United States Supreme Court

Previously we blogged about a pending case before the Supreme Court that had the possibility to significantly increase the liability of persons for assisting in the preparation of a “prospectus.” As of June 13, 2011, the Supreme Court handed down an opinion in that case, styled as Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525 (S. Ct.).

The determination of this case is relevant to accountants and business lawyers who assist in the preparation of documents for the purpose of raising money for investment. The Janus Capital Group, Inc. case presented the question of who may be deemed to have “made” an untrue statement for the purposes of Rule 10b-5, and specifically whether someone who assisted in the preparation of a prospectus could “make” a statement through such assistance. As the result of a 5-4 decision, accountants and business attorneys may breathe a little easier. Continue reading “Can an advisor be held liable for the false statements in a prospectus made by another?”

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Sometimes commercial tenants, unable to stay current with their lease obligations, decide to close up shop and abandon their leased premises. In those circumstances, commercial landlords need to know their options. This blog post discusses a commercial landlord’s options when a commercial tenant abandons its lease.

Continue reading “My Commercial Tenant is gone . . . should I re-enter the Property?”

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Flying the flag is an important way that Americans celebrate their liberty and the sacrifices of past and present heroes who defend it. There were news stories about a dispute between an Ohio homeowners’ association and a Vietnam veteran over a flagpole that brought an important issue to the forefront.

In Ohio, a homeowner erected a large flagpole on his property to fly the flag. The homeowners’ association told him that the flagpole (not the flag) violated the declaration of covenants for the neighborhood, and asked him to take the flagpole down. It offered to place flagpoles in common areas in the neighborhood, and suggested that the covenants would allow him to fly a flag on a pole attached to his house. He refused. After a firestorm of publicity, the HOA averted litigation by permitting the homeowner to keep his flagpole. The underlying question remains: can a homeowners’ association really prohibit an owner from flying the American Flag?

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A recent Virginia Supreme Court Case, Cattano v. Bragg, illustrates two points we have made time and time again: 1) Make sure your small business is prepared for an eventual “divorce” between the shareholders; and 2) Litigation is very, very expensive.

In this blog post we will review the Supreme Court’s decision and provide some tips for your small business so that you can avoid the calamity that occurred in this case, which included an attorneys’ fee award of over $260,000 for the prevailing party.

Continue reading “Small Business Break-Ups – The High Cost of Litigating a Forced Separation”

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It’s a simple fact of business life that you and your company’s fellow shareholders or members will not always see eye-to-eye. Furthermore, our personal lives change and that effects the level of willingness in which some participate in a business venture.

As in any relationship, businesses also reach that awkward stage in which a shareholder or member wants to leave his current business venture and start something new. We have discussed starting your business and provided guidelines for setting forth the rules for governing your business. This article addresses some of the difficulties that arise during the “break-up period.” For the purposes of this article, we will use the terms “shareholder” and “member” interchangeably, as well as the terms “director” and “managing member.”

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Obviously the use of email has changed many aspects of our world, including the practice of law. As with all new technology, we sometimes learn hard lessons. The attorney-client privilege is the foundation of effective communication between counsel and clients. Only a client can waive that privilege. Although email has far more positives than negatives, to protect attorney-client communications, use these three tips.

Attorney-Client Privilege

Continue reading “3 tips for safe emailing with your attorney”

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As a follow-up to our post on the costs and benefits of the arbitration process, the Federal Trade Commission (“FTC”) recently issued a report indicating that the litigation and arbitration practices for resolving consumer debt need major reform.

Debt collection cases are on the rise.  We have seen a tremendous increase in the number of cases we are filing on delinquent homeowner association dues. In James City County/Williamsburg, the local courts have seen a 27% increase in civil filings from 2006 to 2008.  Other courts in Virginia and other states are experiencing similar increases in civil filings.

The FTC has made specific recommendations that the Federal government and the states consider new laws to protect consumers including a recommendation that a temporary ban be placed on the use of binding arbitration until such time that the arbitration forums have initiated changes to address deficiencies in arbitration. The FTC has suggested that state legislatures adopt measures to make it more likely that consumers will defend themselves in litigation, decreasing the prevalence of default judgments; require debt collectors to include more information about the alleged debt in their complaints; take steps to make it less likely that collectors will sue on debt on which the statute of limitations has run; and change laws to prevent the freezing of a specified amount in a bank account including funds exempt from garnishment.

We do not believe that these changes, if they occur, will effect our current practice areas and clients. However, we have also seen instances in which perceived procedural unfairness can lead to overreaching legislation. For example, it is fair to say that when the Fair Debt Collection Practices Act was passed, legislators did not intend for it to reach into the wide-ranging areas it now does, including the collection of homeowner dues. See, e.g., Barry v. Board of Managers of Elmwood Park Condominium II, NT Slip Op 27506, http://caselaw.findlaw.com/ny-civil-court/1211140.html (December 12, 2007, NY Civil Court City of New York, Richmond County) (Judge Philip S. Straniere writing that “Somehow I think that Adams, Jefferson and Madison must be turning over in their graves at the thought that the federal government is regulating such a local activity as the collection of condominium association dues between the homeowner and the association”).

Arbitration tends to release pressure on state courts by handling cases that otherwise would be brought in court. However, if the process continues to be perceived as unfair, restrictions on the use of arbitration could be forthcoming.

Tarley Robinson, PLC, Attorneys and Counsellors at Law

Williamsburg, Virginia

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This blog post comes from Jason Howell, our 2011 Summer Associate when he was a rising third-year law student at the William & Mary Law School. Jason is working with us this summer and debuts his first blog post.

Negotiation can be challenging. Whether you are negotiating the terms of a business agreement, trying to buy or sell property, or settling a dispute, getting to an agreement can be difficult. Even if you are successful in getting the other side to negotiate with you, you may feel at a disadvantage or worry that there is something in the final negotiated agreement you are missing.

Hiring an experienced attorney to represent you can give you advantages that can help you get to an acceptable agreement. By using an attorney in your negotiation, you can benefit from the attorney’s knowledge and skill, which can help you to reach your negotiation goals.

Continue reading “Do you need an attorney to negotiate on your behalf?”

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Frequently, a homeowner contemplating renting out his property believes that he will be able to save money by writing his own lease or using a do-it-yourself lease form found or purchased online. Almost as frequently, the homeowner realizes too late that if he had spent a little money up front to have an attorney prepare a lease, or at least review his proposed lease, he could have saved himself a lot of time, money, and aggravation. By the time problems arise with a tenant, it is too late to ensure that the lease contains all of the provisions necessary to protect the homeowner’s interests.

Continue reading “I want to rent my house to a tenant, do I need an attorney to draft a lease for me?”

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This week, at the venerable Homestead, the annual Virginia Leadership Retreat will take place. For this event, community managers and their management company executives, guest speakers, and the community association attorneys and service providers from all parts of Virginia will meet to discuss this year’s topic: Changing Times in Community Associations.

Both Susan Tarley and John Tarley will teach classes at the VLR, discussing topics about which we blog frequently. The topics for this year’s event include:

• Learning to Communicate like a Pro;
• The Role of a Manager as a First Responder;
• Leadership Training;
• Preparing for “Forcing Green” Legislation (taught by Susan Tarley);
• Conflict Management Skills;
• Virginia Legislative Update; and
• Dealing with Lawsuits (taught by John Tarley).

The VLR provides us with an opportunity to mingle with other industry professionals so we can provide better service for our clients. Oh, and the golf is pretty nice, too!

Tarley Robinson, PLC, Attorneys and Counsellors at Law

Williamsburg, Virginia