|
· A. NEWS TO USE ·
A1.
Using Arbitration to
Lower Costs
You have a contract dispute
that cannot be resolved. Now what? Well, the next step is often to get
assistance. That is, to go to court.
There are some
advantages to going to court, and some disadvantages.
Courts usually have a relatively inexpensive filing fee.
However, using the judicial system sometimes provides a judge or jury who is not familiar with the subject-matter of the dispute, the
litigation is usually public, and there are multiple layers of
appeals. Although a system of intended fairness, courts
have so many protective mechanisms, that taking a dispute to an
ultimate non-appealable award can be extremely expensive in time
and attorneys' fees.
A note about
attorneys' fees. You may not know it, but attorneys'
fees are usually only available if a contract provides for attorneys'
fees, or if an applicable statute provides for attorneys' fees.
For example, let us say you have a claim worth $25,000.
That is a lot of money by many estimations. However, if
there is no applicable contract provision or applicable statute,
attorneys' fees generally are not recoverable. Many, if
not most, attorneys do not accept contract litigation on a
contingency basis. Unlike the industry-standard for
personal-injury cases, contract litigation is usually handled
for the
servicing attorney's applicable hourly rate; accordingly, you could
easily spend $25,000 to take a case to trial. The net
effect is that you might break even — or even lose money — for the effort. The lesson
known by sophisticated business people is to have a contractual provision setting forth
attorneys' fees, even if some something as basic as, "Interest
on overdue invoices will accrue at the lesser of 1.5% per month
or the highest rate permitted by law. You are responsible
to indemnify and hold us harmless for your breach of the terms
hereof, including, but not limited to, all costs of collecting
overdue invoices, including costs and attorneys' fees."
Back to arbitration. There are two kinds
of arbitration. One type of arbitration is called
"statutory arbitration" or "compulsory arbitration" because
there is a statutory requirement compelling you to arbitrate
before you get to see a judge in court. Many court systems have
statutory arbitration for small cases. If you lose a
statutory arbitration, you appeal to the trial court. In
this case, statutory arbitration is part of the judicial court
system. It is sort of a case before a case.
The other type of
arbitration is private arbitration, a private process of
resolving disputes outside of the judicial system. Private
arbitration is distinct from the judicial system,
with the exception that the law provides that the courts will respect the award
for enforcement purposes. That is, even though you did not
use the court system to resolve the dispute, the court system
will respect the private arbitration award and send the Sheriff
out to collect the judgment. The courts are glad for
private arbitration, since it helps resolve the dispute without
judicial process.
The American
Arbitration Association is a leader in providing arbitration
services, although there are many qualified private arbitration
companies. Private arbitration is a controlled settlement
mechanism outside of court whereby the parties indicate in a
contract something like, "if we have a dispute, we will settle
it amongst ourselves and we will hire an arbitrator to assist
us." Actually, it is stated a bit more formally than that
statement, something like: "In the event of any dispute
arising from, related to, or in connection with this agreement,
the parties agree to settle the dispute in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association. The award may be entered in any court having
jurisdiction thereof."
But, let us not get
ahead of ourselves. What is an arbitration procedure? Simply
put, an arbitration is a streamlined procedure for hearing
disputes without a "judge" acting as such. It usually
occurs in a small room with an attorney or other "arbitrator,"
evidence is presented, with witnesses, relaxed rules of evidence
and an ultimate award. That is all. It is a private hearing,
just less formal than court. Remember, arbitration is
merely an agreed and controlled private settlement mechanism.
A private
arbitration can be based upon a "demand" or a "submission."
An arbitration is based upon a demand when the contract at issue has an
arbitration provision. Thus, a party has a contractual
right to demand the arbitration. An arbitration is based
upon a submission when the parties agree, after the fact, to
submit themselves to an arbitration; for example, the contract does not have
an arbitration provision, but the parties decide to arbitrate
anyway.
Arbitration can
often cost more to file; however, the savings can be absorbed
through less complex motion and hearing practice. And,
there is usually no appeal. This means the result of the
arbitration is final. Another advantage is that a
corporation or LLC might be permitted to have an officer present
the case, which means that the
company possibly might not need an attorney. In the court
system, however, usually only licensed and admitted attorneys
may appear at the Bar.
Often the greatest
advantage of arbitration is that the parties can mutually agree
in the contract to the credentials of the arbitrator(s). This
means that, for a sophisticated relationship, the parties can
identify arbitration credentials, such as, "the arbitrator must
have practiced law for at least 10 years representing commercial
enterprises in the area of technology licensing." Also, if
having a sophisticated relationship ruled upon by one person is
a concern, the contractual arbitration provision can identify,
for example, three arbitrators, each with specific credentials.
For example, a retired judge, an accountant and a practicing
attorney within the industry.
Arbitration provides
an excellent tool in certain circumstances and should be
seriously considered.
Back to
Top
A2.
Integration Clauses.
"He said. She
said." You have probably heard that phrase to indicate
a case that is tough to prove because it is one person's
testimony against the other person's. In fact, those cases
are difficult to prove.
How do you keep
contract enforcement from being a "he said, she said" case?
You use an integration clause, sometimes called a "merger"
clause. It is called "integration" because the oral
communications are integrated, or merged, into the written
agreement.
Some background is
in order. Proving a case is a question of evidence.
Let us say you have a written contract for a painter to paint a
box the color of black. You get the box back, but it was
painted the color of yellow. You are not happy, the
painter will not return your calls. You sue.
You testify the box
was to be black, and you show the written contract. Case
closed, right? Simple. Well, not so easy. The painter testifies
that the document was a merely a "form" and that you were saying
"yellow" while signing the agreement; you both forgot to change
the word from "black" to "yellow" in the form. In fact, the sample you were using
was yellow as well, so there is some evidence of the painter's claim. But, the written
agreement says, "black," right? Believe it or
not, this happens all the time. And, this is the most
basic example. Believe it or not, attorneys have a tough
job.
The problem is that
the contract did not have an "integration" clause. This
means that the court must hear all evidence. The court
cannot tell the painter he is not permitted to contradict the
written agreement. If you had an integration clause, the
painter would not be able to contradict the written agreement.
So, if the agreement is integrated, "black" means "black," not
"yellow." Technically, for integrated agreements, you
cannot introduce evidence to contradict the written document,
but you can still introduce evidence to explain the written
document.
Remember, there are
three points in time: past, present and future.
Accordingly, each period must be addressed in your contract.
You might consider an integration clause, such
as: "This document is final, complete and exclusive statement
of the entire agreement and understanding between the parties
and supersedes any prior or contemporaneous communications,
whether oral or written. No modifications of this document
may be made without the signed written agreement of both
parties."
So, for example, if you are using
an attorneys' fees clause in your written contracts, such as
stated in the above article, without the
integration clause, it might be contradicted at trial by the
defendant. You
see that it is the integration clause that "locks down" the terms and
conditions of your agreement. The lesson is to
consider having integration clauses in your agreement.
Back to
Top
· B. LEGAL UPDATE ·
B1. California Anti-Paparazzi Law.
California recently passed a law
giving greater protection to citizens from interference from the
paparazzi, at Cal. Civ. Code §1708.8. This law has become
somewhat controversial because it pits privacy rights against
free speech rights, or at least that is the suggestion from some
media pundits.
Oliver Wendell Holmes once
famously stated, in
Schenck v. United States, that the right of free speech does
not permit yelling fire in a crowed theater. That is,
quite simply, that there are limitations to fundamental
guaranteed rights. Free speech is good, but the benefit is not untethered to balanced justice. Accordingly, we must be wise, as American
citizens, to consider the source when the source exclaims
"freedom of speech" to challenge this law, lest Queen Padme's
Star Wars statement, "So
this is how liberty dies, with thunderous applause" not
be made true. That is, we sometimes gladly embrace the
very thing of our destruction.
True freedom of speech, as
intended in the
Bill of Rights, was a contract between the American People
and the American Government to protect an individual right to
speak against the government without jeopardy.
Fundamentally, the right
of protest. It was not intended to give unlimited freedom
of the press to trespass as an ordinary profiteer for the
purpose of reporting about Britney Spears' undergarments.
There are and must be boundaries.
There must always remain the "free choice" to be alone and
to be private, even for Britney. A singer need not make an
election: sun or song; live in the sun or sing as a hermit in the shade.
The California statute generally
provides:
A person is liable for physical invasion of privacy
when the person knowingly enters onto the land of another person
without permission with the intent to
capture any type of visual image, sound recording, or other physical
impression of the plaintiff engaging in a personal activity and the physical invasion
is offensive to a reasonable person.
A person is liable for
constructive invasion of privacy when the defendant attempts to
capture, in a manner that is offensive to a reasonable person, any
type of visual image, sound recording, or other physical impression
of the plaintiff engaging in a personal or familial activity under
circumstances in which the plaintiff had a reasonable expectation of
privacy, through the use of a visual or auditory enhancing device, regardless of whether there is a physical trespass
....
A person who commits any act described
... is liable for up to three times the amount of any
general and special damages that are proximately caused by the
violation of this section. This person may also be liable for
punitive damages. If the
plaintiff proves that the invasion of privacy was committed for a
commercial purpose, the defendant shall also be subject to
disgorgement to the plaintiff of any proceeds or other consideration
obtained as a result of the violation of this section.
Freedom begins with
the right to be left alone. Security in property, and
freedom from the anticipation and the fear of an intrusion,
is not an incidental right, it is a fundamental right — if not
the seminal principle upon which the United States of America
was founded.
It is proper
to take alarm at the first experiment on our liberties. We
hold this prudent jealousy to be the first duty of citizens
and one of the noblest characteristics of the late
Revolution. The freemen of America did not wait till usurped
power had strengthened itself by exercise and entangled the
question in precedents. ... We revere this lesson too much
... to forget it.”
I believe
there are more instances of the abridgement of the freedom
of the people by gradual and silent encroachments of those
in power, than by violent and sudden usurpations....This
danger ought to be wisely guarded against.
American
Forefather, James Madison [called "Father" of the United
States Constitution]
Back to Top
· C.
TRIVIA WE SHOULD KNOW ·
Was the Government of the United States, in any sense,
founded on the Christian religion?
Treaty of Peace
and Friendship between the United States and the
Bey and
Subjects of Tripoli of Barbary.
Fresh out of the oven in 1797, this
Treaty was sent
to the floor of the United States Senate on June 7th, where it was read aloud
in its entirety. It was unanimously approved by the Senate
and signed by John Adams.
Art. 11. As
the Government of the United States of America is not, in any
sense, founded on the Christian religion; as it has in itself no
character of enmity against the laws, religion, or tranquillity,
of Mussulmen; and, as the said States never entered into any
war, or act of hostility against any
Mahometan nation, it is
declared by the parties, that no pretext arising from religious
opinions, shall ever produce an interruption of the harmony
existing between the two countries.
John Adams'
signature block stated:
Now be it
known, That I John Adams, President of the United States of
America, having seen and considered the said Treaty do, by
and with the advice and consent of the Senate, accept,
ratify, and confirm the same, and every clause and article
thereof.
John Adams (the Second President) is believed to have been a
Unitarian,
such as other presidents and the likes of
Charles Darwin. History teaches that neither John
Adams nor
Thomas Jefferson (the Third President) believed in the
special divinity of Jesus, although both certainly believed in
the United States, universal morality, and the essential rights
of Mankind. A basic study of
Freemasonry, and its
membership (e.g., George Washington, Benjamin
Franklin) is essential to gaining a broad historical
perspective on the personalities of our American Forefathers.
Back to Top
·
D. FIRM UPDATE ·
-
In addition to its Pittsburgh
office, the firm has opened a new South Hills, Upper
Saint Clair, Pennsylvania "meet and greet" facility for the
convenience of its clients, located at 2585 Washington Road, Summerfield Commons
Building 100, Suite 131, Pittsburgh, PA
15241. This convenient office is
intended to serve our many clients in the upper South Hills area of Pittsburgh,
including Bethel Park, Bridgeville, Mount Lebanon, Peters
Township and South Point areas. As the firm is a leader in
law office technology, our facilities are now integrated more
virtually. The world is changing, and we are in step.
In the next few months, you will see increased innovations to
assist with increasing service with lower overhead. This
means lower cost to you!
-
Our clients and friends have asked
us for an update on the
Borings v. Google case. This case is the only known
case against Google for trespass and invasion of privacy from
the StreetView program. The case was dismissed by the
United States District Court for the Western District of
Pennsylvania on the privacy count and the trespass count.
We were successful against Google on appeal, and the Third Circuit reversed the District Court and reinstated the
trespass count, but not the privacy count. The firm is in
the process of appealing to the United States Supreme Court to
hear the case to reinstate the privacy count, as well.
Privacy is not an incidental thing: see
The Universal Declaration of Human Rights. It is not
an issue of whether you care about your privacy; it is an issue
about whether you care about others' rights to care about their
own privacy. Not what we do for ourselves, but what we do
unto others, if you will.
-
Gregg Zegarelli recently spoke as
faculty for the Pennsylvania Bar Institute on
Ethical Issues of Emails, Attachments and Metadata. In
short, your documents are watching you, be careful.
Contact Gregg for details on this subject and/or speaking
engagements. Also, Gregg's book,
ONE - The Unified Gospel of Jesus (Divine Version), is now
available in audio book format at
Amazon, as well as all formats, including digital .pdf, at
OUGPress.com. The "Universal Version" is in
pre-production and due to be first released in digital format
soon; stay tuned. Gregg, an attorney, consolidated of the
testimonies of Matthew, Mark, Luke and John.
-
If you are not sure if someone is
filing for a trademark registration that might infringe upon
your brand, consider our automated proprietary MarkAssure trademark
email notices. You are automatically informed of the
status of your current legal issues, without needing to pay for
attorneys and staff to "pull and review your file." The
goal is to improve service and lower cost through implementation
of advanced technologies. Our clients have
discovered many potentially infringing marks by use of our MarkAssure service.
-
Dennis Moskal has now litigated hundreds of employment
claims and has established a distinct area of
service in advising companies and human resource departments in
employee risk management. In this new economy of
downsizing — or even controlled and thoughtful upsizing — consider contacting Dennis about how to manage your company's
risk. Dennis has worked with many Fortune 500 companies.
Gems of Dennis' real-world experience in this area can be
invaluable to your company.
Back to Top
· E. The Zegarelli
Commentary: The
Monetary Sweat Standard Part II ·
In the last commentary, I addressed the
Sweat Monetary Standard. In essence, my point was that the
real standard of money reduces to work, to sweat: the
real standard of money
reduces to production.
Think about it. Even gold is not a real standard; indeed, minerals
— even the
noble ones
— do not produce anything. Gold represents
something; a coin represents something; a paper dollar represents something.
You cannot eat gold. Gold does you no good on a stranded
island. The value of gold is illusory, except to the
extent of perception and social ethereal attribution. Yet,
my brother working to pull me out of a ditch does help me, for
real.
Q. So, where do the tiers of representation for monetary
standards ultimately touch-down to something real?
A. At the end of the day, what is real is the maintenance and increase in
our standard of living. In the real world, things in life reduce
to the standard of living. Life, and how we live it.
The reason is simple: it is
work — production — inherently improves the standard of living.
Money merely makes individualized production
fungible as an equalized standard of measurement.
Money is merely the shadow of production.
Hold that thought. And, now, let us talk
for a moment about credit.
Credit is a very good thing on one level and very bad on another.
Let us look at simple examples of credit-related issues:
-
A woman has a $10K unsecured credit
line and knows she will die soon. She buys expensive toys
and gives them to her children. Before she dies, she
transfers all of her property to her children. The woman dies. The
estate is bankrupt and owes $10K. The children have the
toys. Children are not liable for the debts of their
mother, so they keep the toys. The lender loses $10K in
bad debt. But, the lender does not "lose" the money, the
lender socializes the expense by charging higher rates to
society to recover the loss. Because the cost of credit
increases as a result, our supermarket must charge us more for food to cover
the interest. The woman's children get fun toys, we pay higher food
prices.
The burden of repayment is not destroyed, only shifted and
diffused. Let us look at another example.
John lives in a dump of a house,
by American standards of living.
John is miserable; his life is
nasty and brutish.
In some societies, John's house would be a castle, but John
watches television shows and has seen teenagers with
expensive cars, so he believes that he has now objectively
confirmed for himself that he should be and is miserable.
Now, if John has the virtue of discipline for three
years, John can save money working and
remodel his home. But, wait, John has an unsecured credit
card for $30K. Great. John spends the $30K and
remodels. Wow, John now has a wonderful standard of
living, as he perceives it. A standard of living that Americans prize, and
expect. But, it is a false standard. It is a lie.
John's standard of living is an absolute fraud. There was no
work, no production, no sweat. Anyone can get credit, no
sweat. It is a monetary game, established by very smart
people who want us to think they know what they are doing, but
they do not. It is quite easy to understand the problem.
John never produced anything for the standard of living he now
enjoys.
But, please wait! There is more. Remember, when
John remodeled, he had to hire the remodeling construction company. They
received new orders. With these new orders, they had to
hire more staff and buy more inventory. How stimulating.
Now, everyone is happy, right? John is happy, the remodeling
contractor is happy, the TV manufacturer is happy, the electronics parts makers
are happy,
and the newly hired employees are happy. Life is good. Everyone is happy! The
economy is stimulated with activity. John is a nice
guy. He did a good thing borrowing, buying on credit and
consuming: he stimulated the economy and made everyone happy! That John.
But what is
really, really, really wrong with this picture?
It is not the extent of consumption that is the problem, it
is the lack of source production. It is out of balance, it must
topple. It is
cold fusion, unending free energy. Unbounded
happiness. There is no burden for the benefit. No
work for the joy. Nature does not play that way. If
you want to eat, then you must sweat out the gathering and the
hunting. That is the way it works. That is what
Mother Nature teaches, and that is the price she demands. Mother Nature reminds us to pay her with a smack, if we should
forget to do so.
Okay, let us stick with the
simple example. Remember, all that economic stimulation
came from the bank's money, based upon credit to
John. John gets the bank's
money, and it moves all around making everyone happy.
But, the circle of value transfers must get closed.
What if John dies or does not pay back the bank? What if
John never supplies the return of value back to the bank for the
benefit he received? Now what? Well, the bank loses the money,
of course. It was a bad loan. Oh well.
But, wait again! From where did the bank get its money in the
first place? The hard-working people gave their earnings to
the bank to hold in trust. Now what? I will tell
you: everyone who
had money in the bank loses it. That is just the way it
works in a simple society. So, if this were the old-school "Old West"
of America, circa
Jesse James, the depositors would lose their money. In
those days, a person who was not credible — a person without
known personal virtue and character — could not get a loan.
But, today, we are smarter than that, right? It would
be unfair for the people to lose their money because of bad John
(who was bad only because he could be). So, the Government
will insure the banks, and bail out bad loans. That is
fair. Now, no one will ever lose their money for bad John
(who was bad only because he could be). The politicians numb
the pain for us. Perfect. Everyone is happy. Thank you.
But, where does the government get its money
to make us so happy?
Two places. The Government, of course, gets its money
from our earnings — full circle — by taxes. Or, well,
the Government just prints it untethered to real value or real
production. So, to the extent that the Government gets the
money from us to make us happy, I suppose through some
circuitous route that is no longer cognizable, we just paid to
remodel John's home. John is certainly happy. On the
other hand, for anyone who simply thinks the Government just
printing money is a solution, we should just take the premise to
its logical conclusion. The Government should just print
more of it, forever, stop taxing us, and we can all have
unending happiness without work. Utopia. We can do
it, no sweat. John did not work.
Money is no longer the shadow of
our production. Our money no longer represents the traditional pride of American Sweat.
The remedy is now the disease. The Government has made
money the very thing itself. Money no longer represents something
else, it is the thing itself. And, we are now confused, and
so is the Government, and so are its advisors. Worse than
confusion, delusion.
The value of a people's currency is no better than the people
who back it. American Currency represents the American
People. And, what does our money represent when it is
printed as vapor?
Benefit and Burden, sister and brother,
where must you find them? One with the other.
Gregg Zegarelli
[These comments are Gregg Zegarelli's and are not necessarily
representative of the TEV Law Group, PC. Comments can be
emailed to
ZegarelliCommentary@zegarelli.com]
Back to Top
|
