Here are some of the key points contained in the video:
• Recitals often follow the introductory paragraph of a contract.
• Recitals can play a very important role later on if there is a lawsuit.
• Recitals often show the purpose of a contract.
• Be careful and make sure the Recitals contain proper information.
If you have a contract matter in North Carolina, South Carolina, Georgia, Florida or Tennessee, we invite you to fill out our confidential potential client intake form.
Over the past several weeks, I’ve spoken with several different non-profit creators that were surprised to hear that their organizations would need a charitable solicitation license in connection with their fundraising efforts.
If an organization or individual asks the public for contributions and/or donations to help, aid, or otherwise support a charitable purpose, a charitable solicitation license is needed.
What is considered a “contribution?” A “contribution” means a promise, pledge, grant of any money or property, financial assistance, or any other thing of value in response to a solicitation (including in-kind contributions or goods or services).
Is my organization exempt from this license requirement? North Carolina General Statute 131F-3 provides for a number of statutory exemptions from the license requirement. A careful review of the statute should be conducted to see if your organization would qualify for such. To obtain an exemption, your organization would need to submit a written request with supporting documentation to the North Carolina Secretary of State Charities Division.
My organization isn’t exempt. What do I need to do now? If your organization does not qualify for a statutory exemption, license applications can be completed online using the Charities Division’s online filing portal.
How much is the filing fee? The license application fees are statutorily set under North Carolina General Statute 131F-8. The fees are set based on the contributions received per fiscal year.
What do I need to do every year to keep my license active? The organization will need to file a renewal application every year to keep the license active. The renewal application is due four and a half (4 ½) months after the organization’s year-end, which is the same filing deadline as the IRS Form 990.
What are the potential penalties if I fail to obtain the license? Failure to comply with the charitable solicitation license statutory requirements can result in civil and criminal penalties such as an administrative penalty up to $1,000 per act or omission which constitutes a violation, a civil penalty up to $10,000 per violation, and a criminal charge of a Class 1 misdemeanor.
What if my organization solicits contributions in other states? Many other states have some version of a charitable solicitation license and filing requirements. If your organization is soliciting funds in other states, you should speak with an attorney licensed in that state to determine if it is necessary for your organization to file in that state.
Here are some of the key points contained in the video:
• DON’T EVER lend someone money without a written agreement
• DON’T EVER create a loan without including an Attorney Fees, Court Costs and Collection Costs provision.
• In most North Carolina cases, it is difficult to collect attorney fees and collection costs unless it is specifically stated in the written contract.
• What if the loan borrower does not repay the loan?
1. The lender could spend thousands of dollars in costs and fees, not to mention time invested, with no guarantee of ever collecting the money owed.
2. If obtained, a judgment will need to be enforced against the borrower, resulting in additional expenses for the lender.
3. For lawsuits by a business entity to collect on a loan, attorney representation is required, because individuals cannot represent themselves.
If you need legal services in North Carolina, South Carolina, Georgia, Florida, or Tennessee we invite you to fill out our confidential potential client form.
Here are some of the key points contained in the video:
1. Should attorney fee and legal costs provisions be included in an arbitration clause? Examples of options:
A. Arbitration is required, but attorneys’ fees and legal costs are specifically not allowed to be recovered by the prevailing party
B. Prevailing party can recover its attorneys’ fees and legal costs from the non-prevailing party
C. The arbitrator has discretion on these issues..
2. Consider which party is more at risk of being sued and which party has more resources.
Does the type of attorney fee being charged influence these drafting decisions?
If considering a legal agreement presented to you, you should have your attorney take a look at the contract and then make a careful decision on how to proceed based on a thorough legal analysis of your situation and the proposed contract.
If you need legal services regarding contracts, business law matters, or other matters we handle in North Carolina, South Carolina, Georgia, Florida, or Tennessee, we invite you to fill out our confidential potential client intake form.
When someone visits your property – whether as a social guest or a repairman – there is always a chance that an injury could result. As a landowner, you may not know the extent of your potential liability when someone becomes injured on your property.
Some states, such as Florida, apply different standards of care on the part of the landowner depending on the classification of the injury person (invitee, licensee, or trespasser). Up until 1998, North Carolina courts did so as well. Now, North Carolina applies the same standard of care of landowners to all lawful visitors – landowners must exercise reasonable care in not exposing lawful visitors to dangerous conditions and must warn of any hidden dangers on the property. “Reasonable care” may mean cleaning up a spill on the floor or just maintaining the property in general.
In order to recover damages from a landowner, the visitor must prove that the landowner negligently caused the condition or failed to remedy the condition after the landowner knew or should have known of the condition’s existence. With regards to hidden dangers, a landowner is required to give an adequate warning of the danger’s existence – this could mean a natural condition (ex/ a hill) or an artificial condition (ex/ a swimming pool).
It is important to remember that the above standard of care is for lawful visitors. For unlawful visitors, a landowner’s duty is only to refrain from willfully harming the trespasser. However, there is a particular doctrine – the attractive nuisance doctrine – that allows a landowner to be held liable for injuries sustained by children who trespass on the landowner’s property if the dangerous condition was one likely to attract children.
Common types of premises liability lawsuits include:
(1) “Slip and Fall” – these cases commonly occur on commercial properties, such as a restaurant or grocery store. There are several issues that can arise in these cases – How long was the dangerous condition (i.e., the spill or liquid) present? Was a warning present (i.e., one of those yellow “Caution” signs)?
(2) Property Defects – these cases can involve injuries resulting from a broken railing or broken stairs.
(3) Dog Bites – a landowner may be liable for any injuries that his or her dog causes if the dog had shown dangerous tendencies in the past and the landowner (and dog owner) had knowledge of these tendencies at the time of the injury.
There are certain situations in which a landowner may defensibly raise the doctrine of contributory negligence, which bars recovery by the injured party if they are partially at fault. This could mean that the visitor did not properly look where they were going or failed to act reasonably at the time they became injured. Imagine a visitor going downstairs to your basement without turning the lights on and then tripping on the stairs.
Landlord/tenant laws cover rights and responsibilities each tenant and landlord has in their specific state. Because Florida is one of the best states in the country to invest in property, you may be considering buying an investment property. Before you do, you should understand Florida rental laws and consider certain aspects to better protect yourself and your investment, especially in the time of COVID-19.
So, you are concerned that your prospective tenant may cause damage beyond normal wear and tear. Or maybe you have concerns about your tenant’s financial situation. Luckily, there is no statutory cap on a security deposit amount in Florida and you are able to charge the deposit at your own discretion. Typically, Florida landlords charge the equivalent of a month’s rent. However, if you have concerns about your property or your tenant, you can charge more than that. While there is no limit, landlords will likely charge no more than two months’ rent. You should understand that charging an excessive security deposit may turn away prospective tenants so just be prepared for that.
You are legally required to keep the property “livable.” Under the doctrine of implied warranty of habitability, a landlord must maintain the structure of the building (stairs, ceiling, floors, etc. safety), provide hot/cold water, provide trash receptacles, exterminate bugs and rodents, etc. Therefore, maintenance and repair of any of those would be required.
On the other side, there are other repairs that you would not be required to fix by law, such as leaky faucets, grimy grout, and squeaky cabinet doors. Your obligations versus your tenant’s obligation to make these minor repairs should be addressed in the lease. I’ve commonly seen leases that require the tenant to pay for minor repairs and specify the price minimum for what constitutes as a ‘major’ repair. This means that, if the cost of a repair is less than the minimum amount of the major repair, you can require the tenant to make and pay for the repair.
Surprisingly, Florida law does not require landlords to provide or repair air conditioning. Rather, landlords are required, by statute, to provide functioning heat during the winter. However, most landlords do provide other appliances outside of just heat, such as air conditioner, ovens, refrigerators, etc. Therefore, the only instance in which you as a landlord would be responsible for repairs to additional appliances is if those repairs were included in the lease.
Yes, however, the tenant must meet strict requirements. Under the previously mentioned doctrine of implied warranty of habitability, the landlord is required by law to make sure that the property is free of any hazardous or dangerous conditions. If you fail to repair the condition, the tenant has the option to either: (1) remain in the property and withhold rent until you fix the condition; or (2) move out and terminate the lease.
If the tenant seeks to remain in the property and withhold rent, the tenant:
• Must provide notice – the tenant must provide written notice to you of their intent to withhold rent at least 7 days before the rent is due. They may either hand deliver it or send the notice by certified mail. If mailed, the notice must be sent at least 12 days before the rent is due. After receiving the notice, you have 7 days to make repairs;
• Must be current in rental payments;
• Has the right to withhold all future payments – as long as the tenant follows the correct procedure, they have the right to withhold all future rental payments until the repair is completed.
The tenant is “breaking” the lease, which is when a fixed-term lease is terminated before the end date without paying the remainder of the rent due. Some states require a landlord to mitigate their damages by finding a new tenant. However, Florida does not require this. A landlord has 3 options: (1) find a new tenant; (2) do nothing and collect rent from your tenant as it becomes due; or (3) invoke right to liquidated damages.
(1) Find a new tenant – So, this is something you could do but are not obligated to do. However, if you have a good relationship with your tenant, you could try to have them provide you with a replacement tenant.
(2) Collect the rent as it becomes due – This is basic contract law. Your tenant cannot just agree to do something and then change their mind without having some consequences. Unless there is an early termination clause in your lease (see below), the tenant will be required to continue to pay rent until a new tenant is found or the lease period ends.
(3) Invoke the early termination clause – Some leases include an early termination fee (aka liquidated damages clause). This fee is normally about two months’ rent and your tenant will need to give you at least 60 days’ notice that they will be terminating the lease early.
This is probably the most common issue among landlords and tenants after the lease ends. While the tenant wants their money back, you also want to get your property back in good condition. You have two options: (1) return the tenant’s security deposit in full; or (2) deduct damages from the tenant’s security deposit and return the remaining balance.
(1) Returning the Security Deposit in Full. Your property was given back in great condition and you don’t need to deduct from the deposit. Therefore, you must return the full amount within 15 days from the lease termination.
(2) Deduct Damages From the Security Deposit and Return the Remaining Balance. If there was damage to your property and you intend to deduct from the tenant’s security deposit, you have 30 days from the lease termination to notify the tenant in writing of your intent to keep part of the deposit.
• If you fail to provide this notice in writing within the 30 days, you forfeit your right to keep ANY part of the deposit.
• Additionally, statutorily, you must strictly adhere to the following or risk losing your right to withhold a portion of the deposit:
o Send the written notice by certified mail to the address you have on file. It is not your responsibility to ask the tenant for a forwarding address.
o You must state your intention to keep a portion of the deposit and the reasons why
o Inform the tenant that they have 15 days from receipt of the letter to contest the deduction in writing
o If the tenant does not object – you must deduct and return the remainder of the deposit to the tenant within 30 days of your initial letter
o If tenant does object – you can seek judicial remedies
The landlord-tenant statute makes the award of attorneys’ fees discretionary in some instances, such as in actions to enforce rental agreement provisions and actions of possession; while in other instances, the award of attorneys’ fees are mandatory, such as actions to recover a security deposit or prohibited practices.
See the following applicable sections and notice the language contained therein (i.e., “may” versus “entitled”/”shall be”):
Section 83.48 – Attorneys fees – In any civil action brought to enforce the provisions of the rental agreement or this part, the party in whose favor a judgment or decree has been rendered may recover reasonable attorney fees and court costs from the non-prevailing party. The right to attorney fees in this section may not be waived in a lease agreement. However, attorney fees may not be awarded under this section in a claim for personal injury damages based on a breach of duty under s. 83.51.
Section 83.49 – Deposit money or advance rent; duty of landlord and tenant.
(3)(c) If either party institutes an action in a court of competent jurisdiction to adjudicate the party’s right to the security deposit, the prevailing party is entitled to receive his or her court costs plus a reasonable fee for his or her attorney. The court shall advance the cause on the calendar.
Section 83.59 – Right of action for possession
(4) The prevailing party is entitled to have judgment for costs and execution therefore.
Section 83.625 – Power to award possession and enter money judgment. The prevailing party in the action may also be awarded attorney’s fees and costs.
Section 83.67 – Prohibited practices.
(6) A landlord who violates any provision of this section shall be liable to the tenant for actual and consequential damages or 3 months’ rent, whichever is greater, and costs, including attorney’s fees.
As an attorney who routinely drafts and analyzes business contracts and a bride during the COVID-19 pandemic, I knew that there were several contractual aspects I would need to consider when entering into countless contracts with the vast array of people and vendors involved in planning a wedding, especially during a global pandemic.
While it appears that the initial “panic” of the COVID-19 pandemic has gradually decreased and many 2020 weddings have been rescheduled, the health concerns with regard to mass gatherings are still very much present and will not be going away any time soon. Whether you’re in the beginning stages of planning like myself, or attempting to navigate the contracts you entered into months ago, below are some considerations and legal concepts you may find helpful.
Most service contracts have a deposit or fee due at booking in order to hold the date for your event. Typically, these deposits are non-refundable. Well, what if the contract wasn’t performed due to force majeure or impracticability/frustration of purpose, can I get my deposit back? It will depend on the circumstances, but maybe not. Global pandemic or not, these initial deposits are usually just to hold that date – thereby, causing the servicer (caterer, photographer, wedding planner, etc.) to turn away other events for the same date, i.e., business for them – so that part of the contract has already been ‘performed.’
As an attorney who routinely drafts and analyzes business contracts and a bride during the COVID-19 pandemic, I knew that there were several contractual aspects I would need to consider when entering into countless contracts with the vast array of people and vendors involved in planning a wedding, especially during a global pandemic.
While it appears that the initial “panic” of the COVID-19 pandemic has gradually decreased and many 2020 weddings have been rescheduled, the health concerns with regard to mass gatherings are still very much present and will not be going away any time soon. Whether you’re in the beginning stages of planning like myself, or attempting to navigate the contracts you entered into months ago, below are some considerations and legal concepts you may find helpful.
Regardless of whether your contract includes a force majeure clause or not, general contract principles will still apply. The doctrine of impracticability refers to an unforeseeable event or incident that could not have been anticipated which makes performance under the contract unreasonable and difficult. North Carolina courts apply this doctrine in cases where a party’s performance is rendered practically impossible by law and thus the party is unable to fulfill its obligations under the contract. This defense could apply in a situation in which an event or wedding was to originally be held during a government closure order due to COVID-19.
The frustration of purpose doctrine refers to when the unforeseeable event or incident undercuts the prime purpose of the contract and may be applied even if a party’s performance isn’t necessarily impossible. An example in the event context would be your catering contract during a government order limiting mass gatherings – obviously, the order frustrates the purpose of your catering contract and thus the defense may excuse your performance.
It’s important to note that these defenses will usually not apply where the event is reasonably foreseeable.
At McGrath and Spielberger, PLLC, we represent many local and regional clients who own and operate many different types of businesses, including restaurants, gyms, retail stores, and other commercial businesses, throughout North Carolina, South Carolina, Florida, Georgia, Ohio and Tennessee. We are obviously hearing a lot from our clients right now regarding their issues and concerns in relation to the Covid-19 coronavirus pandemic. Overwhelmingly, most client inquiries relate to commercial leases in which our clients are tenants. Their main questions typically revolve around their requirement to pay rent and whether they can be held in default and/or evicted during the pandemic.
This article will focus on the answers to these question in relation to commercial leases in South Carolina specifically, but a lot of what is discussed may also apply in other states. As of now, without an explicit agreement with the landlord under the lease regarding payment of rent during this pandemic, there are “simple” answers and “practical” answers that either now exist or that will eventually reveal themselves. Please also note that the answers to the above questions are fluid and may be affected by forthcoming government relief programs and bailouts.
Simple Answer: Yes.
Practical Answer: Still yes unless some sort of law is passed allowing commercial tenants to stop paying rent for a period of time, unless your landlord has specifically told you your rent will be abated, or unless your lease agreement has an applicable Force Majeure clause or other clause which would relieve your obligation to pay rent (Click here for a brief summary of what a Force Majeure clause is). As of now, there have been no Federal or state orders issued or laws passed that currently allow tenants to stop paying rent or requiring landlords to provide any type of rent relief.
Simple Answers: Held in default, yes. Evicted, probably not for the immediate future.
Practical Answer: Again, still yes for default. As far eviction goes, though, when you can or will actually be evicted or ruled by a court to be in default is somewhat up in the air and it likely won’t be before May 1, 2020. On March 18, 2020, the South Carolina Supreme Court issued an order stating, in part, “. . . that all evictions currently ordered and scheduled statewide shall be rescheduled for a date not earlier than May 1, 2020.” While this order does not specifically differentiate between commercial and residential leases, the lack of such differentiation bolsters an argument that the order applies to all leases, both commercial and residential. And despite some public perceptions to the contrary, the order does not state in any way whatsoever that tenants in commercial leases are excused from paying rent, that landlords cannot add late fees, penalties and interest to late or unpaid rent payments, or that landlords can’t hold tenants in default or file to evict them for not paying rent or otherwise violating their leases. It simply means that virtually no eviction hearings will be heard in court prior to May 1, 2020. It should also be noted that South Carolina law does not necessarily require a landlord to file an eviction action to remove a tenant – in some cases “self-help” evictions are allowed. However, they are rarely utilized because they pose many risks to and are wrought with pitfalls for landlords trying to utilize them. So, practically, if you fail to pay your rent or otherwise violate the terms of your lease, you are unlikely to be physically evicted or ejected from your leased space prior to May 1, 2020, and probably much later due to the backup of cases that will result from the order. But you can still be in default of your lease and may be liable for past due rent, penalties, late fees, interest and other damages suffered by your landlord due to your failure to pay rent or comply with other provisions of your lease.
So, if you cannot pay your rent due to the Covid-19 coronavirus pandemic, or for any other reason, we highly recommend you first discuss it with an attorney. It may be that approaching your landlord and reaching an agreement that works for both of you is the best approach, or it may be that your specific situation requires more complex and/or drastic steps. If you are located in one of the jurisdictions in which McGrath and Spielberger has licensed attorneys, please contact us and we would be happy to assist you analyze your situation and form a plan that will allow your business to survive during these unprecedented times. You can click here, email us at info@mcgrathspielberger.com, or call us at 800.481.2180.
McGrath and Spielberger, PLLC handles business law, contract law and commercial lease matters every day, and has lawyers who are licensed to practice in FL, GA, NC, OH, SC, and TN (if you are unsure as to what jurisdiction applies to your legal matter, we can help make that determination).
What contract controls the relationship between the National Basketball Association and its teams like the Boston Celtics on the one side and players like Kemba Walker on the other? The relationship between the NBA, the teams, and the players is generally governed by contract law, and specifically a business contract almost 600 pages long titled the “Collective Bargaining Agreement” (the “CBA”).
What key part of the CBA might largely control what happens in these coronavirus-induced circumstances? What immediately comes to mind is whether there is a “Force Majeure” clause somewhere in those many pages of fine legal verbiage. Click here for a brief recap of what a Force Majeure clause is; in essence, some unusual, significant condition beyond the control of a contractual party which interferes with that party’s ability to perform duties under the contract. Yep, on page 467 is “Section 5: Termination by NBA/Force Majeure”.
Is something like COVID-19 addressed in the CBA under the Force Majeure clause? Notably, the list of Force Majeure items in the NBA’s contract with the National Basketball Players Association [sic] does include “epidemics”. That term is not defined specifically in the CBA, which means we’d typically look to the standard definition, perhaps influenced by what definitions relevant courts of law have accepted over time. “Epidemic: a disease affecting many persons at the same time, and spreading from person to person in a locality where the disease is not permanently prevalent.” Very few reasonable minds would disagree that coronavirus is an epidemic in the United States right now (and in Canada to a certain extent, let’s not forget the reigning NBA champion Toronto Raptors).
You should also know that the Collective Bargaining Agreement – which, again, is a business contract – allows the NBA to terminate that contract after a Force Majeure event.
So does coronavirus mean that the NBA doesn’t have to pay the players while games are suspended? There may be an epic battle over that very question. The CBA specifically states that if a Force Majeure event (like coronavirus – an “epidemic”) occurs and causes teams not to be able to play one or more games, and those games are not made up, each player who was part of that team shall have his overall compensation for that season reduced by 1.08%. (In the contract it’s actually expressed as a fraction – 1/92.6th, based on an agreement that for this purpose a season is made up of 92.6 games.)
Interestingly, this part of the CBA specifically states that neither the NBA nor the Players Association must terminate the contract even if it has the right to do so, including as to the NBA’s right to cancel the CBA due to this Force Majeure event. However, there is not similar language which specifically addresses whether the NBA has the option to reduce compensation to the players under a Force Majeure circumstance. Thus we are left with language mentioned in the previous paragraph (and in the CBA itself, the previous page) which says that the players’ compensation “shall” be reduced.
If I was arguing for non-payment, I’d argue that the contract doesn’t allow the teams to pay the players in these circumstances even if the teams wanted to. The players, presumably, would argue that a contractual party always has the right not to enforce one of its rights, and thus the teams could of course pay the players if they so choose. Also, there are certainly other aspects of this 598-page contract, governed by New York and/or Federal law, which influence these legalities, and this article is not attempting to engage in a detailed analysis of this issue and is not attempting to interpret or comment on New York law.
This NBA stuff is interesting, but what about my business? Can your lawyers help my company deal with contract issues? Yes, that’s what we do. We explore, we troubleshoot, we diagnose, we advise, we repair, we resolve, we combat, whichever is appropriate. If you want help and the subject matter and the jurisdiction (which state, etc.) match up with those of our Firm, reach out to us and ask for a consultation; one way to do so is by clicking here. Good luck and keep yourself – and your business – safe!
McGrath and Spielberger, PLLC handles business law and contract law matters every day, and has lawyers who are licensed to practice in FL, GA, NC, OH, SC, and TN (if you are unsure as to what jurisdiction applies to your legal matter, we can help make that determination).
