Here it is, the official, “Top 10 Ways to Get Sued” – guaranteed! In our previous post, we covered the 1st 5 Ways to Get Sued and NOW in Part 2, we will cover 5 more ways! Here are numbers 6-10.
6. Try to Call Employees Independent Contractors. Many employers hire employees, but call them “independent contractors”. If someone works for you regularly and you pay them by the hour, they are an employee and should be put on the payroll. Failure to do so can expose you to a claim for unpaid wages or worse, an investigation by the IRS or state department of labor. Don’t risk it – use a payroll service to pay them as a w-2 employee.
7. Sign a Contract Without a Representative Capacity. If you take the time to incorporate, then make sure you sign all checks, notes, contracts, and agreements as an officer of the company. Failure to do so even ONCE can mean personal liability.
8. Give a Personal Guaranty. Don’t ever give a personal guaranty for a friend or relative. Their failure to pay will hurt your credit at best, and end up in a lawsuit against you at worst.
9. Let People Borrow Your Car. In most states, the owner of a car is liable for anything done with the car by the driver. Make sure if you lend your car the person driving it has their own insurance and yours is adequate.
10. Attractive Nuisances. Pools, trampolines, and other “cool things” tend to attract children, who eventually get hurt. Eliminate all attractive nuisances on your property, especially rentals!
Finally, having a mentor or good attorney experienced in real estate can help keep you heading in the right direction!
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