Archive for January, 2017

Michigan Business Law Update – Proposed Bill Aimed at Removing Barriers to Employment for Ex-Convicts

January 31, 2017 Leave a comment

Yesterday I read an Article from the Business Bridge – Senate Considers Employer Incentives to hire ex-Prisoners.

This article discusses Senate Bill 14 – introduced just recently. Check ou2015-09-23-15-55-03t the Bill Analysis here.

The Bill would create the “Work Opportunity Act” which would install an “employer reimbursement program to provide grants to employers for hiring people who were on probation or parole.”

In the last several years the State of Michigan has enacted legislation intended to remove employment barriers for individuals with a prison record.

According to the Bridge article, the intent behind this latest legislation is to “seek to get the employee fully engaged in the workplace, – Sen. John Proos, R-St. Joseph, the lead sponsor of the bill package.”

West Michigan is Making Great Progress in this Area – But there is Work to be Done.

There are a number of great companies who reach out to support Michiganders with certain barriers to work.  Goodwill Industries of Greater Grand Rapids lead by CEO Kathy Crosby does a fantastic job of equipping this demographic and putting them into long term employment. Mel Trotter Ministries has placed 135 individuals in their shelter into full time employment in 2016.

Some West Michigan companies who do a great job of reaching out to hire/place those with employment barriers are Cascade Engineering, the work started by its Founding CEO Fred Keller. Others include Lacks EnterprisesKentwood Office Furniture and Express Employment Professionals of Grand Rapids lead by Janis Petrini  to name a few.

Questions? comments?


Twitter: @JeshuaTLauka


Update on Fintech, Social Entrepreneurship and Special Purpose National Bank Charters for Fintech Companies.

January 19, 2017 1 comment

Last month, Thomas J. Curry, Comptroller of the Currency gave remarks about Special Purpose National Bank Charters for Fintech Companies. You can read Mr. Curry’s remarks here.

Mr. Curry announced that the Comptroller of the Currency (OCC) would move forward with considering applications from financial technology (fintech) companies to become special purpose national banks.

Mr. Curry had this to say, in part:2015-11-26-13-04-02

“Over the past year, no topic in banking and finance has drawn more interest than innovative financial technology, and for good reason. The number of fintech companies in the United States and United Kingdom has ballooned to more than 4,000, and in just five years investment in this sector has grown from $1.8 billion to $24 billion worldwide.

“The OCC published a paper discussing the issues and conditions that
the agency will consider in granting special purpose national bank charters.” You can check that paper out here

Support for Special Purpose National Banks from the Fintech Community.

Today I read an article from CrowdFund Insider: Financial Innovation Now supports the OCC’s charter.

Financial Innovation Now is “a public policy coalition comprised of Amazon, Apple, Google, Intuit and PayPal”

Some heavy hitters.

As reported by Crowdfund Insider, Brian Peters, Executive Director of Financial Innovation Now, stated;

“FIN believes that payments and lending regulation needs streamlining for the modern era. We commend the
OCC’s leadership and vision in driving this regulatory discussion. The OCC has rightly concluded that its approach must evolve to ensure that all American consumers and small businesses are empowered with better access to the benefits of financial technology.”

According to Crowdfund Insider  “Fintech Charter could benefit innovative financial firms that can provide superior services at a lower cost for both consumers and businesses.”

Why Fintech Intrigues me – Purpose Driven.

I’ve previously talked about why fintech is so intriguing.

a. taking a risk doing something different;

b. disrupting business as usual;

c. for the good of others.

That’s social entrepreneurship at its finest.

Given the hot water that big banks continue to find themselves in, it isn’t surprising that a consumer friendly alternative is attractive.

Questions? Comments?


Twitter: @JeshuaTLauka

A “Fierce Urgency.”​ Reflections on Community Development/Affordable Housing.

January 18, 2017 Leave a comment

“We are now faced with the fact that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history, there “is” such a thing as being too late. This is no time for apathy or complacency. This is a time for vigorous and positive action.” – Martin Luther King Jr.

Yesterday, I took a picture of this quote from Dr. King, on the overhead of the Grand Rapids Urban League’s 17th Annual Corporate Breakfast in honor of Dr. Martinimg_1373 Luther King Jr.

In light of Dr. King’s quote, Co-Executive Director of LINC UP Darel Ross II spoke eloquently and boldly on the topic of Housing and Community Development.`

Grand Rapids has an Affordable Housing Crisis.

This Fall the Grand Rapids Chamber of Commerce hosted an Issue Summit on the topic of the Affordable Housing Crisis in Grand Rapids.

The Summit brought speakers representing many community stakeholders, including representatives from 616 DevelopmentGrand Rapids Urban League,Rockford ConstructionICCFMSHDA, and many local non-profits, including Mel Trotter MinistriesHQHeartside Ministries, on this lack of affordable housing, what is as Mayor Bliss emphasized, admittedly, “a complex issue”.

I have previously offered my own perspective, both as a lawyer representing real estate developers/investors, and as Board Chairman at Mel Trotter Ministries.

All people are valuable – made in the image of God.

There are people who are hurting in our local community.

Dr. King’s quote is applicable to us, today.

There is a “fierce urgency for now.”

What Mel Trotter Ministries is doing.

In 2016 Mel Trotter Ministries helped 216 families and individuals find permanent housing.

There is still much work to be done.

There are still a significant number of hurting families who need housing in Grand Rapids, alone.

It requires action on our part.

The easy route is apathy and complacence.

Take action.

I invite anyone reading this to join me for lunch sometime and learn what we at Mel Trotter Ministries, in collaboration with so many others, are doing to end homelessness.



Twitter: @JeshuaTLauka

Business Law Update: Key Terms to Consider in Business Contracts.

January 13, 2017 Leave a comment

If you’ve followed my posts for any amount of time, you probably aren’t surprised that I  like reading and writing about the latest Michigan court cases.

Particularly if they are relevant to business or real estate. I always find there are some lessons to be learned.

As another aside – I also like to include photos I took of downtown Grand Rapids, Michigan – overloimg_1360oking Rosa Parks Circle. This one, from today, shows the Zamboni smoothing out the ice for skaters looking to enjoy some weekend ice skating.

The latest case on my mind:

Summit Diamond Bridge Lenders, LLC v Philip R. Seaver Title Company, Inc.

This dispute really has to do with:

Forum Selection Clauses in a Contract.

Backing up a step, why do we prepare written contracts for business transactions?

Contracts are about risk allocation.

In any business transaction, business owners need to  have set in stone terms that answer one question:

who bears what risk?

A Forum Selection Clause would include language indicating that no matter where a dispute about the contract occurred, the contract will be interpreted under (in our case) Michigan law, and the parties agree that any dispute shall only be resolved in _______ County (Typically,  Kent County, Michigan, for my clients.) The parties then would agree to submit to the jurisdiction of said Courts.

Therefore, if your contract contains a forum selection clause, and, for instance, you are owed money by a company in Florida, you would not need to retain a Florida attorney for initiating a lawsuit in Florida. Just initiate the lawsuit in good ole’ Grand Rapids.

So as a general principle, if your business operates in commerce in other states or countries, it is wise to have such a clause.


However, the Summit Diamond Bridge Lenders case tells us that although generally such clause is enforceable, it isn’t always the case.


This case involved an escrow agreement with a  forum selection clause that “provides that California law governs any dispute arising from or related to the escrow agreement. The parties also designated the state of California in the agreement’s forum-selection clause.”

Plaintiff brought suit in Michigan alleging defendant, title company, breached its fiduciary duty as escrow agent of the loan funds by dispersing the funds without an approved letter of credit. Id. at page 2.

Defendant filed a motion to dismiss – arguing that Plaintiff sued in the wrong state. California was the proper forum for the dispute under the plain language of the escrow agreement.

The trial Court agreed. It dismissed the case.

The trial court held that California was the proper forum based upon the plain language of the forum selection clause.

The Court of Appeals reversed.

The Court of Appeals noted on page 3 of its decision that “In Michigan, public policy favors the enforcement of such clauses and, absent certain exceptions” citing Michigan Statute, MCL 600.745(3)(a)-(e).

Those excepts are:

(a) The court is required by statute to entertain the action.

(b) The plaintiff cannot secure effective relief in the other state for reasons other than delay in bringing the action.

(c) The other state would be a substantially less convenient place for the trial of the action than this state.

(d) The agreement as to the place of the action is obtained by misrepresentation, duress, the abuse of economic power, or other unconscionable means.

(e) It would for some other reason be unfair or unreasonable to enforce the agreement.” Id. at pg 5, citing MCL 600745(3).

The Court looked to California Law to determine whether or not the forum selection clause applied. California had a statute that ” precluded from bringing suit against a defendant who is a foreign corporation unless …(2) the agreement relates to a transaction involving at least $1,000,00.” Id. at page 4.

Because the agreement does not relate to a transaction involving at least $1,000,000, because defendant only agreed to hold in escrow $700,000 of plaintiff’s funds.

Essentially, the court of appeals held that since California would not entertain the lawsuit – because it did not meet the monetary threshold – the parties couldn’t obtain effective relief in California – satisfying the exception under subsection b.


Important Lesson:

1. Understand Your Contract Before Signing. 

Contracts are about risk allocation. In a business relationship you need to decide what risk you are willing to bear, and what risk you will allocate away. I am sure in this case Summit did not foresee a dispute arising, and therefore was willing to bear the risk in the event of a dispute to litigate in California in an inconvenient forum. They were fortunate that an exception applied and allowed them to maintain their suit in Michigan.

2. Understand  Your Contract After Signing.

Your business contract will dictate what your rights and duties are.  Here, Summit had the perceived contractual duty to pursue its dispute in California. However, its attempt to avoid abiding by the contract worked out – but it was costly. It was initially dismissed. It took an appeals court to find that a narrow exception applied.

Questions? Comments?


Twitter: @JeshuaTLauka





Real Estate Law Update: Recently Enacted Michigan Legislation Abolishes Dower Right.

January 10, 2017 Leave a comment


A few days ago Governor Snyder signed into law 21 Bills, including Senate Bills 588 and 560 that abolish a surviving wife’s dower right.

The measures are now Public Acts 489 and 490 of 2016.

This is good news since dower right is a relic of the past, sometimes referred to as an “inchoate dower interest” (You can look it up in Black’s Law Dictionary if you are interested.)

I have previously written about the consequences for failing to account for a wife’s dower right in real estate transactions. It appears that there won’t be any Michigan case law developing over this issue in the years to come.

Lawyers will no longer be including in transferring deeds from marital couples the magic words “and his wife for purposes of dower only.”  Something to get used to.



Twitter: @JeshuaTLauka