A horror story. A colleague moved to Brisbane at the beginning of the year. He rented out his PPOR in Sydney.
A month later the male tenant slipped and splintered an ankle bone while walking down the driveway. No major or lasting damage. However, three months later the tenant visited a no win-no fee lawyer. Six months later my colleague received legal papers informing him that the tenant was sueing him for $750,000! There's a medical report to say the tenant's ankle was injured, but had since repaired itself. But there's also a letter from a tame psych who says the tenant suffered deep emotional and psychological as a result of the accident. My friend, who is not a professional investor and has a young family, tells me this placed everything he owned in jeopardy.
After a period of negotiation the claim has been reduced to $30,000 plus legal costs which he'll manage if he sells the property. Nearly, 12 months since the "accident" my friend is still waiting to go to court. The stress has been unbearable.
The tenant remains in the house dutifully and carefully fulfilling all the requirements of the lease. He's stopped working. His wife's income pays the rent. My friend has been advised by his lawyers to leave the the tenant there if the lease expires before the court case, which looks likely, otherwise he might be accused of conducting a vendetta.
What really angers my friend is that he and his wife welcomed the new tenants to their home with a bottle of wine and flowers.
And what of his insurance you ask? Well, the insurance company is trying to wriggle out refusing to say whether he's covered for it. They keep telling him they are "still investigating".
The question? How do we stop bludgers like this coming after us. Is setting up a trust and putting our properties into it the answer? And what a cost! One thing is certain. There will be many more cases like this. Just count the ads being run by lawyers in the rental columns of your local newspaper.
A month later the male tenant slipped and splintered an ankle bone while walking down the driveway. No major or lasting damage. However, three months later the tenant visited a no win-no fee lawyer. Six months later my colleague received legal papers informing him that the tenant was sueing him for $750,000! There's a medical report to say the tenant's ankle was injured, but had since repaired itself. But there's also a letter from a tame psych who says the tenant suffered deep emotional and psychological as a result of the accident. My friend, who is not a professional investor and has a young family, tells me this placed everything he owned in jeopardy.
After a period of negotiation the claim has been reduced to $30,000 plus legal costs which he'll manage if he sells the property. Nearly, 12 months since the "accident" my friend is still waiting to go to court. The stress has been unbearable.
The tenant remains in the house dutifully and carefully fulfilling all the requirements of the lease. He's stopped working. His wife's income pays the rent. My friend has been advised by his lawyers to leave the the tenant there if the lease expires before the court case, which looks likely, otherwise he might be accused of conducting a vendetta.
What really angers my friend is that he and his wife welcomed the new tenants to their home with a bottle of wine and flowers.
And what of his insurance you ask? Well, the insurance company is trying to wriggle out refusing to say whether he's covered for it. They keep telling him they are "still investigating".
The question? How do we stop bludgers like this coming after us. Is setting up a trust and putting our properties into it the answer? And what a cost! One thing is certain. There will be many more cases like this. Just count the ads being run by lawyers in the rental columns of your local newspaper.
She claims the hotel should have known when she'd had enough and should have stopped selling her alcohol (yes, and now we expect barstaff to be experts on human behaviour! Some people I know appear drunk when they're acting normally!!) 
