46 Marine Electronics Journal January/February 2018
through the use of an estimate, sales contract or similar document. This
can be a document on your website, a document sent by postal mail, email or even reviewed in person. Asking for a signature to confirm the
scope of work and the costs as described in the document is standard
business practice. Every business has its own set of guidelines when and
if this document is necessary and what works for one business may not
work in another. Remember, you want it to be easy for your customer
to do business with you and at the same time protect your small business from an unexpected liability.
What is the best way to address the terms and conditions on which
you will perform the service? It is best to have standard terms and conditions that your business uses for every customer and for every job that
has been tailored to your specific business and line of work and used as
part of every sales contract or estimate you provide the customer. These
terms and conditions are often printed on the back or last pages of estimates, proposals and invoices in type that is not too small to read.
If you manufacture marine electronics you will have a different set of
concerns and therefore a different set of terms and conditions that go
along with your product. Most manufacturers have in-house or contracted legal counsel who write and review the terms and conditions.
Many small businesses don’t have the expertise to craft their own terms
and conditions and can use pre-made agreements tailored to their business or hire a legal expert to put together a document that meets their
While many think the terms and conditions document needs to be
perfect since it may be used in court, that is true but the main idea is to
stay out of court by clearly stating to your customer how your company
conducts business and the responsibilities of each party. So while the
terms and conditions may not cover all possible events, scenarios and
situations, the overview should provide enough information to satisfy
typical events that occur in your specific business.
What are some popular terms and conditions that can be used in a
marine electronics business that sells and installs marine electronics?
• Spell out your labor rate (and how you calculate hours) and travel
time rates as needed for your operations.
• You may need to ask for a deposit and indicate to the customer
the method of payment for progress or future payments.
• Describe how you will report your job completion—verbal or
written and to whom and when? Work scheduling-completion
time, day, etc.?
• Is a sea trial needed, if so who, how and at who’s expense? Do you
offer a warranty, for how long and what is covered?
As you can see, the terms and conditions can quickly grow into a
lengthy document. For many small businesses, the terms and conditions
have grown out of a real experience where there was a problem and
going forward, the business spelled out the terms to clarify to the customer how the company conducts its business.
It would be nice to not learn the hard way and have a simple set of
terms and conditions that cover many of the situations marine electronics companies may face. Here are some generic examples you can tailor
for your own business.
Situations to consider
Let’s start off with something that seems simple but can turn into a
mess—the sea trial of a customer’s vessel after an autopilot installation.
While this goes on every day across the country, it could go bad without
some ground rules spelled out in advance of accepting the order from
Should a sea trial be necessary for the purpose of testing and or inspection
of work and or parts furnished by the marine electronics company, the vessel
owner or agent agrees to provide a captain and crew as needed for the safe
handling of the vessel. All costs related to the operation of the vessel during sea
trial including captain, crew, fuel, and any other expenses necessary will be
the responsibility of the owner or authorized agent. It is expressly understood
that the marine electronics company will not be liable for any acts or omissions, including negligence, product failure or operator error by any of the
owner’s agents or personnel during the sea trail.
If you have had a problem getting paid or have placed a lien on a customer vessel, this term may help you in advance of that situation:
The marine electronics company may assert a marine lien against the customer’s vessel and its contents for any unpaid sums due for the services,
including the cost of parts and labor or “necessaries” as defined in title 46 Subtitle III, Chapter 313 of the United States Code. The lien shall include any and
all attorney’s fees and cost of collection for the collecting of any unpaid sums.
The owner/agent shall be responsible for all pre- and post- judgment fees.
With credit cards as a popular form of payment, a properly recorded
and stored credit card can be used with the customer’s permission to pay
for the services with the credit card on file. Here is a term that can help
inform the customer of your procedure:
Payment Terms—The owner or agent acknowledges that he/she has read
this document and agrees with the terms and conditions set forth. If owner or
agent has provided their credit card number for payment, then the owner or
agent signature below will also act to acknowledge receipt of goods and services and that they agree to perform the obligation set forth in the card holder's
agreement with issuer. Payment is due in full at the completion of the job, proportional progress payments may be requested depending on the duration of
How to handle warranty, both for your work and for the
parts you install:
Warranty—The marine electronics company assumes no responsibility
for performance and reliability of products designed and engineered by manufacturers to which we are authorized dealers, retailers or agents. We therefore agree only to warranty the workmanship of our employees. We warranty
our workmanship for a period of 90 days. Any warranty claims regarding the
operation of fitness for use of the product is between the vessel owner or agent
and the product’s manufacturer.
Most marine electronics businesses have the proper insurance based
on their company function and types of vessels they work on. What
about the customer? Do they have insurance on their boat? If something
goes wrong is the customer relying only on your insurance to cover their
loss? Here is a condition that helps to clarify who has insurance and who
Insurance—The vessel owner attests that the vessel described in this
agreement is insured with Marine Hull Insurance and Marine Protection and
Indemnity Insurance. The owner, his heirs and assigns hereby release and
agree to indemnify and hold harmless the marine electronics company, its officers, its employees and its subcontractors from any and all liability for personal injury, loss of life, and property damage arising out of or in connection
with the work performed on or the use of the described vessel and accessories
or the use of the premises. The marine electronics company is not considered
under this agreement to be the insurer of the vessel owner's property and it is
the responsibility of the vessel owner to secure such insurance coverage as is
described. (Continued on page 50)