From Tressie McKeon in our Dallas office comes the following guest post:

Contracts are important and “the devil is in the details.” Too often I see business owners and experienced entrepreneurs come to me as first time clients with a serious problem. But when we go to review the contract that is at the heart of the issue, I often find that the contract was not professionally drafted, does not address many issues that should have been addressed or simply does not make sense in the context of the transaction.

Unfortunately, once a problem arises, it is almost always after the ink is dry and the writing is on the wall so to speak. In short, you’re stuck trying to enforce, or defending against, a contract that simply does not say what your new client thought that it said.

I recently had a new client come to me with a problem. He had invested hundreds of thousands of dollars into the purchase of a business. This client is an experienced entrepreneur with numerous successful business ventures. However, he did not have an attorney review the purchase documents prior to closing. The client sheepishly admitted that it was because he thought he would save himself some money in legal fees. In short, after the deal closed, the client learned that the business he had purchased was not worth even close to what he had invested in it.

While not a handshake deal, my client had trusted the people that he was dealing with to be forthcoming and truthful. Unfortunately, that was simply not the case. To add insult to injury, the contract documents were extremely vague and one sided in favor of the seller—not my client.

In this situation, if the client had invested roughly $3,000-5,000.00 in legal fees on the front end, it could have saved him hundreds of thousands of dollars. Unfortunately, this client’s story is not unique. Many investors and entrepreneurs avoid hiring an attorney to review their agreements related to their business transactions to save time and money. Similarly, many businesses are working with old outdated contracts.

If you are entering into a new business venture, or contract of any kind, have an attorney review the documents. A small investment now may save you a great deal of time, money and heartache later.

 

 

Copyright: squarelogo / 123RF Stock Photo
Copyright: squarelogo / 123RF Stock Photo

Election 2016

Marijuana ballot initiatives won big on election night 2016.  As recently reported in the Washington Post, voters in California, Massachusetts and Nevada approved recreational marijuana initiatives.  And, voters in Florida, North Dakota and Arkansas just approved new medical marijuana initiatives. Washington Post Article

Texas-84th Legislative Session

What is not as well known is that medical marijuana came to Texas in the last legislative session-in a small way.

As noted by the Marijuana Policy Project, the 84th Texas legislative session included five bills which would have reduced penalties for possession of marijuana (including one which would have made access for consenting adults completely legal.)  None of those bills made it out of committee and to a vote.  However, there were also four medical marijuana bills, one of which became law in Texas-the Compassionate Use Act.  Summary of Texas Bills

The Lawyer’s Dilemma

When the dust settles on the 2016 election, more than twenty percent of Americans will now live in states where recreational marijuana use is legal, and it now appears that 29 states will allow cannabis use for certain medical conditions-including Texas. See Fox Rothschild eBook summary of state-by-state marijuana laws

However, marijuana remains a schedule I drug, along with heroin, and possession or distribution remains a serious felony under federal law.

The professional rules of conduct in most states, including Texas, prevent an attorney from counseling a client to engage, or assist a client, in conduct the lawyer knows is criminal or fraudulent, but a lawyer may discuss the legal consequences of any proposed course of conduct with a client and may counsel or assist a client to make a good faith effort to determine the validity, scope, meaning or application of the law.  How can an attorney counsel a client in the cannabis business under these conditions?

How are state bars and legislators dealing with the potential conflict in the law and ethical rules when cannabis has been made legal in a particular state?

The short answer is they are changing their professional rules of conduct in most cases.  My partner,  Joshua Horn recently wrote an excellent post on this topic-which you can find here- Post

A recent Gallup poll found that sixty percent of Americans are now in favor of legalization of cannabis use.  Gallup Poll

As Texas inevitably begins to cope with the realities of the inherent conflict between the existing state and federal laws in this area, and the trap posed by the rules of ethics, it will prove interesting to see how the Texas bar deals with this dilemma for Texas lawyers.

Copyright: alexmillos / 123RF Stock Photographic icon
Copyright: alexmillos / 123RF Stock Photographic icon

 

 

 

While perhaps fun for kids, unusually heavy rain can cause problems for commercial property landlords, including flooding, mudslides, and mud buildup.

Copyright: chepko / 123RF Stock Photo
Copyright: chepko / 123RF Stock Photo

According to visitdallas.com, October ties with April for the second wettest month in Dallas (not surprisingly, May is first). October averages 3.5 inches of rain for the month, which means that Dallas usually gets more rain in October than Seattle, Washington (3.27 inches according to usclimatedata.com).

Under Texas law, premises operators owe a duty to keep their premises safe for business invitees against conditions on the property that pose an unreasonable risk of harm. This duty owed by premises operators, however, does not render the operator an insurer of the invitee’s safety.  According to the Texas Supreme Court, ordinary mud or dirt in its natural state can and often does form a condition posing a risk of harm, but not an “unreasonable” risk of harm. In other words, mud that accumulates naturally on an outdoor concrete slab, without the assistance or involvement of unnatural contact, is nothing more than dirt in its natural state and is not a condition posing an unreasonable risk of harm.

Copyright: Cole123RF / 123RF Stock Photo
Copyright: Cole123RF / 123RF Stock Photo

Plain dirt which ordinarily becomes soft and muddy when wet, or mud that accumulates due to rain and remains in its natural state, are not dangerous conditions of property for which a landlord may be liable.

One word of caution, however: if a premises operator undertakes to remove the mud, it must do so reasonably, and take care to avoid creating a dangerous condition during the removal.