≡ Menu

How To Use This Section Of Our Website

If you have a question about Business Law or Real Estate, I just might have the answer right here on this site.

There are three ways to find the answer you’re looking for.

One, type your question in the search box located down and to the right.  Type your question and then click search.  Every question & answer I have on this site related to your question will then be shown for your review.

Two, review the categories shown down and to the right.

And three, if you have a legal issue related to Business Law or Real Estate Law, and wish to discuss in greater detail, call me at (510) 465-0025.

{ 0 comments }

An issue and question that comes up an awful lot in my practice is the question of whether one of the co-owners of real property can be forced to be bought out. This issue comes up when two or more people own property together, and either one of them wants to sell their interest, while the other one refuses to sell; or when one of the co-owners wants to remain a owner of the property but no longer wants to be a “partner” with the other co-owner.

Under these scenarios, partition actions can be very helpful. A “partition action” is a way for a co-owner to force a sale of the entire property. For an article the explains the partition process in California, see:  http://www.businessandrealtylaw.com/2013/02/02/partition-actions-what-do-i-do-if-i-want-to-sell-real-estate-that-i-own-with-another-person-and-the-co-owner-refuses-to-sell-the-property-can-i-force-a-sale-of-the-property/

What about the scenario where you do not want to sell the property? Instead, you want to buy out your co-owner’s interest in the property. Under California law, there is no obligation for the co-owner to sell their interest, while you keep your interest. Partition allows you to sell your interest, but it does not entitle you to buy your co-owner’s interest. A partition action nonetheless can sometimes achieve the goal of buying out your co-owner’s interest. More often than not, when a partition action is filed, eventually one of the parties buys out the interest of the other. So if you file a partition action, there is a realistic possibility that the end result would be a settlement where you (the plaintiff) buy out your partner or co-owner. This outcome does, however, require the other owner’s (the defendant’s) consent.

Another possible method of using the partition action in California to end up with owning the entire property is where the owner that wants to own the whole, makes a bid or offer to purchase the whole as part of the partition proceeding.

Similarly, if you want to be bought out by the other co-owner of the property and the co-owner is not cooperating, you too could use a partition action to potentially achieve your goal of being bought out by the other co-owner. It is very common that despite a co-owner’s refusal to buy out the other owner of the property, after a partition action is filed, the refusing co-owner eventually realizes that you have a right to sell your interest, and if they want to maintain their interest in the property, their best option is to buy you out. Therefore, it is very common in this situation, that after a partition action has been filed, that the co-owner refusing to sell eventually offers to buy out the plaintiff co-owner.

I regularly represent clients in negotiating buy-out agreements and partition actions throughout the Bay Area, in the East Bay, California, in Oakland, California, and in Walnut Creek, California. If you have questions or need representation by a real estate attorney involving a partition action or the need to negotiate a buyout agreement between co-owners, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

If I have been defrauded by my real estate agent in California, what can be done to recover the monies I have lost? Sadly, this is a question that I have heard more than once. A prospective purchaser of property has entrusted their finances with their real estate agent, who then takes the money and runs.

Fortunately, there are protections should this happen to you. First, in addition to being able to sue the real estate agent, the real estate broker is also responsible for the acts of their real estate agent, if the real estate agent’s activity falls within the scope of activity requiring a real estate license. What this means is that the real estate broker is liable for the acts of the real estate agent, if the activity was as a real estate agent.

Second, even if you have obtained a judgment against the real estate broker and/or real estate agent, but are unable to collect on that judgment, there is further recourse with the California Department of Real Estate, who maintains a “Recovery Account” to help get restitution for consumers who have been defrauded by a real estate agent or real estate broker, but despite efforts to collect, have been unable to collect from the real estate broker or real estate agent. For a useful article on how the Recovery Account works, see  http://www.businessandrealtylaw.com/2013/01/30/what-is-the-california-department-of-real-estate-recovery-account-and-how-does-it-work/.

If you believe that you have been defrauded by a real estate broker, mortgage broker, or a real estate agent in the course of a transaction they handled for you, or you are a real estate broker or agent accused of fraud, please feel free to contact me at (510) 465-0025 or (925) 708-3306 to arrange for a consultation.

{ 0 comments }

It happens all too often in public works projects. A subcontractor who has done a significant amount of work, is not getting paid. For a small to mid-size subcontractor, failure to pay or delays in getting paid can have a disastrous effect on the subcontractor’s business.

In this situation, in California, the subcontractor’s greatest ally and tool to get paid is the Stop Notice. The Stop Notice causes the public agency “owner” to withhold the amount set forth in the Stop Notice by the subcontractor. The greater this amount, the greater the impact it has on the prime contractor. Once done properly, the Stop Notice can be a very effective tool to resolve any payment dispute between the contractor and the subcontractor. Further, by withholding the funds the subcontractor claims is owed to them, it assures the subcontractor that if their claim is valid, that they will ultimately get paid regardless of whether or not the contractor has the ability to pay.

Because the Stop Notice is such an important tool for a subcontractor in a public works project, it is essential that the subcontractor follows the statutory rules to perfect their stop notice rights, such as properly serving a Preliminary Notice.

If the filing of a Stop Notice is ineffective in getting the subcontractor paid, then the subcontractor’s next step is to initiate a lawsuit to enforce the Stop Notice, and assert other remedies, such as asserting a claim against the payment bond. Once at this juncture in the process, it is very important that the subcontractor, if they have not done so already, retain a real estate attorney that is familiar with the stop notice procedures and related remedies.

I regularly represent clients in the East Bay, California in Oakland, California, in Walnut Creek, California, and throughout the Bay Area, in stop notice and related disputes. If you have questions, or need representation by a California real estate attorney involving a stop notice or public works contract dispute, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

REAL ESTATE CONTRACT DISPUTES

For most people, the purchasing of a home is the most significant and important transaction of their lifetime. This is because it is typically the most expensive transaction of their lifetime, and quite often the property they are purchasing will be their home for the majority of the remainder of their life. Unfortunately because these transactions are so important to everyone involved, disputes will arise.

Real estate contract disputes include varying situations including, for example, when a buyer or seller refuses to complete the transaction, or when a seller fails to properly disclose defects relating to the property, or when there are title defects or clouds on title.

These disputes can involve a lot of different parties including the buyer, the seller, the buyer’s real estate broker and agent, the seller’s real estate broker and agent, title insurance companies, homeowner’s insurance companies, and home inspectors, among others. As a consequence of the varied parties and the importance of the transaction, these disputes need to be handled carefully. A variety of strategic questions will need to be answered at the onset such as, do I need to demand mediation prior to initiating legal proceedings; Should I first submit the claim to my insurance company or title insurance company; Should I arbitrate the dispute or file a lawsuit; What is a lis pendens and what is its impact on the case and the outcome of the case; What do I do if the other party ignores my demands for mediation or arbitration. These are just a few of the issues that can come up early on in a real estate contract dispute. Therefore, it is important to get timely advice from a competent real estate attorney.

I regularly represent clients in the East Bay, California, in Oakland, California, in Walnut Creek, California, and throughout the Bay Area, in real estate contract disputes. If you have questions, or need representation by a California real estate attorney involving a dispute regarding a real estate transaction, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

This article addresses the hot topic of whether or not a lender that made a second mortgage on a California property can collect that debt after the first mortgage has foreclosed on the property, thereby eliminating the second mortgage lien on the property. This is commonly referred to as a sold out junior lien. This article will address whether or not a sold out junior lien can be collected by the owner/holder of the loan.

Whether or not a sold out junior lien-holder can initiate proceedings to collect the debt is ultimately a complicated legal question. Once the first forecloses, wiping out the lien belonging to the second mortgage loan, that loan essentially becomes an unsecured debt, very similar to a credit card debt. Before that lender can even commence efforts to collect that debt after the foreclosure of the first mortgage, an evaluation needs to be completed to determine whether or not the borrower has any personal liability on the loan. If the borrower does not, the lender cannot take efforts to collect that debt.

There are a variety of considerations that need to be evaluated by a real estate attorney to determine whether or not that debt is still collectable. Whether or not it is collectable depends upon many factors, such as the nature/character of the loan at the time when it was made, when the last payment was made by the borrower, and the final due date of the loan under the terms of the loan, to name a few.

Recently many lenders have attempted to collect sold out junior loans which are legally uncollectable debts. If you are a borrower in this situation, you should not assume that you owe this debt. Likewise if you are a private lender, you should also not assume that you can collect a debt. The borrower or private lender should first consult with an attorney and have an attorney evaluate whether the debt is collectable. If you are a lender and you collect on an uncollectable debt, you may become liable for collection of an uncollectable debt.

I represent clients, both borrowers and lenders, regarding sold out junior loans, throughout the Bay Area, and in the East Bay, California, in Oakland, California, and in Walnut Creek, California. If you have questions, or need representation by a California real estate attorney involving a sold out junior lien, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

PARTITION ACTIONS AND RIGHT TO ACCOUNTING

As I have discussed in prior articles, a partition action is a lawsuit to force a co-owner of real property to sell the property. The primary issue in a partition action, however, is often not whether or not one party has the right to force another party to sell the property. Rather, it is what to do with the proceeds of the sale when one or more of the parties contends that they are owed monies as a result of inequities in the amounts received and paid by the owners of the property.

In California, in addition to deciding whether or not the property should be ordered sold, the Court also is charged with determining any accounting or contribution issues raised by any of the parties. What this means is first, if there have been any rents or profits collected by one of the owners of the property, but not by the other owner(s), should the other owner(s) be reimbursed for their share of the rents or profits collected by the other co-owner.

Additionally, if one of the parties paid more towards the purchase or maintenance of the property, the court will decide whether or not that owner has a right to contribution, which is the right to be reimbursed by the other co-owner’s of the property for their shares of those costs.

These types of issues are referred to as accounting issues. In dealing with accounting issues, the Court applies principles of equity, where the court decides what would be fair under the circumstances. It is often in the parties’ best interests, to attempt to resolve the accounting issues without the necessity of having to fully litigate the accounting issues, as those issues can be very costly to litigate. In addition to being document intensive, accountings will often require the use of one or more costly expert.

I regularly represent clients in partition actions throughout the Bay Area, and in the East Bay, California, in Oakland, California, and in Walnut Creek, California,. If you have questions, or need representation by a California real estate attorney involving a partition action, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

ENFORCEABILITY OF COVENANTS NOT TO COMPETE

Covenants not to compete are agreements between two parties, where one party agrees not to engage in certain type of behavior that may compete with the other party. In California, the law strongly disfavors covenants not to compete. Unless one of the statutory exceptions to the rule prohibiting covenants not to compete applies, a covenant not to compete will be considered to be void by the Court and hence, completely disregarded.

One of the exceptions, where a covenant not to compete is permissible in California, is in the context of the sale of the goodwill of a business, so long as the covenant is limited to a similar business within a specific geographic area.

Because there is such a strong prohibition against covenants not to compete, any covenant not to compete needs to be carefully drafted to conform with the requirements of the applicable exception statute, and be specific enough so it is very, very clear as to what the parties are agreeing to.

Disputes regarding covenants not to compete come up all the time. They come up in the context of whether or not a covenant not to compete is permissible for the type of transaction that is involved; they come up as to whether or not the covenant not to compete is permissible in the manner that it is used; they come up as to what the scope of the covenant might be; and they come up as to whether or not a covenant has been breached.

Disputes relating to covenants not to compete can be rather significant, as the potential damages can be extremely severe if the covenant not to compete is enforceable and the complaining party can prove damages. Therefore, when evaluating whether or not a covenant not to compete is enforceable, and/or whether or not a covenant not to compete has been breached, it is important to consult with an experienced business/contract attorney.

I often represent clients in the East Bay, in Oakland, California, and in Walnut Creek, California, in business and contract disputes. If you have any questions, or need representation by a California business or contract attorney involving a dispute regarding sale agreements or covenants not to compete, please free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

In California, sellers of real property have a very strong duty to disclose all material facts to the buyer that materially affect value or the desirability of the property; but only those material facts that are known or accessible only to the seller, and only if the seller knows that such facts are not known to the buyer and cannot be discovered after reasonable diligence by the buyer.

Implicit in the seller’s duty of disclosure, is the buyer’s duty to conduct their own investigation regarding the property. Since the seller is only responsible for those material facts that cannot be discovered by the buyer after reasonable diligence, the buyer cannot fail to conduct inspections of the property, and then hold the seller legally responsible for defects to the property that the seller did not disclose but would have been discovered by the buyer had they completed the inspections prior to the sale.

In addition to the seller and buyer having duties regarding investigations and inspections, the real estate brokers and agents also have duties. The real estate brokers and agents representing the seller and buyer have a duty to inspect the property, and to disclose to the buyer any defects they discover that materially affect the marketability and desirability of the property.

Cases involving failure to disclose defects in a real estate sales transaction are very common. In California, because there are so many moving parts, these cases can be complicated. An analysis should be completed to determine, among other things, whether or not the defect is a material defect, whether or not it is a defect that the seller had a duty to disclose and failed to disclose, whether or not the defect would have been discovered after a reasonable inspection of the property by the buyer, or whether the defects were discoverable by the real estate brokers.

If you have purchased a property and have discovered defects that you believe may be the result of a violation of one of the other parties’ duty to disclose; or if you are a seller where such a claim has been asserted against you; or if you are a real estate broker or agent where such claims have been asserted against you, you should consult with an attorney right away. Because there are statutes of limitations and legal deadlines that need to be met, promptly dealing with the issue can be critical.

I regularly represent clients in the East Bay, California, in Oakland, California, and in Walnut Creek, California, in failure to disclose or non-disclosure cases. If you have questions, or need representation by a California real estate attorney involving a non-disclose case, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

ENFORCING ORAL CONTRACTS IN CALIFORNIA

While businesses and consumers do often enter contractual agreements by written contract, it is not uncommon to enter certain contracts using a verbal agreement or oral contract. This is particularly common between two parties that have done business together in the past, where mutual trust has developed. Unfortunately, disputes do arise. However, just because an agreement or contract is verbal and not in writing, does not mean that it is unenforceable. Having said that, enforcing oral agreements can at times be tricky.

For example, in California, the statute of limitations, the deadline by which a lawsuit would have to be filed in order to enforce an agreement, is shorter with oral agreements than with written contracts.

A common dispute that arises in an oral agreement is a dispute relating to what the parties agreed to (i.e., what are the terms of the agreement). In California, if there is a dispute relating to the terms of an oral contract, the court might look to the parties’ own conduct in performing the agreement prior to the dispute developing. Additionally, if the parties have done similar transactions in the past, the court may also look to the parties’ prior “course of dealings” to assist the court in interpreting what the parties agreed to when they entered the disputed oral agreement.

Oral agreements can be commonplace in business. There are a lot of differences between oral agreements and written contracts, and their enforcement, including the shorter statute of limitations. It is important that if a dispute arises relating to an oral agreement, that you act quickly to enforce the oral contract. If that is your situation, it is important that you promptly consult with a contract attorney to determine what steps you need to take to enforce the oral contract, and in the construction setting, there may be additional courses of actions available to you in enforcing the oral agreement, in addition to the filing of a lawsuit to enforce the agreement. Therefore, it is recommended that once a dispute arises, that you immediately consult with a capable contract attorney.

I regularly represent clients in the East Bay, in Oakland, California, and in Walnut Creek, California, in contract disputes. If you have questions, or need representation by a California business or contract attorney involving a dispute regarding an oral agreement or a written contract, please feel free to contact me to discuss your case or to arrange for a consultation. I can be reached at (510) 465-0025 or (925) 708-3306.

{ 0 comments }

DEALING WITH REAL ESTATE CONTRACT DISPUTES IN CALIFORNIA

When entering a real estate sales transaction, the parties to the sale enter a contract for the sale of the real estate. In California, real estate sales contracts are typically entered on “form” contracts. In the residential setting, the California Association of Realtors (“CAR”) form is most commonly utilized. In the commercial setting, an AIR Commercial Real Estate Association form is most commonly utilized.

When people transact business, particularly when the stakes are as high as they are in a real estate transaction, disputes sometimes arise. Some disputes happen prior to the sale closing, and some disputes occur after the sale closes. Some common types of disputes include a claim by a buyer after the close of escrow that the seller knowingly failed to disclose defects regarding the property or made material misrepresentations regarding the property; and prior to the close of escrow a common dispute that arises relates to impediments to get escrow closed.

In dealing with these disputes in California, the parties need to look to the written real estate sales contract to understand how the dispute needs to be dealt with. In the residential setting, the CAR form requires the parties to the contract, prior to commencing any legal proceeding, to engage in a mediation, which is a process that is designed to get the dispute settled without the necessity and cost of having to litigate the dispute. For a prior article on mediating real estate disputes, see http://www.businessandrealtylaw.com/2014/05/30/mediating-real-estate-contract-disputes And in fact, the CAR form not only requires that a dispute first gets mediated by the parties, but also states that if one of the parties refuses to participate in a mediation process or agree to participate in a mediation process, then they are waiving their right to recover any attorney’s fees if any litigation ensues.

Both commercial and residential form real estate contracts contain arbitration clauses. If the arbitration clause is initialed by both parties, then any dispute as between the parties to that contract, should be litigated through an arbitration. An arbitration is a private trial which is often quicker than utilizing a lawsuit and the court system. If the arbitration clause is not initialed by the parties, then the parties, if they are going to commence legal proceedings, would do so by filing a lawsuit.

Both the CAR forms and the AIR forms contain an attorney’s fees clause, which has the effect that if a dispute is fully litigated, the prevailing or winning party to that dispute may be entitled to recovery of some or all of their attorney’s fees. The attorney’s fees clause could be very very powerful, as it can minimize the risk of frivolous or baseless claims.

I regularly represent clients in the East Bay, in Oakland, California, and in Walnut Creek, California, in real estate contract disputes. If you have questions, or need representation by a California real estate attorney involving a dispute regarding a real estate transaction, please feel free to contact me to discuss your case or to arrange for a consultation at (510) 465-0025 or (925) 708-3306.

{ 0 comments }