Tenant Lawsuit. Need advice!

[Alex Stewart]

All, I have a challenging situation that I would like some insight on from the community. I have a rental property I purchased in December 2017 that I rehabbed and rented out in March 2018. The property had been vacant for years and at some point the city had tagged it as effectively “condemned” until certain code violations were resolved. I made the repairs and rented the home out without knowing these issues were outstanding (I genuinely don’t remember seeing the tags on the door). Needless to say, the city posted a red tag notice on the door 10 days later and the tenant could no longer enter the home. I can honestly say that the home was safe and I would have no problem living there personally but the city is furious that permits weren’t pulled and this home seems to have had quite a history with the city (not in a good way). We are still in the process of resolving the issues by pulling permits and re-doing the work but its a lengthy process and will still be a couple more weeks until it is resolved. Finally, I get a lawsuit letter from the tenant’s attorney today claiming emotional distress, hardship, food costs, lodging, etc. to the tune of $30,000 even though they moved into a new home within a couple days of leaving my property. There are more details but I tried to summarize to make it an easier read. What would you folks do here besides the obvious of hiring an attorney? What do you think is a realistic outcome/resolution? Thanks to all for your input!!!