More items to pay attention to in the property management contracts in review:
Liability and Indemnification
All contracts have a section outlining what the management company can and cannot be held liable for. Some contracts are broader and more comprehensive in terms of what the firm requires the owner to indemnify them from. The contract always holds the property management company liable for their acts of negligence, however the management company is not liable for the negligence of those whom they hire on your behalf. The management company can be liable for the actions of 3rd parties hired who have a known history of bad work by adding a reasonable care clause to the contract.
The following are common clauses found at the end of many contracts.
This provision establishes that regardless of what you talked about with the management company before hand, this contract is the final version of the agreement and supersedes all prior written and oral proposals.
The contract should contain a clause stating that the contract can only be modified by a written agreement executed by both parties.
Some contracts allow the management company to transfer their contract with you to another management company without your consent. Make sure there is a requirement that your approval is a prerequisite for the management company transferring or “assigning” your contract to another firm.
Governing Law; Venue
This clause determines which state laws will govern the interpretation of the contract and might also specify the county in which all disputes are to be initiated and resolved.
This clause allows the contract to remain valid and enforceable even if a specific clause is found to be otherwise. For this reason, a legal error in the contract does not require the entire agreement to be done away with.