Otherwise your in a he said she said in court, which is where this will end up.  

Lay the law down with your tenants and don't deviate from your rules.If they end up not respecting you (and some tenants will), they will respect the courts, and the sheriff.

I think it is disregard and I can represent myself in court.

If you have to go to court, you've already lost.  

Landlord pays ~$100 per month water only.Not sure how to proceed.

During the past year of this audit, I researched all aspects of the Real Estate Profession rules and regulations and past court cases.

Maybe the only thing I can do is offer the seller a solution of my property management service to receive the proceeds to add to my cashflow some and to remove his having to think about or manage the property himself..

I'm not going to lie though, I"m targeting that field work position (going to auctions, court houses, meeting with clients, ect). 

she is threating me with sending me to court. 

Anything that needs to be cleared up at the last minute is paid out of the sellers proceeds.