Protecting your business from lawsuits is important, but it is a vast field to cover. Numerous things can result in lawsuits and, as the owner of a condo business, you need to ensure that all of your bases are as covered as possible.

Being sued can cost time and money, and put unnecessary stress on your business. While business corporate law varies from state to state, in Florida you want to make sure that you have trustworthy advisers and lawyers that you can count on to help you through any potential disputes to help you know how to protect your business from lawsuit.

If you are sued and you don’t have the proper resources to defend yourself and your business, you could be put at risk of filing bankruptcy and needing to invest further in bankruptcy attorneys. Depending on the severity of the claims, you may even face jail time if you can’t prove your innocence.

To help you better protect your Miami condo business, here is what you need to know about how to protect your business from lawsuit so that you can keep your investments as safe as possible.

Insurance and Liability

It’s vital that you have all the proper insurance on your condo to help prevent lawsuits due to injury on your property. While individual owners of units may be responsible for providing their own insurance on their condos, the common areas are still your responsibility, as are the grounds.

If you are operating as an LLC — a limited liability entity — you can help protect your personal assets; however, your condo building will still be vulnerable. Estate law attorneys can help you better understand what steps you need to take for your specific property. They can also help you draft the contracts you will need for new owners and tenants.

A qualified insurance agent who specializes in housing can also help you to better understand the coverage you need. While you can insist that unit owners or leaders maintain a minimum amount of coverage for their unit, your condo association’s master policy should cover everything else.

Covering Your Bases

When it comes to how to protect your business from lawsuit as a condo owner, it’s important that you don’t skip any of these important steps.

  1. Vet each tenant and owner thoroughly to ensure that they have a solid rental or ownership history. You should also validate their income to make sure that they are equipped to pay for and manage their individual unit. Background checks should also be conducted to ensure that owners have clean histories with no severe illegal priors. For instance, Florida has strict laws when it comes to sex offenders, and if your building is within the radius of a school or park, you’ll need to speak with a criminal law attorney to determine if they can safely reside in your building.
  2. Establish rules and regulations for your condo building to help improve safety and comfort for everyone living there. For instance, no loud music after a certain hour, no grilling on covered patios to prevent fire, and no smoking in units or near entrances. Similar to the above, Florida also states that convicted felons are ineligible for Condo Board Service. If a board member is charged with a felony, even if they’ve gone through bail bond companies and been released before trial, you’ll have to take action if they are on the board and eventually convicted. This is very important in knowing how to protect your business from lawsuit.
  3. Make sure that all tenants have and maintain their own insurance coverage for their condo units. This will ensure that any damages are covered and you won’t be facing lawsuits or high repair bills once they move out.
  4. Work with a lawyer to understand the fair housing and anti-discrimination laws in your area. This can help keep you protected from lawsuits that may try to pin you with unfair discrimination charges.
  5. Always keep lawyers on hand for advice so that you won’t make any bad choices that could negatively impact your standing.

By taking these steps, you can better shore up your defenses against unnecessary lawsuits and protect your condo business.

What Services Must You Provide to Tenants?

Unlike apartment buildings, condo associations aren’t necessarily beholden to fixing problems in individual units. While some can specify that they will maintain specific things such as HVAC or plumbing, in many cases this falls to the owner of the unit and not the owner of the building and the association.

However, this doesn’t mean that, as a condo business owner, you can neglect your space and let it fall into disrepair. Condo associations should still be responsible for maintaining all common areas and the exterior of the building to ensure that it is clean, safe, and up to code.

This can include roof repair service, trash removal, landscaping, and maintaining commercial fire alarm installations. You will also have to fix any peeling paint, rotting wood, or any hazards that may be on your grounds.


When it comes to knowing how to protect your business from lawsuit, you should also consider what fees you can charge your tenants without veering into potentially dangerous territory. Parking fees and HOA fees are common in condominiums and they can help provide funding towards keeping your building up to code and livable. However, a condominium in Miami was recently sued in 2019 for making tenants pay a non-refundable ‘transfer fee’ when they wanted to lease a unit. In the end, the condo association ended up paying a settlement of $300,000. This is because Florida law prohibits condo associations from charging more than $100 dollars for individuals or married couples who are looking to buy, lease, or transfer a unit.

Overcharging fees like this is illegal and the ramifications can be costly. Always work with your lawyer to better understand what fees you can legally implement so that you don’t end up with a costly lawsuit on your hands.

Further Steps to Protect Your Business From a Lawsuit

When learning how to protect your business from lawsuit, some things are universal, no matter what industry you are in.

Keep Records and Put Everything in Writing

Signed documents dictating agreement between all parties can be a lifesaver — and a money saver — to both prevent lawsuits or win them.

It is essential that you work with your lawyer when drafting all contracts and documents to make sure that nothing you are asking or requiring is outside of the law. You’ll also want to have your lawyer go through all the documents and contracts and make sure that there aren’t any loopholes that could be exploited or taken advantage of. Always use clear and concise language so that nothing can be misinterpreted. Keep copies of everything in an easy-to-access and organized place. You should also make sure to accurately date everything to ensure that there can be no confusion late on.

Additionally, any important correspondence should also be saved and archived. This can include emails and notes from phone conversations.

Take Steps to Protect Your Reputation

Your reputation and the reputation of your condo are important, so it’s vital that you protect your image at all costs. This can help ensure that your condo building stands out from others in your area as a great place to live, as opposed to a place that potential owners and tenants will want to avoid.

This image also extends to anyone on the board and in your condo association. If you allow association members to bend rules or receive special treatment, other tenants will look upon you — and them — unfavorably. This can lead to them looking for another place to live, leaving you with an empty unit.

Whenever possible, act with honesty and integrity to show that you value your unit owners and that you’re invested in the success of your condo business.

Separate Your Personal Assets and Your Business Assets

Some small businesses, such as condos, may operate as sole proprietorships. While this is the easiest and least expensive way to start and run a business, it does come with significant risk. As the sole owner, you are personally responsible for any liabilities in the event that a lawsuit is filed against your business.

Setting up your business as an LLC can help mitigate this risk and remove your personal assets from your business. This means that you won’t have to worry about losing out personally in the event of a lost lawsuit. While it may be easier to forgo setting up an LLC at first, ultimately it is safer for you in the long term.

Work with your lawyer to examine the benefits that this type of structure can bring to your condo business.

Always Have a Lawyer Ready

You might think that once everything gets going that you’ll only need to hire a lawyer as needed. However, this can put you at risk of making costly mistakes and it can increase the chance of running into a lawsuit.

Operating a condo business comes with a lot of legal issues that you will have to learn to navigate. Without the expertise of a lawyer who is familiar with the system, you could end up missing important information and conducting business improperly. If you are sued due to these mistakes, the law won’t be on your side, even if you have a lawyer to defend you then.

Look for an experienced and reputable lawyer in your area that you can easily access whenever you have questions. You’ll want to choose a lawyer who is familiar with housing laws and has experience working with condo businesses. This will set you up with the greatest foundation for success.

Protecting Your Business

Now that you know how to protect your business from lawsuit, you can start taking steps to implement these tips into your business model.

Firstly, find a lawyer before you do anything to make sure that any changes you make are smart and within your rights as a business and property owner. If you find a lawyer and they point out that a current policy or strategy is at risk of going against the law, take immediate action to rectify it before it turns into a lawsuit.

Once you have shored up this sector, consider changing your business model to an LLC, if you are not already. This can help prevent you from being personally liable for any mishaps.

Thirdly, you’ll want to examine your insurance coverage both with your lawyer and with a qualified agent. If you find anything lacking that could leave a hole for a lawsuit, look at how you can fix it as soon as possible.

Along with this, you should make sure that your association has been taking the proper steps to maintain your condo building. This includes maintaining the exterior of the building, the common areas, and the landscaping so that all shared spaces are clean and safe for residents.

Additionally, if any tenant contracts are found to be out of date, or contain inaccurate information, you should ensure that they are updated and re-signed by all residents as soon as possible. If you update contracts but don’t have tenants sign them, they could sue you based on never having gotten or agreed to the new terms. Always make sure that everyone is on the same page when it comes to the rules and regulations that you set for your building.

Don’t Gloss Over the Details

Although it might be tempting to gloss over some of these details, they are all important if you want to know how to protect your business from lawsuit. By following these tips and working with your lawyer and insurance agents, you can help make sure that your condo business won’t be at risk of any unnecessary and costly lawsuits.