casey-taylor

Congratulations to our very own Casey Taylor on successfully passing the Ohio Bar Examination! Casey has been with Finney Law Firm for nearly a year as a law clerk assisting our litigation staff. After being sworn in next week, Finney Law Firm is pleased to announce that Casey will be joining our litigation team as our practicing attorney.   Please join us in congratulating Casey on her success!

We have many dedicated and professional public servants, both elected officials and bureaucrats.  But we also have some who are not so dedicated and not so professional, and even the best can get intoxicated by their power, respond to the mob, or fail to understand the constitutional and statutory limitations on their authority.

Fortunately, in this nation, we have a system of checks and balances, and when an elected official steps over the bounds of his authority, we have the courts to check that abuse of power.

At the Finney Law Firm, we take pride in representing our clients and communities by, when necessary, standing a haughty elected official or appointed bureaucrat before a Judge and making them account for their excesses.  The only thing more satisfying than that is both winning and shifting the fees to the government that forced the action to begin with, for which Ohio law allows.

Under Ohio law, both (i) standing is conferred and (ii) an award of attorney’s fees to a prevailing plaintiff is granted for ultra vires acts (acts beyond their power) by government officials.  This is achieved through taxpayer actions.

Standing

“Standing” is a threshold issue in all litigation.  To have standing, an individual must generally have an actual and concrete injury, caused by the conduct of which the individual complains and capable of being redressed by the court. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).  Because the status of taxpayer is shared by so many, it can sometimes be difficult to establish standing; however, Ohio law has alleviated that problem with statutes such as R.C. 733.59 (for cities/municipalities) and R.C. 309.13 (for counties).

The Ohio taxpayer statutes provide that an individual may request in writing that the city solicitor, village director, or county prosecutor (whichever is applicable), if there is one, initiate an action to hold government actors accountable for their ultra vires acts.  If there is no such solicitor, director, or prosecutor to initiate the action or if they fail to do so upon a taxpayer’s written request, the taxpayer may initiate the suit himself. The action is then brought in his own name on behalf of the municipal corporation or the state, whatever the case may be.  This, in essence, confers standing upon any taxpayer seeking to put a stop to such injustices, regardless of their arguably generalized injury.

In so doing, the taxpayer “volunteers to enforce a right of action on behalf of and for the benefit of the public.” State ex rel. Nimon v. Springdale, 6 Ohio St. 2d 1, ¶ 2 of the syllabus (1966). The only other requirement is that the taxpayer must give a “security” for the cost of the proceeding, presumably to discourage meritless actions.  However, the Ohio First District Court of Appeals, has found that the filing fees satisfy this requirement, although other courts have disagreed and required something more. McQueen v. Dohoney, 1st Dist. Hamilton No. C-130196, 2013-Ohio-2424, at ¶ 21 (June 12, 2013); But see, Bowshier v. Vill. of N. Hampton, 2d Dist. Clark No. 2001 CA 63, 2002-Ohio-2273, at ¶ 27 (May 10, 2002); National Elec. Contrs. Ass’n v. City of Mentor, 108 Ohio App. 3d 373, 381 (11th Dist. 1995).

Attorney’s Fees

 An added benefit for the taxpayers who bring these actions, as well as their attorneys, is that they are entitled to attorney’s fees upon showing that the action resulted in public benefit. State ex rel. White v. Cleveland, 34 Ohio St. 2d 37, ¶ 3 of the syllabus (1973); See also R.C. 733.61 (“If the court hearing a case under section 733.59 of the Revised Code is satisfied that the taxpayer had good cause to believe that his allegations were well founded, or if they are sufficient in law, it shall make such order as the equity of the case demands. In such case the taxpayer shall be allowed his costs, and, if judgment is finally ordered in his favor, he may be allowed, as part of the costs, a reasonable compensation for his attorney.”); R.C. 309.13 likewise provides for reasonable attorney’s fees.  One of Finney Law Firm’s own cases established that “[t]he public benefit need not be monetary in character. That benefit may be of a more intangible character, such as the prevention of illegal government activity.”  City Of Cincinnati ex rel. Smitherman v. City of Cincinnati, 188 Ohio App. 3d 171, 178 (2010), citing Billington v. Cotner, 37 Ohio St.2d 17, 19, 305 N.E.2d 805 (1974).  However, to get attorney’s fees, the taxpayer must produce a contract (fee agreement) showing that he has actually incurred attorney’s fees. Harris v. Carney, 8th Dist. Cuyahoga No. 34733, 1976 Ohio App. LEXIS 8334, *6 (Apr. 8, 1976).

For more information on taxpayer actions, attorney’s fees in such actions, and other fee-shifting provisions, Attorney Chris Finney will be presenting at an NBI seminar in Cincinnati, Ohio titled Local Government Law From Start to Finish on Friday, December 16, 2016.

In recent years, more and more millennials are pursuing higher education.  This trend has, in many instances, pushed back the age at which we are beginning our careers, starting families, and making big purchases.  Thus, NOW is the time that so many of us are looking into buying our first homes.  Here is one thing you need to know, whether you are a prospective buyer or seller:

The Residential Property Disclosure Form (required for residential real property transfers in Ohio per R.C. 5302.30) is not just a formality, but rather, is an EXTREMELY important component of the transaction.

At Finney Law Firm, we represent both buyers and sellers in real estate transactions that have, arguably, gone awry.  The issue often has to do with a disclosure made (or not made) in the Real Property Disclosure Form.  This form requires sellers to answer questions about the condition of the property they are selling.  It covers the structural integrity of the home, water intrusion issues, plumbing, etc.

Home is a big purchase so contracts will have an effectSellers are required to disclose any problems of which they have knowledge.  Even if the property is being sold “as is,” sellers have a duty to not engage in fraud in executing this form (i.e. to not knowingly make any affirmative misrepresentation or conceal a latent material defect in the property).  For example, if the seller knows that the basement floods but checks the box marked “No” next to the section for water intrusion, the seller has arguably engaged in fraud, and a damaged buyer could pursue those claims against the seller.  It is in the best interest of the seller to disclose all that he knows about the property so as to avoid the risk of future liability.

On the flip side, a buyer has certain obligations as well. If the seller in the aforementioned example had said “ten years ago, there was a flood in the basement, but we caulked some cracks and it is no longer a problem,” the buyer is arguably not entitled to rely on that disclosure in assuming that the problem is fixed and that there are no longer any water intrusion issues.  The Ohio Supreme Court has held:

Once alerted to a possible defect, a purchaser may not simply sit back and then raise his lack of expertise when a problem arises. Aware of a possible problem, the buyer has duty to either (1) make further inquiry of the owner, who is under a duty not to engage in fraud, or (2) seek the advice of someone with sufficient knowledge to appraise the defect.

See Tipton v. Nuzum, 84 Ohio App.3d 33, 38, 616 N.E.2d 265 (1992), citing Layman v. Binns, 35 Ohio St. 3d 176, 177, 519 N.E.2d 642 (1988).  Therefore, the buyer should then make further inquiry, by hiring an inspector or asking follow-up questions of the seller, or both. To this point, this can be such an exciting time and even the most cautious buyers can easily become anxious to close on and move into their new home, but it is in the best interest of the buyer to ask questions and investigate anything that might become an issue down the road.  While the extra time or comparably nominal expense of making such further inquiry can seem frustrating, it could save you tens – if not hundreds – of thousands of dollars in repairs and/or legal fees down the road.

The Finney Law Firm and lead attorney Curt Hartman doggedly pursued discipline by the Ohio Elections Commission in the case of dark money spent against Christopher Smitherman in his 2013 election campaign to Cincinnati City Council.

Mysteriously, more than $300,000 in mailers, flyers and radio and television advertisements were issued during the closing weeks of the campaign, but no committee fessed up to making those expenditures or disclosing their sources of funds.

In July, the Ohio Elections Commissioner finally, after years of litigation found that the wrongdoers had in fact systematically violated Ohio elections law and fined them $15,000.

But the key player in that saga, Cincinnati union leader Rob Richardson, steadfastly refused to submit  to a deposition or present his testimony before the Ohio Elections Commission.

This past week, the Ohio Attorney General initiated a contempt action against Richardson for ignoring a lawfully-issued subpoena.

You may read that suit here.  You may read Smitherman’s press release relating to the same here.

Our firm was pleased to represent the distinguished council member Christopher Smitherman in this action and was pleased to win it after years of delay from the Ohio Elections Commission.

Cincinnati CPA’s Crystal Faulker and Tom Cooney are great friends and business associates of Finney Law Firm, and have one of the strongest marketing outreaches in town.  They are with MCM CPAs and Advisors. (Their web site is here.)

They have a radio show, BusinessWise, which airs on: WMKV and WLHS, FM 89.3 and 89.9; Mon – Fri at 7:30 am & 6:40 pm.

They featured Christopher Finney on their show on October 17th to discuss the costs and risks of defending and prosecuting civil litigation, especially for business clients.  A link to that show is here.  Scroll to the 10-17-16 show and listen in!

 

Certain legal challenges seem to come in waves for me, and lately one of those waves involves difficulties encountered in the termination of the Cincinnati Area Board of Realtors Purchase Contract, either for failure of the inspection contingency or the financing contingency.

Three guideposts should guide real estate practitioners, buyers and sellers in the exercise of contingencies in a purchase contract:

  • Read the contract.

Just because a contract is contingent upon the satisfactory outcome of a a loan application or a house inspection does not mean that termination is automatic just because the buyer says it is so.

  • Follow the steps for termination set forth in the Contract.

The Contract many times lays out a specific procedure for contract termination.  That procedure should be followed.

  • Get it in writing.

As we address here, the statute of frauds requires the contract and every amendment and termination thereof to be in writing.  Stating it most simply, if it in’t in writing, it did not happen.

As an example, the Cincinnati Area Board or Realtors Purchase Contract provides a procedure for termination of a contract for the failure of an inspection contingency:

If Buyer is not satisfied with the condition of the Real Estate, as revealed by the inspection(s) and desires to terminate this Contract, Buyer shall provide written notification to Listing Firm or Seller that Buyer is exercising Buyer’s right to terminate this Contract within the Inspection Period, and this Contract shall be terminated.

That seems really simple, but the Cincinnati Area Board of Realtors also has a series of supplemental forms for use in residential real estate transactions.  Two of those are:

  • Release from Contract to Purchase.  This form is a supplemental agreement between a buyer and a seller to terminate a contract.
  • Notice of Termination of the Contract to Purchase.  This document is a unilateral (i.e., just a notice signed by one party to the other; it does not require a counter signature).
Seller refuses to acknowledge an “offer” to terminate.

I recently experienced a situation in which the buyer signed and tendered a Release from Contract to Purchase to the Seller for the Seller to sign within the inspection contingency period.   The seller claimed that that form did not constitute sufficient notice of the failure of the inspection contingency pursuant to the language set forth above and thus it was merely an “offer” from the buyer to the seller to terminate the contact.

The seller reasoned that because both (i) the buyer failed to notify the seller of the failure of the inspection contingency pursuant to the contract requirements and (ii) the seller refused the tendered “offer” to terminate, that the buyer was still bound to the contract. Further, since the inspection period had since lapsed, it was now too late to provide such notice, the seller claimed.

What we did in that circumstance was to supplement the submittal to the seller with a termination under the financing contingency, and eventually the seller conceded that the contract had been terminated and returned the buyer’s earnest money.

Seller refuses to schedule inspection.

In another recent dust-up between a buyer and a seller, the seller refused to schedule an inspection of the property pursuant to the inspection contingency.  In this instance, the buyer attempted to so schedule using the automated showing system, and the seller simply would not permit or acknowledge the request.

In that circumstance, the buyer sent a termination to the seller, and we await his response. But what is a buyer to do when the seller refuses to allow access for an inspection?  Clearly, the courts will permit the buyer to terminate either pursuant to the inspection contingency or because the seller has breached the contract by refusing to allow the inspection.

Conclusion.

So, even though it should seem to be a clear right of the buyer to terminate the contract, the form that that communication to the seller takes informing him of the termination could well impact the substance of whether the termination was effective.

This firm is pleased to represent Professional Psychiatric Associates and Dr. Mohamed Aziz in a suit against West Chester Township challenging the Township’s heavy-handed attempts to outlaw a psychiatric care facility on former nursing home property.

Federal Law clearly prohibits discriminating in zoning laws against those who treat mental health conditions versus physical healthcare, which is precisely what the Township was trying to do, starting with a moratorium issued in April quickly after Dr. Aziz acquired the facility.

The Judge in the suit is Timothy Black, and he spoke pretty clearly in a early order in the case:

“The court has held two initial telephone conferences involving counsel for plaintiffs and for defendant. During these conferences, the court reminded both parties of the consequences that could result if the court finds that the Americans with Disabilities Act and/or the Rehabilitation Act have been violated by defendant, or not.”

The statement is direct, elaborate and unusual, in that the Judge — while keeping an open mind — is forecasting his views on Plaintiffs claims and ever so gently nudging the Township in the direction of resolving the claims by means of settlement versus forcing him to make a ruling against the Township in the matter.

The Hamilton Journal-News and Denise Callahan have the story fully developed here.

Earlier this year, the Finney Law Firm obtained a favorable settlement for five special needs children within the Kings Local School District who were severely mistreated by their teacher, and the firm continues to proudly represent its clients in other similar cases.  However, a decision by the Sixth Circuit Court of Appeals may have heightened the burden imposed on plaintiffs bringing substantive due process claims, which was one of several causes of action alleged in the Kings case.

Substantive due process, under the Fifth and Fourteenth Amendments, forbids government actors, including public school teachers, from intruding into the fundamental rights promised to individuals under the U.S. Constitution.  Relevant here are the “rights to be free from physical abuse at the hands of state actors, and to enjoy personal security and bodily integrity in an educational setting.” Webb v. McCullough, 828 F.2d 1151, 1158 (6th Cir. 1987).

In Domingo v. Kowalski, 810 F.3d 403 (6th Cir. 2016), the Court applied the “shocks the conscience” standard used in substantive due process cases in a way that may very well place an insurmountable obstacle in the way of students seeking to hold their teachers accountable for constitutional violations in the classroom.

The plaintiffs in Domingo, special needs students as young as six years old, brought a substantive due process suit against their teacher alleging that she:

abused her students during the 2003-2004 school year by, among other things, gagging one student with a bandana to stop him from spitting, strapping another to a toilet to keep her from falling from the toilet, and forcing yet another to sit with her pants down on a training toilet in full view of her classmates to assist her with toilet-training.

Despite finding that the teacher’s actions were improper, the Sixth Circuit refused to hold the teacher liable, reasoning that her conduct did not “shock the conscience.” In so finding, the Court borrowed the Third Circuit’s “shocks the conscience” test, which ultimately requires that the actor have malicious or sadistic intent, which the Domingo Court did not find.  Requiring such bad intent is an extremely high standard, making it challenging, at best, for many plaintiffs to meet even in cases as egregious as Domingo. In light of the conduct permitted in Domingo, it is difficult to imagine exactly what type of classroom conduct would shock the conscience.

Earlier this month, an Ohio inmate appealed a state Supreme Court decision holding that a second execution attempt would not violate the inmate’s constitutional rights.

Broom, a convicted murderer, was sentenced to death for his crimes.  In 2009, an attempt to execute him was unsuccessful after 18 stabs at finding a viable vein over a span of approximately two hours ultimately failed.  Broom argued all the way up to the Ohio Supreme Court that a second attempt to execute him would amount to cruel and unusual punishment and violate double jeopardy.  The Ohio Supreme Court rejected Broom’s arguments in a split decision.

Broom has appealed this ruling to the Supreme Court of the United States.  The last time the High Court addressed a death penalty case was in 2015 with its Glossip v. Gross decision.  In that case, the Court upheld a method of execution 5-4 over the challenge of several prisoners. The late Justice Scalia was in the majority.

We know from Glossip that at least four Justices have some concerns about the death penalty, with two of them calling for a re-examination of its constitutionality altogether.  As it takes the vote of only four Justices for the Court to hear a case, it is likely that certiorari will be granted on Broom’s appeal.  If the case is heard before Justice Scalia’s vacancy is filled, and the Justices vote as they did in Glossip, it will be 4-4, and the Ohio Supreme Court decision will stand.

However, filling the SCOTUS vacancy is proving to be a hot issue in this year’s presidential election.  This case may go either way, depending on the outcome and who is appointed by our next president to fill Justice Scalia’s seat.  Thus, it could, interestingly, be decided at the polls on November 8th – yet another reason to get out and vote!

We just got this alert from our underwriter, First American Title Insurance Co., this morning:

The agent receives an email from a “buyer” purporting to have property under contract and wants the agent to facilitate the closing – often a cash deal or large earnest money deposit from an “out of town” buyer. When the agent agrees, the fraudulent buyer sends funds in the form of a wire or check along with purchase and sale agreement.

The agent might even know or confirm that the property really is listed for sale – and it is.  The amount for the contract even looks right given the list price/value. After a few days, the buyer says the deal fell through and asks for the money back saying, “a wire would be best.”

The check or wire has either not cleared yet, or even if it has, it is still within the period for which payment can be stopped or reversed.  Either way, the agent ends up having paid out good funds, but has no good funds paid in.