Scope of the Law

Author: Eric Townsend

Over the last few days I have been developing the first class of a pre-law course for students on their way to law school. As a starting off point, I thought it would be good to first categorize the law from a macro level and then go into each area of law in more depth. As I was developing this initial class I realized this might also be a benefit to anyone who was curious about our legal system, and I decided to write this blog to give my readers a brief and broad overview of our legal system.
The main aspect of our legal system can be summed up in one word, “rights”. Rights correspond with duties. Rights are derived in two ways: first, common law rights of each person as defined by case law; second, Constitutional and statutory rights of each person created through our political system. Once a right is established any breach of the corresponding duty makes the violator guilty of breaking the law. In most cases these rights and duties are simple, but in some cases they are not. An easy example, in a contract for the sale of my car to Bob I have a duty to provide the car when agreed. A more complicated example, if property law says that I am the owner of land and it is my right to be free from intrusion onto such land then all of society owes me a duty not to enter my land.
Our common law rights were borrowed from English courts that developed them over hundreds of years. These common law rights are also known as natural rights. They are used to determine the right of each in their own person and the rights of society in property. Although common law rights cover a broad number of actions, if there is a statutory right it takes precedent over common law rights.
Statutory rights derive from two sources: first, from the Federal government through the limited powers given them by the Constitution; and second, from state governments through the 10th Amendment for any other actions not reserved to the Federal government or where they have failed to take action. States can delegate their authority to local governments like cities and the Federal government can delegate their authority to agencies like the EPA. So a statute will be valid if it does not violate this Constitutional framework.
So to understand our legal system, the law has been broken down into several different areas of law to easily explain and define those rights and duties. Property law determines when a person has a right (aka interest) in property, and also the duties of all people regarding that right. Criminal law seeks to define and limit the rights people have in their actions (based on the political beliefs at that time), and uses liberty and monetary punishments to enforce those limits when that duty is breached. Tort law, like criminal law, seeks to define and limit the rights people have in their actions, and uses monetary punishments to enforce those duties. Tort law additionally seeks that the tortfeasor restore the injured party by monetary contribution in the amount of the harm caused. Contract law seeks to enforce the heightened rights created when people agree to them and to enforce breaches of those duties. Constitutional law provides the framework for our Federal government, it gives limited guidance on the framework of state governments, and it establishes the rights and duties as between the Federal and state governments, between the people and those governments, and between ours and foreign governments. Other types of law will generally be offshoots of these overarching legal areas.
From a broad view, this is our legal system.

If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com.

Probate Prices on the Up and Up in San Diego

Author: Dustin Wetton

New court legislation in San Diego has caused the prices of filing for probate to increase in San Diego. As of the beginning of this month, the cost to file a probate filing with the court is $395. The filing cost is just the amount needed to create a probate case, it does not include the probate code regulated attorney fees, court fees, and examiner fees also associated with probate.

Yet before indulging into these costs, let’s reflect again on what exactly probate is. The probate court is a court designed to distribute and administer a person and their properties once that person dies. This is done for every individual that does not have a trust. Even if that person has a will, they still encounter and run through the gamut of the probate process. The only way to avoid probate is to have a valid trust established.

Thus, for purposes of this article, let’s say that there is no trust established by the deceased person. To initiate the process of distributing their assets, the remaining loved ones will have to file a petition for probate and incur the recently increased costs in San Diego of $395. This is just the initial filing fee. Once the documents are gathered and an examiner or attorney is appointed, then the court will add additional fees to the process. These fees are regulated by the probate code. One such fee is the court fee. The court fee ranges from $1,000 to $3,000 dollars, depending on the amount of complexity with the case. The other fee, the more costly one, is the attorney or the examiner fee. This fee is determined by the probate code by matching a certain percentage with the amount of the estate. For instance, if the estate values at $100,000, the attorney fee is 4%. This percentage heavily increases as the estate increases. The attorney fee can quickly reach $25,000. Determining the value of the estate is done by valuing all real and personal property of the deceased person, thus, it adds up fast when there is a car, jewelry, a house, and even clothing.

Therefore, with all the fees associated with probate, either the estate itself will foot the probate bill and thus disinherit some beneficiaries, or the remaining loved ones will have to pay the fees. Yet, as mentioned above, the probate process can be side-stepped through an established valid trust and estate plan. Further, the probate court only administers to the deceased person and their assets, a whole different court and different fees will be in addition to the cost of probate if there are any minors left behind. To best side-step these fees and costs, an estate plan is needed. Contact us at (619) 796-2381 to setup a free 30-minute consultation to start your estate planning.


If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com.

Issues with Short Sales

October 31, 2010
Author: Eric Townsend

Short sales are more prevalent than ever and many Americans are using them as an alternative to foreclosure. Negative equity home owners see a short sale as a way of limiting their liability. Unfortunately, this is a mistaken belief and acceptance of the short sale by the lenders does not necessarily mean all future litigation of the remaining debt is barred. In some circumstances not only can the lender go after the short seller after the short sale, but, depending on the circumstances, the judgment could be non-dischargeable through bankruptcy.

With a myriad of state and federal laws protecting home owners most residential short sales approved by lenders will result in no future liability, but will remain in several circumstances. Some of these liabilities are created by the lenders and are strictly unenforceable under California state law. Others liabilities were created at the time the short seller created the loan for the subject property. In these circumstances it is very important to understand when there are legitimate and illegitimate liabilities places on the short seller. Once the short seller understands the legal ramifications of completing a short sale only then should action be taken.

Without understanding the liabilities a short seller may be subject to, or to assume an illegitimate liability, it is easy to place a short seller in a position of liability that could have been mitigated with adequate legal advice. In some, but not all, cases lawyers can use simple strategies to help prevent the future liability of these short sellers.

A short sale done properly should operate as a settlement because in fact the short seller is helping the lender to procure the highest proceeds through a non-distressed sale. These actions are valuable to the lenders, and should be used for bargaining the removal of the short seller’s liability, but only a licensed attorney can explain and guide these short sellers to that result.

If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com.

Who is to Blame, Fraud or the Market?

Author: Dustin Wetton

During the recent economic decline, many American’s lost much of their investments in the stock market. While loosing money can cause hardship, permanent damages, and harsh repercussions, by itself it does not open the door to sue somebody. After all, the main person to sue sometimes would be ourselves, as it was our decision, based upon our knowledge, to take a risk and gamble our money in a market that can be as unpredictable as earthquakes. So, why did you loose your money?

If it was based on bad luck, bad timing, or bad choice on your part, then that just comes with the territory. The capital market is know for its harsh ups and downs, and no matter how much the government may try and soften these punches, the market will continue its ocean-motion of ups and downs, and thus a good investor is a person who can see the dips and the inclines, and react smartly to them. Thus, if money was lost based on these issues, I’m sorry, but its you to blame for loosing your money, and thus, you can contact us or any other attorney to see if you have a valid suit against yourself for damages, and maybe even intentional infliction of emotional distress.

However, let’s say that you lost your money based on the faults of your financial broker, advisor, or fund manager. Were you a victim of fraud? These individuals are meant to give you financial advice, through a fiduciary duty owed to you, to help you invest your money based upon your investment profile, and given the recommendations that you knew of and knew the risk of. If they followed these steps, and gave you “bad” advice, then there is not much room for suing still. Yet there are some things that these individuals can be caught in the act and be held liable for, such as:

1) Breach of duty of care – This is a duty of a financial advisor to act with care in giving you financial advice. While this duty is protected by the business decisions exception, if your advisor gave you tips that were out of the realm of normal everyday business practices, then they can be held responsible. While this is often argued for, it is difficult to prove that the business exception rule does not apply.

2) Misrepresentation – This duty is to ensure that all information given to you is to the best of the advisors knowledge true. Thus, if they intentionally or negligently misrepresented facts to you, you bought onto these facts, and relied upon them in making your investment, and damages were caused upon you…then you have a good case against your advisor.

3) Going Against the Flow – This is not the legal term, because it mostly captures an array of suits that fall into it. If the broker did not follow contract terms, or did not listen to reports of unsuitability, or lack of diversification, then there are actions that can be brought against these individuals.

4) Breach of Loyalty – This is a duty to act in the best interest of the client in all decisions made for that client. This duty is breached when an advisor acts in their own interest, to better either themselves, or someone that they know. This is easily spotted with good evidence, and can cause many problems for advisors that went down this sour road.

These are all good actions that may apply to those of you who thought it wasn’t your fault. Also, remember that theft is always a good choice for legal action as well. If there are any signs of schemes, pyramids, or any other sketchy action taking place with your broker, be sure to seek legal help. As always though, while your advisor might have let you down, or you ran into bad luck, it’s always a good idea to be active and on top of your financial investments.

If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com.

Industry of Short-Sales is About to Boom under SB 931

October 05, 2010
Author: Eric Townsend

Home owners walking away from their properties in foreclosure do so at their own risk. Only certain types of mortgages allow homeowners to walk away from their properties without recourse and now those same home owners will be protected when they instead go through the short-sale process.

Home loans, where the borrower also lives in the home as their primary residence, that were obtained to initially acquire property are protected under anti-deficiency statutes. Unfortunately, these loans do not represent the majority of borrowers who have home loans.

Over the last several years borrowers have refinanced their properties to obtain lower interest rates or to delay balloon payments coming due under an adjustable rate mortgage. When a loan is refinanced it is no longer classified as a loan used to acquire property and is left unprotected under the anti-deficiency statutes.

What does this mean? This means that should a homeowner choose to exit their investment (walk away from their home and home loan) in most cases they will be liable for the difference between what they owe and the amount the property brings in a foreclosure sale. This could leave homeowners that walk away in foreclosure with tens if not hundreds of thousands of dollars in debt. But for homeowners there is an alternative.

Governor Schwarzenegger recently signed SB 931 which provides relief to homeowners, but there is a cost. Homeowners that walk away must do so through a short-sale. This legislation adds a section (e) to Civ. Code sec. 580 and protects property owners – not including S or C corporations – from a deficiency judgment if their lenders agree to a short-sale. This means many homeowners that would have had to declare bankruptcy can now be relieved of their debt if they do the right thing and help the lender sell the property in a non-distressed short-sale.

If you have any questions or comments regarding this blog email us at blog@lauruslaw.com

Black’s Law Dictionary: Abandonment - Abavia

Abandonment - Abavia August 3, 2010
author: Dustin Wetton

Another day, another top five listings in what Laurus Law Group is calling “the Book”:

1)abandonment – Here is another word from the Book with so many uses and definitions, yet it is also a very importantly used word. Abandonment is the “relinquishing of a right or interest with the intention of never again claiming it.” According to Black, it is often used by courts as a synonym for “rescission” in contract law, but it is important to note the differences. Under a contract, if the contract is abandoned, it means one of the parties has accepted the other party’s situation of nonperformance and the result. A rescission on the other hand is a termination or discharge of the contract as a whole.

Abandonment is also used in family law, where a spouse abandons or deserts the other spouse or child willfully, with or without the intent to return. In this context there is a distinction between malicious and voluntary abandonment, yet I can’t see how a “voluntary” desertion is not malicious, as it must be willfully done. Maybe an abused spouse who finally escaped the prison of her home could be a candidate for a voluntary abandonment subject.

Lastly, abandonment is used in bankruptcy law. Under bankruptcy, a trustee can release property that is part of the bankruptcy estate if it has become a burden or is inconsequential to the estate. The property is not abandoned to the streets for the mass, but is instead abandoned back to the original owner, the debtor. This is an example of an extreme word in a non-extreme case. “I’m sorry debtor, but we must abandon your vehicle in this bankruptcy, I hope you understand.”

2)abarnare – “to detect or disclose a secret crime.” This makes me think of Sherlock Holmes. Those are some great stories of detecting and disclosing crimes, more often than not, secret crimes. I guess there would be difficulty in detecting and disclosing obvious crimes. That just wouldn’t make a good detective story at all. Holmes = abarnarish (not sure if that is the correct mutation of the word.)

3)abatement– To abate is to take away from something. I first came across this word while studying for the GRE test prior to taking the LSAT…yes, I was a bit confused and had a lot of time on my hands. Although the top definition is “the act of eliminating or nullifying,” while studying for the California Bar and in learning of estate planning, this word became one of my favorite flash-cards. Under estate planning, abatement refers to a reduction of a devise, either a general or a specific, to an heir because the estate was not properly funded to pay its debts. This is a common mistake that occurs when an estate plan is not updated correctly and the deceased creates devisees that are not realistic in connection with their recent life status. Thus, before you have your heirs loose out to your debtors because of abatement, ensure that your estate plan is up-to-date!

4)Abatement clause– No, this is not related to the above definition. While it is the clause that allows tenants to abandon their obligation to pay rent, this is not due to a contract nonperformance or because of the inability to prepare better for debt owed at death. This clause is used in a lease to “release the tenant from the rent obligation when an act of God precludes occupancy.” While this is a vital clause, it is not necessarily guaranteed to be in your lease. Also, this clause normally is in association only with residential leases, not commercial. Also, there is no general idea of what an act of God is. While some may argue that an act of God is any act, it is normally understood to be the wrath of God, such as floods, lightning, wild-fires and the like of destruction.

5)abavia – if you read yesterday’s blog and were curious if abamita’s mom had a proper title too, from their great-great-great-grandchild perspective, you’re in luck because they do. It is called an abavia. This term is “a great-great-great-grandmother.” Wow. Hopefully, if your ancestors were mature enough, your abavia would be about a 100 years, or five generations, older than you. Also, if my math is correct, you should have a total of 16 abavias. That’s a lot of family. My new goal is to try and start using these terms and tell people why I have brown hair, “we’ll you see, my abavia’s…”

If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com

Laurus Law Group Project: Black’s Law Dictionary, "A - Abalienation"

Laurus Law Group Project: Black’s Law Dictionary
This is a notification. Laurus Law Group, in pursuit of spicing things up, has decided to engage its blog in a new direction: Black’s Law Dictionary. The goal is to accomplish the whole dictionary, and write about it. This idea was rooted in the book The Know-it-All by A.J. Jacobs and by a recent movie titled “Julie & Julia”, with the theme in both situations being the conquering of lengthy and informative books such as Black’s Law Dictionary.

Now to the details. The exact book that will be used is Black’s Law Dictionary 7th Edition, edited by Garner of West Group. This book is huge. Not including the appendixes or prefixes, the total page count totals up to over 1600 pages. Not only that, but each page has anywhere from 1 to 20 listings of words or topics. Thus, to fulfill my due diligence in this project, Laurus Law will not report on every single subject in the book, but instead will write about the five top listings, ranked according to our lawyers. The top five listings will be written of hopefully each day, so readers try and keep up.

Why are we doing this??? Well, Black’s Law Dictionary is a corner-stone of cement in the legal community. Law students, judges, lawyers, and professors have relied upon this book since 1891 when it was first published by Henry Black. There are thousands of versions and languages that this book has been transcribed into and there are even on-line versions and pocket versions of this same book. With so much of the world depending upon this book for their legal definitions, Laurus Law believes that the lay people of the world should have their crack at understanding its terms. Thus, our project.

Therefore, with no further ado, let’s start with the five top listings of the day.

A - Abalienation August 2, 2010
author: Dustin Wetton

1) A – There are many definitions for this word, and while it may seem ultra-common and obvious, what better place to start the dictionary but with the letter “a”. One great start to defining it is how it is practically used in the legal world with the reference to “a hypothetical person.” For instance, when talking about a real estate transaction, the legal community would say “a transfer Blackacre to b.” Thus, in those situations, facts of who the people could be are of little importance, and the focus should be on the other facts of the situation.

Another definition used in the Book is “a grade as ranked by Standard & Poor’s.” With this definition, the rankings of the S&P are of AAA to C from high to low based on their opinion of a stock. Thus, to be sure not to miss anything, the Book has made sure that when A is in a document, it could be in reference to its ranking system, which is somewhere between AAA and C, but who knows what “A” ranking really stands for.

My favorite and last definition for “a” is “a scarlet letter worn as punishment by a person convicted of adultery.” Yes, this was used in The Scarlet Letter, but it was also a common practice in the colonies during the founding of America. This is a great reference to legal history and how not only adultery used to be a crime, but how the punishment matched the act committed. The secrecy of adultery was punished with the constant announcement of its action. How grand of an idea. Oh “a”, how we will miss you.

2) abacinate – “to blind a person by placing a red-hot iron or metal plate in front of the eyes.” Ouch. With my wild guess, I would have to assume that this was a type of punishment used and not a crime, yet I could be wrong. What is even more interesting to me is that the item of metal was not placed into the eye of the person, but instead was placed “in front” of their eyes to blind. It was as if they were trying to be mean, but not too mean. Also, this is the name of a modern band, with very peculiar artwork.

3) ab actis – Latin is found throughout the Book. This is because much of our legal codes have derived from Roman law and thus we have adopted many of their sayings. The word “ab” means “by” or “of.” Here, this word “ab actics” is “an officer responsible for public records, registers, journals, or minutes.” This is in reference not to a modern day clerk, but instead to an officer under Roman law. Yes, even back in the day of the empire, there were individuals recording, registering, and journaling everything in the legal system. This is a hard job, and one with a long history, thus, the next time you go into the court house, pay a little respect to these individuals.

4) ab agendo – there is that ab again. Here though, this word is relating to the inability to act, or more properly, “unable to act or incapacitated for business or transactions of any kind.” I wonder when this word was first used. It could be those with the inability to act in battle, or those who tried to sell their chicken, but were unable to act in a transaction of that kind for their spouse would not let them get rid of the family chicken. Any of which would be completely ab agendoed out.

5) abamita – “a great-great-great aunt.” Or in other words, the sister of one of your great-great-grandparents. Thank God they have a term for this. It is so much easier to say this word rather than the repetitive and confusing “great’s.” Yet, my curiosity is aroused as to whether there are many living abamita’s. The number must be small, but it is very possible to have one living. If any of you readers have a living abamita, I would love to hear all about it.

If you have any questions or comments regarding this blog, email us at blog@lauruslaw.com