Property Management Agreement language

[Dave Ketcham]

I would appreciate some BP wisdom on this. We just bought our first property in Missouri and the PM agreement includes the following two sections that are troubling -- we haven't seen this language before. It seems to say, "you have to pay me all the fees for property management, but if we make a mistake or get sued, you (the Owner) have to protect me (the Property Manager) from all of my mistakes!".

Is this standard language in property management agreements?

Thanks!

Dave

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"5.2. Carry at Owner’s own expense public liability insurance that names the Owner and the Agent, that is adequate to protect their interests and that is in form, substance and amounts reasonably satisfactory to the Agent. Owner shall furnish to the Agent certificates evidencing the existence of such insurance. Unless the Owner shall provide such insurance and furnish such certificate within ten days from the date of this agreement, the Agent may, but shall not be obligated to, place said insurance and charge the cost thereof plus an administrative fee, to the account of the Owner. All such insurance policies shall provide that the Agent shall receive thirty (30) day’s written notice prior to cancellation of the policy.

5.3. Pay, except as provided elsewhere in this Agreement, all expenses incurred by the Agent, including, but not limited to, reasonable attorney’s fees and Agent’s costs and time in connection with any claim, proceeding, or suit involving an alleged violation by the Agent or Owner, or both, of any law pertaining to fair employment, fair credit reporting, environmental protection, rent control, taxes, or fair housing, including, but not limited to, any law prohibiting, or making illegal, discrimination on the basis of race, sex, creed, color, religion, national origin, age, marital status, or mental or physical handicap, provided, however, that the Owner shall not be responsible to the Agent for any expenses in the event that Agent is finally adjudicated to have personally, and not in a representative capacity, violated any such law, unless such acts and or omissions are outside the course and scope of Agent’s duties hereunder. Nothing contained herein shall obligate the Agent to employ counsel to represent the Owner in any such proceeding or suit. The Owner also agrees to pay reasonable expenses (or an apportioned amount of such expenses where other employers of Agent also benefit) incurred by the Agent in obtaining legal advice regarding compliance with any law affecting the Premises or activities related thereto."

[Tim Norris]

I agree with Sharon. It is standard for them to request to be named as an AI. That stated, may be worth asking for them to name you as the owner as AI on their policy! This also ferrets out whether they have insurance or not...right? : )