Friday, August 18, 2006

Contract Killers

"A grammatical blunder may force Rogers Communications Inc. to pay an extra $2.13-million to use utility poles in the Maritimes after the placement of a comma in a contract permitted the deal's cancellation."
- The Globe and Mail - August 7, 2006

Hard as it is to believe, telecommunications giant Rogers Communications Inc. left itself wide open with a contractual goof-up based on a misplaced comma. The provision in question provided that the agreement "shall continue in force for a period of five years from the date it is made, and thereafter for successive five years terms, unless and until terminated by one year prior notice in writing by either party."

Rogers thought it had at least a five-year term at the negotiated rate but the CRTC ruled that the agreement could be terminated at any time with one year prior notice. The other side exercised its option and more than doubled the rates payable by Rogers.

Rogers’ retail customers are perhaps the most surprised at this obvious oversight by the phone and cable conglomerate. When they review their contracts with the company, they can’t find any such flaws or openings.

For example, the standard cable contract provides that the customer "shall pay whatever fee Rogers decides to charge on a monthly basis until hell freezes over or a rate hike is approved by the CRTC, whichever comes first." The document goes on to state that "the lessee shall be entitled to customer service in the form of a toll-free number but access to a so-called ‘live person’ is not guaranteed. The company undertakes to provide an automated phone menu for the customer’s assistance and convenience 24 hours a day but otherwise is not responsible for any residential technical problems."

Rogers has a similarly worded agreement covering its residential high speed Internet service. For example, the standard boilerplate includes a provision that "the company cannot be responsible in any manner for a customer’s failure to connect to the Internet, access his or her e-mail messages or even get his or her modem connected. The company will provide a handy on-line help manual but how the customer is able to access that manual without an on-line connection is not the company’s concern."

Rogers also appears to have an airtight contract when it comes to wireless phone service. The standard retail customer agreement provides that "the customer will pay a monthly fee in addition to fees by the minute of phone usage determined by the company on an ‘ad hoc’ basis. If the customer’s monthly charges are at odds with any previously published rates, the charged rates will be deemed to have always been in effect. The customer is not entitled to any explanation as to the meaning of the phrase ‘roaming fees’ nor the random application of such charges. Service may be cancelled if and only if the customer gives notice in the prescribed form and in the prescribed manner which can be found at the company’s web site once the customer achieves on-line access."

Given the impermeability of its standard residential service contracts, Rogers has reportedly fired the law firm responsible for the misplaced comma snafu and delegated all future corporate and commercial contract drafting to its customer service department.

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