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Atricle Dump - Contracts That Work - Limitations of Liability
Playing the Product Name Game
If you've ever held a brainstorming session to come up with new product names, you know that it is usually not hard to get people to attend. In fact, such meetings generally start off with a lot of enthusiasm and elation. This quickly fades though as the cold reality sets in. Naming a new product is really difficult.Naming a product is about as close as you can get to having a root canal without going to the dentist. Even done well with an expert team, it's an exercise in pain, frustration, and disappointment.Nevertheless, there are some things you should know about the process.First of all, get a reality check on how important a product name really is. Some people tend to think that it's a life and death matter, others rate it as inconsequential,
cide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”If you've ever held a brainstorming session to come up with new product names, you know that it is usually not hard to get people to attend. In fact, such meetings generally start off with a lot of enthusiasm and elation. This quickly fades though as the cold reality sets in. Naming a new product is really difficult.Naming a product is about as close as you can get to having a root canal without going to the dentist. Even done well with an expert team, it's an exercise in pain, frustration, and disappointment.Nevertheless, there are some things you should know about the process.First of all, get a reality check on how important a product name really is. Some people tend to think that it's a life and death matter, others rate it as inconsequential,
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
Blogging for Business
Blogging for business can be a very effective marketing tool.The first thing you may need to know, especially if you’re very new to this, is, what in the dickens is a blog? In its most basic form, a blog is just a personal journal or diary. It’s a web space that allows you to rant on ‘til the cows come home. The word “blog” comes from a combination of the words “web log.” You can blog about absolutely anything, any topic. And the most amazing thing about blogs is that other people, all over the world may actually be interested in what you’re blogging about. The coolest part about blogs is that most of them are interactive. Most bloggers allow you to post responses to their blogs. Other readers can add their thoughts and a continuing dialogue is underway.Limitations of Liability
Thomas J. Hall, JD
It’s a provision found in almost every commercial contract:
“Vendor shall be liable only for direct damages, in an amount not to exceed $X. In no event will vendor be liable for indirect, special, consequential, exemplary, or punitive damages or for lost profits.”
Although the actual words may vary, the meaning is the same:
• The most vendor will pay is $X;
• For certain claims, vendor has NO liability.
Such provisions raise a number of issues:
• They are unfair. Vendor’s liability is capped, but customer’s is not. In other words, vendor knows his or her own maximum liability under the contract, while customer’s liability is unlimited.
• Vendor’s maximum liability - $X – may be inadequate. For example, “X” may be “no more than customer paid under this contract” or “no more than customer paid in the xyz months preceding the event giving rise to the claim for damages.” If we assume customer is paying 10 grand a month, and “xyz” is 12 months, then vendor’s liability is capped at $120,000. While that is not pocket change, is it adequate to cover damage that vendor could cause? How much damage can a vendor cause?
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too littl
• Vendor’s maximum liability - $X – may be inadequate. For example, “X” may be “no more than customer paid under this contract” or “no more than customer paid in the xyz months preceding the event giving rise to the claim for damages.” If we assume customer is paying 10 grand a month, and “xyz” is 12 months, then vendor’s liability is capped at $120,000. While that is not pocket change, is it adequate to cover damage that vendor could cause? How much damage can a vendor cause?
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too little. A number of tools are worth consideration:
• X times the fees paid and payable under the contract. Three times is a good starting point. Vendor cannot object that they cannot quantify the risk. But, is it adequate to cover the exposure?
• Vendor will be responsible for direct damages incurred. Vendor will object that “direct damages” cannot be quantified. But:
- “Direct damages”- damages that are foreseeable and which flow directly from the breach or action – are the traditional measure of damages under contract law. This is the amount vendor, and customer, would be liable for if the contract did not contain a limitation of liability;
- Presumably vendor carries insurance. (If they do not, why are you doing business with them?)
- Is it unfair to ask the vendor to make good any harm that it causes?
- One caveat. As with any legal term, the meaning of “direct damages” is open to interpretation, and debate, and debate.
• Vendor will be responsible for up to $X. We began with this approach, which is perfectly reasonable, provided X is sufficiently large. A $500,000 cap is terribly insufficient if the exposure is $2 or 3 million. In addition, with a specified cap, vendor cannot claim unknown and potentially unlimited exposure, AND Vendor can obtain the necessarily insurance more easily.
• Vendor will be responsible for up to the limits of its insurance. This approach removes the objection that the risk cannot be quantified and that it cannot be insured against. BUT:
- The insurance limits must be sufficient to cover the possible risk; - Customer must require certificates of insurance, evidencing the existence of insurance (not to mention that the insurance must be from reputable companies, licensed to do business in your state); - Customer must monitor Vendor’s compliance.
Blogging for business can be a very effective marketing tool.The first thing you may need to know, especially if you’re very new to this, is, what in the dickens is a blog? In its most basic form, a blog is just a personal journal or diary. It’s a web space that allows you to rant on ‘til the cows come home. The word “blog” comes from a combination of the words “web log.” You can blog about absolutely anything, any topic. And the most amazing thing about blogs is that other people, all over the world may actually be interested in what you’re blogging about. The coolest part about blogs is that most of them are interactive. Most bloggers allow you to post responses to their blogs. Other readers can add their thoughts and a continuing dialogue is underway.
• The most vendor will pay is $X;
• For certain claims, vendor has NO liability.
Such provisions raise a number of issues:
• They are unfair. Vendor’s liability is capped, but customer’s is not. In other words, vendor knows his or her own maximum liability under the contract, while customer’s liability is unlimited.
• Vendor’s maximum liability - $X – may be inadequate. For example, “X” may be “no more than customer paid under this contract” or “no more than customer paid in the xyz months preceding the event giving rise to the claim for damages.” If we assume customer is paying 10 grand a month, and “xyz” is 12 months, then vendor’s liability is capped at $120,000. While that is not pocket change, is it adequate to cover damage that vendor could cause? How much damage can a vendor cause?
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too littl
Medical Billing - Hiring A Staff
If you're in the medical billing business, or plan to get into it, one of the most important things you're going to have to do is hire a staff of billers. This may sound easy but it is far from it. In this installment, we're going to cover some basic things that you're going to want to look for when hiring a billing staff.The first thing you want to look for, probably above all else is somebody who has knowledge of the industry. The reason for this is because the medical billing industry is filled with rules and regulations. Medicare regulations alone are enough to make your hair stand on end. The last thing you want is for a biller to have to look up every single regulation before sending out a bill. They need to have a solid command of the rules of the i
but customer’s is not. In other words, vendor knows his or her own maximum liability under the contract, while customer’s liability is unlimited.If you're in the medical billing business, or plan to get into it, one of the most important things you're going to have to do is hire a staff of billers. This may sound easy but it is far from it. In this installment, we're going to cover some basic things that you're going to want to look for when hiring a billing staff.The first thing you want to look for, probably above all else is somebody who has knowledge of the industry. The reason for this is because the medical billing industry is filled with rules and regulations. Medicare regulations alone are enough to make your hair stand on end. The last thing you want is for a biller to have to look up every single regulation before sending out a bill. They need to have a solid command of the rules of the i
• Vendor’s maximum liability - $X – may be inadequate. For example, “X” may be “no more than customer paid under this contract” or “no more than customer paid in the xyz months preceding the event giving rise to the claim for damages.” If we assume customer is paying 10 grand a month, and “xyz” is 12 months, then vendor’s liability is capped at $120,000. While that is not pocket change, is it adequate to cover damage that vendor could cause? How much damage can a vendor cause?
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
My Most Embarrassing Auction - What A Difference A Dot Makes!
As a newbee to eBay I sold a LOT of things. I looked around our farm and I found a TON of stuff that I was interested in getting rid of. Old metals, seeds, wood, cattle, dogs, wife...(well, truth is she got rid of me first, but that's another story..)But you know, after awhile I got tired of the hassle of packaging and posting everything. Then one day I was looking at a piece of metal called brass shim stock and a bell went off inside my head! You see, brass shim stock is mostly used in machine shops to adjust tooling, but I remembered my grandmother using it to make decorations. And I was off to the races!I found a supplier on the internet and got a very good deal.. Then I placed an auction on eBay and crossed my fingers and SURE ENOUGH, it started selli
damage that vendor could cause?
How much damage can a vendor cause?As a newbee to eBay I sold a LOT of things. I looked around our farm and I found a TON of stuff that I was interested in getting rid of. Old metals, seeds, wood, cattle, dogs, wife...(well, truth is she got rid of me first, but that's another story..)But you know, after awhile I got tired of the hassle of packaging and posting everything. Then one day I was looking at a piece of metal called brass shim stock and a bell went off inside my head! You see, brass shim stock is mostly used in machine shops to adjust tooling, but I remembered my grandmother using it to make decorations. And I was off to the races!I found a supplier on the internet and got a very good deal.. Then I placed an auction on eBay and crossed my fingers and SURE ENOUGH, it started selli
• How much is the contract worth?
• How much is the over-all project worth?
• Will the vendor have access to sensitive/valuable information?
• Will the vendor have access to sensitive systems or facilities?
Being good business persons, vendors will resist expanding their potential liability, and they will offer a variety of arguments in opposition. Some of these arguments carry more weight than others:
• “We cannot accept unlimited liability.”
Customer is not asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
Buying Gold as a Form of Investment
Many investors see investing in gold as a good long-term investment because it is a stable investment, and appreciation over time has shown gold to be a more viable form of investment than some of the other investments.Since the times of the Persian Empire, Muslims have seen value in buying gold. The fact that there is no restriction under Islamic laws for Muslims to deal and invest in gold has made this as a popular investment instrument among Muslims, especially those living in the Arab world. Besides, the fact that economies and money markets can be very unpredictable and subject to sudden downturns has made many investors turn to buying gold.Investors looking to buy gold as an investment can do so either via the open global gold markets or by purchasi
t asking for unlimited liability, just responsibility. Customer should not bear a loss resulting from errors or omissions of vendor. Curiously, standard language routinely exposes customers to unlimited liability.Many investors see investing in gold as a good long-term investment because it is a stable investment, and appreciation over time has shown gold to be a more viable form of investment than some of the other investments.Since the times of the Persian Empire, Muslims have seen value in buying gold. The fact that there is no restriction under Islamic laws for Muslims to deal and invest in gold has made this as a popular investment instrument among Muslims, especially those living in the Arab world. Besides, the fact that economies and money markets can be very unpredictable and subject to sudden downturns has made many investors turn to buying gold.Investors looking to buy gold as an investment can do so either via the open global gold markets or by purchasi
• “Our pricing tied to the amount of liability we can accept.” Again, customer is simply looking for responsibility. In addition, a great price combined with an unacceptable level of risk is not a good deal. A customer who is concerned only with price may be persuaded by this argument. Customers willing to assess the project as a whole may decide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too litt
Medical Billing - Enteral Nutrition Billing
In the world of medical billing, there is a sub domain all to itself. It is called enteral nutrition. Once upon a time, this was something that would have never been considered to be billable, which is part of the reason that this particular sub domain has its very own CMN. To understand how the CMN works, we first have to know a little something about enteral nutrition itself and what it is.In modern times, it has been determined that there are people who are ill because they don't get the right kind of nutrition. Years ago, we weren't so health conscious. The 60s saw the days of white bread and preservatives and nobody even knew what the word fiber stood for. Health food stores were the exception rather than the norm. Then, suddenly and without much war
cide that the “great price” is not a good deal after all. There is nothing wrong with telling a vendor “No.”In the world of medical billing, there is a sub domain all to itself. It is called enteral nutrition. Once upon a time, this was something that would have never been considered to be billable, which is part of the reason that this particular sub domain has its very own CMN. To understand how the CMN works, we first have to know a little something about enteral nutrition itself and what it is.In modern times, it has been determined that there are people who are ill because they don't get the right kind of nutrition. Years ago, we weren't so health conscious. The 60s saw the days of white bread and preservatives and nobody even knew what the word fiber stood for. Health food stores were the exception rather than the norm. Then, suddenly and without much war
• “We need a sum certain, so we can manage our risk and buy our insurance, etc.” Customer has the same concerns, so it is only fair to make the limitation mutual. Also, customer has no objection to a sum certain; customer merely wants an ADEQUATE sum. Which is one of the questions we began with.
It may not be possible to determine with certainty how much protection is enough; in which case it is better to ask for too much rather than too little. A number of tools are worth consideration:
• X times the fees paid and payable under the contract. Three times is a good starting point. Vendor cannot object that they cannot quantify the risk. But, is it adequate to cover the exposure?
• Vendor will be responsible for direct damages incurred. Vendor will object that “direct damages” cannot be quantified. But:
- “Direct damages”- damages that are foreseeable and which flow directly from the breach or action – are the traditional measure of damages under contract law. This is the amount vendor, and customer, would be liable for if the contract did not contain a limitation of liability;
- Presumably vendor carries insurance. (If they do not, why are you doing business with them?)
- Is it unfair to ask the vendor to make good any harm that it causes?
- One caveat. As with any legal term, the meaning of “direct damages” is open to interpretation, and debate, and debate.
• Vendor will be responsible for up to $X. We began with this approach, which is perfectly reasonable, provided X is sufficiently large. A $500,000 cap is terribly insufficient if the exposure is $2 or 3 million. In addition, with a specified cap, vendor cannot claim unknown and potentially unlimited exposure, AND Vendor can obtain the necessarily insurance more easily.
• Vendor will be responsible for up to the limits of its insurance. This approach removes the objection that the risk cannot be quantified and that it cannot be insured against. BUT:
- The insurance limits must be sufficient to cover the possible risk; - Customer must require certificates of insurance, evidencing the existence of insurance (not to mention that the insurance must be from reputable companies, licensed to do business in your state); - Customer must monitor Vendor’s compliance.
All in all, focusing on the limits of vendor’s insurance may be the most productive approach. It overcomes most standard vendor objections AND it helps ensure that sufficient assets are available if things to wrong. Without insurance, vendor may not have sufficient liquid assets to cover the damages. A judgment against a vendor is of little value if it cannot be enforced. A word about the types of
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