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Rental Property Owner – Sued for Wrongful Death

by Douglas Lineberry on April 20, 2012

On April 17, 2012, the Estate of Billy Ray Shirley III sued Bill’s Towing and Garage for Mr. Shirley’s death.  The complaint is linked below if you care to read it.  It alleges that the property owner allowed its tenant, a motorcycle club, to operate an illegal nightclub on the premises.  Mr. Shirley was unfortunately shot at the nightclub (apparently there helping a friend find his mother).  Three causes of action are claimed against the property owner.  First, that it was negligent in allowing a motorcycle club to operate a nightclub on the premises.  Second, that a hazardous condition existed on the premises that the owner should have warned of and repaired.  And third, that the defendant violated the Washington Consumer Protection Act by engaging in unlawful and deceptive practices.

The Tacoma News Tribute ran an article on April 19, 2012, that included several quotes from Tom Lomis (the owner of Bill’s Towing & Garage).  Mr. Lomis is quoted as saying he had no knowledge of the nightclub and for that matter that the tenant was a motorcycle club.  The article states that he rented the property to a “clean-cut, polite man” to be used as storage space.

I’m not going to comment on the merits of either the case or likely defense.  There are not enough facts available in either the complaint or the newspaper article to fairly do so.  I do believe, however, that the case illustrates something I regularly tell rental property owners (both commercial and residential).  If something bad happens, the property owner gets sued.  It’s the classic “name on the title” theory, and also something of a deep-pockets theory.  Notably absent from the lawsuit is the person that actually pulled the trigger, or even the tenant.  Why didn’t anyone bother finding and naming them as defendants? Probably because they wouldn’t have any money or insurance coverage.

Rental property liability comes from unknown directions at unknown times. Be prepared! You must get title to the property in an LLC or other corporate entity before bad things happen!

The point, then, is that if you have rental property you have no idea what you can be sued for or when.  Obviously it can be the acts of your tenants (whether you knew about the acts or not).  Given that uncertainty, you would be foolish not to hold title to the property in some kind of corporate form such as a limited liability company.  If you do have property in your own name I urge you to contact experienced legal counsel who can help you assess all of your potential risks and liabilities and structure a solid asset protection plan.

Hayes v Bills Towing & Garage Complaint

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