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Washington County residents' contracts with alarm company might be voidable

August 01, 2008|By ANDREW SCHOTZ

WASHINGTON COUNTY -- Washington County residents might be able to get out of alarm system contracts they purchased from unlicensed salespeople.

"It would not surprise me if we'd have to let people out of those contracts," Alex Dunn, the chief operating officer of APX Alarm Security Systems, said Wednesday.

For weeks, APX salespeople blanketed neighborhoods in Hagerstown and other parts of Washington County and knocked on doors.

APX, which is based in Utah, later found out the sales group in the Hagerstown area was from Virginia and didn't have licenses required in Maryland.

"As soon as we found out, we told them to leave (Maryland)," Dunn said.

The company didn't replace the salespeople with properly licensed salespeople.

Dunn didn't know how many security systems were sold in Washington County.

He said APX will void local contracts if it has to.

"The law is what it is and we'll comply with the law," he said.

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Asked on Thursday about the validity of the contracts, two people familiar with Maryland law said customers might be able to nullify them.

The contracts wouldn't be automatically voided, but might be "voidable," said Harry Rifkin, an attorney with the law firm Cohan, West, Rifkin & Cohen P.A. in Baltimore.

A salesperson who failed to get a necessary license "gives you probable grounds to rescind" a contract, Rifkin said.

"I think it makes the contract void," said Phillip Robinson, executive director of Civil Justice Inc., a nonprofit legal aid organization in Baltimore. "But it's murky."

Robinson said the Maryland Court of Appeals ruled last week in a guardianship case that not following a statute didn't void an outcome.

He said he disagrees with the decision.

"It changes 80 years of law," he said.

Robinson said licensing is meant to prevent fraud and ensure that businesses and salespeople meet standards.

A customer who wants to get out of a contract has to make a "timely" attempt, Rifkin said.

The customer should make his or her objection clear by writing a letter and hiring a lawyer, Robinson said.

Raquel Guillory, a spokeswoman for the Maryland attorney general's office, didn't respond by deadline to a question about the validity of contracts purchased from unlicensed salespeople.

Sgt. Arthur Betts, a spokesman for the Maryland State Police, which has a division that licenses alarm system sales, said APX was going to send the police a list of Virginia representatives who would obtain Maryland licenses, but later decided not to.

Salespeople and technicians who install security systems have to get state licenses, he said.

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