CARD TRICKS ARE DESIGNED TO MESMERIZE AN AUDIENCE AND KEEP THEM GUESSING AS TO HOW THE TRICK WAS PERFORMED. THE LAST THING A BOARD OF DIRECTORS WANTS TO LEARN IS THAT A VENDOR THEY HIRED HAS USED SLEIGHT OF HAND WHEN IT COMES TO SHOWING APPROPRIATE PROOF OF THEIR LICENSING OR INSURANCE. IT IS NOT A SECRET THAT THIS CAN EXPOSE AN ASSOCIATION TO A NUMBER OF SERIOUS LIABILITIES.
The board of directors has the responsibility of seeking bids and hiring vendors to provide the services needed by their association. There are many things a board of directors needs to consider before awarding a contract on behalf of their association.
Price and quality of workmanship are very influential factors in deciding upon a vendor. The goal of most association boards is to hire the best of the best while paying as little as possible. After all, special assessments or increases in assessments make the board a target of criticism and heavy scrutiny from their association members. The lowest price, can sometimes create the highest risks for an association. A vendor that offers their services well below market rates may be able to do so because they are cutting corners when it comes to obtaining the proper license or insurance.
Chances are, if a vendor is performing work that requires a license and they can not show proof of a valid license, it is likely they will not have adequate insurance either. Using this type of vendor exposes the association to liability for the actions of the vendor and/or contractual liability. If the price quoted by a vendor is significantly lower than any of their competitors, it is possible they do not have Auto, General Liability or Workers Compensation insurance. Just like in a card trick, the cheapest price may turn out to be an illusion. If a vendor causes property damage, bodily injury, or has a worker injured on the job, and does not have the proper insurance, the liability, responsibility, and financial burden will all shuffle back to the association.
www.cai-illinois.org • 847.301.7505 | 45
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