Lawsuits In San Diego: When is Small Claims Court Appropriate? Do I Need an Attorney?
Small claims court can be a great option for individuals involved in disputes. While parties may instinctively seek to “lawyer up,” getting lawyers involved may not make financial sense. I guess you could say this information goes against my business interests as a private attorney in San Diego…well, so be it.
Small claims court allows individuals to bring claims of up to $7500.00 ($5000.00 for corporations, partnerships, or any other business entity other than a sole proprietor). If your claim, as an individual, is more than $7500.00, you do not qualify for small claims court and you must file in the civil division of the Superior Court of San Diego. Two key benefits of small claims as opposed to the standard civil division are time and cost. A trial date will be scheduled in a timely fashion (potentially within 2-3 months of filing and serving the lawsuit). In San Diego’s civil division, trial dates are sometimes set 18-24 months out from the date the lawsuit was filed! In addition, the filing fees are much less in small claims, as well as all of the other litigation costs and attorneys fees involved in your typical lawsuit.
Attorneys are not allowed to appear in small claims court on behalf of clients. Parties may seek advice from an attorney during the preparation of the case before a small claims trial. This can be very helpful to your case. However, during your trial, it will be you (the plaintiff), the defendant (if he/she shows up), and your witnesses (if any). Attorneys are blocked at the door, so you do not have to worry about the defendant showing up with a hot-shot attorney on the day of the trial.
Seeking the advice of an attorney before proceeding in small claims is beneficial for two reasons: 1) he/she can offer guidance in preparing/organizing your arguments/evidence for the trial, and 2) after reviewing your case, an attorney may alert you to a higher value of the case based on the applicable law. If so, it may end up being worthwhile to hire an attorney to advance your claims in San Diego’s civil division.
For more information about the small claims process in San Diego, please visit San Diego County Superior Court’s website on the topic.
To speak with an attorney regarding the civil litigation process in San Diego, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
Avoiding Business Disputes: Should You Go Into Business With Family And/Or Friends?
It is natural to partner up with friends and family for a business venture. These are the people with which you most often socialize and share ideas. Also, these are the people you trust. Going into business with family and/or friends is perfectly okay–as long as you remember it is “business.”
For those of you who know me, you know I have gone into business with family and friends in the past and I can venture to guess that I will do it again. Fortunately for me personally, I have had only positive experiences. However, I have had the unfortunate luck as an attorney of watching best friends transform into bitter enemies and family members damaging relationships, leading to irreparable conflict. What is the most common cause? Treating the business venture as anything other than what it should be–a business venture. Friends and family members in business together tend to take a relaxed and informal approach to the very issues in business that require formality and structure. Such a “friendly” approach is often the factor leading to the ruination of the business and the pre-existing relationships between partners. Friends and family members engage in a sense of false comfort, lulling themselves into believing no issues will arise that they cannot deal with “as friends.”
Business structure formalities are essential to effectively govern critical issues in business. When conflicts (or mere questions) arise, both parties need to be able to revert back to the governing document or set of documents that are in place to govern. Such direction takes the emotion out of the issue.
These governing documents are typically the shareholder agreements and bylaws for corporations and the membership agreements and operating agreement for limited liability companies (LLC’s). These documents will be the controlling documents on important issues such as control, owner disputes, sale or liquidation of an owner’s interest, what to do in the event of a deadlock, what happens if one partner dies, becomes incapacitated or wants to move to the Galapagos Islands, and any number of other issues that may arise.
Of crucial importance is the formal agreement as to how conflicts between owners will be handled. Many times, a dispute resolution clause will be included in the governing documents calling for: 1) one side giving the other side written notice of a disputed issue; 2) if the conflict cannot be worked out between the parties, non-binding mediation will be held; 3) if unsuccessful, arbitration will occur. This is an over-simplified example, but surprisingly friends and family choose not to lay this type of framework, again due to that false sense of comfort. I have been told by clients that it “would have been awkward to bring up” or “we have been friends for decades, we know how to solve our disagreements.”
Business disputes are never pretty, but they are particularly messy when between family or friends. Take a business-like approach, because let’s remember–this is business.
For more information regarding business formation or if you are involved in a business dispute in San Diego, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
The California Civil Litigation Process: Complaints, Answers, Discovery, Trials, and Judgments
I am asked on a daily basis by potential clients, “how does a lawsuit work?” As I begin to explain the dry, meticulous, and laboring process…I am typically abruptly cut off with the next question, “how long does all that take?” In typical lawyerly fashion, my response is, “it depends.”
Knowing full well that the conversation described above is met with mild frustration and definite confusion from potential clients, I will try to describe below the GENERAL civil litigation process in California state court (*please note: federal court procedure is much different and is not covered in this article; criminal court procedure is much different and is not covered in this article).
FIRST STEP: INITIAL CONSULTATION/POTENTIAL EFFORTS FOR INFORMAL RESOLUTION
The attorney sits down with the client to determine the factual background of the claims of the client or the client’s defense to a claim advanced by another. The initial meeting is essential and should take place at the earliest opportunity as valuable rights may be lost by delay. During and after the meeting, the attorney will review the documents relevant to the matter, research the applicable law and begin to identify the available next-step options.
If deemed worthwhile, the attorney may draft a demand letter to the potential defendant or the defendant’s attorney, or if defending a claim, make an informal telephone call to the claimant or claimant’s attorney advancing the claim. This step is usually taken if the client has a strong desire to resolve the claim short of litigation and it is decided that such resolution appears possible.
SECOND STEP: FILING COMPLAINT (LAWSUIT)/FILING RESPONSIVE PLEADING (ANSWER)
The filing of the Complaint with the County Superior Court initiates a lawsuit. After that Complaint is served on the defendant, the defendant typically has 30 days to “respond.” In most situations, that response will be in the form of an Answer (the defendant also has the right to advance a more aggressive attack on the allegations within the Complaint–typically a Demurrer or Motion to Strike).
THIRD STEP: DISCOVERY
After the defendant has filed its Answer, the case is “at issue” and the litigation process continues. At this point, discovery ensues. The discovery process allows for both sides to investigate the case, as well as force the other side to provide supporting evidence for the claims and/or defenses asserted. Discovery can be in written form (typically requests for production of documents, written interrogatories, and requests for admissions, subpoenas to third parties). Discovery also includes the compulsion of oral testimony in a deposition. Depositions are utilized for parties to the lawsuit, as well as key witnesses and expert witnesses.
FOURTH STEP: TRIAL
A trial may be in front of a jury or a judge and can vary in length depending upon the number of witnesses, number of parties and complexity of the case. The plaintiff has the burden of proof. The plaintiff’s case goes first. The defendant then has the opportunity to respond to the plaintiff’s case with witnesses and evidence to support the defense. The plaintiff then has the an opportunity to put on a rebuttal case to counter the evidence offered by the defendant and, on occasion, a defendant may offer a sur-rebuttal to reply to the evidence presented by the plaintiff.
The jury or judge, after deliberation, returns a verdict. That verdict, typically a finding that a party is liable or not liable based on the causes of action asserted by plaintiff. In addition, if the defendant is found liable, the jury or judge is required to include an amount of monetary damages attributed to the defendant’s extent of liability. The finding of liability and the amount of damages is memorialized in a Judgment.
FIFTH STEP: POST-TRIAL MATTERS
After a judgment is issued, parties may appeal or file post-trial motions to vacate or amend the judgment.
In addition, the plaintiff who now possesses a judgment against the defendant must now “collect” on the judgment. A judgment may state that a defendant has a legal obligation to pay plaintiff $100,000. However, our civil judicial system does not incarcerate defendants until they pay off their judgments. We have no “debtor prisons.” Therefore, the plaintiff must take steps to collect on the judgment. Such collection efforts can include, but are not limited to, wage garnishment, real property liens, writ of execution, bank account levy and debtor’s examinations. For more information on enforcement and collection of California judgments, read Griswold Law’s recent article on the topic: Enforcement and Collection of California Money Judgments.
For additional information on litigation in general, or if you have a claim or have been sued in a business or real estate matter, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
Fix It or Lose It! Receivership Remedy for Dilapidated Properties is Needed Now More Than Ever
As foreclosures continue flowing and banks lose additional control of their REO portfolios, more and more vacant properties in substandard condition will turn up in neighborhoods within San Diego County and the nation at large. Cities within San Diego County have taken promising steps over the years to beef up code enforcement strategies and neighborhood improvement initiatives, particularly in the City of Chula Vista and the City of San Diego. Attempts to stave off vacant/substandard/nuisance properties, coupled with an aggressive penalties system, can solve half the problem. However, once the property has been identified as a “nuisance” and the fines/penalties/charges have been issued, what next? Who ensures the property will be cleaned up and brought within compliance with the applicable code? The answer: court-appointed receivership.
A Health & Safety Receivership is an immediate and systematic process that seeks to eliminate slum housing and/or habitually substandard properties at no expense to the referring agency/prevailing party (i.e. city governments, code enforcement agencies). Receiverships are a mechanism that visibly communicate to the neighbors and surrounding communities that the agency is taking positive steps to clean up residential neighborhoods and protecting tenants who have been subjected to dangerous and unhealthy conditions by absentee or recalcitrant property owners.
Unlike the traditional concept of financial receiverships, a Health & Safety Receivership is a legal process through which title to a piece of real property is temporarily taken from the owner and placed with a court-appointed officer–the receiver. Authorized pursuant to California Health & Safety Code section 17980 et seq., receiverships are used primarily for abandoned and substandard properties where the owner has a history of non-compliance with local enforcement agency orders to abate or where emergency circumstances are discovered which pose immediate threats to health and safety.
Health & Safety Receiverships are implemented most effectively under three scenarios:
1. Owners and/or occupants refuse to comply with local enforcement agency’s orders to abate substandard conditions;
2. Owners and/or occupants are unable to comply with local enforcement agency’s orders to abate substandard conditions due to financial, physical or psychological limitations;
3. Owners and/or occupants of substandard property cannot be located.
The receiver, under the authority and supervision of the California Superior Court, borrows against the subject property (using the property’s equity) and utilizes those funds to pay for emergency owner/occupant relocation, property rehabilitation, demolition or other work as authorized by the Court in order to bring the property into compliance with local and state regulations.
Griswold Law works with California Receivership Group, LLC (www.calreceivers.com) on many Southern California Health & Safety Receiverships. If you are a city agency and would like more information on the receivership remedy and its effectiveness, please contact Griswold Law at (858) 481-1300 or California Receivership Group, LLC at (310) 471-8181.
Wrongful Foreclosure Action: Homeowners Armed with Powerful Remedy Against Sloppy Lenders
My intention in writing this post is not to stoke up another debate over the current real estate debacle in California. I do not intend to spark once again the philosophical wrangling between homeowners and their lenders. I am a lawyer, not a radio talk-show host (yes, there is a difference). I take this opportunity to present the options available to a homeowner who has fallen victim to a “wrongful foreclosure.”
A wrongful foreclosure action is a lawsuit filed by the borrower/homeowner against the loan servicer, the holder of the note, and/or the foreclosing trustee. The driving allegation is that there was an illegal, fraudulent or willfully oppressive sale of property under a power of sale contained in a mortgage or deed of trust. In simple terms, the borrower is claiming the lender did not follow the rules during the foreclosure process and therefore the foreclosure sale should be barred (or “set aside” if the sale has already taken place).
The specific grounds for such an action are typically one of the following: 1) the amount stated as due and owing within the notice of default is incorrect; 2) a forbearance agreement was not adhered to by the loan servicer; 3) loan servicer accepted partial payment during foreclosure process but continued with foreclosure; or 4) notice of default states unsubstantiated non-monetary basis for default (i.e. invalid “waste” argument). These are merely examples and do not consist of an exhaustive list of grounds for a wrongful foreclosure action.
Typically, the homeowner/borrower seeks to have the foreclosure sale set aside (if the sale has already occurred) or seeks to have the court bar or enjoin the foreclosure sale from occurring. Alternatively, he/she may seek the difference between the value of the mortgage as compared to the foreclosure sale price. In addition, a homeowner/borrower may seek attorneys fees, emotional distress damages and/or punitive damages.
For more information regarding this process and/or what remedies are available to a homeowner in the above-described situation, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
Amendment to Promissory Note and Deed of Trust: Extending Maturity Date
Griswold Law recently posted an article on the basics of a Promissory Note. In this current article, the practical issue of amending an existing promissory note (or a likely expired promissory note) is discussed.
One common situation is the note “expires,” or in other words has reached its date of maturity. At that point, the remaining principle balance is due, as well as all delinquent payments. If payment is not made and the lender and borrower would like to extend the date of maturity, allowing for a continued payment schedule, the parties will want to amend the existing promissory note and related deed of trust.
The amendment may call for an “Extension Payment” from the borrower upon execution of the amendment. This payment may include existing delinquent payments owing to the lender, as well as other fees and charges associated with the filing/recording of the amendment.
Although a simple written Amendment to the Promissory Note is likely enough, it is recommended that the amendment also amend the Deed of Trust and be recorded with the county recorder’s office. This will ensure the continued priority of the Deed of Trust and provide notice to all potential subsequent lien holders.
For more information about real estate finance documents and other real estate legal issues, please contact Richardson “Red” Griswold of Griswold Law at rgriswold@griswoldlawsandiego.com or (858) 481-1300.
CA Real Estate Transaction Basics: What is a Promissory Note?
The real estate industry is one of those industries that is obsessed with lingo, acronyms, and abbreviations. Keeping up with all of the latest real estate terms thrown around by brokers (commercial brokers especially) is not easy. However, there are certain legal real estate terms that are part of the long-standing industry vocabulary. My goal is to touch on a handful of these terms in a general fashion.
Promissory Note:
A promissory note is a contract where one party makes an unconditional promise in writing to pay a sum of money to another, either at a fixed or determinable future time or on demand of the payee, under specific terms. The terms of a promissory note, sometimes referred to simply as a “note”, typically include the principal amount, the interest rate, the parties, the date, the terms of repayment, and the maturity date. Many times, there are specific provisions addressing the payee’s rights in the event of a default (i.e. acceleration clause, foreclosure).
One important thing to consider is that there are limits as to how high the interest rate can be according to the state you are in. If the interest rate exceeds the limit, the payee may face severe legal consequences.
In the context of real estate financing, a promissory note is secured by a mortgage or deed of trust that is recorded against the property. The promise to pay is now “secured” by the real estate, which serves as security collateral. When filed and recorded with the applicable county recorder’s office, it establishes legal notice to all that the note is secured by the property.
If you have legal questions regarding a real estate transaction, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
Independent Contractor vs. Employee: Misclassification Can Create Mess for Employer and Employee
Independent contractor…employee…”getting 1099′ed”…self-employment tax…these terms and their implications, in a legal and a tax sense, are complicated. At the outset of a company/independent contractor or employer/employee relationship, a clear relationship needs to be defined. Unfortunately, many times the relationship is not made clear because neither party understands the difference between an “independent contractor” or an “employee.”
Individuals designated as independent contractors are issued 1099 tax forms by companies that have compensated them in the previous year for labor/services provided. No taxes are being paid by the company on behalf of the independent contractor. On the other hand, employees of a company receive payments from their employer and the employer is obligated to withhold associated taxes. In addition, employees typically receive W-2 tax forms from their employer for the previous year’s employment.
Obvious questions remain…how does one differentiate between an “independent contractor” and an “employee”? Can companies and individuals elect to be treated one way or the other? Does the company have the power to determine the designation?
The designation is determined by the applicable statutes in the particular state and the related tax code. This designation is not an “election” and the standards cannot be “waived.” The IRS provides a general outline aimed at differentiating between independent contractors and employees and the stemming implications.
The IRS outline is helpful in a general sense, but the analysis must be done on a case-by-case basis by the employer before the relationship is established. In addition, employers must take into account that the roles and responsibilities of an independent contractor may alter during the course of the relationship and that “independent contractor” that was hired may ultimately morph into an “employee.”
Things become messy when an individual begins to realize they have been (or believe to have been) misclassified as an independent contractor when they were legally an employee of the company, as defined by legal and tax authority. The individual realizes that he/she is responsible for all the taxes associated with his/her labor/services for the previous year and any additional applicable taxes, such as self-employment tax. This is where the conflict arises and the relationship goes sour.
Companies/employers and employees/independent contractors need to address this designation issue at the outset of the relationship and understand the implications (both legally and from a tax perspective).
If you are an employee and believe you have been misclassified or if you are an employer who needs assistance with these designation issues, please contact Richardson “Red” Griswold of Griswold Law at rgriswold@griswoldlawsandiego.com or (858) 481-1300.
California Commercial Leases: Should My Real Estate Attorney Review/Negotiate?
Whether you are obtaining new commercial lease space, have available commercial space to lease, or are approaching a lease renewal negotiation, Griswold Law can help.
As a licensed California real estate broker and attorney, I will approach your real estate transaction with a “real world” business approach, while maintaining a focus on the legal intricacies involved in commercial leases. Commercial leases can exist for five, ten, twenty or more years. One overlooked lease provision can cost landlords or tenants a significant amount of money and considerably affect one’s legal protections under the lease.
Hiring an attorney with a real estate background can save money in the long run and hopefully prevent disputes for the life of the lease. At Griswold Law, we offer experienced and knowledgeable commercial lease negotiation and review.
Commercial leases are typically drafted by attorneys in the first place. It makes sense to have an attorney review the subject lease before entering into it. For more information, please contact Richardson “Red” Griswold of Griswold Law at (858) 481-1300 or rgriswold@griswoldlawsandiego.com.
What is Your Employment Law Case Worth in San Diego, California?
Griswold Law obtains a handful of new clients through this blog site, particularly individuals with employee-based claims. Naturally, I am interested as to how these clients are stumbling across my site. Through Google Analytics, I am able to review what keywords are used that lead people here. Among many different variations of internet searches, there is a common theme running through the keywords used that show most people want to know two things right off the bat: 1) Do I have a case?, and 2) How much is it worth?
My analysis reveals that there is a significantly larger amount of people that are searching for answers to the two above questions (in particular the second question) as compared to people that are actually making contact with me (or any other employment attorney) to assess their case and contemplate whether to retain me. Now, before we go any further, this is not a pity-party wherein I complain that I am not getting enough new business. No, I complain about that on my own time (ask my wife). I simply make this point to reveal what I believe to be evidence of people’s burning desire to have a dollar-figure attached to their gripe at the click of a button (or mouse).
Below, I hope to uncover why such a wish is not obtainable, while also convincing those with potential claims why that fact is exactly what is most valuable to your case–the fact that your case is unique.
I was inspired to share these thoughts after reading an enjoyable article recently written by Joel Christiansen, an attorney friend of mine in Portland, Oregon. If interested, please refer to his article entitled, “What is the Settlement Value of an Oregon Employment Law Case.”
Joel playfully begins his analysis with a hypothetical:
Let’s pretend that a magical “Employment Case Settlement Value Calculator” existed somewhere on the web. It’s exactly what you were hoping to find! To use this calculator, you would type in a bunch of data (salary, type of case, etc.). Then, using that data, the calculator would compare your case to thousands of others and pop out a reasonable settlement value. It goes without saying that you would immediately plug in your information and press the submit button. I’d do the same thing. Next, let’s pretend the calculator tells you your case is worth $98,153.23. Then what? Ah yes, you would open up MS Word and draft a letter. “Dear Employer, You owe me $98,153.23. Respectfully, John Doe.” Each night thereafter, as you drifted to sleep, you would think of how you would spend the settlement check. You’d receive the check in the mail the next week and live out your dreams. Exactly what you wanted, right?
This exaggerated example begs the question: how can a case be valued? A case can only be valued through an independent analysis of the particular facts of your case by a qualified employment attorney (if not me, there is a wide selection of other competent attorneys in San Diego). If there ever existed a settlement value “swami”, it would do more bad than good for plaintiffs. Insurance companies and corporations would control, dictate, manipulate and twist the “value calculator” and rid all plaintiffs of what we cherish so dearly in this country–the right to have your day in court where your claim is treated on an individual basis based on the individual facts and circumstances of your case.
As Joel aptly puts it, “if employment case values were ascertainable via Google search, that would undermine the very system that gives value to your case in the first place. The reason the courts work so well is because they operate on a case-by-case basis. 12 of your peers sit down, consider the evidence in your case and apply the law. The court recognizes you as an individual.”
To conclude, as frustrating as it may seem, the “unknown” aspect of your case may be one of your biggest assets. Defendants hate surprises. Allow competent counsel to thoroughly investigate the facts of your case and vigorously advocate on your behalf. You are unique and so are your claims.
For a free consultation, please contact Richardson “Red” Griswold of Griswold Law at rgriswold@griswoldlawsandiego.com or (858) 481-1300.