Consumer Law, Warranties Computer Techs Liability??

[techguy]

I own a small computer repair company (LLC). I had a freelance tech visit a clients home. The tech had to erase her computer and reinstall everything. He did not backup her data. The client is outraged and is threating legal compensation for data recovery and time lost as she works at home. The client never asked for the data to be backed up.
I also had a tech try to recover her data for her at no charge but he was mostly unsuccessful.

The client did not ask to backup the data. We do not have errors and omission insurance. The client never paid for the services.
What is our .liability in this matter?

Thank You

 

[David_Staub]

Do you have a written agreement or at least a set of standard terms and conditions that the client is given? In tech service agreements, it is customary to include a disclaimer of "indirect, incidental, special or consequential damages." What that means is that even if you are negligent and, say, damage a hard drive, your liability would be limited to replacing the hard drive. The cost of restoring lost data would not be your liability as it is an "indirect, incidental, special or consequential damage."

Also, it is customary in such agreements to expressly state that backing up data is the customer's responsibility.

For an example of what I am describing, go to the web site of the Geek Squad and read their terms and conditions of service.

If you had no agreement, the first question is whether you are liable at all. To be liable, you must have either breached a contractual duty (including for example, what is known as an implied warranty) or acted negligently. Without getting into all the facts, a basic question will be what is the standard practice in your area. If the standard practice is that the client is expected to have already backed up their data, then you may be off the hook because your technician acted reasonably in accordance with standard practice. If the standard practice is to back up the data for the client or at least determine that the client has made a backup and your technician failed to live up to the professional standards, you may well be liable for damages.

If you are liable, the next question is: what are her damages. Without language limiting your liability, you may be liable for consequential damages. The standard of proof varies from state to state and sometimes even within state court appellate districts, but there are typically several elements that go into determining damages. For one thing, the damages need to be foreseeable. If you are performing services on a client's home computer, replacing lost downloads of music may be foreseeable, but finding that the client was a well known author who just lost her only copy of a manuscript that she had been working on for 2 years might not be foreseeable. It is a question of fact for a judge or jury to decide. In addition, the damages must be reasonably ascertainable and not purely speculative. The cost of repurchasing lost music may be reasonably ascertainable if the client has records of which music she had purchased, but the value of a manuscript by a previously unpublished author may not be definite enough to establish damages.

Since the determination of the amount of damages is a question of fact, one judge or jury may reach different conclusions than another judge or jury on identical facts, so no one can really tell you what your liability is.

If you don't have a standard contract, you need to get one before you take any more jobs or you are taking unecessary risks.

David Staub