Security & the Law
Was a Security Alarm Company Negligent in Fire Death?
MONITORING CONTRACTS
A case filed in the United States Court for the District of Kansas was notable not for the decision of dismissal rendered because the matter was not timely filed, but because of the court’s consideration of the allegations.
The plaintiff’s estate filed an action for wrongful death against the alarm company stating that the alarm company’s alleged conduct was wanton as required to support a gross negligence claim.
The background of the case involved an accidental house fire that claimed the life of the decedent. The home was equipped with a security system accompanied by monitoring services under a contract entitled “Residential Alarm System and Services Agreement.” The alarm company provided 24/7 monitoring for $37.99 a month. Although offered, the contract did not cover smoke or CO detection.
On the morning in question, at 1:32 a.m., the alarm company received a sensor tamper alert for glass breakage in the dining room. Between 1:43 a.m. and 2:04 a.m. the alarm company repeatedly attempted to call the decedent and the next contact number listed on the account, but was unable to reach either. Around 2:04 a.m., without having made contact, the alarm company fully cleared the alarms.
The fire was reported by Public Works Department employees and 911 was called. First responders arrived at the scene at approximately 2:58 a.m. They found the decedent still alive, but she died later at the hospital.
The decedent’s representative claimed that the decedent reasonably relied on certain representations on the alarm company’s website, including: “The ability to remotely learn of possible hazards and to dispatch responders is key to how security monitoring works”; “24/7 professional monitoring centers will address alarms immediately to ensure that help is on the way”; “In the event of an emergency, local police or fire assistance will be notified”; and “A trained employee immediately attempts to call you to notify you of the disturbance in case it is a false alarm. … If the employee is unable to contact you, or if you confirm that the alarm is genuine, the authorities will be notified.”
The court declared that the contract between the alarm company and the decedent does not contain these representations. Instead, the contract states: “SECTION 6, 7, AND 8: WE ARE NOT AN INSURER, Limitation of Liability, Hold Harmless which, among other things, significantly limits the alarm company’s liability to you under this contract.”
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Section 6 clarifies that the alarm company is not an insurer. Section 7 limits the alarm company’s liability to the lesser of $300 or six times the monthly service fee ($227.94 in this case). Section 10 outlines the monitoring services to be provided, including “reasonable efforts, consistent with local laws and our response policies, to make the appropriate notifications. …”
Claimants argued that the alarm company’s wanton behavior and gross negligence invalidate certain provisions of the contract. To show wanton conduct, claimants must establish 1. The alleged acts were performed with a realization of imminent danger, and 2. The alleged acts were performed with a reckless disregard or complete indifference to the probable consequences. The claimants’ conclusory allegations fail this test. Despite receiving the alerts, the alarm company had little actual knowledge of the danger the decedent faced at the time of the fire. Moreover, nothing about the alarm company’s response indicates reckless disregard or complete indifference. While the judgment against the plaintiff’s estate was affirmed on the premise that such claims are barred if, as here, they are brought more than a year after the claim accrues, the contract provisions were upheld and protected the alarm company.
READERS ASK
Q: If one of my subscribers is hit with a cyber-security attack, computer is down and valuable proprietary information is lost, am I protected under my current contract (you did the contract)?
A: I cannot answer the question as framed. What did you agree to protect? Normally, a cyber-security attack would be the unauthorized use of or malicious attack against ones electronic data or electronic devices, whether a computer, computer network mobile phone etc. If you agree to protect your subscriber against that type of malicious activity, you better make sure you specify just exactly what you are intending to protect or not intending to protect in the contract. If there is any question, make sure you specifically exclude it from what you are intending to protect. Having said that, with the above in mind, and excluding any issues of gross negligence or willful misconduct, the protective provisions in your contract should protect you or limit your liability from any claims by your subscriber or any third parties.
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