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Category Archives: Miscellaneous

Coming Soon: Major Changes to the Fair Labor Standards Act that Promise to Impact Nearly Every Kentucky Business

Author By Todd McMurtryPosted on

Written By: Todd V. McMurtry

The Fair Labor Standards Act (“FLSA”) requires that most employees be paid at least the federal minimum wage for all hours worked and overtime pay at time and one-half the employee’s regular rate for hours worked over 40 in a workweek.

Section 13(a)(1) of the FLSA, however, provides an exemption from the minimum wage and overtime pay requirements for certain executive, administrative, and professional employees. This exemption is commonly referred to as the “white collar” exemption. In 2015, the Department of Labor (“DOL”) announced major changes to the “white collar” exemption in an effort to increase the number of employees who are eligible for overtime pay. These changes will significantly impact nearly every employer in Kentucky and across the country.

Currently, to qualify for the “white collar” exemption, an employee generally must (1) be salaried; (2) be paid at least $455 per week ($23,660 annually); and (3) primarily perform executive, administrative, or professional duties. The DOL’s proposed changes, however, include raising the minimum salary level to the 40th percentile of weekly earnings for full-time workers. This change would raise the salary threshold to qualify as “white collar” from $455 per week to $970 per week in 2016 ($23,660 to $50,440 annually).

The DOL sent the proposed changes to the White House Office of Management and Budget for final review in mid-March 2016. Experts expect the changes to take effect in just three months. With major changes expected in July, employers should begin to take action now.

Employers should perform internal FLSA audits to determine which employees will be affected by the “white collar” exemption changes. The DOL anticipates that the changes will bring nearly 4.7 million currently exempt employees within the scope of the FLSA’s overtime pay provisions. As part of the internal FLSA audits, employers should consider whether it is necessary to update job descriptions to ensure compliance.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

Myth buster: When is an Ohio Residential Property Disclosure Form required?

Author By Christopher P. FinneyPosted on

We hear a lot of misinformation from prospective sellers and Realtors on when a Residential Property Disclosure Form must be used in Ohio:

  • “I’ve never lived in the house, and thus I am exempt from filling out the form.”
  • “I’m just an investor.  I don’t have to complete the form.”

Neither of these statements is true, so let’s bust these myths and in the process really dig into why a residential property disclosure form is “required” and when it is “required.”

What is the “requirement”?

As an opening proposition, Ohio law does not actually require the use of the Residential Property Disclosure statement. And by this I mean that no one is going to go to jail for failure to use the form, and the civil consequences are generally limited to termination of the contract before closing, if any.

The law in question is Ohio Revised Code Section 5302.30.  It is indeed entitled “Property disclosure form required for all residential real estate transfers.”  But when reading the statute it becomes apparent that the penalty for non compliance is: rescission of the contract, but only prior to the earlier of thirty days after the contract is signed or the date of closing (ORC § 5302.30 (K)(4)):

If a transferee of residential real property subject to this section does not receive a property disclosure form from the transferor after the transferee has submitted to the transferor or the transferor’s agent or subagent a transfer offer and has entered into a transfer agreement with respect to the property, the transferee may rescind the transfer agreement in a written, signed, and dated document that is delivered to the transferor or the transferor’s agent or subagent in accordance with division (K)(4) of this section without incurring any legal liability to the transferor because of the rescission, including, but not limited to, a civil action for specific performance of the transfer agreement.

Ohio Revised Code §5302.30 (K)(2) also provides for rescission if the seller amends the Residential Property Disclosure Form after the contract is signed.

It is always advisable to disclose

Before we get to the question of whether Ohio law requires disclosure, there is another question of whether disclosure is advisable.  The answer is almost always “of course.”

The basis of property defects fraud claims is either (a) a material misrepresentation as to a known defect (i.e., lying about the basement leaking or the presence of termites) or (b) non-disclosure of a known material defect that is not readily open to observation by a buyer.

A full and proper written disclosure inoculates a seller from both of these claims and this is advisable even if the law does not require full disclosure.

What types of transactions are covered?

Section (B)(1) of the statute tells us what types of transactions are covered by the “requirement”:

  1. transfers by sale;
  2. transfers by land installment contract;
  3. transfers by lease with option to purchase;
  4. an exchange of property; or
  5. a lease for a term of ninety-nine years and renewable forever.

Who must provide the form and who is exempt?

So, then, on to the question of who must provide the disclosure and when must it be provided:

The statute provides that it covers all “transferors ” of properties containing one to four dwelling units.  So, this would seem to include otherwise commercial properties that contain under four dwelling units, such as a bar or restaurant with apartments above.

And then the statute contains an extensive list of exemptions from its requirements detailed below, but the exemptions do include:

  • New construction;
  • Transfers from an estate; and
  • Transfers among family members and co-owners or pursuant to a divorce;

The statute does not exempt investors or simply owners who did not live in the property.

Waiver by buyer

Finally, a buyer can waive his right of rescission for a Residential Property Disclosure Form (O.R.C §5302.30 ((K)(3)(c).  And, since this is the only remedy for the failure to deliver the Residential Property Disclosure Form, it is essentially a waiver of rights of the buyer under the entire statute.

Conclusion

So, the myth is busted.  Investors and other owners who did not live in the house (except those administering an estate of a seller) are not exempt from the requirements of the statute.

Appendix

A more complete list of exemptions is below:

(1) A transfer pursuant to court order;

(2) A transfer to a mortgagee by a mortgagor by deed in lieu of foreclosure or in satisfaction of the mortgage debt;

(3) A transfer by a mortgagee, or a beneficiary under a deed of trust, who has acquired the residential real property at a sale conducted pursuant to a power of sale under a mortgage or a deed of trust or who has acquired the residential real property by a deed in lieu of foreclosure;

(4) A transfer by a fiduciary in the course of the administration of a decedent’s estate, a guardianship, a conservatorship, or a trust;

(5) A transfer from one co-owner to one or more other co-owners;

(6) transfer to immediate family members and transfers as a part of a divorce;

(7) A transfer to or from the state, a political subdivision of the state, or another governmental entity;

((8) A transfer that involves newly constructed residential real property that previously has not been inhabited;

(9) A transfer to a transferee who has occupied the property as a personal residence for one or more years immediately prior to the transfer;

(10) A transfer from a transferor who both has not occupied the property as a personal residence within one year immediately prior to the transfer and has acquired the property through inheritance or devise.

“6th Circuit loses patience with IRS”

Author By Christopher P. FinneyPosted on

The above headline — a great headline — greeted us from today’s Washington Post, for an article describing a decision issued today from the 6th Circuit Court of Appeals on the case in which we are local counsel — NorCal Tea Party v. United States of America.

That case addresses the abuses at the IRS over the segregation and targeting of conservative groups for slowed consideration of their tax exemption applications, and harassment in the form of illegal and over-burdening questioning and extra reviews of their applications.  It is the only case addressing the abuses at the IRS that is still proceeding and the only case to achieve class certification status.

In that case, the Plaintiffs are seeking the spreadsheets showing the list of the targeted groups, and certain details of the extra scrutiny they endured.  Federal District Court Judge Susan J. Dlott had ordered that the IRS produce that list.  The IRS first asked her to reconsider that decision and then appealed the decision to the 6th Circuit Court of Appeals.

Today’s opinion upheld that decision of Judge Dlott.  The decision is here.

Nominally, the decision was a detailed analysis of the taxpayer confidentiality statute, 26 USC Section §6103.  But the unanimous 6th Circuit panel decision authored by Judge Kethledge, did so much more than that.

  • First, it provided a detailed recitation of the alleged abuses of the IRS in targeting and discriminating against tea party groups;
  • It also laid out a scorching criticism of the IRS and its counsel for fighting every issue in the litigation, including discovery, beyond reason.

The opinion has garnered widespread media coverage as well:

Our firm is proud to participate in this historic and important litigation.

 

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Our title underwriter: First American

Author By Christopher P. FinneyPosted on

I recently was asked by a commercial real estate salesman desiring to refer to Ivy Pointe Title: “Who is your underwriter and what is the quality of their paper?”

Who is our underwriter?

We are proud to have been accepted as an agent for First American Title Insurance Co.  We write exclusively with First American as our title underwriter.

Who is First American?  

From their web site:

  • First American is the title insurance industry’s largest single brand name;
  • First American has been issuing title insurance for more than 120 years.

What are First American’s financial strength ratings?

  • Moody’s Investors Services: A3
  • AM Best: A Excellent
  • Fitch Ratings: A

Our firm obtains great support from the underwriting staff of First American and have a high degree of confidence in the coverage they provide to our clients and customers.

 

 

Getting a Competitive Edge May Be as Easy as D.B.E.

Author By Sean GarzaPosted on

  • posted: Mar. 15, 2016
  • Hemmer DeFrank Wessels PLLC
  • Uncategorized

Written By: Scott R. Thomas

Federal, state and local governments offer numerous benefits to a disadvantaged business enterprise or a “DBE.” Government projects sometimes set aside a portion of the contract value with a view toward that work being performed by a DBE. A contract awarded to a prime contractor may require a portion of the work to be subcontracted to DBEs.  The federal government created these benefits to “level the playing field” and minimize the effects of competitive advantage that may have arisen when unfair discrimination was more prevalent.

A small for-profit business can become certified as a DBE when one or more socially and economically disadvantaged people own at least a majority interest in the company and control management and business operations.  Obtaining DBE certification is valuable because it increases your chances of getting selected by a prime contractor.  The prime contractor has an incentive to hire your company because your participation will count toward the achievement of the prime’s contract goals.  Moreover, getting one opportunity may assist the new DBE in expanding or diversifying to earn more or different work in the future.  If you want to pursue DBE work in another state, you typically must be first certified in the state where you have your principal office.

The certification process is administered on behalf of the federal government by your state’s department of transportation.  The process begins with a detailed application that asserts why you believe your company is eligible for DBE certification.

The applicant must own at least 51 percent of the company.  African Americans, Hispanics, Native Americans, Asian-Pacific and Subcontinent Asian Americans, and women are presumed to be socially and economically disadvantaged.  Other individuals can also qualify as socially and economically disadvantaged on a case-by-case basis.  To be regarded as economically disadvantaged, an individual must have a personal net worth that does not exceed $1.32 million.  The applicant’s ownership of a residence and equity in the company are excluded from the determination of whether the personal net worth ceiling has been broken.

To be seen as a small business, a firm must meet the size criteria of the Small Business Administration.  The size of the applying organization will be evaluated on the basis of gross receipts or the number of employees, judged from an industry specific standard.  Typically, the company must have average annual gross receipts less than $22 million.  In addition, the company must not be affiliated with, or dependent on, another firm.  The applicant company must have the ability to stand on its own without external support.  Officials reviewing the application will scrutinize areas such as personnel, facilities, equipment, financial assistance, and bonding support to evaluate whether the business is truly independent.

The state transportation officials will examine the application and ensure all the requirements are met.  The application will be reviewed to ensure the individuals on whom the DBE is based are qualified to run the business and not mere placeholders for others who run the operation.  The majority DBE owner must possess the power to direct the management and set the policies of the company, as well as make day-to-day and long-term business decisions.  If the state requires the owner to have a particular license or other credential to own a certain kind of business, the applicant must possess that license or credential to obtain DBE certification.

In addition to reviewing your application and supporting paperwork, the state Department of Transportation is required by regulations to visit your company and further evaluate the application.  The DOT official will interview the principal officers of the company, review the resumes of key employees, visit job sites, and generally investigate the accuracy and completeness of the information provided in your application.  The official may also ask to see evidence of stock ownership, equipment, bonding information, etc.

The time from application to certification will vary from business to business.  Some states, including Ohio, are contracting out the heavy lifting in the certification process to expedite decisions.  If an application is denied, the state’s decision can be appealed to the U.S. Department of Transportation.  That process can be time-consuming and expensive so it’s preferable to make the initial application as compelling as possible.

Once you obtain your DBE certification, you must update the information you provided every year.  You give the Department of Transportation an affidavit representing that there have been no changes in the company’s ability to meet the DBE criteria.  In the fifth year update, you may be asked to provide additional information showing you still are under the personal net worth cap.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

Growing Our Practice To Serve You Better

Author By Finney Law FirmPosted on

FLF_MtAdams_2

For the past two years Finney Law Firm and Ivy Pointe Title have expanded their service to clients with the addition of attorneys paralegals staff and technology.

We are pleased to enhance our service delivery with the addition of a second office in Mt. Adams. The new office has a gorgeous panoramic view of downtown, Over-the-Rhine and Northern Kentucky.

Our second location is:
1077 Celestial, Suite 10 Cincinnati
Ohio 45202

It is “Open for Business” for real estate closings depositions and confidential client conferences. Our team of transactional litigation and public interest attorneys is here to serve your legal needs … from both of our offices: Eastgate and Mt. Adams!

Gun Trusts: Get Yours Before the Rules Change!

Author By Sean GarzaPosted on

  • posted: Feb. 19, 2016
  • Hemmer DeFrank Wessels PLLC
  • Uncategorized

Written By: Scott R. Thomas

If you want to own a suppressor (a silencer) or any firearm regulated by the National Firearms Act of 1934 (“NFA”), you have to submit an application to the Bureau of Alcohol, Tobacco, Firearms, and Explosives.   These items are serialized and the Bureau keeps track of who owns what.  You submit your application on BATFE Form 4, along with your check for $200 to pay for the tax stamp.  The application requires a fingerprint sample, a passport-style photograph, and the approval of the chief law enforcement officer in your community.   Of course, the possession of the item has to be permissible under state law.  Possession of suppressors is legal in Ohio, Kentucky and Indiana.

Huntertown Arms “Guardian” on an HK P9s.

For people in many communities, however, getting the approval of local law enforcement was a problem.  While suppressors have many advantages in terms of hearing protection, reduced recoil, and diminished disturbance of game, many law enforcement officials saw suppressors as the tools of assassins in Hollywood movies and refused to sign applications submitted for their approval.  Enter the “gun trust.”

A trust is a relationship where one person—the Trustee—holds property for the benefit of another person—the Beneficiary.  The person who creates the trust is usually called the Grantor.  Trusts have been around for centuries.  People use them for a wide variety of purposes, to provide for children or people with special needs, for charitable reasons, to facilitate the transfer of assets at death, etc.  A trust can also be created to take ownership of NFA items and firearms—the “gun trust.”

In a gun trust, the Grantor creates the trust and transfers the NFA items to it.  The gun trust becomes the legal owner of the NFA item.  The document that creates the trust will name the Trustee and the Beneficiaries.  The Trustee and Beneficiaries are lawfully permitted to possess and use the items owned by the trust.

The gun trust was useful in the past primarily because the approval of the chief law enforcement officer was not required.  But even if your local Sheriff or Chief of Police is willing to approve a Form 4 submitted by a law-abiding citizen, the gun trust still offers several advantages compared to the purchase of an NFA item.

On an administrative level, the gun trust dispenses with some of the red tape associated with an individual application.  With a trust, for example, no photographs and fingerprints need be submitted.  More importantly, the gun trust protects your family in the event of your untimely death.  For example, if a person who lawfully purchased a suppressor later dies, the spouse or roommate could be deemed to have “constructive possession” of the suppressor in the house because they have “dominion and control” over it.  The BATFE calls such people “accidental felons.”  Possession of a suppressor without a tax stamp is a felony punishable by up to ten years imprisonment.

A gun trust enables you to avoid that risk.  Gun trusts should be created with multiple beneficiaries so that the “survivor” who “constructively possesses” the NFA item will be possessing it legally.  The Beneficiary can then decide whether to dispose of the item legally by transfer or otherwise.  In the alternative, the gun trust can be amended to adapt to the change in circumstances.

All that said, the rules are changing.  Last month, President Obama announced his plan to implement gun control measures using his executive powers.  One of those measures was the promulgation of “Rule 41F” by the BATFE.  This Rule becomes effective on July 13, 2016.  Without attempting to recite the 248 pages that appeared in the Federal Register, suffice it to say that Rule 41F makes some significant procedural changes.

Rule 41F creates obligations for “Responsible Persons” under the trust.  A Responsible Person is broadly defined to include any person who has a right to possess the NFA item.  Since possession is the whole purpose of the gun trust, the Grantor, the Trustee and all the Beneficiaries will likely be deemed “Responsible Persons” under the Rule.  After July 13, 2016, when a gun trust acquires an NFA item, each Responsible Person in the trust will be required to do the kinds of things that individuals must now do: submit fingerprint cards, photographs, etc.  While the approval of the chief law enforcement officer will no longer be required, the Responsible Person must still give that officer a copy of the application.

The good news is that Rule 41F is not retroactive.  Any application that is approved—or pending at BATFE—before July 13, 2016, will be grandfathered in under the former rules.  Accordingly, if getting a suppressor or NFA item (pre-1986 automatic weapon, short-barreled rifle, etc.) is on your bucket list, now is the ideal time to get a gun trust and put that plan in motion.

There are gun trusts that are offered for sale on the internet.  Be wary.  There’s a reason they publish a small-print disclaimer along the lines of “GunTrustsЯUs does not offer legal advice, recommends you consult an attorney, and will not be responsible for the use of this form by any person.”  For example, most of these online purveyors will claim “Valid in All 50 States.”  Really?  Good luck trying to use your gun trust in the 11 states that prohibit private possession of a suppressor.  If there’s a state law that’s the same in all 50 states, I don’t know what it is; but I’m willing to bet it has nothing to do with gun trusts.

So recognize that the gun trust is an important legal document that will protect you, your family, and your significant investment in NFA items.  This is not the place to cut corners with a generic, one-size-fits-all document prepared by someone you’ll never talk to.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

The Risk of Party Incapacity During Mediation

Author By Todd McMurtryPosted on

  • posted: Feb. 29, 2016
  • Hemmer DeFrank Wessels PLLC
  • Uncategorized

Written By: Todd V. McMurtry

Most lawsuits today are settled through mediation.  For this reason, a lawyer’s skill at managing the mediation process is more critical than ever.  So, a lawyer has to be prepared for the unexpected.  Take for example, a client that has become incapacitated.  Time and circumstance may cause a client who started the case in full possession of her mental faculties, to later suffer diminished capacity to the point of incapacity.  This change imposes additional duties on the lawyer

Common examples of diminished capacity are (1) a spouse suffering debilitating depression as the result of a divorce proceeding, and (2) an elderly client who shows signs of dementia or foggy thinking.  The National Institute of Mental Health defines Major depression as “severe symptoms that interfere with your ability to work, sleep, study, eat, and enjoy life.”  These symptoms would certainly describe a client with diminished capacity.  Similarly, an elderly client may show signs of dementia or clouded thinking caused by Alzheimer’s, a recent surgery or new medication.  Any of these conditions could limit a client’s ability to engage in the mediation process. 

The ABA Model Rules of Professional Conduct, Rule § 1.14 governs this situation.  Subsection (a) states, “When a client’s capacity to make adequately considered decisions in connection with a representation is diminished, whether because of minority, mental impairment or for some other reason, the lawyer shall, as far as reasonably possible, maintain a normal client-lawyer relationship with the client.”  This rule favors that the lawyer do all she can to work with a client under these adverse circumstances, but it also provides further guidance if the lawyer believes this effort has become untenable.

Subsection (b) states, “When the lawyer reasonably believes that the client has diminished capacity, is at risk of substantial physical, financial or other harm unless action is taken and cannot adequately act in the client’s own interest, the lawyer may take reasonably necessary protective action, including consulting with individuals or entities that have the ability to take action to protect the client and, in appropriate cases, seeking the appointment of a guardian ad litem, conservator or guardian.”  By this rule, the “risk of substantial . . . harm” is the trigger for the lawyer to act. 

Either of these scenarios could befall an attorney without notice at mediation.  If faced by a scenario where counsel believes her client may be at risk of substantial harm, such as entering into a damaging mediation agreement, due to incapacity, and where counsel cannot adequately act in the client’s best interest, the best decision is to adjourn the mediation and immediately consult with individuals that have the ability to protect your client from substantial harm.  

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

Growing Our Practice to Better Serve You!

Author By Finney Law FirmPosted on

The Finney Law Firm is pleased to announce the addition of three new attorneys to our transactional practice group, focusing on real estate, estate planning and corporate law:

 

FLF_DylanSizemore_5x7_lowW. Z. “Dylan” Sizemore
Dylan is a 2014 graduate of the University of Cincinnati College of Law, where he was awarded the Tyler Short Award for Entrepreneurial Excellence.

He earned his bachelor’s degree from the University of Kentucky, Summa Cum Laude. Dylan is an Iraq War Veteran, having served as Company Commander and platoon leader. Dylan’s practice will focus on real estate and corporate law.  Read more >

 

FLF_JulieMGugino_lowJulie M. Gugino
Julie is a 2001 cum laude graduate of Salmon P. Chase College of Law and a 1995 graduate of the University of Cincinnati, Summa Cum Laude.

Julie has extensive experience in all three practice areas of our firm, transactions, litigation and public interest litigation.  Julie re-joins our team after seven years apart. Julie’s practice will focus on real estate and real estate-based litigation.  Read more >

 

FLF_PaulSian_5x7_lowPaul S. Sian
Paul is a 1997 graduate of the University of Detroit School of Law and earned his MBA from Wayne State University in 2001.

Paul previously worked as a tax law specialist for the IRS and as a Claims Judge Advocate for the U.S. Army Reserve.  He is licensed in Ohio and Michigan. Paul has joined the firm “of counsel” and his practice will focus on real estate and estate planning law. Read more >

 

We are pleased to expand the services we provide with these three new professionals.  Let us know how we can help you seize a business opportunity or unravel a litigation knot.

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