The fate of Bahamian company Bahama Divers, after a $9 million lawsuit forced its closure, should be a wake-up call to business owners to ensure their companies are properly structured to avoid huge losses, attorney Wayne Munroe, QC told Guardian Business yesterday.
Munroe said Bahamian business owners must become more progressive when setting up companies in order to avoid huge losses.
According to Munroe, oftentimes company owners only think of lawyers when they run into a problem, but he insisted that investing the time and money to have a lawyer properly structure a company to protect assets, could eventually save that company from huge losses.
“Certainly you can avoid the destruction of your business by proper structuring,” Munroe said.
“If you’re going into business, how many people have sat down with a lawyer and gotten advice as to how they might structure their businesses and matters like that? I find very few.
“If you go to a lawyer and you get advice about structuring and you are given poor advice, then at least you have some recourse as to somebody you can sue.
“Bahamian businessmen just have to be more progressive. Anyone who is setting up any serious business should really consult a lawyer specifically about structuring. They should ask questions about how they should hold their assets, how they should hold the fruits of their labor and if the lawyer is competent, then he would advise you on structures.”
A local newspaper reported on Friday that the Supreme Court upheld a $9 million judgement struck against Bahama Divers in a U.S. court.
Munroe said this story should awaken Bahamian businesses to the realization that they should re-examine their structures, carry enough insurance to cover damages that could be awarded in a Bahamian court and do whatever is necessary to limit exposure.
“If you are doing business, there is no way you should keep your assets in a company that is doing business and can be sued,” he said.