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Radon disclosure effective January 1, 2014

3 Jan

Making Sense of the Radon Awareness Act

Buyers and sellers of residential real estate in Minnesota should be aware, if they are not already, of a law passed in the last legislative session that became effective January 1, 2014.  The new law requires sellers to disclose to buyers, in writing, any knowledge the seller has concerning radon concentrations in the dwelling.  It also requires very specific disclosure in the form of a statutory notice and accompanying publication, as detailed below.

Clearing the confusion.  While this law has only been in effect two days as of the time of this writing, it is clear that there is already some confusion and misinformation concerning what the law requires. Perhaps it is worth clarifying what the law does not require, first.  The law DOES NOT require a seller or buyer to perform a radon test before the property is sold.  The law DOES NOT require a seller to provide, or a buyer to obtain, a radon inspection.

  • What transactions are impacted? While the law became effective January 1, 2014, it applies very specifically to “[…]agreements to sell or transfer residential real property executed on or after that date.”  Minn. Stat. Sec. 144.496, subd. 6.
  • What does the Minnesota Radon Awareness Act require?  You can find the full text of the law here: https://www.revisor.mn.gov/statutes/?id=144.496. The new radon disclosure law is somewhat similar in approach to other Minnesota seller disclosure obligations, and also to federal lead-based paint disclosure.  The statutory language states:

Before signing an agreement to sell or transfer residential real property, the seller shall disclose in writing to the buyer any knowledge the seller has of radon concentrations in the dwelling.

(Minn. Stat. Sec. 144.496, subd. 3)

  • Additional requirements.  The disclosure must also include additional information, including whether radon tests have been performed on the property, recent records pertaining to radon concentration levels, a description of any remediation/mitigation efforts taken, etc.  Additionally, the law requires two very specific disclosure obligations be met: 1) the seller must provide a very specific radon disclosure statement containing language specified within the statute (Minn. Stat. Sec. 144.496, subd. 4); and 2) the seller must provide the buyer with a copy of the Minnesota Department of Health publication entitled “Radon in Real Estate Transactions”.  You can find that publication here: http://www.health.state.mn.us/divs/eh/indoorair/radon/rnrealestateweb.pdf
  • Certain transactions are excepted from the requirements.  The statute lists an array of transactions for which the Radon Awareness Act does not apply.  Minn. Stat. Sec. 144.496, subd. 3(d). To determine if your transaction may be excepted from the requirements, review the statute carefully and speak with your legal counsel to clarify any questions.

Some trade organizations, like the Minnesota Association of Realtors(R), and the Minnesota State Bar Association have created forms that incorporate the disclosure requirements.  If you are already utilizing an attorney or real estate agent in your transaction, hopefully they are assisting you with understanding and complying with this disclosure obligation.  If they aren’t, or you have not already engaged a real estate agent or attorney you should be sure to speak with a competent real estate attorney to ensure you obtain the advice and counsel you may need to help you fulfill this disclosure, and other applicable disclosure obligations.

For residential buyers, it is important that you understand that while a seller is obligated to disclose what they know, regarding radon, many sellers have no reason to know radon levels are normal or abnormal unless they have had an inspection done.  Buyers are free to negotiate a radon inspection into the terms of a purchase agreement.

If you are curious about the health concerns or rationale for why the legislature believed a radon disclosure to be necessary, radon facts and background information can be found at the Minnesota Department of Health website, here.  According to the Minnesota Department of Health,

High radon exist [sic] in every state in the US.  In Minnesota, 2 in 5 homes has radon levels that pose a significant health risk, and nearly 80% of counties are rated high radon zones.

Source: http://www.health.state.mn.us/divs/eh/indoorair/radon/index.html?utm_source=print&utm_medium=brochure&utm_campaign=general

Additional radon-related information can be found within the MDH website, here.

As real estate transactions become increasingly complex, it is prudent to engage professionals such as a real estate agent and attorney to help you navigate disclosure obligations and other responsibilities involved in buying or selling residential real estate.

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This blog entry is written by Brad Boyd, a Shareholder at Thomsen Nybeck.  Brad’s practice focuses primarily in Real Estate, Real Estate Brokerage, Business and Corporate law.  Brad provides legal advice, guidance, and representation related to risk management in a wide variety of real estate and business law matters.  a

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No Business is too Small to Need Corporate Counsel

30 Jul

All businesses, big or small, should have “corporate counsel”.   While it is not necessary for most business to maintain in-house counsel, as their needs are irregular, it is unwise to utilize an attorney only when a dispute arises.

There are numerous reasons why a business or business owner who waits until a problem has arisen before contacting an attorney is at a distinct disadvantage.  This author has addressed this, and a variety of inter-related issues, in more detail in the full article, which you can find here: No Business is too Small to Need Corporate Counsel.  The full article addresses common misconceptions and failures made by a business in some of the following scenarios:

1)     Self-help business formation, filing Articles without an attorney and failing to have proper entity structure or formalities;

2)      Overlooking the importance of member/shareholder transfer restrictions and the value of a “Buy-Sell Agreement”;

3)     Failing to establish the rights, responsibilities and obligations of each owner/member, resulting in costly disputes; and

4)     Failing to maintain the “veil” between corporate and personal liability.

If you are a business owner, or you know a business owner, you should read the full version of this article, and forward it to anyone who you may believe would benefit from reading it.  Should you need to speak with an attorney, information about Brad Boyd and the Thomsen Nybeck firm can be found here: http://www.tn-law.com/Attorneys/Brad-J-Boyd.shtml.

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Follow MNLegalAdvisor on Twitter

This blog entry is written by Brad Boyd, a Shareholder at Thomsen Nybeck.  Brad’s practice focuses primarily in Real Estate, Real Estate Brokerage, Business and Corporate law.  Brad provides legal advice, guidance, and representation related to risk management in a wide variety of real estate and business law matters.  Brad has worked with a wide array of small and mid-size businesses through all stages of the business life-cycle, from formation, to ongoing operation, to shareholder disputes, work-outs, and sale or dissolution.

One Car. Two Sisters. Both Arrested for DWI. Wait, what?!

3 Jul

Two sisters in Florida were recently arrested for DWI. At the same time. While driving the same car. Yes, you read that correctly. So, how did these sisters manage to pull this off? Well, the youngest one – 18 years old – was allegedly zig-zagging down a highway, which attracted the attention of a local police officer. When the officer pulled up behind the vehicle, he turned on his lights and siren. Abruptly, the vehicle stopped in the middle of the road. Then, the sisters changed seats by hopping over one another inside the vehicle. Needless to say, the officer had no trouble noticing the switcheroo occurred. The consequence is that the older sister – 24 years old – was now behind the wheel. And even though she didn’t drive the vehicle anywhere, she was in control of the vehicle while under the influence of alcohol. Thus, both sisters were arrested and charged with DWIs – coincidentally enough, they both blew .12.

The key fact leading to the arrest and charge of the older sister is that she was in physical control of the vehicle. In Minnesota, physical control is defined as:

Being in a position to exercise dominion or control over the vehicle. Thus, a person is in physical control of a vehicle if he has the means to initiate any movement of that vehicle and he is in close proximity to the operating controls of the vehicle, and this is true whether the vehicle can be driven on the highway at that point or not.

Minnesota courts have extended this definition to include vehicles that are parked and even when a person is outside the vehicle. In these extenuating circumstances, courts will look to the surrounding facts to determine whether the defendant was in physical control, such as whether the keys are in the ignition, whether the car is running, and if other individuals are in or outside the vehicle.

As in previous years, you can expect local law officials will be doing DWI patrol this Fourth of July weekend. So, if part of your celebration over this holiday weekend involves enjoying a few adult beverages, keep in mind that the switcheroo does not work! Have a safe, enjoyable, and responsible Fourth of July!

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This blog entry is written by James Gempeler, an associate at Thomsen Nybeck. James practices in the litigation area of the firm with a focus on criminal defense, general civil litigation, construction litigation, and is a prosecutor for the Metropolitan Airports Commission.

Right to Remain Silent – And That Silence Will Be Used Against You

24 Jun

The right to remain silent is not an absolute right. It’s a misperception held by many that the right to remain silent – and for that silence not to be used against you – is always the case, no matter the setting. But, the United States Supreme Court forcefully reminded us that this is not the case in the Salinas v. Texas decision it issued earlier this week.

In Salinas, the defendant agreed to accompany the officers to the police station, where he was subject to questioning for an hour. Key to the case is that the defendant was never in custody – i.e. he was free to leave at any time – and, as a result, he was never given the Miranda warning we are all familiar with (you have the right to remain silent, etc…). The defendant answered most of the officers’ questions during the hour. But when they asked him whether his shotgun would match the shell casings removed at the scene, he fell silent, looked down, and shuffled his feet. After a few moments of silence, the officers asked different questions, which he again then answered. The defendant was ultimately convicted based, in part, on this silence. His silence was, in fact, used against him.

The Supreme Court was faced with the following issue: whether the prosecution may use evidence that a defendant asserted the privilege against self-incrimination during a police interview when the defendant was not in custody.

In holding that the prosecution may rely upon the defendant’s silence as an inference of his guilt, the Supreme Court held that a defendant must explicitly invoke his Fifth Amendment privilege against self-incrimination. Because the defendant was free to leave and was not even read the Miranda warning, “simply standing mute” is not enough to invoke the Fifth Amendment privilege against self-incrimination. It is not self-executing and can only be recognized in this setting when the defendant explicitly invokes it.

All is not lost, though, because the Court recognized that this rule does not apply – even in the same circumstances – when government coerces the forfeiture of the Fifth Amendment privilege. The Court’s few examples of when this might occur are not clear; but, the overriding principle is that coercion occurs when the government action denies the defendants free choice to admit, deny, or to refuse to answer.

So what does this case mean going forward? The most obvious implication is that the prosecution will use all available evidence (and inferences from the same) to obtain a conviction. But, you’d expect that out of them – otherwise, they aren’t doing their job.

Instead, it shows that defendants need to be careful about what they say and do not say during the police investigation. Most defense attorneys advise defendants to politely decline answering police questions during the investigation stages – i.e. before they are placed into custody. After all, what’s being said is most often only aiding the state’s case against you. But, now, a savvy prosecutor could attempt to use that silence against you if you were not in-custody, unless you explicitly invoke your Fifth Amendment privilege against self-incrimination. This means that must say the magic words – something along the lines of: “I’m invoking my Fifth Amendment privilege against self-incrimination.” To best protect yourself, identify Fifth Amendment by name, not just your privilege against self-incrimination.

Salinas has paved the way for prosecutors to get creative with what is said and not said by the defendant before being placed into custody. It’s important to make sure you have defense counsel to help combat this.  

This blog entry is written by James Gempeler, an associate at Thomsen Nybeck. James practices in the litigation area of the firm with a focus on general civil litigation, construction litigation, criminal defense, and is a prosecutor for the Metropolitan Airports Commission.

Matt Drewes Quoted in Recent Article at HOALeader.com: Does Your Architectural Committee Have the Right or Responsibility to Enforce Local Laws?

6 Jun

Matt Drewes recently contributed quotes for the following articles published at www.hoaleader.com, a national web-based publication focused on homeowners association and condominium board members and association management professionals:

  • Does Your HOA’s ARC Have to Enforce Local Laws? Discussion Forum Follow-up; published April, 2013 at HOALeader.com
    • Publisher: Plain-English Media, LLC (quoting Matthew A. Drewes); Read it now.

Matt is a Shareholder with Thomsen Nybeck.  He is the head of the firm’s eight-member Community Association Representation Group and the firm’s Creditors’ Remedies Group, and practices in the areas of business and real estate litigation and transactions, employment law, construction litigation, community association law, debtor/creditor law and insurance. He has been included in the annual list of Minnesota’s Rising Stars for several years, and has been quoted in the Minneapolis StarTribune, Minnesota Lawyer, Habitat Magazine, and on various websites including Yahoo!Finance.com, Bankrate.com, MSN.com, and elsewhere on issues involving construction litigation, community associations and real property issues. He can be reached at mdrewes@tn-law.com or by phone at 952.835.7000.

Supreme Court Quickly Reins in Court of Appeals on Expungements

6 Jun

Well, that didn’t last long. Just over a year ago, the Minnesota Court of Appeals departed from case precedent to grant an expungement that encompassed not only the sealing of judicial records, but also the sealing of executive records. The Minnesota Supreme Court quickly and decisively held otherwise.

Many have thought that expungements do not grant a meaningful remedy because records held by the executive branch – such as the Bureau of Criminal Apprehension (“BCA”) – are not sealed and, thus, still available for review by prospective employers or landlords. Understanding the unfairness caused by the BCA still making records available to the public – and likely abiding by the adage “the ends justifies the means” – the Court of Appeals opined that, because the executive branch records originate from court records, the judiciary’s inherent authority in granting an expungement extended to records created by the judicial branch, but maintained by the executive branch. In turn, an expungement under the Court of Appeals logic had a meaningful impact in sealing both the court records and also records held in the BCA. Arguably logical, this conclusion is unsupported by law and policy – at least according to the Supreme Court.

The Supreme Court’s analysis begins with its pronouncement that the judicial branch’s inherent authority is limited to what is necessary to the performance of a judicial function. And to the Supreme Court, the unfairness argument the Court of Appeals relied upon exceeds the court’s inherent authority: “[b]ut the authority the judiciary has to control its own records does not give the judiciary inherent authority to reach into the executive branch to control what the executive branch does with records held in that branch, even when those records were created in the judiciary.”

Further explaining this is the Supreme Court’s continued reliance on the “separation of powers” doctrine. To the Court, the extent of the relief sought via an expungement is limited by what it claims are clear “legislative expressions of policy.” First, under the expungement chapter (Minn. Ch. 609A), the legislature provides for the expungement of all records, including those maintained by the executive branch, for certain limited criminal records. Second, the Minnesota Government Data Practices Act (“MDPA”) establishes a presumption that records are public. Specifically, “data created, collected, or maintained by the BCA” relating to the crime, conviction, and sentence are public data for 15 years. Through these actions, the legislature, according to the Supreme Court, decided against extending the expungement remedy to include records held by the executive branch, such as the BCA.

So, is an expungement truly an “illusory remedy” as the dissent claims? Yes and no. It certainly does not have the teeth it would have if a district court could seal both the court records and BCA records. But, an expungement is still a viable option for those looking to clear their criminal history if doing so is important for job and/or housing considerations. Additionally, as the Supreme Court pointed out, there are certain criminal records wherein an expungement order can include sealing records maintained by the executive branch.

If you are considering an expungement, you should retain counsel to ensure that you are maximizing the remedy available and not simply getting an “illusory remedy.”

This blog entry is written by James Gempeler, an associate at Thomsen Nybeck. James practices in the litigation area of the firm with a focus on general civil litigation, construction litigation, criminal defense, and is a prosecutor for the Metropolitan Airports Commission.

Bank agrees to postpone foreclosure sale; forecloses anyway and obtains dismissal of lawsuit against it

28 Dec

The Minnesota Federal District Court recently dismissed the legal action that Etta Bracewell and her husband commenced against U.S. Bank for allegedly breaking its promise that it wouldn’t foreclose on them. Ms. Bracewell and her husband sued the Bank because it foreclosed on them on December 29, 2011, even though just days earlier they say the Bank had promised it would cancel the foreclosure sale.

The case was dismissed because of the Minnesota Credit Agreement Statute (“MCAS”). Minn. Stat. § 513.33. The MCAS insulates banks from lawsuits claiming they made promises or agreements relating to the grant, extension, or even holding off on the collection of loans unless the bank and the borrower have signed a credit agreement specifically stating the terms of the bank’s obligation and the value the bank is receiving in return.

The MCAS exists for a reason. Many people have sued banks claiming they were supposed to get a loan or that they had received an extension of time to pay the bank back, but the promise either was not made or someone within the bank without authority to make such a deal said they would try to get it approved. Sometimes, however, the results can appear unfair to the borrower. If the allegations by Ms. Bracewell and her husband are true, this may be one of those instances, as they alleged they might have taken other action to stop the foreclosure sale if they had known the Bank would not follow through with, or be bound by, its alleged promise.

The case, which is currently available only if you have a subscription to the Federal Courts electronic case filing system or if you subscribe to a legal research publishing service, is Bracewell v. U.S. Bank National Association. In its decision, the court explains the application of the MCAS as follows:

The Eighth Circuit has held that a creditor’s promise to postpone a foreclosure sale constitutes a “financial accommodation” for purposes of the MCAS. Brisbin v. Aurora Loan Servs., 679 F.3d 748, 753 (8th Cir. 2012). Therefore, Plaintiffs may only maintain an action on U.S. Bank’s alleged promise to cancel the sale if that promise “is in writing, expresses consideration, sets forth relevant terms and conditions, and is signed by” Bracewell and U.S. Bank.

Bracewell v. U.S. Bank (citing Minn. Stat. § 513.33, subd. 2). The Court went on to cite to several other recent cases where plaintiffs’ claims were barred by failure to verify their arrangements in signed agreements, including where the bank did not dispute that it made a promise to postpone the foreclosure sale. The Court found that, because Ms. Bracewell and her husband could not, and had not, asserted any of these requirements had been met, their claims are barred.

It may be that the MCAS was applied in the proper manner in this case, and that Ms. Bracewell and her husband did not receive the promise they say they did. But the case nevertheless represents a word to the wise; be sure to get that promise in writing, especially where the MCAS may apply.

Matt Drewes contributed this post. Matt is a Shareholder with Thomsen Nybeck.  He is the head of the firm’s eight-member Community Association Representation Group and the firm’s Creditors’ Remedies Group, and practices in the areas of business and real estate litigation and transactions, employment law, construction litigation, community association law, debtor/creditor law, and insurance. He has been included in several years’ annual lists of Minnesota’s Rising Stars, and has been quoted in the Minneapolis StarTribune, Minnesota Lawyer, Habitat Magazine, and on various websites including Yahoo!Finance.com, Bankrate.com, MSN.com, HOALeader.com, and elsewhere on issues involving construction litigation, community associations and real property issues. He can be reached at mdrewes@tn-law.com or by phone at 952.835.7000.

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