Virginia became one of the latest states to pass legislation limiting the use of employee noncompete agreements. Beginning July 1, 2020, certain noncompete agreements are prohibited by statute. This blog post examines that new statute and what it means for employers and employees.

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Everybody who applies for a PPP loan must certify under oath that “current economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” Undoubtedly, all of our local businesses who have applied and who made that certification thought there was NO DOUBT that the economic uncertainty was obvious and evident.

But then it came to light that many publicly traded companies and larger private companies applied for and received PPP loans. Although those companies technically qualified for the PPP loan, there is no doubt that the CARES Act was not intended for entities like Shake Shack and the Los Angeles Lakers.

So to address these issues, the SBA offered more pointed guidance to dissuade these types of companies from applying for the loans. But the ambiguous guidance proposed in the interim rule applies to everybody who applies for a PPP loan, including a sole proprietor. In this post, I hope to provide you some guidance to help you “paper your file” supporting certification of need, which you may need when you apply for loan forgiveness, 8 weeks after receiving your loan proceeds.

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We have pointed out the fluidity of this pandemic, and now we have some updates for you on holding meetings and closing facilities (including pools). We have received relief on some of the requirements found in the POAA and the Condominium Act on holding remote meetings.  We have also obtained information on the closing of community association pools.

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The final PPP loan regulations are not yet released as of April 23, 2020, but there are certain things we are pretty sure about: you will need to meticulously document your spending on allowable expenses in order to receive full forgiveness for your loan.

At the end of your 8 week period following your PPP loan disbursement, you will need to submit your forgiveness to your lender. Your lender will make the decision on whether a portion or all of your PPP loan is forgiven. At a minimum, your request should include:
• Written proof of payroll costs;
• Written proof of the number of full-time equivalent employees with their pay rates;
• Written evidence of invoices and payments you made on eligible mortgage, lease, and utility obligations; and
• Certification that all supporting documentation provided are true and that you used the forgiveness amount to keep employees and make eligible mortgage interest, rent, and utility payments.

You should be compiling this information from the moment you receive your loan, so you are not scrambling later on, and to ensure that the payments you made from the PPP loan proceeds comply with the restrictions. If you can put your PPP loan proceeds in another account, even better to track! If you have questions about proper documentation, contact your accountant or financial advisor.

Again, we hope this information is helpful, but please note that this blog post does NOT constitute legal or tax advice. These are simply my observations and notes based upon information I have gathered through an analysis of the CARES Act, an analysis of proposed regulations governing the PPP, and my attendance at numerous webinars given by tax and banking experts explaining the PPP.

YOU SHOULD CONTACT YOUR TAX ADVISOR AND BANK FOR PERSONALIZED INFORMATION FOR YOUR CIRCUMSTANCES.

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Our pandemic situation continues to be fluid. It is difficult to get a handle on stay-at-home orders, best practices for health and safety, and where all of this is headed. We have many who are out of work. We have health workers who are exhausted and taxed beyond limits. We have shortages of protective equipment, and some grocery items. All of this stays with us all day even if we are fortunate enough to be able to work, and to continue to have work to do. It is more important than ever for our community leaders to have consistent and frequent communications with their residents, and for our managers and attorneys to continue to provide guidance to our communities. It is also critical that community leaders, managers and attorneys take time for their own mental health.

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A Virginia Beach jury found a condominium association liable for failing to permit unit owners an opportunity to inspect and copy association records. Not only must the condo board allow inspection and copying, they must pay for an audit of the association records and pay $50,000 for the unit owners’ attorneys’ fees.

These questions arise frequently. This blog post reviews the various Virginia statutes that address the right to inspect and copy records for companies, HOAs and condominium associations.

Continue reading “Requests to Inspect and Copy Community Association or Company Records: Should it be this complicated?”

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In Virginia homeowner associations, the governing documents permit a developer to continue control of the HOA’s Board of Directors for a specific period of time, or until a specific number of lots are sold. The length of that period depends upon the governing documents of each association.

This issue has generated litigation in Williamsburg, and now, thanks to Peter Vieth from Virginia Lawyer’s Weekly, we have learned of a formal opinion from the Virginia Attorney General. In an opinion dated January 11, 2013, the AG answered two questions posed by Virginia Senator Bryce E. Reeves. This blog post takes a look at that opinion.

Is the Property Owners Association Act Unconstitutional?

Continue reading “Virginia Attorney General opinion on HOAs”

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Few real estate topics cause more disputes between owners than those involving activities at a common boundary. We have reviewed boundary line disputes involving trees that straddle property lines and fences that encroach upon boundary lines.

A recent Portsmouth case highlights another issue relating to boundary lines.

Continue reading “Neighbor Law: Tips for Avoiding Boundary Line Disputes”

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We blogged previously about finding guidance in Virginia’s rules on the unauthorized practice of law as they pertain to community associations. In this post, we will review Virginia opinions that address whether certain work performed by managers is the unauthorized practice of law (“UPL”).

Continue reading “Part 2 on Virginia’s Unauthorized Practice of Law Rules and HOAs – What is considered the unauthorized practice of law?”

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Imagine if someone told Don Draper and Roger Sterling of Mad Men that they could no longer smoke in their apartments. They would look at you curiously, smirk and light up a cigarette. But Mad Men, the television show about a Madison Avenue advertising agency is set in 1965 and as the ad for Virginia Slims said, “[we’ve] come a long way, baby.” Almost half of all adults smoked in 1965 but that percentage has dropped to 18% by 2012.

The negative health effects have been documented and the reported adverse health effects caused by second-hand smoke has resulted in smoking bans in restaurants. One of the next areas in which smoking bans have been put in place is in condominium communities. Some of the smoking bans address common elements only but others have imposed a ban on smoking in the condominium unit.

Continue reading “Smokin’ in the Condo”

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Our attorneys have been asked to address a community association’s ability and process for boards of directors to make decisions without holding a meeting. Many community associations have responded very quickly to make adjustments in how they are doing business to limit contact and follow the health guidance on COVID-19. Typically, we are advising our community associations to not make decisions unless they are doing so at a board meeting. However, we are in uncharted waters and need to make sure that we are following the requirements of social distancing and isolation, and at the same time continuing the operations of the HOA, all with transparency to permit the owners in the community to know what decisions are being made.

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Courtroom

With the downturn of the housing industry, we have seen a dramatic increase in the number of construction disputes, especially in residential construction. Owners are battling with the contractors, and subcontractors are trying to get paid by somebody. These cases lead inevitably to litigation.

The property owners and the building contractor should have a written contract. However, the subcontractors sometimes find themselves in a difficult situation, unpaid by an insolvent building contractor. It is usually then that we will receive a call from a subcontractor asking about their mechanic’s lien rights. Unfortunately, it may be too late for that subcontractor to preserve their mechanic’s lien rights because they failed to provide proper notice at the outset of the work performance. This blog post provides a brief overview of the notice requirements for subcontractors to preserve mechanic’s lien rights. Continue reading “Residential construction and mechanic’s liens; how you can protect your mechanic’s lien rights”

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No sooner had we posted our blog article on the enforceability of listing agreements even when they are not in writing, another recent case came to our attention. This case is from the New Kent County Circuit Court. This case is another example of the increasing acrimony between sellers and brokers in a tight real estate market.

Listing Agreements

Continue reading “Real Estate Listing Agreements are Contracts – Do you know your rights and obligations?”

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We have written previously on the costs—both in time and money—for homeowners and condominium associations to litigate cases. On one hand, boards of directors have a fiduciary duty to uphold the governing documents of associations, but on the other, the board must investigate alternatives to the divisive nature of litigation.

As it turns out, sometimes there is no alternative because a homeowner can sue an HOA, forcing the association to defend. But what efforts can or should a homeowners or condo association take to avoid the consequences of litigation?

A series of recent Virginia cases highlights the consequences associations can face in litigation cases. This blog posts provides a brief summary of those cases and some cautionary advice.

Board of Directors Meeting

Continue reading “HOA Litigation: Is it avoidable?”

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