Decreasing liability

Decreasing liability

From my days in Hotel and Resort management, I learned some tricks that help reduce liability on income properties. Obviously larger properties like hotels and resorts have extensive experience when dealing with liability. I am going to focus on just a couple of items here, but hopefully one will help you with properties you might own or manage.

The first one is documentation. In legal proceedings I have been involved with, documentation has been the key to my success in defeating certain legal challenges.

One example is from our pool staff in Florida. We as management would constantly get complaints from guests that our pool had bleached their swimsuits. Our first step would be to contact the pools manager, and he would bring his logs for the days in question. There would be a record at three times throughout the day as to the chemical composition in the pools. Any dispute would be quickly dispelled, as the real culprit would be from some other location.

In housing, there are pools, so this may apply directly, but in other facets of management of property the concept is equally important. Documentation of maintenance records of appliances, inspection of locks, doors, and windows, or even just preventative maintenance may be the key to showing you're not a negligent owner.

Another thing to consider is to get the tenant to sign off as to the condition of the property. In my experience, tenants like having the owner around as little as possible. So I would show up with a monthly inspection report, and sometimes would actually do an inspection of the property, but would sometimes just ask the tenant to sign off at the doorstep that things are safe and ok. They always do, because they don't want me around more than I have to be. But now I have a monthly record showing that they signed off to the fact that the property is safe and in good condition. Now nobody can come back and say I didn't care, or that I was negligent in taking care of a safety concern.

Obviously the key to all of this is rapid response if there ever is actually a problem. That is a very quick road to a negligence claim if the tenant reports an unsafe condition and nothing happens. Luckily, that doesn't happen very often, if you are managing your properties well.

In conclusion, document, document document!! It solves a lot of problems, keeps you in touch with your property on a regular basis, and fights liability issues.