Continuing Reinforcement of the Need for Asset Protection
A recent New York state appellate court decision (Cornell v. 360 West 51st Street Realty, App. Div., 1st Dept), in favor of a plaintiff suing her landlord for injuries related to exposure to mold, is expected to result in more litigation by tenants against landlords. As the Wall Street Journal reported:
“The decision has been the talk of condo and co-op lawyers . . . who worry that it will lead to a new wave of personal-injury lawsuits for mold injuries, driving up insurance rates and costs for building owners.” (WSJ, April 2, 2012.) Practitioners also predict that this ruling might be followed by courts around the country, expanding the mold litigation threat to landlords and property owners not only in New York, but throughout the country.
The Cornell case is significant because the court gives credence to scientific evidence within the medical community as support for claims of illness and injury from mold. Previously, a lower court had ruled that the evidence was lacking, which put a damper on mold based litigation in New York. Now that the appellate court has accepted the scientific evidence as supporting mold injury claims, more mold-based lawsuits are expected against real estate owners, landlords and developers.
We have frequently written about litigation threats to property owners and landlords. These threats are based on many potential sources of liability, including asbestos, lead based paint, mold, Chinese drywall and changes in law that encourage people to sue property owners. Our articles provide an overview of the liabilities associated with property ownership and real estate development, and discuss how asset protection can safeguard against these threats. Proper asset protection also allows for more reasonable levels of insurance and thus, lower premiums, while the personal and business assets of the property owners are protected from plaintiffs’ lawyers and future litigation. For instance, please see:
- Turning Property into a Fortress
- Creating a Safety Net for Landlords
- The Drywall Problem and Asset Protection – Why and How Builders and Real Estate Developers Should Protect Themselves
It is clear that the risks facing real estate owners and developers, including theories of tort liability sanctioned by courts, offer compelling reasons for builders to properly protect the assets they have worked hard to acquire. In addition to their real estate holdings, developers must give thought to protecting their personal assets. Proper asset protection strategies offer builders and developers piece of mind and provide the protection their properties need to withstand the inevitable attacks. For additional information on protecting assets, please contact us.