Your business is a vital part of your life. Obviously, you will do everything in your power to limit risk and to keep it running smoothly. But how can you go about limiting the potential of a lawsuit to ensure business operation? Let’s take a look at 5 tips you can apply today to protect your company for whatever it will face in the future.
1. Censor what you show in the public. Business image is everything regardless of the type of business you are running. Owners and their staff must avoid conducting any business or making public announcements that can be seen as questionable. This involves avoiding things like slanderous statements or libelous writing. It also involves not engaging in business with devious people.
Keep a lookout for any conflict of interest. Business managers and their staff should avoid situations that can lead to conflicts of interest. Situations like these can potentially damage your integrity as a business or land you in legal hot water. As an example, sitting with the town council and assisting to pass an ordinance that benefits your business could be a conflict of interest, even when you didn’t make the last call or decision that will benefit your company.
2. Hire a Competent Lawyer. As a business manager, you have to hold up against legal persecutions the best possible way. Start interviewing lawyers as soon as you start up, in order to have a ready legal assistance when necessary. You may need the lawyer to advise you before you act or on how to react when a person or entity is actively suing you.
You can also lodge your court documents for any NSW Civil Registry from the convenience of your desktop. This convenient eFiling in NSW via Infotrack offers no setup fees, no repetitive data entry requirement, and documents are lodged instantly and they are returned as PDF documents, with the Court seal.
3. Separate Yourself from Your Business. There are many businesses that are run by sole proprietors. The problem with this setup is that in the event the company is sued, the manager /owner’s asset (including their home, car, and other properties) is vulnerable to attack or can be attached in a court of law.
The solution is simple; you need to have a trust that will own the business. A trust is a legal entity that has the ability to file its own tax return and can own businesses, properties, securities, cash and a host of other assets.
4. Get Insurance for Yourself. You should obtain a liability insurance in case a customer slip and fall in your business place. Professionals like consultants and insurance agents can help you with this. They can also assist you should a client or customer accuses you of making an error, or not following through a contract.
If you’re running a large business with a formal board of directors, it will help you to secure directors and offers liability (called a D&O insurance.) Once obtained, this insurance safeguards the director’s individual assets in a larger suit filed against the business.
5. Protect Your Computers. Businesses today are heavily reliant on computers, so it makes sense to emphasize on the safety requirements for your computer system. Always install antivirus or malware protection software on your computers – and keep them updated.
The Bottom Line
As a business owner, you have the responsibility to protect your business and personal assets if you encounter a lawsuit. With these five tips under your belt, your company is on its way to a legal- and hassle-free future.