In their note to the seller they also acknowledged they paid rent late.The previous owner had two strokes and wasn't in a position to provide me with much information with regards to whether he kept the deposit in an interest-bearing account.

How do co-owners effectively manage these aspects?

Here is an example of the laws associated with utility companies (That I know of).https://www.revisor.mn.gov/statutes/2021/cite/325E.025https://www.revisor.mn.gov/statutes/2021/cite/327C.01https://www.revisor.mn.gov/statutes/2021/cite/327B.01From my interpretation "A utility may recover or attempt to recover payment for a tenant's outstanding bill or charge from a property owner where the manager, acting as the owner's agent, contracted for the utility service."

Separately, even if there is a claim that could earn you monetary damages against the past owner if in fact they are somehow at fault, keep in a mind a judgment against the past owner is not necessarily going to yield you anything.

I'm trying to refinance a piece with some cash out, just went under contract on my lot next to it for $260k for 7 acres, but need to refinance the 249 out of a owner carry contract for the other deal to go through.

Quote from @Chris Seveney: @Tammy HelleWow I never knew this- thanks this is great to know I found out from another business owner as she's had success in doing this.

The property is currently owner-user but would likely not qualify as an owner-user to give more insight on the condition.  

Also, if it isn't a legal duplex I might consult a lawyer to see if your title insurance or the previous owner might be liable to you for that issue. 

I've been learning about creative financing lately and gathered that the seller is open to owner financing.

We are being told by largest single family home operator and owner and a second one in the top 10 that even Columbus Ohio isn't in their market.