Opinion wanted. Is this ethical/legal conduct?

[NJservice]

A printer whose platesetter I service had a dongle problem last Summer. It turned out the company they leased the equipment from had taken the dongle without their knowledge, demanding payment they had fallen behind on.
After payment and return of the dongle, the company sent a service man in to "upgrade the machine so it runs better", for free.
A few months later, they called me about a safety latch door error. They were down. Basically, I found a black box connected to the safety latch circuit. Upon further investigation, I found this is a device that is used to kill cars when people don't make payments. It can be activated like a pager.
So, I realize people have a right to collect payment, but aren't there rules? Wouldn't users have to be aware of such a device installed in the machine, as people are in the case of kill switches on cars? At some point, if a business owes me money, can I remove electricity to their building somehow to demand payment? hack into their computers to demand payment? maybe just go in with a gun and make them an offer they can't refuse?
opinions?

 

[dabob]

This is a tough question . . . 1st by signing the lease they have both a moral and legal responsibility to make the payments. That said the leasing company should have done due diligence and approved their credit. Then the appropriate thing to do would be to institute collection/repossession procedures. But all that aside in my opinion why would you prevent the customer from being able to do any work to produce the funds with which to pay the late bills. This is intuitively counter productive. With good documentation of the story as it is told I would contact a personal injury attorney and consider a lawsuit for damages due to their machine being tampered with and while they are also technically in the wrong, the old saying goes, two wrongs don't make a right. Even when a car loan gets behind there are legal requirements to meet before repossessing the car.

 

[mattbeals]

I've threatened to take away dongles or to de-activate licenses unless payment is received. It's a pretty drastic step but if you don't pay, you don't play.

If you don't pay your electric bill doesn't the electric company shut you off? Water bill? Landlord? Mortgage?

I've also had situations where we have had vendors, customers and I agree to spread the terms out of a period of time. After each payment you get a 35 day key. Miss a payment, software is useless. Pay the agreed amount in full and get your permanent key.

As distasteful as it may be sometimes you have to do so to protect yourself. As for limits on collecting and things like the black box I guess you would have to look to your state laws. It may also be that the terms of the contract that the customer signed allowed, or did NOT disallow, such things.

 

[NJservice]

Right Matt, I see your point with the electric and water bill, and dongle expirations.
But aren't those known consequences, laid out on paper somewhere?

Myself, I wouldn't lie to a customer or do something unethical like this, but if that weren't enough, I would be hesitant to open myself up to a lawsuit for lost revenue for the time the printer was down. Sure, you might think you're in the right because you are collecting a debt, but I always remember these words:
"This is a court of law, young man, not a court of justice." ~Oliver Wendell Holmes, Jr.

There's a lot of "what if's" too. They must have thought they would always be the people called in for service, not me. If I'm using the schematics from the manufacturer and working on this problem, what if I got electrocuted? The machines power switch was bypassed such that the 12v power supply to the cutoff box was ALWAYS supplied with 200v. It's undocumented, and unknown. This box was hidden behind the circuit board cabinet. So, if I got physically harmed by this, while using the schematics, who would be liable?
What if this box had an electrical problem, caught fire, and burned down the print shop one night? I don't think I would pay if I were the printer's insurance company. I don't think the company that made the kill switch would pay, because this device was intended to be used in cars. Just some food for thought.

 

[Steve_S]

The bigger issue is being sneaky about it. If a client owes and you are shutting down their equipment, walk in the front door and do it like a man. Removing the dongle without their knowledge is unacceptable, as is installing the black box without their knowledge. If you want to repossess, then do it. But being a weasel does not lend to your future ability to conduct reasonable business with the client.

 

[mattbeals]

The remedy's do not necessarily have to be explicitly stated as far as I know as long as there is some sort statement about the laws governing the contract. I suppose that the argument could be made that by disabling the device that the Company has unduly/unfairly interfered with business operations and caused material harm. But at the same time it could be reasonably argued that the Company was within their rights by virtue of the Customer not fulfilling the terms of the contract by not making regular payments as agreed to and being so far behind. Or that local collection laws allows for such "lockouts" or similar actions.

Moral and legal obligations/ethics are not necessarily the same thing. It's a tough predicament for everyone involved. As you said, if you disable the equipment/software, "device" then they cannot conduct business which means they cannot pay you. If the customer is at least making some effort to pay then it's a tough choice. There were terms agreed to for payment after all.

It could get sticky very quickly

 

[mattbeals]

@snappysteve - I do agree that you have to be upfront and explicit about all this.

 

[dabob]

Matt . . .

Your right about the water and electric bills but last time I was that late (a long long time ago) they sent out 30 day, 2 week, and 24 hour notices before they would cut it off . . . . and as far as landlords and this is different everywhere but here in California after the renter stops paying rent it takes about 3-4 months before the court will order an evection notice and mortgages don't even get me started on that with the mortgage meltdown going on I hear about people not paying their mortgage for over a year and are still in their houses.

Personally, our business has never missed a discount date and we have been in business since 1977 so you can see that we believe that bills should be paid and paid on time, that said there is such a thing as due process and the method that the vendor used doesn't appear to have any due process about it so I don't think that the vendor has any claim on the "moral" high ground any more than the client, like I said two wrongs never make a right!

 

[Servicetech]

I was told by an employer to never do this unless it is in writing (lease, contract), it is a gray area and has legal risks of it's own. If it is in your contract and the customer knows about it and has agreed to the terms then well.....

 

[mattbeals]

You have to put everything in writing before you act on it, there's just no way around it. I don't think that you can necessarily jump right to repo or disabling. And I'm sure that state to state there are different laws governing the collections process whether it involves collecting an account you own or a collection agency. I think that you need to make reasonable efforts to rectify the situation. But at some point though you have to take action. But you have to document *everything*. As servicetech said and I eluded earlier, if it's in the contract then you're within your rights (assuming the contract terms and conditions will stand up in court). It's a shame to have to take such actions, it's a shame to be in a position where such actions might be taken against you. Hopefully things can be worked out before any of this is ever necessary.

 

[BillJ]

Most leasing companies hold title to the equipment until the lease completed and the residual is paid. Since it is their equipment, they do have the right to do it. Some leasing companies do high risk leases and probably are more likely to do this.

I used to work for a company that had an in house leasing company. As a tech, I was occasionally asked to go to a site and disable the equipment if the lessee was way behind (90+ days) in payments.

 

[spigot]

So, I realize people have a right to collect payment, but aren't there rules? kill switches on cars? At some point, if a business owes me money, can I remove electricity to their building somehow to demand payment? hack into their computers to demand payment? maybe just go in with a gun and make them an offer they can't refuse?
opinions?

Yes there are rules. Consumer protection and the contract they signed.
No you cannot remove electricity unless you are an electricity company or their authorised reseller. Anyone else is illegally tampering.
No you cannot hack into their computers; this would be an offence against cyber crime legislation, possibly terrorism legislation.
No you cannot attempt to retrieve owed funds via the use of firearms. This is frowned upon these days.

You may find that the contract states the owner of the equipment reserves the rights modify, update or amend the equipment. As the owner of equipment this is their perogative.

The printerin question has more serious things to worry about than concentrating on the method in which the equipment was decommisioned. For example cashflow issues and why the situation appeared before them to begin with.

It's very similar to complaining that the coin operated TV stopped working because your coin ran out. The box controlling it does not have ears and does not have cares.

As for your safety concerns, if the device meets current electrical safety standards, then it must be up to you to obtain and familiarise yourself with its schematics prior to commencing any work on it.

I have worked for people who play fast and loose with lease arrangements. Non payment, stretching dates right out, meanwhile utilising the service and depreciating the asset. Then handing the keys over. To me, ethics goes both ways. I'm not inferring the printer in question here deliberately didn't pay, but the lease company may have had no choice other than to protect their interests.
If every one plays ball we all have a good game.

 

[johnarleth]

this seems a great group to ask another question

this seems a great group to ask another question

Are there standard terms and conditions for a printer to use with a client? Are they enforceable? I want to know before I have a problem and am getting conflicting answers to the question.

 

[dabob]

Are there standard terms and conditions for a printer to use with a client? Are they enforceable? I want to know before I have a problem and am getting conflicting answers to the question.

Interesting question . . . according to this article

Printing industry trade customs | American Printer | January 2008

in general they really don't exist anymore but . . . . more searchs on google will get you some guidelines for general purposes

 

[chevalier]

I highly suspect that this will become more of a norm if tough economic conditions persist. I also suspect that any equipment that is network attached for remote diagnostics, etc. can probably be disabled remotely and monitored without your knowledge.

 

[Steve_S]

I think the remote diagnostic clause would have to explicitly state that they reserve the right to remotely disable your gear within the contract for this to be "legal". Of course, a business would have a hard time taking them to court with the extenuating circumstance that they are 6 or 12 months tardy on payment....

 

[chevalier]

I completely agree with you. I understand the vendors perspective especially if you have a press or the like and weren't paying the bill. All that mileage is going to decrease resale value in the case the vendor has to repossess and attempt to recoup costs.

I personally don't like the idea of a vendor getting to play big-brother at-will. I'd keep the equipment fire-walled from remote except during valid maintenance.