Protecting Your Assets: Ways You Can Protect Your Farm From Lawsuits

Injury lawsuits and other types of lawsuits are a farmer's worst nightmare, especially because they can seem to come out of left field. If you are not prepared to handle extensive litigation, you could suffer extraordinary losses to your farm. Here are some things you can do to help reduce the chances of being sued and to lessen the severity of a lawsuit should one occur.

1. Keep scrupulous records. 

The more you can document on your farm about working hours, wages paid to hired hands, how much you spend on feed for animals, fuel for machinery, and other business costs, can really help you if a case ever comes against you. Working records from several years of farming can show that you are consistent in your business practice, and so any issue that someone brings against you can be lessened in severity if you have proof that you have been doing things the same for a long time. For example, if you are sued for using a specific type of fertilizer because a local water source is polluted, showing the you used the same fertilizer in the same amounts before the pollution was problem can help the case against you to be dropped. 

2. Hire a lawyer to set up asset protection planning. 

Asset protection planning can help you should a lawsuit ever be filed. You often cannot set up asset protection after a case has been made against you, so asset protection is like insurance against lawsuits that will allow you to keep your farm, even if damages clean out more liquid financial resources. Asset protection is possible by making your farm into an incorporation. If your business-- the incorporation-- is separate from your personal assets, things like your land and your house cannot be touched by a lawsuit. Another option is to form a limited liability company, which build protection around the assets of the farm, in that it is much harder to seize personal assets that are protected by an LLC. 

3. Protect against personal injury lawsuits. 

Personal injury lawsuits, including lawsuits that involve worker's compensation damages, can be one of the most costly to your operation. It is essential that do everything possible to avoid negligence of any kind. Be sure that all farm workers have proper documentation, like driver's licenses, before they are permitted to operate tractors or larger machines. Check your holdings carefully from month to month to make sure that everything is in good repair. Require safety procedures to be preformed every time heavy machinery is going to be used. For example, you can make it farm policy that every employee walks around the combine before turning it on to make sure no one or nothing is in the way of the machine. Rules may seem troublesome, but enforcing them will strengthen your argument should you need to defend the operation of your farm in the courtroom. 

4. Keep a lid on publishing your success.

The more successful you become and the more your farm grows, the more likely you are to face a lawsuit. The logic behind this is that when people feel they can sure, they might not do so if there is nothing to win. When you have plenty of land, tens of thousands of dollars worth of equipment, and several hundred employees, your pockets get deeper and people might target you more, because they know they will actually gain something from litigation. As much as possible, keep the profit of your company under wraps, and run a clean, tight ship. Hire an accountant to deal with payroll and billing, and pay into larger insurance policies as you grow. Try to keep your assets divided so they don't all fall under one name or one business. A personal injury lawyer or an estate planning lawyer can help you in this area. 

For more information, contact a company like Burke Schultz Harman & Jenkinson Attorneys at Law.