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Liability? Where do you start?

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Forum topic by becikeja posted 05-05-2017 10:59 AM 1774 views 0 times favorited 22 replies Add to Favorites Watch
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becikeja

825 posts in 2653 days


05-05-2017 10:59 AM

This morning I was reading an older post here on the site ”Starting a small wooden toy business ” http://lumberjocks.com/topics/55618
How sad it is that a discussion on Building Toys immediately went to liability and risk.
I made a rocking horse recently for my grandkid, and since I have had several people offer and give me actual cash to make one for them. It has me thinking about knocking a few of these out on the side as a “small business” and see if I can’t sell a few more. Would love to knock these out at a price that young families can afford something decent, but don’t want to risk my life savings trying to be a nice guy.

But after reading the post referenced above I am now scared to death. Rocking horses are not exactly without risk. Where do you start to research this? Is it really that bad? Has America really become so litigious you can’t even knock out a few toys without being sued?

Yes, I think the Paranoids are after me

-- Don't outsmart your common sense


22 replies so far

View Fred Hargis's profile

Fred Hargis

4769 posts in 2333 days


#1 posted 05-05-2017 11:12 AM

Is it really that bad? Has America really become so litigious you can t even knock out a few toys without being sued?

Yes, I think the Paranoids are after me

- becikeja

My opinion: yes it is that bad, we need tort reform. But as long as we have lawyers writing the laws, they will favor (ta-da) lawyers. One more time: my opinion.

-- Our village hasn't lost it's idiot, he was elected to congress.

View FarmerintheWoods's profile

FarmerintheWoods

36 posts in 289 days


#2 posted 05-05-2017 11:58 AM

Consider setting your business up as a Limited Liability Company (LLC).

View TravisH's profile

TravisH

551 posts in 1775 days


#3 posted 05-05-2017 12:18 PM

Is it really that bad? Has America really become so litigious you can t even knock out a few toys without being sued?

Yes, I think the Paranoids are after me

- becikeja

My opinion: yes it is that bad, we need tort reform. But as long as we have lawyers writing the laws, they will favor (ta-da) lawyers. One more time: my opinion.

- Fred Hargis

I seam to put a lot of blame on the average Joe for this not necessarily the lawyers.

To be honest you can jump through all sort of hoops to protect yourself and it really doesn’t amount to much unless you have the money to back it up. Even in a LCC there are situations in which you personally can be sued.

I think it comes down to how comfortable you feel with the product you are making and who is buying it.

The problem is too many people have some strange viewpoint on product safety. As a consumer and one time user of a rocking horse. I expected my child to rock and flip over front and backwards and hit their head and smack their face a time or two. I also expected, once a sibling was introduced, we would have smashed fingers and toes. I knew that at some time we would also see it used as a jumping platform. None are offenses that I see as negligent or defective on the manufactures part.

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Matt Rogers

99 posts in 1810 days


#4 posted 05-05-2017 12:59 PM

If you are selling, just call around and find a liability policy with Products and Completed Operations coverage. Mine only costs $550 per year. If you want to operate a business, there are costs and you should be able to easily cover $550 or it is not really a business at all, just a hobby. In that case, don’t worry about the money and just make stuff for fun and give away the horses to friends and family or trade them for services from people you know.

-- Matt Rogers, http://www.cleanairwoodworks.com and http://www.cleanairyurts.com

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johnstoneb

2642 posts in 2013 days


#5 posted 05-05-2017 01:11 PM

Think twice before building to sell. Your hobby will become a job with quotas to meet, deadlines. All of a sudden that hobby you used to enjoy because you could build what you want when you want is gone. Now you’re buiding the same items over and over with very little time to try new things. Think long and hard make sure it’s really what you want then look into setting up a business and worrying about liabilty etx.

-- Bruce, Boise, ID

View bigblockyeti's profile

bigblockyeti

4698 posts in 1561 days


#6 posted 05-05-2017 01:35 PM


I seem to put a lot of blame on the average Joe for this not necessarily the lawyers.

- TravisH

+1! Too many people are comfortable absolving themselves of personal responsibility and letting that fall on someone else’s shoulders (think octomom or the crotch coffee lady for example). Even the new Toyota commercials show a couple of young ladies singing as they cruise down the road with the driver clearly comfortable letting driving fall outside of her top ten priorities while behind the wheel, alas, it’s OK, the car steered itself back into the lane and away from oncoming traffic. Or the ford commercial where the wife asks the husband if he can back the boat into the water navigating a tight launch ramp, his response: Of course not, that’s why I bought a $70K half ton truck to do it for me, life skills are so overrated!

Bottom line is you cash probably make a little money on the side safely (with a good liability policy in place) without assuming unnecessary personal risk. Knowing your customers would almost certainly help, making a few hundred per month and selling them on Etsy and all bets are off. Just my two cents.

View pontic's profile

pontic

505 posts in 448 days


#7 posted 05-05-2017 01:44 PM

From one who has been sued a few times it is not plesent. That being said it is what happens in business.
Product liability insurance is based on (mainly) how many units you make and sell per year. A small hobby business like yours they will usually not insure and refer to your home owners policy.
Product liability is based on three pillars. 1)defects in manufacture-you 2) defects in materials-glue ans other fasteners natural products are harder to litigate against. 3) design you or the plans you use.
If the Lawyer can show direct causality in any of these areas they will have a case. Personal damage after a homade repair = no case.

-- Illigitimii non carburundum sum

View Dark_Lightning's profile

Dark_Lightning

2928 posts in 2949 days


#8 posted 05-05-2017 11:25 PM

Remember the OSHA Cowboy? Maybe you could build in some of those safety features. Seriously, as has been mentioned, people nowadays seem to have abandoned their safety concerns for tort gain. Anyway, here’s the Cowboy. Enjoy!

-- Random Orbital Nailer

View becikeja's profile

becikeja

825 posts in 2653 days


#9 posted 05-07-2017 11:48 AM



Think twice before building to sell. Your hobby will become a job with quotas to meet, deadlines. All of a sudden that hobby you used to enjoy because you could build what you want when you want is gone. Now you re buiding the same items over and over with very little time to try new things. Think long and hard make sure it s really what you want then look into setting up a business and worrying about liabilty etx.

- johnstoneb

Definitely staying in the hobby area. I’m thinking more along the lines of building 2-3 a month as my schedule allows. Only selling those after they are completed. I have a 2 rules when someone asks me to build something for them. 1) I get 100% creative license. 2) You can not ask me when it will be done. I guess after this post I will need to add rule number three. 3) You can not sue me.

I guess next step is to look at my homeowners policy. Thanks for the input.

-- Don't outsmart your common sense

View knotscott's profile

knotscott

7789 posts in 3215 days


#10 posted 05-07-2017 12:03 PM

Is there any less liability if you don’t sell for cash? Ie: have the people who offer cash provide you with the materials or gift cards for materials instead of cash? Then maybe a gift card to your favorite restaurant or grocery store when complete.

-- Happiness is like wetting your pants...everyone can see it, but only you can feel the warmth....

View Dan's profile

Dan

645 posts in 1732 days


#11 posted 05-07-2017 02:32 PM

TravisH “I seam to put a lot of blame on the average Joe for this not necessarily the lawyers.”

Hospitals and such are now hiring out to subjugation firms. These firms will contact the injured party, ask questions and determine who they can sue. They are completely ruthless.

The injured party could be your best friend and next door neighbor but it will not matter.

-- Peace on Earth

View poopiekat's profile

poopiekat

4320 posts in 3574 days


#12 posted 05-07-2017 04:56 PM

Not to mention the severe cost of proving that your finishes and materials are non-toxic. The state of California for example, requires Certification before your craft work can be sold, and the rest of the states are not far behind. Speaking simply from memory, certification from a recognized agency will cost you $3500.

-- Einstein: "The intuitive mind is a sacred gift, and the rational mind is a faithful servant. We have created a society that honors the servant and has forgotten the gift." I'm Poopiekat!!

View BigYin's profile

BigYin

403 posts in 2256 days


#13 posted 05-28-2017 10:51 PM

<<the>>
Can’t the manufacturer provide certification for their own products. If you make Glue, polish, varnish, oils they must have all been tested bedore sale ?? or is this just CA-Prop65 crazyness ? as in “this product contains freedom of thought and is known to the state of California is known to increase risk of cancer/pregnancy/ trump voting etc”

-- ... Never Apologise For Being Right ...

View AlaskaGuy's profile

AlaskaGuy

3662 posts in 2149 days


#14 posted 05-28-2017 11:55 PM

Unless I had no money for food I wouldn’t build and sell kids “stuff”.

-- Alaskan's for Global warming!

View jonah's profile

jonah

1473 posts in 3139 days


#15 posted 05-29-2017 02:23 AM



Is there any less liability if you don t sell for cash? Ie: have the people who offer cash provide you with the materials or gift cards for materials instead of cash? Then maybe a gift card to your favorite restaurant or grocery store when complete.

- knotscott


No. Anything of value exchanged for a good or service is consideration, which is payment. You can pay someone in potatoes, but you still paid them.

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