For more than a century the alarm industry has been entrusted to design, install, maintain and monitor security systems for all types of applications, including high risk venues. Most of the time the systems function as intended and represented.

However, if the system does fail and it is determined the security contractor was legally accountable for the damages sustained, the liability can be dramatic.

To illustrate this loss potential, consider the real-life case study of a storeowner who reported she was physically assaulted and raped after repeated attempts to set off a panic button prior to the attack. The central station never received any panic alarm signals and, as a consequence, the police never responded. The woman claimed if the panic button had functioned properly — as represented by the alarm company — the cruel violence would not have been inflicted upon her.

As the plaintiff’s theory goes, a successful panic alarm transmission to the central station would have commenced a course of action leading to a timely police response, thereby resulting in the perpetrator being intercepted and stopped. Let’s take a closer look at the woman’s security solution that allegedly failed her.

Scene of the Crime

An onsite examination and analysis of the alarm system revealed the panic button portion of the system consisted of wireless handheld devices (transmitters) and a single-zone wireless receiver. The wireless transmission initiated upon depressing any of the handheld panic button transmitters. Upon receipt of the properly coded radio signal, the system’s wireless receiver automatically energized, and as a result, would activate the alarm system silently through its on-board normally open contacts. The panic signal ultimately was supposed to trigger the appropriate zone of the control panel set and notify the central station for immediate police dispatch to the premises as instructed on the central station’s database printout dispatch instructions for this subscriber’s account.

Notably, the wireless receiver was found to be properly connected to a 12V supply for DC power, and it was connected and programmed to a 24-hour “silent” zone of the alarm system’s control panel set. The telephone lines connected to the digital alarm communicator transmitter (DACT) of the control panel were also found to be fully functional and properly wired to the RJ-31X jack that was installed adjacent to this equipment. Further, the wireless panic transmitters selected by the alarm contractor were specifically designed by the manufacturer to be set up by the installer utilizing matching dip switches, located in each of the transmitters and in the single-zone wireless receiver.

Thus, the intention of this design was such: Once the dip switches were properly matched, the transmitters would be able to communicate with the receiver (subject to their range limitations) and the system would perform its intended function of central station notification of an emergency event. It is important to understand the wireless devices used for this particular application did not have the technical capability of low battery detection or notification for transmitter supervision, or lack thereof, so that the system could automatically annunciate a detected loss of functionality, which would otherwise go unnoticed and/or left impaired.

‘Smoking Gun’ Discovered

Of particular significance, after investigating the alleged loss of functionality it was determined that one of the transmitter’s dip switch settings did not match the receiver’s settings. And while the internal battery showed that the transmitter was still functional (it had the capability and power to transmit after the transmitter button was depressed), the flawed and improper dip switch setting revealed that the system catastrophically failed due to this mismatched configuration. In other words, once the dip switch setting in the subject transmitter was found not to match, it was technically impossible for this portion of the system to function at all.

Conversely, once all of the dip switch settings were properly matched the system functioned normally and successfully communicated with the central station. Now the forensic focus was to determine if the system was ever tested upon completion. Did the system ever work? Or was the loss of functionality due to some other occurrence that was created after the installation, either accidentally or nefariously, but before the alleged incident?

The alarm company installation records did not evidence any testing of the system, even though the company strongly professed it did in fact fully test the system. Similarly, the central station didn’t have records for any system testing or any testing performed upon the alarm company’s purported completion of the original installation since these records, if they ever existed, were automatically purged long before the time an actual request was ever made to retrieve them. It was also determined that the installer had not actually programmed the system himself, but that it was downloaded remotely.

Of course, even if the control panel was found not to have been properly programmed (which it was not), the manual dip switch settings were still incompatible and difficult to dispute, especially lacking any other competent evidence to support functionality of the initiating device before the alleged incident.

Maintain System Test Documents

Fundamentally, it is extremely important to understand that different actions by the alarm company in this matter could have, in all probability, dramatically helped in this unfortunate situation. Consider the selection of supervised wireless transmitters and receiver equipment, instead of a nonsupervised system, which if properly configured (the supervised wireless system) would annunciate a loss of functionality on-site and simultaneously to the remote station so corrective action would occur if something became impaired before a loss.

Also vital, the alarm contractor should maintain all central station testing records in the subscriber’s file. These records are necessary to document the completion of the installation of each security system zone, thereby verifying testing was actually performed and/or if the initiating device(s) was ever functional or not. By having policies and procedures in place, you ensure a subscriber contract is executed, which includes but is not limited to, incorporating protective language and other provisions.

Clearly, legal protective language that may help lower your company’s loss potential, provision examples include: limiting the alarm contractor’s liability, waiver of subrogation, and third-party indemnification provisions, and establishing that it is the subscriber’s responsibility to routinely test the system on a weekly basis.

With all of these practices in mind, it is still particularly critical that intrusion and fire alarm companies never elect to take a one-size-fits-all approach to system design, and always select the proper equipment for the application, functionality and risk. Finally, it is prudent for alarm companies to maintain all pertinent documentation for each of its subscribers in order to be fully prepared in the event of a claim or any allegation regarding their actions, inactions and conduct.

Warning: This column is not intended to be legal advice and should not be construed as such. Please first consult your lawyer and/or advisors, with any concerns or questions you might have before taking any actions or inactions.

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