Although all business entities are susceptible to litigation, shooting photos for a living can lead to a number of lawsuit scenarios. Someone trips over a light stand or is burned by a hot light. You accidentally spill a beverage on the front of a bride’s dress before taking some of the pictures she absolutely wants. Photographers are vulnerable to what is called “errors and omissions,” which is why there is specific insurance for those kinds of mistakes.
You can protect your business, home and financial and other assets when you follow this simply ABC formula.
A is for Averting. In our highly litigious society, being sued is quite likely, even if a court/judge eventually declares the suit to be frivolous. Your first mindset adjustment, therefore, is to be aware of the possibility. Then, you can take three different sets of action steps to reduce the possibility.
First, thoroughly review how you set up and use equipment in a shooting environment where there may also be models, clients, assistants, interns, whomever. Maybe you need sandbags or other means to make sure light stands remain in position, even when accidentally knocked. Tape the complete lengths of cable to the floor or use cable runners in which to hide the cords.
The second set of action steps is to train your staff members thoroughly, so they are always safety conscious when they assist you during a shoot.
Then, be sure you NEVER obligate yourself personally for any leases, contracts or other business agreements. This automatically makes you vulnerable to being sued as a private individual. Instead, use a corporate and/or other types of legal business structures, so both your business and personal assets are very difficult, or impossible, to reach if a lawsuit is successful. This is why having an attorney on your business team is an absolute necessity for even the smallest business of any kind. Even if you are a semi-pro or make money with your camera part-time, you want to consult with an attorney to put these protective layers in place.
B is for Bust. Let someone sue you; let the court declare a judgment against you; but if you appear to be financially bust, then there is nothing for the litigant to collect. Before any attorney will agree to represent a party that wants to sue you, the attorney wants to know that there is a better than 50-50 probability of winning and that there are assets to attach. Most attorneys will advise against filing the suit if they and their clients must spend months in court, only to receive nothing.
Remember, in most cases, people that want to sue you will sign a contingency agreement with an attorney, meaning he or she doesn’t receive a fee unless the client wins and there are assets available. A smart attorney will determine before filing the suit whether your assets are vulnerable to collection. If you and your attorney have structured your business correctly, then public records will show that you own nothing.
C is for Command. This leads to the final protective strategy, which is that it is more important to be in command of your business (or anything) than appearing to own it. You don’t need to own and use a car if a corporation owns it, but permits you to use it. The same goes for a credit card. Sometimes, valuable business assets, such as the building where your studio is located, can be put in the name of another family member. The laws are very specific about hiding assets, which is another reason you need the guidance of an attorney to structure your business, personal finances and property and estate to protect them as much as possible from lawsuits.
(PhotographyTalk.com does not provide legal or financial services or advice, and this article should not be construed as such. It is for a general informational purpose. You are encouraged to contact your attorney to discuss how to protect your personal and photography business assets from lawsuits.)
People who read this PhotographyTalk.com article also liked:
Feel free to look at our tips and taking photos forum
Photo by PhotographyTalk Member Sreejith Venugopal