Property managers and landlords feeling the bite of lawsuits

Posted by John Cofini on Tue, Aug 13, 2013 @ 03:10 PM

"Good night, sleep tight, don’t let the bed bugs bite, and if they do, then take your shoe, and knock them ‘til they’re black and blue!"

Remember that? It’s an old nursery rhyme that parents have been tucking their children into bed with for over a century.

But nowadays when bed bugs bite, more people are biting back – with lawsuits against landlords and property managers. Bed bug lawsuits across the nation have increased dramatically over the past few years, and a couple of recent high profile cases have put the spotlight on the issue – and the heat on landlords:

  • In January, a Spring Valley, NY woman filed a $7 million suit against Holiday Inn’s parent company after allegedly being bitten by bed bugs on a visit to a North Carolina Holiday Inn. 
  • In May, 300 residents of apartment buildings in Iowa got the go-ahead to file a class-action lawsuit against landlords for an alleged bed bug scourge. 
  • Also in May, an Annapolis, MD woman was awarded a record $800,000 in a bedbug lawsuit against her landlord, as reported in the Baltimore Sun.  

A sign of things to come?

These cases highlight the growing sympathy juries have with plaintiffs in infestation cases, and their desire to send a message to landlords who they feel aren’t properly dealing with this problem. And while the recent Maryland case will likely serve as a catalyst for others to file suit, it’s a wake-up call for landlords and property managers.

Let’s face it – we live in a litigious society, and more and more property managers and landlords are finding themselves named in lawsuits. And it’s likely to get worse. According to Jeff White of BedBug Central, an expert in bed bug litigation, “In the next two years I think it’s going to be a complete circus when it comes to bed bug litigation and property management.”

But the bedbug problem isn’t the only thing biting property managers and landlords in court.

Lawsuits against landlords and property managers cover a lot more ground than just bug infestations, with grievances that include fraud, negligence, breach of contract, code violations, and safety and health violations. And they’re not the only ones feeling the pinch. Plaintiffs are being urged by their lawyers to sue all parties associated with the lease agreement to include the property manager’s agent, the property management broker/company, the owner(s) or investment groups, etc. In short, plaintiffs are out for blood.

How do you fight this serious threat to your bottom line?

With more and more lawyers being trained for this type of litigation all the time, landlords and property managers are fighting back. They’re making sure they document everything diligently and have the proper insurance in place. And many are limiting their exposure to possible litigation by turning to third party inspection companies for professional documentation of the property in the form of: 

  • Pre-agreement inspections
  • Initial / move-in inspections
  • Periodic / preventative maintenance inspections
  • Transitional / exit inspections

If you own, develop, or manage commercial or residential real estate such as office buildings, retail space, or multi-family properties, a lawsuit could take a big bite out of your bottom line. Let the insurance experts at BNC Insurance and Risk Advisors Insurance provide you with the most comprehensive, competitively-priced real estate insurance in the New York boroughs, so that you can sleep tight

Tags: NY business insurance, NY property manager insurance, NY hotel insurance, NY landlord insurance, NY commercial real estate insurance