It sucks to see a lump sum of something lower then four digits be on someone’s record,And potential jail for such lazy and negligent behavior that could be solved by a few months of minor savings.

If a tenant negligently damages the appliances, then they're responsible.

For most investors, the final tax amount on rental income is negligible - maybe costing .25-.5% of overall return on investment from the deal - which the use of leverage kicked upwards in a much higher degree.If debt-financing is still in place when the property is sold then the gain on sale is also treated as UDFI and taxable.  

Often they hold the cards because they collect rent, then disburse to you, which puts you in a precarious situation.Sounds like the writing's on the wall, though in terms of your relationship with your PM and their sub(s).So, I'd be thinking in terms of replacing them first, and then if you feel the work was truly out of scope, fraudulent, or borderline negligent, AND you feel the contractor and/or PM has enough to loose to actually have to defend themselves and pay out, then I'd pursue.If nothing else this action sends out smoke signals to future PMs that you're not dealing with this nonsense. 

Should one or more of these items need repair or any maintenance due to tenant misuse or negligence, Landlord will not be responsible for the cost of such repairs/maintenance.

I can see landlord getting dragged into a lawsuit and it being an expensive PITA to deal with, but I highly doubt you would be found negligent in any realistic scenario.

The contact my wife signed said I cannot sue them for anything except for gross negligence.

My main concern is that if I go this route that my own personal insurance rate would increase significantly as a result of some negligent kid. 

Nicole: a homeowner's insurance policy may not cover losses incurred due to the negligence of a renter. 

In addition to crippling fines, you don't want to live with the knowledge that your negligence has wrecked a kids life forever.I'm not familiar with the particular phrasing of that statement, but it sounds like the city thinks there's a lead hazard there.