It starts out as a lovely, sunny, holiday weekend in Southern California. Most of your tenants at the Palm Grove apartments are enjoying a day off, and having a barbecue in the parking lot.
Missy from unit C goes back into her apartment to get a few more cold ones out of the frig, comes out her front door carrying the six pack, somehow trips on the step, falls and fractures her ankle. The other tenants call 911 and Missy is rushed to the hospital.
As a responsible property owner, you will of course immediately report this to your insurance carrier, as soon as you learn of it. Your insurance carrier investigates, and offers Missy a settlement. But Missy’s no fool. She sees the physical injury attorneys that advertise on daytime TV. She rejects the amount offered by your insurance carrier, finds a PI attorney, and files suit.
Being served can ruin your whole day. But as soon as your heart rate returns to normal, you turn the summons over to your insurance carrier. (Note to property owners: While there are lots of ways to cut costs, skimping on liability insurance is never a good place to do it). But even though your insurance carrier provides your defense, you must still participate in the process.
And one of the first events in that process will be answering interrogatories, a formal set of written questions that one party in a lawsuit asks an opposing party. If you are new to litigation, the questions asked in the interrogatories will seem bizarre, obscure and strangely repetitive. You visualise the lawyers pouring over law books and carefully, meticulously crafting each question for maximum effect.
For example: Every set of PI interrogatories I’ve ever seen has contained a question about Sweep Records. Sweep Records? The local supermarket keeps records of how often the parking lot is professionally swept. The owner of a small four-plex probably doesn’t.
Here’s what you need to know: Those questions are canned. Attorneys have been seen in online law forums posting questions about where to obtain interrogatories for their particular case. Attorneys also purchase them on CD from outfits like James Publishing.
Check it out. An investor with several rental properties could do worse that having the opposing team’s playbook on his or her shelf. (NO, I don’t work for James Publishing.)
The interrogatories lose a little of their intimidation power when you realize the questions aren’t that much different than a set of scripted questions served up by a mortgage broker taking a loan application.
Disclaimer: I am not an attorney. This is not legal advice. Always consult your attorney.
Teri Lussier says:
Cheryl-
Please keep this up. All this might be common knowledge to some but I doubt I’m alone in saying that I’m learning something with every post.
February 22, 2008 — 5:03 am
Jim Boyer says:
very nice post, I am not in this end of the business, but I have a friend and client who wishes to purchase a few apartment buildings.
February 22, 2008 — 9:37 am
Brian Brady says:
CJ-
I echo Teri’s plea for a continuation of the Prop Mgt 101 textbook. This is good stuff
February 22, 2008 — 10:03 pm
laurie mindnich says:
This is something that simply would not have occurred to me. Please offer up more- this was great.
February 24, 2008 — 5:07 pm
Cheryl Johnson says:
When Greg first invited me to join BHB the first thing that crossed my mind is that it would be utter sacrilege to clutter BHB with my trademark beginner level tutorials. Just visit daBlogMother.com and you’ll see what I mean. Could you visualize all those screen shots hogging BHB’s content panel? Gimme a break!
Then it occurred to me that while there is a lot of information in the RE.net about the financial end of property investment, not alot of people have written about the hands-on down-and-dirty day-to-day stuff of dealing with tenants, city regulations and rental property maintenance.
I wasn’t sure how it would be received, so I am very pleased to read the positive response, and yes, I plan to offer up more.
February 25, 2008 — 5:45 am