Not every business will have to face legal proceedings.  In fact, you may never see so much as a summons, much less become the target of a lawsuit (especially if you run a small, freelance, or home-based operation).  But that doesn’t mean you can afford to go unprepared for the possibility.  Running a business is a big responsibility and it comes with specific legal obligations that you must be aware of and meet.  And the truth is that it’s much better to avoid a lawsuit than to have to face one, even if you are prepared for it.

So, here are just a few ways that you can protect your business and hopefully steer clear of any potential legal troubles.

Hire Representation

First and foremost, you should consider putting a law firm on retainer.  Granted, this could be a big expense for a small business, but it could also save you a lot of money in the long run.  The idea here is to secure legal advice and services early on in order to avoid costly lawsuits down the road (that have the potential to put you out of business).  At the very least you need to separate your business assets from your personal ones (especially if you are self-employed or otherwise unincorporated, or you work out of your house).  And there’s a lot more an attorney can do for your business to prevent legal issues.  Of course, he can also represent you should you ever have to face legal proceedings.

Use Your Brain

Your best tool for preventing a lawsuit is your brain.  By thinking things through you can often engineer solutions that will keep you from being sued.  For example, you can probably come up with a laundry list of things that people might sue over, such as faulty products, failure to deliver, accident and injury (if you employ others or if your products may be unsafe for, say, small children), and so on.  If you know about these possible issues going in you should be able to find ways to avoid them.

Get It In Writing

Nothing protects you better than a contract that is legal and binding, especially should a courtroom situation arise.  This means that you need to get everything in writing.  Certainly we all want to believe that others will live up to their word, but a smile and a handshake will get you absolutely nowhere with a judge.  However, a comprehensive contract could specify arbitration or mediation (rather than filing suit) in the case of a dispute.  Or it could lay out terms so specifically that they simply aren’t open to interpretation.  A good contract could halt a lawsuit before it even starts.

Do Unto Others

Most people these days just want to be treated fairly.  While there are those who prey on businesses that they perceive to be weak as a way to earn a living, the majority of your customers, employees, and business associates are just average people trying to get by and it doesn’t take much to keep them happy, especially in this day and age of impersonal interactions.  So if you’re willing to bend a little, makes some concessions, and offer reparations for disputes (not to mention excellent customer service) you’re bound to come out ahead.

Get Insured

It never hurts to have a “just in case” scenario.  So, just in case you should face some kind of lawsuit, be prepared with business insurance.  It will protect you and your business should anyone come after you.

Evan Fischer is a writer for, a law firm that protects the livelihood of clients who have suffered from an injury due to another person’s negligence.

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