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Liability Question on using Subs

Discussion in 'General Chit-Chat' started by Texas_Signmaker, Aug 24, 2019.

  1. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    I hire "ABC Sign Company" to do an install for me, and "ABC Sign Company" provides me with their COI. If "ABC Sign Company" subs that out to an installer that is not insured and something goes wrong, does it fall on "ABC Sign Company"?

    Just wondering because I'm planning on subbing an install out and I have a feeling the company I'm dealing with subs their installs. I know if something goes wrong everyone gets tagged.
     
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  2. GetTarps

    GetTarps Member

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    Yes, your responsibility is only to the company you directly sub your business to. You do not even want to know what happens after that.

    Make sure you put this in writing. On your purchase order state "I am subbing this out to "Company A" with General liability of 3 million liability only.

    Or something like that. "If it's not in writing, it's a lie".
     
  3. Gino

    Gino Premium Subscriber

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    Not sure how the law states it, but anything underneath you will become your problem. It's up to you to know EXACTLY what and who is representing you. If you're willing to take the happy stuff without question, you need to be prepared to take the unexpected.

    Usually those kinda contracts are nothing but disclaimers and rulings, which are only in writing, but can be broken.
     
    • Agree Agree x 2
  4. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Well, I might just pull out of this one situation. Most companies I've subbed to I can see on Google if they have bucket trucks lying around and know they are doing their own work. I looked this company up and they are in a strip shopping center and no trucks visible anywhere. This location is in a small town with limited sign company options AND a tight deadline. It's 3 1/2 hours away and I may just do it myself.
     
    • Like Like x 2
  5. signbrad

    signbrad Member

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    If any of you have done subcontracting work for large general contractors, you probably were required to sign insurance liability agreements. Further, some of these GCs have you sign additional agreements covering such things as "prevailing wage," "nondiscriminatory practices," and other things. These contractors either have lawyers on the payroll or they get outside legal advice for guidance in these areas. They make sure that they are protected. Should we do any less if we use subcontractors?

    A consult with a lawyer may be a small price to pay to take the guesswork out of this subject.

    Brad in Kansas City
     
  6. AF

    AF Active Member

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    Here in business-friendly California, if your sub hires a day laborer who then gets hurt you will be liable for a minimum $20,000 fine if you do not have worker's comp insurance and you will be dragged through years of civil litigation by the injured laborer. The only way around some of this is if your contract is bullet proof and prevents the hiring of non-licensed non-insured non-bonded subs. The laborer will claim to be an employee to avoid jail time for contracting without a license and case law falls in their favor. Your gut instinct is good, and if you can't find someone else it would be prudent to consult an attorney.
     
    • Like Like x 1
  7. equippaint

    equippaint Very Active Member

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    Its a chain, everyone is going to be liable. If they werent, any gc would bury their liabilty with shell companies. Ignorance is no defense, it would take a half wit attorney 2 minutes to tear you apart for not knowing who was doing the job. This is why they always warn you to hire licensed contractors, theyre supposed to be above this.
     
  8. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    I checked and their license is current.

    I should be fine even if something bad happened? I have an LLC who's only asset is a work truck...and business insurance on top of having an umbrella.
     
    Last edited: Aug 24, 2019
    • Like Like x 1
  9. Christian @ 2CT Media

    Christian @ 2CT Media Major Contributor

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    Insurance is all risk, you will be liable and unless you get listed as additionally insured by your sub you may run the risk of not being covered by your provider.
     
  10. zspace

    zspace Merchant Member

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    Talk to your insurance provider. They should be the ones to recommend the contract language that makes them comfortable.
     
    • Like Like x 1
  11. stew1tx

    stew1tx Centex Wraps and Signs

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    WHERE IS IT, i MAY BE ABLE TO OFFER SOME GUIDANCE ON A SUB
     
  12. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Oct 21, 2016
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    North Houston suburbs
     
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