All Forum Posts by: Alex T.

@Jason G. Thanks again for all the info. I spoke to my insurance agent, and he basically said everything you've pointed out. Judging off the letter, he thinks it's bogus too, but admits that the carrier will look at all the facts before deciding how to proceed. At a minimum, it sounds like the carrier will force the lawyer to file a lawsuit...and that could result in the lawyer dropping the case. But if not, it'll probably be months before we hear anything else.

Sidenote: Assuming this is a scam, I don't understand how there aren't laws in place to protect against this. A simple law making personal injury lawyers accountable for court costs - should they lose - would be enough to dissuade a lot of these guys from taking crap cases. My understanding is that it's very difficult to win these cases in my local court system, but because it's at least 10-15k to defend an average claim, it rarely makes sense to fight it. Most of these lawyers only sue for an amount similar to what they know it'll cost the insurance agencies to fight. And the cycle just goes round and round.

Regarding the insurance premium, my agent said that if I continue setting up separate LLCs for each investment property, there'd be no impact of this claim on future insurance coverage. My GC, however, might see an increase if the claim goes against his insurance...but if so, I'm sure he'll find a way to pass that extra cost onto me!

@Ashish Acharya Thanks a bunch - this is easy to understand. I'll confirm with my CPA and then begin paying 2019 taxes quarterly based on my 2018 tax liability.

@Jason G. Yes, I have GL coverage for this rehab project. I have forwarded a copy of the lawyer's letter to my insurance agent to see how they want to handle it. So frustrating...I'm very confident this is a bogus claim!

My GC also has a GL policy to which my LLC for this property is named as an additional insured. The claim is that a piece of wood fell and hit the claimant on the head. I'm 99% sure that my GC wasn't onsite or working with any subs on the day in question...is my insurance carrier going to try and file this with my GC's coverage because the claim is that part of the building was left unsecured?

If the insurance company decides to settle, do you have a sense for what impact it might have to my future Builder's Risk/GL policies? I assume I'm going to end up paying significantly higher premiums for the next couple of years. Does the answer change if the insurance company fights the claim and wins?

Thanks all for the advice. I'm definitely not communicating with their lawyer. It seems like my insurance agent is out of town, but I've sent him a copy of the letter. I also know an injury lawyer in my state, so I'm trying to reach out to him as well.

I am working on a rehab right now, and I just received a letter from a law office stating that their client was injured on my property by a "piece of wood which was unsecured" when it "fell and struck her on the head." The lawyer makes no mention about specific injuries or wanting to file a lawsuit; instead, he's asking me to provide him with the name, policy number and contact information for my GL carrier.

Obviously, if this lady was actually injured walking by my property, I'd feel terrible and this is what I have insurance for. But taking everything at face value...(1) The letter states that the incident took place 6 weeks ago. Why is this the first time I'm hearing about it? (2) The reviews for the law firm all make it sound pretty scammy. (3) I've read other places on BP about these types of letters...if the lawyer is only asking for insurance information, it's because they would not proceed if they have to sue.

Not that it proves anything, but I know for a fact that there was no construction happening on the incident date. I have zero experience with this; I would greatly appreciate the BP community giving me some feedback!

@Ashish Acharya Thanks for the response. So I have 4 members in the LLC (wife included), but I am the only managing member. Two of the members (including myself) are self-employed without a W2. So in 2017, we filed taxes showing that the LLC didn't make any money. In 2018, the LLC netted 100k. Everyone will get their K1s and file their share of the profit by 4/15/19. In 2019, let's assume the LLC has one flip that closes around June 2019 and the LLC nets another 100k. Would myself and the other non-W2 LLC member need to calculate our tax liability based on our share of the 100k profit and then pay the IRS 50% of our liability in Q3 and Q4? Is that how it should work?

I have an LLC that was started in 2017 for my first flip. The LLC generated no taxable income in 2017, but of course, we still filed a return. We sold the flip property in 2018 for a profit. Was I supposed to be paying quarterly taxes to the IRS from the time I made a profit in 2018? My CPA never mentioned anything. I read that you don't have to start paying quarterly until the year following your first filing that has a taxable income...so for me, that would be starting in 2019. Can anyone confirm this? Thanks for the help.

@Eric Seo I agree with David's comment about windows needing to be 24"+ off the floor for a second or third story. Occasionally, I've seen windows below this threshold, and when we redo the windows, we adjust the framing to comply with the 24" requirement. If the windows are safely above the floor, really the only other thing an inspector could call out is the need for glass tempering. Other than that, there is no requirement I've heard of to limit the opening. If so, virtually every house in Philadelphia would be in violation. Let us know what ends up happening...

@Troy Sheets Thanks again for the insight. We still have a ton of lumber on the sidewalk, so I'm just going to let it go until after Xmas and then clean everything/open it on Wednesday. I can't see the city running around this weekend and over Xmas, but who knows. If they ticket me, it's not the end of the world. I still think closing my sidewalk right now, and having people traverse the street, is slightly safer than having them walk across the jobsite...but it's close...and you're right, ultimately it's no win for us. 

I put a lot of attention and effort into neighbor relations. Part of that is keeping the sidewalk clean and free of debris. Obviously, it's impossible to control subs when I am not onsite, but I do what I can. 

@Troy Sheets I agree with you, people crossing to the other side incorrectly has always been a concern of mine...and I watch it happen all the time. In the future, I'm not sure it's worth it except for quick closures like utility work, concrete, etc. 

So do you think Streets is driving around once a permit expires to confirm that the sidewalk is open again? What are the odds I get back from Xmas on Wednesday, and I get a $75 ticket to my home address for every day that I keep it closed? It's a silly system. If I could pay for an extra week, I definitely would have, but they make you commit to the length in the beginning. And of course, my guys weren't doing any construction for the first week and a half when we had it closed.