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January 2013 Archives

Liability for Payment of Note Required to Rescind Mortgage

A mortgagor who is not personally liable for payment of the note securing a property loan cannot rescind the loan transaction or mortgage, the United States Bankruptcy Court for the District of Massachusetts has held.  In re Smith-Pena v. Wells Fargo Bank, N.A.In re Smith-Pena v. Wells Fargo Bank, N.A., 2013 WL 28696 (Bankr. D. Mass. Jan. 2, 2013).

Appeals Court Carves Out Condominium Exception to 'Economic Loss Rule'

The "economic loss rule" prohibits a plaintiff from suing for negligence to recover "pure economic losses," such as lost profits or the cost of replacing an allegedly-defective product.  The rule requires a showing of harm to person or property in a negligence case.  If a defective product is involved, any property damage asserted must involve property other than the defective product itself.  

Proposed Parenting Coordinator Bill Seeks To Codify an Increasingly Common Practice

Although a "final judgment of divorce" terminates a legal marriage between spouses, all too often, the parties will remain embroiled in litigation for years to come, particularly with respect to issues surrounding the care and custody of their minor children.  Even the most well-drafted parenting plan cannot anticipate and preemptively resolve all of the disputes that inevitably arise when raising children, and the failure, inability, or outright refusal of one or both parents to communicate and reach an agreement with respect to these matters (such as whether Susie can get her ears pierced, if Johnny can sign up for football, and which parent should be responsible for picking up the children on a snow-day) can lead to repeated court appearances and thousands of dollars in legal fees.  While child-related issues can always been modified upon a material change in circumstances, and some matters genuinely require the court's intervention, many of these "day to day" disputes can be efficiently and cost-effectively resolved by the appointment of a "Parenting Coordinator" ("PC").

SJC: Release of Wage Act Claims Requires Specificity

In the recent decision Crocker v. Townsend Oil Company, Inc., the Massachusetts Supreme Judicial Court held that a general release that intends to release claims under the Massachusetts Wage Act, M.G. L. c. 149, §148 ("Wage Act") will be enforceable as to those claims only if the release contains an explicit waiver of Wage Act claims. If specific language waiving Wage Act claims is not included in a general release, such claims will not be released.

Arbitration Clauses Binding on Contract Assignees

Mandatory arbitration clauses present in contracts are binding on assignees of those contracts, even where the transfer agreements assigning those contracts do not themselves contain arbitration clauses, the United States Court of Appeals for the First Circuit has ruled.

Standing Is Limited In 'Soldiers and Sailors' Actions - For Both Plaintiffs and Defendants

Earlier this week, the Massachusetts Supreme Judicial Court (the "SJC") held that a plaintiff who is not a present mortgagee (or the mortgagee's agent) has no standing to bring an action under the Massachusetts Soldiers' and Sailors' Civil Relief Act for a determination that the named defendant is not entitled to the protections of the Federal Servicemembers Civil Relief Act (the "SCRA"). 

Parallel Parenting Plans

Studies indicate that parents who make disparaging comments about each other, engage in verbal altercations in the presence of their children, place the children in the middle of parental disputes, encourage protective behavior by the children in favor of one parent who may be seeking to alienate the children against the other parent, and who engage in other types of behavior that repeatedly expose their children to interpersonal, parental conflict may be causing significant adjustment problems for their children.  

Is It Possible to Recover Attorney's Fees in a Business Dispute?

Your company has been wronged. A vendor failed to deliver as promised causing lost sales. A customer has failed to pay for services rendered. A construction contractor's shoddy workmanship resulted in leaks and damage in your company warehouse. The defendant will not pay up voluntarily, so your business has decided to engage a law firm to file a lawsuit to recover the damages. Can your company recover its attorney's fees and other litigation costs? 

First Circuit Court of Appeals Hears Culhane Case

A panel of the United States Court of Appeals for the First Circuit heard oral argument in the matter of Oratai Culhane v. Aurora Loan Services of Nebraska earlier this week.  The panel was comprised of Chief Judge Hon. Sandra L. Lynch, Senior Circuit Judge Hon. Bruce M. Selya, and retired U.S. Supreme Court Associate Justice Hon. David H. Souter, sitting by designation.  The Culhane case is notable for District Court Judge Hon. William G. Young's discussion in a summary judgment decision of Mortgage Electronic Registration Systems, Inc. ("MERS") and the propriety of MERS's system of assigning mortgages held in its name to loan servicers prior to foreclosure.  See Culhane v. Aurora Loan Serv. of Neb., 826 F. Supp.2d 352 (2011).  

EFTA Amendments to Deter Serial Plaintiffs

Banks and other financial institutions that maintain ATMs got good news from Congress to close out the year.  On December 11, 2012, the Senate passed H.R. 4367 by unanimous consent, following passage by the House of Representatives in July.  The bill now moves to the President's desk for his signature.  H.R. 4367, as passed, amends the Electronic Funds Transfer Act to remove the placard fee disclosure requirement for ATMs operated by a financial institution other than the institution at which a consumer has an account.

How to Keep Your Arbitral Proceedings Confidential

Aside from the flexibility to tailor the process to the particular needs of the case, arbitration also enjoys another major advantage over litigation: The ability to keep the proceedings confidential. Although a party involved in litigation can move to seal the court proceedings, public access to court records is a central tenet of the American legal system that cannot easily be restricted.

Arbitration Confidential: How to Keep Your Arbitral Proceeding Confidential

Aside from the flexibility to tailor the process to the particular needs of the case, arbitration also enjoys another major advantage over litigation: the ability to keep the proceedings confidential. Although a party involved in litigation can move to seal the court proceedings, public access to court records is a central tenet of the American legal system that cannot easily be restricted.

Motion for Counsel Fees Pendente Lite

All clients involved in litigation need money to pay their counsel's legal bills, which include the initial retainer fee, fees incurred during the pendency of the litigation, and often replenishing the retainer fee.  A client obtaining a divorce, however, has a unique problem in that they are precluded from dissipating marital assets -- i.e., using marital assets for their own use when the marriage is coming to an end and with the intent of depriving the other spouse of his or her fair share of the marital estate.  Although the payment of reasonable counsel fees is not a violation of the automatic financial restraining order under Rule 411, even in the absence of a motion for counsel fees pendente lite, using joint marital assets to pay one party's counsel's fees reduces the total amount of the marital estate, thereby depriving the other spouse of their fair share of equitable distribution of all marital assets at the conclusion of the case.

For Large Project Permitting Appeals, No Removal From Land Court's Permit Session to Housing Court

In a decision handed down just last week, the Appeals Court ruled that a large project permitting appeal filed in the Land Court's six-year-old permit session cannot be removed to the Housing Court, since the Housing Court lacks jurisdiction over such matters.  In Buccaneer Development, Inc. v. Zoning Board of Appeals of Lenox, Appeals Ct. No. 1-P-1159, the Appeals Court vacated a Housing Court judgment upholding the Town of Lenox's denial of a special permit for construction of a twenty-three home retirement community, and remanded the matter to the Land Court for a new trial. 

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