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Archive for November, 2015

Waiting For Your Personal Invitation From the Non-Profit CEO?

November 19, 2015 Leave a comment

The Attorney General’s Office issued a press release today in collaboration with The Michigan Nonprofit Association, Council of Michigan Foundations,Michigan Association of United Ways:

A guide to supporting Michigan’s charitable nonprofit organizations

Some good advice for charitable giving.

One point I thought worth mentioning – volunteering.

If a charitable non-profit is worth giving your money to, why not give your time and expertise as well?

I serve on the board of directors for Mel Trotter Ministries.

At Mel Trotter, we are always looking for people to volunteer who have a heart for the homeless and hurting in West Michigan.

We honestly could use anyone who is reading this. If you are passionate about our ministry, there is a place for you to use your time and talent at Mel Trotter. If interested – e-mail me.

Maybe rescue mission work isn’t your thing.

It is equally  true of all non-profit ministries – they could use you whether they personally let you know or not.

This is a call to everyone, but particularly millennials.

Non-profits may not (do not) do the best job of reaching out to you individually to engage you with their ministries. That’s a “growth area” for non-profits. We are all working on it.

However, that shouldn’t stop you from reaching out to a ministry that you are passionate about and asking the question:

How can I serve?

Millennials – I’m reminded of the Bible – 1 Timothy 4:12 –

Don’t let anyone look down on you because you are young, but set an example for the believers

If you are passionate about serving – there is a place for you.

Don’t wait for a personal invitation from the Non-profit’s CEO.

Take the initiative.

Get engaged.

Just show up!

 

Questions?

Comments?

E-mail: Jeshua@dwlawpc.com

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News of Sham Real Estate Companies’ “Bad Acts” a Lesson for Real Estate Investment Companies.

November 13, 2015 2 comments

Today the ABAJournal reported the following article: “Deed thieves use sham companies to hide their identities

According to the ABAJournal:

“Fraudsters are using sham limited liability companies that shield their identities in order to obtain properties without the knowledge or full understanding of the owners.”

Further,

Some fraudsters search legal notices for delinquent mortgages and then dupe the homeowners into signing over their deeds.”

This unfortunate criminal enterprise underscores a useful aspect of a limited liability company for real estate investors:  privacy.

Michigan law requires Limited Liability Companies to have appointed a Resident Agent.

MCL 450.4207(1)(b) requires an LLC to have a resident agent. A person, or business with a physical presence in the State of Michigan.

Michigan law does not require that an “owner” of the LLC be the resident agent.

“The resident agent appointed by a limited liability company is an agent of the company upon whom any process, notice, or demand required or permitted by law to be served upon the company may be served.” MCL 450.4207(1)(b).

Many of my real estate investment clients will utilize my law firm as resident agent when filing their articles of organization with the State of Michigan.

An example of why this might be useful to a business owner…

A while back I had an investor call into my office looking to contact my client – “Investment Company, LLC”.  This investor was prospecting commercial real estate to purchase, discovered from reviewing the property tax records that the owner of the commercial property was Investment Company, LLC – and that my name was listed as Investment Company, LLC’s  resident agent, through the State of Michigan.

Investor wanted to contact my client’s “decision maker” and see if they would be willing to sell.

I informed my client, and client wasn’t interested in selling. So that’s all I told the investor.

That’s all the investor knew about my client’s identity.

The value of privacy.

Questions? Comments?

email: Jeshua@dwlawpc.com

Real Estate Investors: A Discussion on Laches

November 10, 2015 2 comments

If you aren’t into real estate investment in Grand Rapids – maybe you should be.

According to an MLIVE article posted last week, Grand Rapids has one of the hottest real estate markets in the country.

As reported by MLIVE:

“For landlords and real estate investors, Grand Rapids is the second best rental market in the Midwest and one of the hottest markets in the U.S., according a study of 75 real estate markets by All Property Management (APM)

Great news!

Now on to some legal stuff…

Laches.

A few years back I wrote a post about the legal doctrine of Laches and how laches relates to real estate disputes.  

Since then, I consistently get a lot of hits on that post – and a lot of searches for “laches in real estate.

Why?

I don’t know. Maybe because its an unfamiliar term, unless you went to law school (even then).

Maybe because it is a valid defense to some real estate related actions. (which it is if you read my previous post).

A recent Michigan court of appeals decision came out on the subject, so I thought I would write about it.

As a recap…

The Equitable Doctrine of Laches:

“Laches is an equitable tool used to remedy the inconvenience resulting from the plaintiff’s delay in asserting a legal right that was practicable to assert.” Public Health Dept v. Rivergate Manor, 452 Mich. 495, 507; 550 NW2d 515 (1996).

As such, “when considering whether a plaintiff is chargeable with laches, we must afford attention to prejudice occasioned by the delay.” Lothian, 414 Mich. at 168. It is the prejudice occasioned by the delay that justifies the application of laches.Dunn v. Minnema, 323 Mich. 687, 696; 36 NW2d 182 (1949) .

Therefore in deciding on the issue of Laches, a Court will ask two questions:

1. was there a delay in bringing the claim and, if so,

2. did it prejudice the Defendant?

Question: Why is laches relevant to real estate disputes?

Answer: Because many real estate claims are based in “equity” as opposed to “law”-  e.g. –an injunction, specific performance, action for quiet title… 

Another Question: If someone fails to bring a legal claim in a timely manner can it be barred by laches?

Another Answer: See Hamilton v Jeannot.

Let’s fast forward to the September 3, 2015 case of Hamilton v Jeannot

Facts:

Like most cases that end up going to trial, the facts of this case are a bit complex, including various business entities, bank work outs, and various individual investors. You can tell that what appeared to start out as a good business relationship turned south quite abruptly.

The case surrounds the various “parties’ efforts to renovate and reopen the Brookside Inn and Restaurant in Benzie County, Michigan.”Hamilton v. Jeannot, 2015 Mich. App. LEXIS 1654, *2 (Mich. Ct. App. Sept. 3, 2015)

It lead to one of the parties, Hamilton, filing suit against the others for conversion, claim and delivery, defamation, and unjust enrichment.

The Trial Court dismissed all of those claims.

relevant to our discussion on laches, the trial court  determined that “Hamilton’s long delay in bringing his claims for conversion and claim and delivery prejudiced the ability of the Jeannots and Eden Brook to present a defense to those claims. Accordingly, it applied the equitable doctrine of laches to bar those claims.”

On Appeal, the Court answered the question: is Laches only an “equitable defense” or does it apply to a legal claim?

Laches: Equity versus Law.

The Court of appeals explained at some length and cited historic case law and legislative history that show a clear intent that “laches” applies to equitable claims, but not to legal claims.

Legal claims are governed by “statutes of limitations” – e.g. if you don’t bring a breach of contract claim within 6 years of the date it was breached, you are likely to be barred from recovery.

However, in Hamilton the Court was “compelled” to apply laches to legal claims, given the binding case law precedence. Per the Court: “[t]his Court has held that courts may apply the doctrine of laches to bar actions at law, even when the period of limitations set by the Legislature has not passed.” Id, page 14.

So, even though the Court of Appeals really did not want to apply laches as a defense to a claim at law, it did.

But, the court decided that the facts of the case did not justify compel applying laches, so it reversed the trial court on that point.

Two take aways:

1. If you own investment real estate and are sued, the doctrine of laches may apply as a defense to bar the party that is suing you from recovery.

2. Much to the Hamilton Court’s dismay, even if there is a relevant statute of limitations that has not yet passed, laches may bar recovery if you can show a delay in bringing the claim that has caused you to be prejudiced.

Questions? Comments?

e-mail: Jeshua@dwlawpc.com

Lessons From Trial: Business Owners – Don’t Be so Quick to File a Lawsuit.

November 6, 2015 Leave a comment

Happy Friday, all!

It’s been a while since my last post. My month of October was swallowed up alive by a jury trial spanning 11 days over a 3 week period. So, forgive me, but I am going to go off on a rant about businesses litigation. Because it is what is on my mind at the moment.

I. Litigation and Football.

The past month whenever I told anyone that I was busy in trial (mostly through my auto-respond e-mail) – the response I often received was “good luck“.

Kind of brings me back to the days of playing high school football. (Yes, I am one of those guys who reminisces about such things…much to my dismay, I wasn’t tall enough to play for Michigan State…)

On game day, I would get a lot of: “good luck in your game tonight!

Indeed – in litigation, like a high school football game, there are winners and there are losers.

Litigation, like football, is an adversarial process. 

II. So where am I going with this? Mediation.

In Kent County, we have an effective business court.  I am thankful that business lawyers have the business court as a viable tool to resolve business disputes.

That being said, for businesses there are often more effective ways to resolve disputes than to go to war – initiate a lawsuit, go through the court system for two years, and have the case resolved by way of a 3 week trial in front of a jury or judge.

I’m a proponent of mediation. I’ve previously written posts about mediation.

To be fair, mediation and arbitration don’t always work. Arbitration clauses in particular have critics, particularly in consumer transactions, as a recent ABAJournal article notes.

III. Benefits of Mediation.

Mediation and arbitration provisions in contracts have a place. In particular, mediation can:

  • resolve disputes quickly, without spending hundreds of thousands of dollars in legal fees.
  • resolve disputes privately.
  • could save business relationships and personal relationships.
  • could save years of emotional and mental turmoil that can impact your business life and personal life.  

IV. Mediation Clauses Aren’t For Every Scenario.

I’m not saying that arbitration and or mediation provisions work in every contract. They don’t. For instance, you don’t want an arbitration provision without the ability to go to court to enforce an injunction to gain immediate relief from bad actions by another company/person.

But arbitration and mediation provisions should be considered.

They have a place.

Ok. I’m done with my rant. Have a great weekend.

Questions? Comments?

E-mail: Jeshua@dwlawpc.com

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