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Closing Out
Well, I have left private practice and have taken a job with the US Attorney's Office. In light of my career change, this blog is shutting down. Thanks to everyone who dropped by for the latest SC legal news.
Merry Christmas.Constitutional issues with Clinton appointment???
"No Senator or Representative shall, during the Time for which he was elected, be appointed to any civil Office under the Authority of the United States which shall have been created, or the Emoluments whereof shall have been increased during such time; and no Person holding any Office under the United States, shall be a Member of either House during his Continuance in Office."
Clinton was in the Senate when a pay increase passed for Secretary of State. Thus, under this clause, she is not eligible for the office. This situation has come up in the past and Congress has simply passed a law reducing the salary to what it was before.
The LA Times has more on this issue here.Who will Obama appoint to SCOTUS?
The LA Times has this article.
The top three are:
Judges Diane Wood, 58, of the U.S. appeals court in Chicago;
Judge Sonia Sotomayor, 54, of the U.S. appeals court in New York;
and Elena Kagan, 48, dean of Harvard Law School.Billy Wilkins' return to the courtroom as a lawyer meets with success
From the Greenville News:
William W. aBillya Wilkins successfully argued against a motion in a shareholder suit against South Financial that asked for a temporary restraining order barring retirement payments to retired CEO Mack Whittle as part of a an agreement that the suit alleges is aunconscionablea and could threaten the companyas solvency if carried out.
The agreement would pay Whittle $10 million following his retirement in October, attorneys said in court Tuesday during a hearing before Circuit Judge John Few, who denied shareholder Vernon Mercieras request for the restraining order.
Not surprisingly, Wilkins's stock as an advocate is rising.SCOTUS vacates injunction against Naval use of sonar
Last week, the United States Supreme Court issued its first opinion of the new term: Winter v. Natural Resources Defense Council. This case concerned the Navyas use of mid frequency active sonar, which transmits sound waves at various frequencies. This type of sonar is used in Naval exercises, including training and tracking of submarines. The Ninth Circuit Court of Appeals upheld a preliminary injunction imposing restrictions on the Navyas sonar training, even though the record contained no evidence that marine mammals have been harmed by the activity. In arguing against the injunction, the Navy emphasized that it had used sonar during training exercises off the coast of California for forty (40) years, without a single documented injury to a marine mammal.
The injunction issued based on the Navyas alleged violation of the National Environmental Policy Act of 1969, which requires federal agencies to the fullest extent possible to draft an environmental impact statement for every major federal action affecting the quality of the human environment. The areas of the injunction that were in contention required the sonar to be shut down when a marine mammal was spotted within 2,200 yards of a vessel, and the requirement that the sonar be powered down during significant surface ducting conditions, in which sound travels further than it otherwise would due to temperature differences in adjacent layers of water.
In reversing and vacating the injunction, the Supreme Court noted that the District Court and Court of Appeals held that when a plaintiff demonstrates a strong likelihood of prevailing on the merits, a preliminary injunction may be entered based only on a apossibilitya of irreparable harm. The Supreme Court held that the preliminary injunction standard requires plaintiff seeking relief to demonstrate that irreparable injury is likely in the absence of an injunction. The issuing of a preliminary injunction based only on a possibility of irreparable harm is inconsistent with the courtas characterization of injunctive relief as an extraordinary remedy that may be awarded upon a clear showing that plaintiff is entitled to such relief.
The Supreme Court went on to note that even if the plaintiffs had shown irreparable injury from the training exercises, such an injury was outweighed by the public interest and the Navyas interest in effective, realistic training of its sailors. The court cited testimony from several Naval officers who emphasized that realistic training cannot be accomplished under the two challenged for civic restrictions imposed by the District Court.Obama could transform the Fourth Circuit
A snippet from the Richmond Times:
As president, Barack Obama and a new U.S. Senate could transform the Richmond-based 4th U.S. Circuit Court of Appeals, long one of the most conservative in the country.
President Bush failed to fill four vacancies on the 15-judge court, which decides cases on issues such as abortion, the death penalty and terrorism.
The Bush administration steered terrorism cases to the court, where it largely has been successful in protecting the president's national-security powers, though not always.
Six of the court's current judges were appointed by Republican presidents and five by Democrats.Judgment not necessary to pierce corporate veil
In Drury Development v. Foundation Insurance, the South Carolina Supreme Court answered the following certified question: whether a judgment against a corporation is a prerequisite to an alter ego claim. This question has come up often in South Carolina. Frequently, plaintiffs attempt to demand many financial documents of a corporation early in discovery on the basis of an alter ego claim. Defendants often counter that this discovery is premature and improper because no judgment has been entered against the corporation and therefore the issue of veil piercing cannot come up.
Noting that veil-piercing is a form of equitable relief, the South Carolina Supreme Court refused to impose "rigid rules of law to seek substantial justice." The court ultimately held that "so long as the plaintiff has pled facts sufficient to survive a motion to dismiss as to the corporate liability claims and the alter ego claim, the trial court should move forward to determination of both matters."Voter registration drives
Here is an interesting take on the voter registration movement and the duties of citizenship.SC Supreme Court says that dreadlocks is insufficient reason to strike juror
In McCrea v. Gheraibeh, the South Carolina Supreme Court reversed the denial of a Batson Motion and remanded the case for a new trial. This case arose out of an automobile accident. When three of six potential black jurors were struck, a Batson Motion was made. During the hearing, the lawyer striking the jurors stated that he struck one man with dreadlocks because he was uneasy about him. In accepting counselas explanation, the trial court stated that he knew both of the attorneys, was aware of their reputations in the community, and that he did not believe that the attorney would engage in racially high motivated conducted. Therefore, the trial judge accepted the auneasinessa argument regarding the dreadlocks.
In reversing on grounds of Batson, the Supreme Court held that uneasiness over dreadlocks was not a race-neutral reason for striking someone. Regardless of their gradual infiltration into mainstream American society, the court stated that dreadlocks retained their roots as a religious and social symbol of black culture. Hence, no race-neutral reason for striking the juror was offered.Court of Appeals issues opinion on 43k settlements
The following settlement was put on record just before trial:
Your Honor, the settlement thatas been reached is that this case will be dismissed with prejudice by an order of dismissal with prejudice to be consented to by the parties and signed by your honor.
Furthermore, the defendants, each and every one of them, will consent to and sign and deliver to me a confession of judgment which will provide for the payment of $165,000 within 18 months. And there will be additional payment terms in there, $25,000 of the 165 within 30 days.
Further, in kind consideration, in addition to the 165,000 the return of 15 rugs, three of which shall be room size Herizes, the confession of judgment will have an attorneyas fee provision that in the event of default, that the cost of enforcing the judgment or collecting the judgment will be recoverable.
And, finally, the confession of judgment will have a no contest stipulation. If itas required to be domesticated in some state other than South Carolina, the defendants agree not to contest the domestication.
Some weeks after this was put on the record, the parties disputed whether interest was applicable. The court of appeals held that even though interest was not mentioned, it was applicable. The court of appeals held that interest was applicable: "However, interest is provided for by statute. Section 34-31-20(A) provides '[i]n all cases of accounts stated and in all cases wherein any sum or sums of money shall be ascertained and, being due, shall draw interest according to law, the legal interest shall be at the rate of eight and three-fourths percent per annum.'"
The case is Vista Antiques v. Noaha.Can McCain or Obama Turn the Supreme Court?
Law.com offers this analysis.SC Supreme Court affirms conviction of criminal solicitation of a minor
In State v. Gaines, the South Carolina Supreme Court upheld a conviction under our recently enacted Criminal Solicitation of a Minor statute. Gaines was an Internet predator who used AOL chat rooms to engage in conversations with young girls. Unknown to Gaines, two of the friends he met on line were police officers. A police officer in Pennsylvania reported his conduct to authorities in South Carolina, and an officer in South Carolina contacted Gaines via AOL. The officer pretended to be a 13 year old girl and Gaines suggested they meet for sex.
After conviction, Gaines appealed and argued that the evidence regarding the chats with the officer in Pennsylvania should have been inadmissible. This contention was rejected because under Rule 404(b) crimes or evidence crimes, wrongs, or acts similar to those that the defendant is on trial for, can be admitted to show motive, identity, or the existence of a common plan or scheme.
Gaines also argued he was entitled to an entrapment instruction. The entrapment defense consists of two elements: (1) government inducement, and (2) lack of pre-disposition. Gaines argued that because the South Carolina police officer first contacted him with the message "Hey" constituted entrapment. The Supreme Court disagreed and said that the initial contact merely afforded Gaines the opportunity to solicit sex. He was in no way induced to commit the crime of criminal solicitation with a minor.Supreme Court hears case about Navy sonar and whales
From the LA Times:
The Supreme Court justices appeared closely split Wednesday on whether environmental laws can be used to protect whales and other marine mammals from the Navy's use of sonar off the coast of Southern California. A Bush administration lawyer argued that when national security is at stake, the president and his top military commanders are entrusted with setting the rules.
The government is urging the high court to throw out a Los Angeles judge's order that put limits on the Navy's operations. Acting on a suit brought by the Natural Resources Defense Council in Santa Monica, U.S. District Judge Florence-Marie Cooper ordered the Navy to shut down its high-intensity sonar whenever a whale or marine mammal is spotted within 1.25 miles of the ship.Big Changes at SCOTUS
Law.com has a nice article on the upcoming term and possible changes.SCOTUS declines to rehear Ban on Execution for Child Rape
The state of Louisiana and the Justice Department had asked the court to reconsider the 5 to 4 decision because the justices had not been presented with what the state and federal government considered an important fact: that Congress in 2006 made child rape a capital offense under military law. This would have perhaps undermined the "national consensus" argument in the majority opinion.
The Court, however, declined to reconsider the issue.
The Washington Post has this article.Chief Justice Roberts stays execution of Freddie Owens
Freddie Owens has gotten extra time to prepare a petition for cert to the Supreme Court. Owens was sentenced to death stemming from a 1997 robbery-murder on Laurens Road in Greenville County.
In his order, Roberts wrote that should Owens' petition for a writ of certiorari be denied by the justices, the stay would automatically terminate. That would clear the way for the state Supreme Court to set another execution date.Greenville Councilman Trout arrested by FBI
WSPA has the scoop here.
United States Attorney W. Walter Wilkins announced Harold Anthony aTonya Trout was arrested Wednesday morning by FBI agents on federal charges of unauthorized computer access.
The federal complaint and supporting affidavit, filed Wednesday, allege violations concerning the unauthorized access of computers.
Trout made an initial appearance in federal court before the U.S. Magistrate Judge William M. Catoe at the United States Federal Courthouse in Greenville.I'm on Vacation
Check back October 1 for more posts!!Social worker refuses to testify in Inman case
There has been an interesting twist in the Inman trial going on in Greenville. Marti Loring, a social worker licensed in another state, did a social history on Inman, but refused to take the stand after the prosecutor alleged she was violating state law by practicing social work in SC.
"I feel threatened as a witness in this case and in other cases in which I've testified in South Carolina," Marti Loring told the judge after a recess to allow her to consult with an attorney.
The social worker is refusing to testify now, though the judge told her she does not have a legal ground to refuse. Thirteenth Circuit Solicitor Bob Ariail had previously objected to the introduction of Loring's testimony to her evaluation of Inman's behavioral profile, saying she freqently offers opinions that aren't factually based. The judge asked Loring if she felt uncomfortable and she said she was concerned that Ariail might charge her with a crime. She said she feared her reputation as an expert might be damaged. Ariail said he would grant her immunity, as did the judge.
Sounds like to me the defense team is working to come up with an appellate issue or something to raise on PCR.S.C. Supreme Court issues opinion of duty of counsel to present mitigation evidence
In Council v. State, the South Carolina Supreme Court affirmed relief in a death penalty PCR case. Council was convicted of sexually assaulting a woman and forcing her to ingest cleaning fluids. At trial, Councilas lawyer argued that he was not the murderer, but rather an accomplice at the scene actually did the killing. In the penalty phase, trial counsel only called the defendantas mother as a mitigation witness. She testified about Council's mental health between the ages of 7 and 14 and that he had been teased while a child at school. Not surprisingly, a jury returned a verdict of guilt and recommended a sentence of death.
The death sentence was overturned because trial counsel fails to present voluminous mitigation evidence. For example, no social history was compiled. Had a social history been compiled evidence could have been presented to the jury that several of Councilas family members suffered from mental illness, that his father was an alcoholic and extremely violate, that Council lived in several homes which did not have running water and indoor plumbing, that he did very poorly in school, and that he had attempted suicide at a young age. Had trial counsel obtained a forensic psychiatrist, testimony could have been presented that respondent was an undifferentiated schizophrenic, which began in early adolescents for childhood.
In summary, the Supreme Court agreed with the PCR court that the mitigation evidence would have been powerful and that that trial counsel was ineffective for failing to present such evidence. Accordingly, the sentence of death was reversed.Inman mitigation evidence presented in Greenville trial
Here is the story from the g-news.
Today's proceedings are expected to focus on the defense testimony of mental and prison experts, carrying over Priceas testimony on Tuesday -- based on 3,000 pages of medical and prison records -- to how Inmanas childhood and genetic predisposition to mental disorders paved his violent path.When Inman was a toddler, his biological father would tie Inman and his older sister to their bunk bed and molest them, a pattern of abuse that later manifested as Inman likewise bound his victimsa hands after in most cases waking them in their beds, Price testified.
The sexual assaults, along with later sexual acts by another family member, left Inman permanently damaged mentally, Price testified. Inmanas only steady parental figure -- his grandfather, who would often try to intervene when Inmanas parents abused him -- died when Inman was a child, Price testified.At age 10, Inman was using drugs. At age 15, after dropping out of ninth grade, Inman was living on the streets, Price testified.Forgotten, man sits in jail for two years
From the St. Louis Post:
Joseph A. Shepard Sr. sat in local jails for almost two years, assuming that his lawyer was making progress on his case and that drug-related charges against him would soon be resolved in federal court.
His family says lawyer Michael P. Kelly told them Shepard had pleaded guilty and would return home soon with credit for time already served behind bars. Shepard never came home. Shepard, 53, is a man the system forgot, apparently ignored by his own attorney--and the prosecutor and judge--as days ticked by in a municipal lockup where he was confined to a cell 23 hours a day.
Shepard was surprised when a reporter broke the news at the Jennings jail Wednesday night that his case had been forgotten. It was more than a month after prosecutors took steps to move the case forward, though he still had not been told about it by his lawyer.Mississippi Supreme Court tries to suppress a dissenting opinion
Take a look at this article.
Power corrupts--especially on the Mississippi Supreme Court.ABA supports legal outsourcing
Always one to battle for Mom and Apple Pie, the ABA have given its approval to shipping American legal jobs to India.
According to the opinion, Fat Cat Firms may send legal work overseas as long as the lawyer doing the outsourcing takes steps to ensure the protection of client confidences and preservation of attorney-client privilege. The advisory also states that attorneys should check to make sure that foreign lawyers are suitably trained and competent and that bills for outsourced work be reasonable.SC Supremes issue opinion in Sloan emergency procurement case
From the Greenville News:
The South Carolina Supreme Court on Monday sided with Greenville businessman Ed "Ned" Sloan in ruling that state transportation officials were wrong to negotiate with a contractor on a project rather than put the job out to bid.
The 4-1 decision handed Sloan another legal victory in his lawsuits against the state Department of Transportation and other government agencies and made clear what is and is not an "emergency" for state agencies procuring services.
Sloan filed his suit in 2005 over a 2004 Charleston-area road-widening project that had fallen behind, according to the justices.
Faced with the dilemma of firing the contractor and putting the remainder of the project out to bid, DOT officials thought they could save time by negotiating a new contract with a subcontractor on the project under the state's emergency procurement procedures. The new contract cost just under $8 million, according to the justices.
Sloan argued in his suit that the circumstances did not allow an emergency procurement.Paradoxes
For the past six months or so, I've been using ConsensusDOCS agreement forms wherever I can reasonably do so ---- meaning that I'm using them for projects on which there is not an owner or architect who insists on using AIA documents. I usually represent owners, have used many AIA standard form agreements over the years (with modifications) and continue to use them.
But where there is not a vested interest in staying with AIA forms, I have tried to use ConsensusDOCS, because my twenty-plus years of experience as a construction lawyer has demonstrated that the premise on which they are based is valid --- a collaborative rather than an adversarial relationship among project participants will, without fail, result in more successful projects.
It is distressing, then, to say the least, to read in a recent Engineering News Record (June 29, 2009) that slow pay has now become a huge issue for contractors and subcontractors throughout the construction sector and in all parts of the country. Pay cycles for contractors have stretched from the customary 30 days, to 45 or 60 days. For subcontractors, pay cycles of 90 days are common. In addition, contractors and subs report that retainages are being held beyond any reasonable time frames, and change orders for indisputably changed work are more frequently being withheld by owners.
It is truly paradoxical that while the ConsensusDOCS are being endorsed by many and varied industry participants (including owners, contractors and subcontractors), the reality is that the economic straits in which we exist make it all but impossible to forge the collaborative relationship the documents contemplate and on which they are based. (This entry published by Karen Estelle Carey, a construction attorney and member of Womble Carlyle's construction group.)ConsensusDOCS for Public Contracts? Yes, In South Dakota
It will be interesting to see how quickly South Dakota begins using ConsensusDOCS for public contracts after the February 2009 legislation permitting the use of the "ConsensusDOCS 200 Standard Agreement and General Conditions Between Owner and Contractor." It seems safe to assume that the South Dakota chapter of the AGC will be working hard to encourage the use of this contract form, and indeed, it probably is in use now for some public projects.
Several press releases covering passage of the law permitting the use of ConsensusDOCS 200 hailed the law as revolutionary in showing other states how to have a better and more efficient contracting process (for one such release, click here). This could be true, if the ConsensusDOCS 200 is used pretty much "as is". However, H B 1212, the law that gives permission for the use of the form, also provides that any public corporation can modify or delete any portion of it. As with most other things like this, the devil will be in the details of what changes a given public corporation makes to the form. (Post published by Karen Estelle Carey).
How do you measure damages when a construction blunder saves an owner $200 million?
A recent story out of Las Vegas, covered in the NY Times, poses an interesting question for construction and real estate lawyers ---- what would be the measure of damages for defective construction, the result of which is estimated to save the owner at least $200 million?
The Harmon hotel tower, part of MGM Mirage's acclaimed $9 billion development called the CityCenter, had been designed as a 48-story tower, the upper 20 floors to be luxury condominiums. But recently it was discovered that the rebar installed in the concrete beams in the first 15 stories already constructed had been positioned incorrectly, and could not safely support a 48-story tower. Correcting the problem would involve extensive and very expensive demolition and rebuilding.
So MGM Mirage made the decision to top out the building at 28 stories, and not build out the 200 condo units planned for the upper stories --- resulting in a savings estimated at $200 million. And also not being stuck with a lot of unsold condos in the very soft Las Vegas market. The chairman of MGM Mirage said "It takes pressure off of selling more condominiums; it takes pressure off of occupying more rooms."
The measure of damages for defective construction is normally the cost to repair the defective work. However, if the cost to repair is so enormous relative to the value of the structure that it would constitute economic waste to fix it ("economic waste" is a term of art with varying meanings depending on the facts and circumstances), then the measure of damages is usually the diminution in value of the structure.
Under these facts and circumstances, it appears there is a good argument that demolishing and rebuilding the existing 28 stories correctly would constitute economic waste, and that the appropriate measure of damages is the diminution in value of the hotel tower. But this appears to present a problem. In the absence of any obvious market for condos in Las Vegas these days, has the value of the building really been diminished at all?
It would seem not.
But there is something else to consider. The Harmon will be the closest building to the Strip in the CityCenter, so the shortening of the tower is going to change how the development looks. It seems that a lot of work has become necessary to figure out what the new skyline of the CityCenter should be and to satisfy City government on that score. Maybe that's the way to approach the damages calculation.
To read the articles in the NY Times, click here and here. (This blog was published by Karen Carey, a member of Womble Carlyle's Real Estate Development and Construction Law practice groups.)Employee Free Choice Act Reintroduced; Battle Lines Are Already Drawn
On Tuesday, March 10, George Miller (D-CA), Chairman of the House Education and Labor Reform Committee, introduced the Employee Free Choice Act (H.R. 1409). Asserting that the bill would agive workers the ability to stand up for themselvesa and heralding the effort as a key component of economic recovery, Chairman Miller insisted the EFCA would restore employee rights. Co-sponsor Tom Harkin (D-IA) explained, ajust as the National Labor Relations Act, the 40-hour week and the minimum wage helped to pull us out of the Great Depression and into a period of unprecedented prosperity, so too will the Employee Free Choice Act help reinvigorate our economy.a
The bill, essentially the same as one passed by the House but killed in the Senate two years ago, faces a stiff fight. Although President Obama has pledged his support to the legislation, employer organizations have mobilized a well-coordinated campaign to highlight what they perceive as significant weaknesses in the Act, also countering with their own proposal, the Secret Ballot Protection Act. To make matters even more confusing, on March 11 Joe Sestak (D-PA) proffered yet another alternative, the National Labor Relations Moderation Act (H.R. 1355), which Congressman Sestak describes as a amiddle grounda compromise to preclude a divisive confrontation. As the rhetoric on either side escalates, examination of the key features of EFCA is essential.
To read about the key features of EFCA, continue here.
(This entry was published by Charlie Edwards, a member of the firm's employment law practice group.)Real Estate Developers Ask for a Bailout
The WSJ and the Washington Post report that some of the country's biggest commercial property developers have sought out government assistance as debt comes due.
Although the numbers vary by source, roughly $530 billion in commercial mortgages will be coming due in the next three years, with $160 - $400 billion coming due in 2009. Delinquency rates have begun to rise as rent prices fall and vacancies rise for commercial properties; despite the rise, delinquency rates are still below historic levels (i.e the vast majority of these loans are performing).
The problem is these types of loans are underwritten for five, seven, or 10 years with a balloon payment due at maturity. At maturity the loan is typically refinanced by the property owner. But the credit markets are virtually frozen (in large part because hardly anyone is securitizing commercial mortgages) and little, if any credit is available for refinancing (except for loans being made by HUD, Fannie Mae, and Freddie Mac).
To address this problem, property owners are asking the Treasury and the Federal Reserve to include the commercial real estate industry in the $200 billion loan program to rescue the consumer debt market, money intended to help investors purchase securities backed by those assets. Property owners hope that including commercial real estate will encourage banks to refinance mortgages coming due because the banks could securitize the mortgages. Some property owners have gone one step further and asked the Treasury to set up a separate fund just for commercial real estate.
The Treasury and Federal Reserve have said they will consider including commercial real estate in the $200 billion loan program.
Unfortunately, including commercial real estate in this loan program may not be enough to save the industry if only $200 billion is available and $160-400 billion in loans are coming due in 2009. Even if the program includes enough money to cover commercial real estate, Lenders may not be able to underwrite the loans; they may not be able to accurately price the assets because of plummeting property values.Page took 1 seconds to load.
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