they should. In 1999 alone, more than $150 million was received by manufacturers related to providing products to our industry. Clearly, it is the EPA and the state regulatory bodies that dictate how we inspect and treat homes and they often work with the manufacturer long before we get involved. We must, however, be mindful that manufacturers provide products and regulators enforce statutes, but we provide expertise to homeowners.

Because of the ever-growing changes in science and with our regulatory bodies, I expect to see continued changes in the pest management professional's daily activities and business plans. I think we can expect to see some of today's plans and programs offered by forward-thinking manufacturers to be indicative of what is coming in the future. Because of these rapidly developing, sophisticated changes in our marketplace, pest management professionals need to be well trained in the services they provide and the manner in which they provide services to their customers, so that they can enjoy using these new type products without the fear of claims and/or lawsuits.

It is important to remember that the role of all lawyers who serve the pest management industry is to reduce the role of lawyers within the industry. Just like the pest management professional's role is to prevent termite infestation and damage to a home, it is the job of attorneys to help prevent claims and lawsuits as much as possible. Just like protecting a home, attorneys cannot get rid of all suits or claims — but together, equipped with the historical knowledge of our industry, well-written contracts tailored to the specific needs of the pest management professional's business and consumer base, plus well-trained technicians properly performing their duties, we can and should prevent lawsuits from growing at the pace they have for the last few years.