2012 started off with a bang for Schorr Law. By the third week of the year we have already had 2 bench trials. Both trials resulted in positive results for our clients. We pride ourselves on being able to take a case and litigate it without the fear of trial that many attorneys have.
For more information contact Schorr Law, www.schorr-law.com, 310-954-1877, info@schorr-law.com.
Schorr Law represents clients in arbitrations in front of the major arbitration services in Los Angeles. And, over the past few years we have definitely seen a spike in the number of cases that are arbitrated. It comes as no surprise given the increased use of arbitration provisions in standardized contracts and the budget problems facing the California Superior Court System.
In Wednesday’s Los Angeles Times there was an interesting article on a recent supreme court ruling regarding arbitration “A win for arbitration.” The article focuses on a recent Supreme Court decision upholding arbitration clause over a customer’s right to file a lawsuit. The case focused on a 1996 law that sought to protect consumers from businesses promising to improve their credit rating, and specifically gave customers the right to sue any firm in violation. The Supreme Court’s ruling, however, said that credit repair companies could block these lawsuits and instead force its disgruntled customers into binding arbitration if they had agreed to such provisions in the fine print of their agreements. Justice Scalia, writing for the majority, said that if Congress had intended to prohibit binding arbitration in the consumer credit protection law, it would have specifically done so, rather than implying it in a right to sue provision.
For more information on arbitrations, or a free consultation on your arbitration, contact Schorr Law, APC, info@schorr-law.com, www.schorr-law.com, 3310-954-1877.
Yesterday, we got notice of the Los Angeles County Superior Court that we had prevailed in a fraudulent transfer action against the transferee (recipient) of fraudulently transferred property. This is another important win for our client.
As background, after obtaining a large judgment against a defendant in a commercial leasing dispute, the defendant transferred nearly all of his assets, including his commercial real property, to his adult son. The judgement debtor then filed bankruptcy. Schorr Law, on behalf of its client, filed an adversary proceeding in the bankruptcy court, attacking the judgment debtor’s bankruptcy filing for failing to disclose the debtor’s true assets and liability. Schorr Law successfully got the bankruptcy action dismissed without allowing the judgment debtor to be discharged from his debt.
Following successfully contesting the bankruptcy action, Schorr Law then filed a fraudulent transfer claim against the defendant’s son seeking to void the transfer of property to him and/or to obtain the full money judgment against the son. Yesterday, after nearly a year of hotly contested litigation, we learned from the Los Angeles County Superior Court that our client had prevailed in his action. The court gave a judgment awarding the full amount of our client’s damages against the judgement debtor’s son and voided the transfer of the property from the father to the son (re-vesting title in the father).
Collection can be difficult, especially when a judgment debtor disposes of assets, but if you know what you are doing you can still collect.
For more information, contact Schorr Law, APC, 12100 Wilshire Boulevard, Suite 620, Los Angeles, California. www.schorr-law.com, 310-954-1877, info@schorr-law.com.
1. If you are dealing with a company, get a personal guarantee in addition to the commercial lease.
2. Consider an attorneys’ fee provision. If you think you are more likely to sue then be sued, an attorneys’ fee provision can help you recover the litigation costs.
3. Clearly identify common area charges. It is even a good idea to consider putting in a dispute mechanism for dealing with common area charge disputes.
4. Do your due diligence on the tenant. Make sure the tenant has a business that can support the lease obligations.
5. Consider establishing rules and regulations as part of the lease. Do you want the tenant to be open certain hours? Do you want the tenant to not do certain things.
It is always best to establish everything upfront before any problem can arise.
For help with all of your commercial leasing needs, contact us at 310-954-1877, www.schorr-law.com, info@schorr-law.com
Yesterday, I attended an interesting legal education seminar on the ability to get insurance on a California litigation involving an attorney fee dispute. As background, in California many contracts, like the California Association of Realtor’s standardized Purchase and Sale Agreement and most commercial leases in California, contain prevailing party attorneys’ fees clauses. These clauses essentially provide that the winning party (whoever wins the case) has a right to get reimbursed their attorneys’ fees and costs from the losing party. These clauses require the prevailing party to make a motion to the court for an award of attorneys’ fees and costs after the matter has been resolved. These clauses are important because often times the amount of the attorneys’ fees involved in the dispute can exceed or become a significant part of a party’s damages.
The insurance available is available to both plaintiffs and defendants. Essentially, the insurance allows a party to insure against a negative attorney fee award – an attorney fee award in favor of the opposing party. The insurer claims that this is a way to insure against a big loss, based on a large attorney fee award, in litigation with an attorney fee provision. While this is true, the cost of these policies can be very expensive. According to one insurance company representative the cost to obtain coverage up to $100,000 can be between $6,500 and $7500. Of course, this coverage must assume that there is no underlying insurance coverage in the lawsuit already.
In the end, it is good to know this type of coverage exists. Whether or not it makes financial sense to ever buy this coverage is a complicated issue that involves, among other things, an analysis of a party’s risk tolerance, ability to absorb a loss and cash on hand at the outset of the litigation.
For help with Los Angeles litigation involving attorney fee disputes contact Schorr Law, APC, 12100 Wilshire Boulevard, Suite 620, Los Angeles, California, 310-954-1877, info@schorr-law.com, www.schorr-law.com.
Essentially, either party can go out and buy insurance on the prevailing party fee determination that accompanies
Today, Zachary Schorr of Schorr Law, A Professional Corporation was quoted on foxbusiness.com, a national website. The article, “Renting Your Home? 7 Things You Need to Know“ provides tips for people considering renting out their home or a spare room. In it, Schorr discusses the important of having a solid written lease.
For more information, contact Schorr Law, 310-954-1877, info@schorr-law.com, www.schorr-law.com.
Taking a deposition is one of the most effective ways in obtaining discovery in civil cases. Depositions are powerful tools because the information obtained at depositions can be used at trial. As such, it is important that depositions are conducted fairly and in accordance with all applicable rules.
Oftentimes, during a deposition, a deponent will have off-the-record conversations with his attorney. After this conversation, the deponent will resume the deposition, presumably as instructed by the attorney. This is common deposition practice in California.
At least one California court, however, has prohibited this practice and held that attorneys may not engage in off-the-record conferences with their clients during depositions, except for the purpose of deciding whether to assert a privilege. Vestin Realty Mortgage. II, Inc. v. Klaas (S.D. 2010) 2010 WL 4259946, at 4 (citing Hall v. Clifton Precision (E.D. Pa. 1993) 150 F.R.D. 525, 528 (blanketedly prohibited any communications between a deponent and his attorney, even during breaks, except to determine whether to assert a privilege)). This court limited a deponent’s rights to communicate with his attorney during a deposition, advising that there is no need “for the witness’s own lawyer to act as an intermediary, interpreting questions, deciding which questions the witness should answer, and helping the witness to formulate answers.” Id. at 3. Instead, the deponent should ask the deposing attorney, not his own attorney, for any clarifications, definitions, explanations during the deposition. Id. at 4. Therefore, any off-the-record conferences should be for the sole purpose of deciding whether to assert a privilege – not to clarify the questions or instruct the witness how to answer. In fact, the court warned that the deposing attorney may ask, on the record, about any off-the-record communications to determine whether there has been any coaching of the witness, which can result in sanctions. Ibid.
Other states have already followed this practice and preclude any off-the-record communications during depositions (except those concerning privilege). If courts continue to follow this apparent trend, the deposition practice will begin to look notably different.
In any event, the role of non-deposing attorneys in depositions are limited to simply objecting and asserting privileges when needed – not interpreting questions, or instructing their clients how to respond. Therefore, attorneys should think twice before engaging in off-the-record conversations with their clients to avoid any claims that they are improperly coaching their clients.
By C. Mina Kim of Schorr Law, APC, www.schorr-law.com, 310-954-1877, info@schorr-law.com
There are few things more frustrating as a trial attorney in Los Angeles than preparing for trial without the benefit of the opposing party’s trial witness list, trial exhibit list and other trial documents. Los Angeles County Superior Court Local Rule 3.25((h)(1) provides that at least five days prior to the final status conference, counsel must serve and file lists of pre-marked exhibits to be used at trial, jury instruction requests, trial witness lists, and a proposed short statement of the case to be read to the jury explaining the case. In my practice, I always make sure to file these documents in a timely so as not to risk any exclusion orders. Unfortunately, opposing counsel often wait until the last possible moment, including up until the final status conference itself to file their documents.
In the past few weeks, opposing counsel refused to provide his client’s trial documents. As a result, I sought and obtained an evidentiary order precluding the defendant from introducing any witness or using any exhibits at trial. This was a powerful order. Shortly after receiving the court’s tentative ruling in my client’s favor on this issue, the defendant stipulated to liability in the case. The court, in granting my client’s motion, relied on California Rules of Court rule 3.1548(e) to preclude defendant’s evidence and witnesses.
Los Angeles County Superior Court rule 3.25(h)(1) and California Rules of Court rule 3.1548(e) are powerful tools for trial attorneys in Los Angeles. You can quickly turn opposing party’s game playing into their downfall.
by Zachary Schorr, zschorr@schorr-law.com, www.schorr-law.com, 310-954-1877.
Whether opposing counsel is not prepared or simply withholding
The Las Vegas Review Journal ran an article today entitled “Neighbor Niceties” addressing how neighbors can resolve disputes that typically arise between adjacent owners of land. In California, much like other states, there are general state and local laws helping neighbors resolve disputes. In Los Angeles, the city even offers free mediation services to help resolve common disputes between neighbors.
By Zachary D. Schorr, www.schorr-law.com, info@schorr-law.com, 310-954-1877.
A “power of sale” clause in a mortgage or deed of trust permits lenders to foreclose on defaulted loans without court approval – a non-judicial foreclosure. The sale is conducted by the trustee without court intervention. If there is no such clause, the lender must sue the borrower and obtain a court order to foreclose – a judicial foreclosure. In California, generally all mortgages and deeds of trust contain a “power of sale” clause. Thus, judicial foreclosures are rarely used.
Notice of Sale
After the notice of default is recorded with the county recorder’s office, the borrower has 3 months to reinstate the loan (or bring the account current). Cal. Civ. Code § 2924(a)(2). If the borrower does not reinstate the loan within the 3-month period, the trustee may proceed to give a Notice of Sale.
There are several requirements pertaining to the Notice of Sale. At least 20 days before the foreclosure sale, the Notice of Sale must be:
1) mailed by registered or certified mail, postage prepaid, to the borrower, all parties to whom notice of default was given, and any state taxing agency that recorded a notice of tax lien;
2) posted on the property;
3) posted in a public place in the city where the property is sold;
4) published once a week for 3 consecutive weeks in a newspaper of general circulation in the city (the first publication must be at least 20 days before the sale); and
5) recorded with the county recorder.
Cal. Civ. Code § 2924f(b)(1). Additionally, when a federal tax lien has been recorded against the property, the Notice of Sale must also be sent to the IRS by registered or certified mail or personal service, at least 25 days before the sale. Cal. Civ. Code § 2924b(c)(4).
Debtors’ Right to Reinstate
Debtors have the right to reinstate the loan up to 5 business days before the foreclosure sale date. Cal. Civ. Code § 2924c(e). If the sale is postponed, debtors’ reinstatement right is also extended to 5 business days before the new date.
Sale of the Property
If the debtor does not reinstate the loan, the property is sold by public auction. Anyone, including the beneficiary, may bid on the property. The sale is deemed final when the highest bid is accepted. The highest bidder receives title to the property by a trustee’s deed that relates back to the date when the deed of trust was recorded. Thus, all liens and encumbrances that attached to the property after the deed of trust was recorded are extinguished (unless the bid exceeds the amount necessary to pay off the senior lien as explained below under Distribution of Sale Proceeds).
Distribution of Sale Proceeds in California Following a Non-Judicial Foreclosure
After the property is sold, the proceeds are applied in the following order:
1) to pay trustee’s fees and expenses in conducting the sale;
2) to satisfy the debt to the lender;
3) to the payment of junior creditors in the order of their priority; and
4) the balance, if any, to the borrower.
When proceeds remain after trustee fees are paid and lender’s debt are satisfied, the trustee must send written notice to those with recorded interests in the property who would have been entitled to receive a copy of the notice of default.
Right to Redemption
In California, in non-judicial foreclosures, debtors have no right to redeem the property after the sale is completed. This is not the case in judicial foreclosures. In judicial foreclosures, debtors have a statutory right of redemption for one year following the sale. Accordingly, after a non-judicial foreclosure sale, the purchaser owns the property and the debtor can no longer claim any right to the property.
by C. Mina Kim, Esq, cmk@schorr-law.com, www.schorr-law.com, 310-954-1877
Commercial Real Estate News
