What does your attorney say? Anybody can sue for anything at any time.

 

This is one question best discussed with a lawyer. Laws vary from state to state. What is written in your contract may not hold up in court in another state.

Also, hopefully your contract was written or reviewed by a lawyer. Piecemeal contracts that are slapped together by laymen may not hold up well in court.

 

It doesn't cost much to saw cut out a little section of blacktop and patch it. I had to do this exact thing last year. I'm not saying your are responsible but sometimes it's just best to fix it if you break it.

 

No expert but it appears to me that you're missing a key word in your contract. DEFEND. Usually it will say "defend, hold harmless and indemnify." As such, your contract does not appear to protect you from third-party lawsuits such as from an insurance company.

 

I could be wrong, but I believe indemnify means defend? Not sure.

Unrelated to this issue, months ago, I spent about an hour researching the word indemnify, and i found all varying meanings!

 

So for the last 20 minutes, prior to reading the most recent round of responses here, I was researching Subrogation.

Subrogation is something that ALL contractors should know and understand. As already mentioned by others here, anyone can sue anyone. We all know that.

But....what I did not know....and I bet very few contractors know this - your client's insurance company has a legal right to Subrogation. This means that when your client files a claim - their ins co will pay your client. Then, your clients ins company has the legal right to come after the party responsible for the loss.

So yes, your client agrees in writing not to sue you. But that doesn't mean their insurance company wont sue you. But wait, there's a way around that.

As in my case, my contract states my client will indemnify me. Indemnify means: secure (someone) against legal responsibility for their actions. So, with that said - I could potentially go after my client to recover what his insurance company wants from me. Or, my insurance company, under their right to subrogation - could potentially go after my client to recover what they paid on my behalf!

NOW. There is a WAIVER OF SUBROGATION.

The following comes from INVESTOPEDIA:

A waiver of subrogation is a contractual provision whereby an insured waives the right of their insurance carrier to seek redress or seek compensation for losses from a negligent third party. Typically, insurers charge an additional fee for a waiver of subrogation endorsement. Many construction contracts and leases include a waiver of subrogation clause.

Such provisions prevent one party's insurance carrier from pursuing a claim against the other contractual party in an attempt to recover money paid by the insurance company to the insured or to a third party to resolve a covered claim.

Investopedia also writes:
IMPORTANT - Insurance companies frequently charge an additional fee on top of the premium to include a waiver of subrogation clause. Parties to the contract avoid litigation, and the insurance company bears the loss.

But I don't see this industry's clients agreeing to go this route. This is done through their insurance carrier, I presume it would raise their premium.

Which, I assume is why we need the indemnify clause(s)

 

Why did the judge toss the case???

 

How much are we talking about?

 

I dont know. all i know is the asphalt driveway was VERY small. as in only enough to fit (2) honda accords side by side with no extra room around them. And the asphalt driveway was already in subpar condition

 

Yeah, I would agree with just fix it and eat it. Or offer to settle with their insurance company at 50%. You would be surprised what they will settle because it might cost them more to send it to an attorney.

“mr insurance agent, I am happy to immediately pay any judgement enter against me. We do not believe we caused damage that is not waived in the contact. Therefore, we suggest coming to us with a settlement offer or suing us for the amount you feel.”

 

You need to have clients sign a damage waiver.

 

Little more background on what we do.

We offer a specialty demolition service. Our service entails heavy machinery (10 to 12,000# track loaders, 12,600 to 18,000# excavators) traversing on residential properties. Our service entails importing and moving anywhere from 80 to 250 cubic yards of soil from the driveway to the backyard. day-in and day-out, 50 weeks a year.

Yes we use 3/4" plywood and mats, but they are only effective to certain extents.

So, this isn't exactly a "lesson learned" event! It is, but it isn't!

Pavements sustaining damages subsequent of the work we do is par for the course. The homeowner is made well aware of what could happen and what to expect. And, we have the clause in the contract.

About (2) years ago we had a job where the asphalt driveway was ONLY 2-inches thick, with NO aggregate base. True story, yes I have pictures. The tri axle dump trucks had the asphalt destroyed within hours. The homeowner was not surprised it happened, end of story. No claim. no expecting us to be liable.

31 years in business, and I have a strong legal knack. Many of my clients are attorneys (DC Metro area), and many of them have complimented my contract. One attorney said about a year ago "you had a very good lawyer write your contract". It was me that wrote it!

Yes, I have always been well aware that someone's insurance company CAN come after you for money. I am aware of this from an incident involving my mother hitting a dog, State Farm went after the dog's owner for reimbursement.

And I am well aware of this from our heavy involvement with motocross.

However, I was under the assumption that my client's insurance company would see that the client accepted a contract knowing the risk, and would say "hey, you signed the contract, you're on your own, sorry for your luck".

This is where I learn.

And this is where others reading this can learn, too.

My client had a subpar driveway, as most of my clients do. I advise them its best to have us do our service on their property before replacing their aged driveways, that way a new driveway isn't at risk of damages.

After 31 years, this is the first where a client's insurance company is coming to me wanting reimbursement.

We can not be any more careful than we already are. The risk of damages to pavements is high, its par for the course.

The man did not seem bothered that the corner was broken. He did not ask me on the final day what I would do about it, and yes he saw it. In fact, he thanked us repeatedly for our good work, told myself and each individual member of my crew a sincere "thank you". I have a hunch his wife came home and saw it and I speculate that it was her that was upset.

This risk exists even for landscape and hardscape contractors.

This man already had a sub-par asphalt driveway. I know exactly what was wrong with it, it would take me 10 minutes to type in detail what was wrong with it. In a nutshell - it was re-paved by a fly by night asphalt gypsy.

And he got a new driveway out of the deal. A deal where he agreed upfront that we would not be liable or responsible.

yes, anytime we do these jobs I do take pictures or video of the driveways BEFORE the trucks back onto them and before our equipment goes over them. We just did a job last week where a masonry wall was about 30" from the structure we were hammering on with a breaker on an excavator - I shot video of the wall before we started because the mortar joints already had cracks.

But this job at hand - the asphalt wasn't cracked. Asphalt IS ONLY AS GOOD AS WHATS UNDERNEATH IT. The asphalt was THIN. We have NO way of knowing asphalt is thin.......until we break it....if we break it.

So yes - pictures and video before hand is a must. But that doesn't account for thin asphalt, or poured concrete slabs with NO wire / rebar reinforcement.

So now I'm on a mission of coming up with a clause where the property owner acknowledges the risks, and agrees to assume responsibility in the event their insurer comes after me. I welcome anyone else's experiences as well as positive thoughts / suggestions. I think this is an important subject that all contractors should be aware of

 

31 years in business, and I have a strong legal knack. Many of my clients are attorneys (DC Metro area), and many of them have complimented my contract. One attorney said about a year ago "you had a very good lawyer write your contract". It was me that wrote it!

Interesting how the longer I am in business, the more clauses get added to my contracts.
What continues to amaze me is that I sub contract a couple very large companies in town, concrete, fencing, electrical etc. Some of these companies have 1/2 page contracts with almost nothing in them...

 

On a much lighter note...It sounds like you need to get into the asphalt business in your area.... it seems the need is great for quality work...

 

Can't you submit to your insurance company and they will defend you? IDK, just asking.

 

I will submit to my insurance. I am Not being sued. All that's happened is this subrogated collection / law firm called me wanting me to pay. I didn't know anything about it until that call came.

A phone call means nothing. Once I receive papers - then, I'll submit to my insurer.

 

Customers can be unrealistic in their expectations. Best lay out expectations before job and after job if customer is unhappy try to make it right with them.
I'd take a deep breath and go talk with customer a face to face can solve problems. Some customers remain irrational in which case they are your insurance companies problem. That's what you pay those big premiums for.

 

I'm not sure that talking with the customer will do any good. He already filed a claim and was satisfied. The problem is his insurance company is trying to cover their loss. The best thing to do is to give it to your insurance company and let them deal with it. Don't be surprised to hear from your company that they are disappointed in you, that you attempted to solve it yourself before it got out of control.


Best of luck to you in your pursuit of perfect contract wording. It seems like there are thousands of contract lawyers out doing the same thing and adding more words to all ready wordy contracts which only leads to more confusion and more words. Lots of before pictures will be your best defense.

 

This subrogated claim business, I was doing some thinking about it. It’s almost like the insurance company is abusing the subrogated claim system .

Subrogate claim is this example:

30 years ago My mother was driving her Honda Civic. Dog ran in the road and she hit it. It did $3500 damage to her car. State Farm, her insurer covered the damages. But......they filed a subrogate claim against the dog’s owner. See, that was justified.

But in my case - my client KNEW the risks. My client knew there is only one way into his backyard. He KNEW we should have heavy machinery on the property. He knew that job at hand required such machinery. He knew there were no other options for how to accomplish his needed demolition job. He agreed in writing to the terms and conditions.

When my mother hit the dog - she didn’t know a dog would run in front of her. This man, was aware of what was taking place.

It’s wrong that an insurance company would exercise their right to a subrogated claim under this context. And they do it day in and day out. Sub par driveway. In the contract I EVEN STATE THAT IMPORTED SOIL WILL BE DUMPED IN THE DRIVEWAY. I even specify in the contract that the soil will be hauled via tri-axle dump trucks! I strongly speculate that subrogate claims were not intended for such a scenario.

Too many clauses in a contract can steer prospective clients away from you.

When I mentioned clauses, please know - I do not believe clauses rule the courtroom. I know they don’t. But I do feel they can help.

I don’t think I will add any new clauses. I think I will create a property assessment report. Where I notate existing conditions of pavements, etc. before work begins. maybe in the report grade the pavement with 10 being the highest grade. And ask the client to sign the report. I already do shoot pictures (most of the time).

With the report, if another insurance company comes after me - me or my insurer can say “here is a report stating the driveway was in despair before we started the work, and the client signed the report”.

 

You make too many assumptions about what customers know, they don't have your experience.

First time my wife saw lawnmower blades we argued because she thought I was trying to pull one over on here. "There's no way those would cut grass"

All those people in Texas who don't know where their water shutoff valves are. They should know but they simply don't know.

 

You make too many assumptions about what customers know, they don't have your experience.

First time my wife saw lawnmower blades we argued because she thought I was trying to pull one over on here. "There's no way those would cut grass"

All those people in Texas who don't know where their water shutoff valves are. They should know but they simply don't know.

I wouldn't say I personally make assumptions about what my clients know. Because I know darn well most clients don't know anything.

And because I'm well aware of that, as part of my contract, I have a sheet that has pictures and a caption of the equipment that will be used for their job

Started my company when I was in high school. 31 years of working in the residential market - I've acquired an entirely different way of working with residential clients. I'm very descriptive, from speaking with them, to my demolition website, to my contract. And the people that use us, usually have their mind made up they're going to go with me before they even get my quote, because of those attributes.

But yes, I agree. Most clients have no idea what will be involved along with all the logistics.

 

It doesn't cost much to saw cut out a little section of blacktop and patch it. I had to do this exact thing last year. I'm not saying your are responsible but sometimes it's just best to fix it if you break it.

No offense but, they never want that

You see they always have a perfect driveway before you come and it's the Taj Mahal of driveways so a patch won't do
They need the whole enchilada redone

Can't tell you how many times I've heard that one

I'm surprised the OP gets anyone to sign that contract in the first place.

 

No offense but, they never want that

You see they always have a perfect driveway before you come and it's the Taj Mahal of driveways so a patch won't do
They need the whole enchilada redone

Can't tell you how many times I've heard that one

I'm surprised the OP gets anyone to sign that contract in the first place.

With a speciality service, if the people want the work done - they have no choice. Once in a while, we have a client or two that doesn't want the work done, but the county mandates the work be done. Regardless, it's things like this that come into play and all the more reason to hire an experienced competent professional.

We've had challenging jobs that have turned out great, and I often say to myself "this probably would not have gone as smoothly had they gone with another contractor".

By no means playing big shot on the Internet, I take a lot of pride in what we do and I'm very particular

 

I dont know. all i know is the asphalt driveway was VERY small. as in only enough to fit (2) honda accords side by side with no extra room around them. And the asphalt driveway was already in subpar condition

So about $3800-$4000 (Ish)

 

That's about what I'm thinking.

 

One personal thought I meant to post here but forgot -

Myself and the client got along great. I enjoyed working with him. He was the type of client that good contractors dream of.

We did a top notch job for him.

We even did a couple small extras at no cost.

It is upsetting, very upsetting, that this “subrogate claim” happened.

Every contractor needs to be aware of this aspect of business.

 

Curious if you let the customer know his insurance company dinged you for the asphalt?

 

I wondered if he knows. Part of me believes that he does know. He's they well educated type. The type that does his homework.

I have thought about calling him and telling him, and telling him that I'm very disappointed because we got along so well, and because he may have gotten his subpar driveway replaced thanks to me. But, I'm bitter, it's best I don't call and do anything the interfere with how my ins co will handle it.

 

That's not bad. I'm in a position that I will always be doing this part time, for at least 10 years. Maybe I can build a network of some guys to do work for me while I'm at my career. But I just don't see the need to spend big bucks on branding anytime soon for myself. I'd like to get a few more yards lined up this year, but cautious about spending too much marketing and not be able to do it all.

The guys talking about building a solid logo and brand are right. But you have to decide your own current priorities.

 

I received a letter from the subrogation company. They are looking for $8,562.91.

The letter states:
“An investigation into this loss reveals that you MAY be legally responsible for the damage claim amount of 8562.91”. Keyword “may”.

I have 2 mil $ liability insurance coverage.

It’s the whole principle here that really irks me.

The driveway was in bad shape.

Someone widened the driveway by like 18 to 24” on the right side. Let me tell you how they widened it, as the portion that broke - was the portion that was added on:

They left the original driveway in place. Looked like it had been repaved a time or two. And the top coat was really poor grade asphalt and poor condition.

It appeared that They basically came in with a steel nursery spade, dug out like 18-24” out from the original asphalt, and dug down no more than 4”. There was NO aggregate base. And the added on portion was just that - added on - no gravel under it to act as a shoulder. I’m not even for certain the broken asphalt was even 4-inches thick.

Because of the add-on, the driveway wasn’t not level on top. LOL - it was sorta rounded - similar to the roof of a school bus!


It was a shoddy asphalt job. Period.

I will forward the letter to my insurer. And I intend to have a long detailed chat with them. It will be in their hands. But I plan to urge my insurer to fight them, just out of principle. Although, I’m sure this is not their first claim of this nature, they know how to handle it, but it’s wrong wrong wrong.

 

That's a tough one. But any time you're moving heavy materials in a residential setting there is a risk. You'd think between your mats and the disclaimer on the contract you'd be off the hook.
In the future include a quote for driveway replacement as an add option on the job and flat out say the driveway needs replacement.

 

I can't believe you would entertain this. Why would you not just fix the edge that you broke? If they balk that it looks like a patch job then seal coat the rest of the driveway. Probably $500 or less. I don't get it. Any pictures?

 

You have to read the thread. I already stated I wasn't aware he was upset. I didn't know he had an issue until after he filed a claim. And as I already stated - part of me thinks his wife was upset. I dealt with him the entire time. She was at work. There is no playbook, when you're not aware!

No pics.