Maintenance agreement: what should it contain?

What is a maintenance agreement?

A maintenance agreement is a contract that governs the ongoing maintenance and servicing of a property, a technical installation, a machine, an IT system or other assets. The agreement sets out precisely who is responsible for what, when maintenance is to be carried out, and what it costs.

Maintenance agreements are used in many contexts:

• Properties and tenancies: an agreement on external and internal maintenance responsibility between owner and tenant
• Technical installations: ongoing servicing of, for example, heat pumps, ventilation systems, lifts or sprinkler systems
• IT systems: a support and maintenance agreement for software, hardware or network infrastructure
• Production equipment: planned preventive maintenance of machines in production companies
• Green and outdoor areas: maintenance of gardens, roads and parking areas

A clear maintenance agreement prevents disputes about who bears the costs when something goes wrong, and ensures that assets are kept in proper condition.

Maintenance agreement and lease

In tenancies, the maintenance responsibility is governed by the Rent Act, but the act's default positions can on several points be departed from by agreement. Without a clear agreement, uncertainty often arises:

• Who maintains windows and doors internally and externally?
• Who is responsible for white goods?
• Who pays for painting and wallpapering on move-out?

The Rent Act's default: the landlord has the internal maintenance, unless otherwise agreed. Many landlords choose to transfer the internal maintenance to the tenant, and this requires a clear agreement in the lease or a separate maintenance agreement.

In commercial leases, the parties have more freedom and can largely agree the maintenance responsibility as they wish. Here a detailed maintenance agreement is even more important.

What should a maintenance agreement contain?

1. The parties' identification

Full names or company names, addresses and CVR numbers. State precisely who is the service provider (the maintenance supplier) and who is the customer (the owner or the tenant).

2. A description of what is maintained

Describe precisely what the agreement covers:

• The property address and specific installations (heat pump model X, lift no. Y)
• The identification of IT systems (system name, version, licence holder)
• Areas and installations

The more specific the description, the less doubt arises about what the agreement actually covers.

3. The scope of the services

Specify carefully what the maintenance involves:

• Preventive maintenance: scheduled inspections, lubrication, replacement of consumable parts
• Corrective maintenance: repairs on faults and breakdowns
• Updates and improvements: this applies especially to IT agreements, where it should be clear which versions and updates are included

State clearly what is not included in the agreement, to avoid misunderstandings.

4. Response and repair times

For operationally critical installations and systems, the response time is decisive:

• Response time: within what time must the supplier react to a fault report?
• Attendance time: within what time must a technician be present?
• Repair deadline: when at the latest must the fault be resolved?

Differentiate between critical faults (the system is down), serious faults (reduced functionality) and minor faults (cosmetic problems). State the consequences if the deadlines are not met.

5. Availability and working hours

Does the agreement cover only normal working hours, or is there standby outside working hours? What is the price for any standby service?

6. Price and payment terms

• A fixed monthly or annual price for scheduled services
• Prices for extraordinary services outside the agreement
• Notice periods and price adjustment

7. Liability and insurance

Who bears the liability if the maintenance work causes damage? The supplier should have liability insurance, and the agreement should state who covers damage that arises during the maintenance.

8. Duration and termination

Is the agreement fixed-term or ongoing? What is the notice period? On what conditions can the agreement be cancelled?

Typical pitfalls

An unclear division of responsibility: "The landlord maintains the building" is too vague. What is "the building"? The roof? The windows? Fixed installations? Precision is the key.

No consequences for breach: many agreements state deadlines but forget to specify what happens if they are not met. State a penalty, a right to call in another supplier at the customer's expense, or a right of cancellation.

Excessive disclaimers of liability: the supplier's disclaimer must not make the agreement meaningless. A general disclaimer does not cover intent and gross negligence and can in some cases be set aside.

No price-adjustment clause: a multi-year agreement without price adjustment can quickly become unfavourable for the supplier, and this can lead to poorer service. Agree a clear model for price adjustment, for example the net price index.

Undocumented maintenance: require the supplier to document the maintenance carried out on an ongoing basis. Logbooks and service reports are important evidence in the event of a dispute.

Maintenance agreement or service agreement?

The terms overlap, but there is a practical nuance:

• A service agreement is the broader term and can cover any form of ongoing service, including IT support, cleaning, security and customer service.
• A maintenance agreement is typically more specific: it concerns the technical maintenance and operation of physical assets or systems.

In practice, the terms are often used synonymously.

When should you create a maintenance agreement?

• Before you enter into an agreement with a service company, not afterwards, when the conflict has already arisen
• On entering into a commercial lease, where the division of maintenance should be described explicitly
• When you buy new installations, where the service contract can usefully form part of the purchase with a written agreement
• When you outsource IT operations, where an IT maintenance agreement (SLA) is the standard document for cloud services and managed services

Conclusion

A well-crafted maintenance agreement is the best insurance against disputes about responsibility and costs. The most important ingredient is precision: a clear description of what is maintained, the scope of the services, response times, price and the division of liability. Use a template adapted to Danish law, and seek advice for large or complex agreements.

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The content of this article is for guidance only and does not constitute legal advice. Contact a lawyer if you are in doubt about your specific situation.