Even though you probably have the necessary insurance to provide protection in the event of a lawsuit, avoiding one altogether is preferable. In some cases, a lawsuit may seem as though it was unavoidable, but what if you could go back and change things? While you can’t reverse time, there are some acts you can take now to provide you greater legal protection in the future.
Put Everything in Writing
The number one rule in business has become to provide a written document for every transaction. Even if you have a room filled with witnesses to a “handshake deal,” it’s still far better to provide a printed invoice, receipt, or other documents. A written document should provide the services or goods to be provided, a delivery date, and the total price. This will help reduce the likelihood of a dispute in the future.
Make Cybersecurity a Priority
It’s becoming increasingly common for businesses to face lawsuits over data breaches. When consumers engage with your business, they will have to share sensitive personal and financial information with your business. In doing so, your customers are trusting that you’re taking the necessary precautions to protect that information from hackers and other cybercriminals. Installing a high-quality cybersecurity infrastructure, which you regularly update, helps you provide better protection to your customers, employees, and vendors.
Incorporate Your Business
Most entrepreneurs and small business owners operate their businesses as sole proprietors without realizing the risk that entails. If your business does become named in a lawsuit in this type of situation, you can also be held personally liable. This means your private assets won’t be protected. The best solution is to incorporate your business, so the business’ assets are held in a trust. In this situation, your personal assets and savings will be protected.
Retain a Competent Law Firm
Lawsuits do happen from time to time and it’s highly unlikely that your business will never be named as a defendant in a claim. There are also many other legal concerns you’ll face as a business owner, which may include meeting IRS tax requirements, incorporating your business, or drawing up legally binding contracts. By retaining one law firm to handle all of your business needs, you can ensure your lawyers are up to speed on your business dealings whenever you may need their services. This can save you time and money, as well as ensuring you’ll always have someplace to turn for legal help.
By following these suggestions, you’ll provide a safer environment for your employees and customers. In turn, you’ll be protecting your business from lawsuits. By planning ahead you can help minimize the likelihood of a lawsuit in the future.
**This article is for informational purposes only and is not intended to be legal advice. In relation to your individual situation, always seek advice specific to your circumstances from a lawyer.