Ohio Practical Business Law : Columbus Ohio Business Lawyer & Attorney : Teri Rasmussen : Plunkett Cooney Law Firm : Commercial Law, Creditors, Business Formation : Columbus, Central Ohio

One of the questions I get asked a lot by my bank and creditor clients is "how long?"  How long til we can get the property back?  And those on the unfortunate receiving end of a foreclosure have the same sort of question - how long til I have to move out? - for different reasons.  Of course the answer is that it depends on so many different things and varies considerably from one county to the nextand one case to the next.  But that's not really the sort of answer anyone can run a bank on or make personal decisions with.  So here are some slightly more specific FAQ  

     1.     How long can I stay in my home if it is in foreclosure? 

If your residence is in foreclosure, it still belongs to you until the time it is sold at sheriff's sale and a confirmation entry is entered by the Court.  So, in plain language, the house is still yours until it is sold at sheriff's sale.  At that time, title to the property passes to the successful purcahser at the Sherriff's sale.  However, it will typically be at least a few more weeks (maybe even two or three months) as a practical matter before the confirmation entry is entered by the Court and the successful purchaser at the sheriff's sale receives the deed.  Because foreclosures are taking so long, in "real life", we are probably talking a year or more.

Double-edged sword is that you ARE still the owner as far as taking care of property......  Soooo,,. if you were thinking about just walking away from the whole mess because you're so far underwater equity-wise, it may not be quite that simple.  For a brief summary of the consequenses ogf this approach, visit Connie Carr's post entitled Mortgage Debt: The Consequences of Walking Away over at the Ohio Real Estate Blog.

     2.      How long will the foreclosure take? 

Talk about impossible questions to answer!  I like to start with the absolute MINIMUMS as far as time periods required if everything went exactly perfectly and there were absolutely positively no delays whatsoever.   Here's what has to happen to at least get to the point of getting a Decree in Foreclosure.  

• Defendants must actually be "served" with the foreclosure Complaint, i.e. they must either actually receive a copy of the Complaint or be deemed served through "publication by service" which means that it's been advertised in those tiny print LEGAL NOTICES part of a local newspaper.  Figure probably a week or two if no problems arise.
• Once "served", under Ohio law, a defendant has twenty-eight (28) days to respond to the Complaint.  So, OK, figure another month here.
• If the defendant does not respond after being served, the plaintiff lender can seek a "default" judgment.  To do this, the plaintiff lender must file a Motion for Default with the Court and wait for the Court to enter the Default Judgment.  This is obviously a HUGE wild card.  Some judges may enter judgment right away while others may just let things sit on their desk for months.  And there's really not all that much the plaintiff lender can do to move things along.  Let's just pencil in a couple of months here as being a not unreasonable period of time for this to happen, but with the understanding that this might well be much longer.
• If, on the other hand, a defendant does respond by filing an Answer to the foreclosure Complaint or there are other complications, the plaintiff lender will need to file a Motion for Summary Judgment.  A Motion for Summary Judgment is similar to a Motion for Default Judgment, but will need to address any arguments brought up by any defendants.  In addition, an Affidavit by an officer of the plaintiff lender will probably also be included setting forth the amount owed and explaining other relevant facts.  Once the Motion for Summary Judgment is filed, defendants have fourteen (14) days to respond and customarily, the plaintiff lender will have an additional seven (7) days to file a responsive Reply.  Here again, it's up to the judge as to when a decree in foreclosure will be entered and there really isn't that much a lender can do to hurry things up.  So, OK, figure 2-6 months here (although I will tell you that I currently have at least one case in which the Motion for Summary Judgment has been pending for more than a year)    

So, to recap, to get from the point the foreclosure Complaint is filed to actually having a judgment Decree in Foreclosure, it's going to be AT LEAST 3 1/2 months or so, and THAT IS SUPER OPTIMISTIC!!!  More likely, you are really looking at six to seven months or more and even that assumes that everything goes perfectly.  My anecdotal expereince is whether commercial or residential, a year or more is NOT an unusual amount of time for a foreclosure to take right now just to get to judgment, even if there is no spirited defense.

     3.     So the case FINALLY has reached that Judgment Decree in Foreclosure stage!  NOW how long til it finally gets auctioned at Sheriff's sale? 

Short answer: one heckuva lot longer than you might expect.  Again, I like to go with what i know to be the MINIMUM periods of time required and work out from there.  Here's what has to happen at this point:

• First off, under Ohio law, the property MUST be appraised by appraisers working for sheriff's office.  This is because, under Ohio law, the opening bid  at sheriff's sale for the proerty MUST be at least TWO-THIRDS of this appraised value.  How long this takes will depend A LOT on what county the case is in.  However, in general, let's figure about a month here.        
• Once the appraisal is done, the Sheriff's Office must set the date on which the property will be offered for sale.  This is where, as a practical matter, things really SLOOOW down.  As a practical matter, this is taking MONTHS right now.  By way of example, Franklin County currently already has sheriff's sales already scheduled through March.  In other words, right now, this step is taking 3 months or more.
• Once the sale date is set, it must be advertised for at least three consecutive weeks.  If there is a silver lining anywhere, it's here where the advertising can take place during the waiting period between the time the sale is set and when it actually occurs.  Also, unlike some surrounding states such as indiana, typically most Ohio counties have sales on a weekly basis.    
• If the sale is cancelled for any reason,even if it was something like a blizzard, the property must be readvertised.  There is no such thing as "postponing" a shriff's sale without the necessity of having to readvertise the property.  However, a new appraisal is not required.

So, to recap here, we're probably talking 3-4 months AT BEST!!!!

    4.     The Sheriff's sale has happened!!!! When do I get $$$?  When do I get the property??? 

OK, here the "good news" is that in Ohio - unlike certain other states -- the "equity of redemption" ends when the hammer falls at sheriff's sale and the Confirmation Entry gets entered by the Court.   The exact process will probably vary from one county to the next.  (On its website, the Franklin County, Ohio Sheriff's Office has helpfully posted an overall summary of its procedures following sale as well as an even  more specific  "What You need to Know as a Potential Third-Party Purchaser"  For other counties, visit the Buckeye State Sheriffs' Association website.)  In general, here's the process: 

• Once the sheriff's sale is over, the confirmation entry is to be submitted within 30 days after the sale,
• Once the Order of Confirmation has been entered, the plaintiff's attorney is to submit the deed to the Sheriff's Office within seven (7) days thereafter
• The successful bidder generally has thirty (30) days following entry of the Order of Confirmation to pay the purchase price to the Sheriff's office, although the precise amount of time will be set forth in the Order of Sale.
• The Sheriff is supposed to record the deed within fourteen (14) days of payment, but that doesn't always happen.  Once the deed is recorded, it will be sent to the successful bidder. 
• The proceeds will be distributed as described in the order of Confirmation after the purchase price has been paid in.

So you're looking at another two or three months here.

     5.     Can I get control of the property sooner by getting a receiver appointed and how long will that take?

Yes, maybe. Appointment of receiver generally only makes sense in the context of commercial properties.  Most  commercial mortgages provide for the appointment of a receiver and especially if there are defaults other than  nonpayment, appointment of a receiver should not be especially difficult.  It is possible in certain cases to obtain appointment  of a receiver on an expedited basis, but the timing and the identity of the individual appointed is still a matter of discretion with the court.  Once the receiver is appointed, the receiver can collect the rents,  handle maintenance issues, and interface with tenants.  However, in non-emergency situations, it is sometimes difficult to obtain a quick hearing date on the Motion to appoint a receiver.  

    6.     What about a "deed in lieu"?  Can that speed things up?

Yes, it can.  However, a "deed in lieu" in which the borrower conveys the property over to the lender, usually in exchange for a release or limitation of liability, only really works if (A) the borrower wants to to do this; and (B) there are no other liens on the property.  If those two criteria are met, a deed in lieu (DIL in the biz) can happen very quickly, perhaps even in a month or less.    

     7.     So the bottom line is.....?

Any way you look at it, foreclosure in Ohio is a long process for either residential or commercial property.  Think at least a year before the property is auctioned at Sheriff's sale and another couple of months before it's finalluy done.  In a commercial foreclosure, getting a receiver appointed early in the case can make the long wait far more palatable to the foreclosing lender as it gives the lender control over the income being produced by the property.

• Email This
• Print
• Comments
• Trackbacks

The recent late night television mess with Jay Leno and Conan O’Brien  is a great object lesson as to what contract law really is and does AND what it actually isn’t and doesn’t do.  In my last post, I highlighted some of the various legal arguments being made by Conan, NBC, and to a lesser extent Leno.  (Visit "Leno gives his side of 'Tonght Show' intrigue" for Leno's take on the events, including his guranteed payments under his contract.)    However, now that it’s over, let's look at some important points about contract disputes as they happen in "real life" well illustrated by the series of recent events.

            FIRST - Contract disputes frequently come down to the “letter of the contract” versus “spirit of the agreement” sort of dispute the Conan/NBC situation illustrates.  NBC’s initial saber rattling focused on the fact that Conan’s contract as host of The Tonight Show apparently did not specify an exact time slot.  (This is the nightmare every transactional lawyer dreads – the one thing you didn’t think of turns out to be the really crucial provision that should have been in there.)   From NBC’s perspective, this gave them the right to move The Tonight Show back a mere half hour without breaching their obligations under Conan’s contract.  Here, the LETTER OF THE CONTRACT.

Conan’s camp for their part pointed out that The Tonight Show has aired at 11:35 P.M. immediately after the local news for 60 years and essentially contended that the time slot was an “implied” term of the contract.   Here the SPIRIT OF THE AGREEMENT.  And that close cousin to “spirit” of the agreement”, namely, the “GOOD FAITH” requirement imposed in every contractual relationship.

Now, this is good stuff because it pits those careful enough (or perhaps lucky enough) to have said what they meant against those urging what might be considered a “fair” outcome built on what may well have been shared assumptions at the time the contract was made.  In a way, both sides are right, but only one’s perspective can be enforced. 

Should Conan have specified a time if that mattered so much?  Yeah, probably….. but seriously, who would think anyone would even propose moving The Tonight Show to a different slot?   Often, how a court decides to resolve this issue will do much to affect its determination of whether any breach of contract in fact occurred, and if so, what sort of damages should be awarded.  Which brings us to the second point of understanding>>>>>>

            SECOND – Resolving contract disputes OUTSIDE the court room is generally better for everyone. This three-way conflict had the potential to get really ugly really fast. Conan might have gone to Court to require NBC to keep him on at 11:35 PM until there could be a full hearing of how his contract with NBC should be interpreted. If instead Conan chose to walk away, well then there was a noncompete to deal with and the possibility of being held liable for a breach of contract by failing to continue to perform at the later time slot. The details of how Leno agreed to pass the torch to Conan in the first place (i.e. Conan’s contract was expiring and NBC needed a way to keep him at NBC) almost certainly would have been examined in graphic detail unlikely to be flattering to either NBC or Conan. Things could very well have gotten “personal” between Leno and Conan as they were already beginning to do, something which in the end was probably not going to enhance the image of either in the public eye. 

In short, long divisive publicity of this dispute was in no one’s interests. NBC decided that Leno was more valuable than Conan to it (or perhaps even more expensive proposition to jettison) and agreed to pay Conan and his crew enough to make the case go away.  And Conan got a nice severance package for himself and his staffers and, perhaps more importantly, the ability to host another show as early as September without having to deal with lawyers and lawsuits.  NBC was able to make amends to its affiliates whose unhappiness started the avalanche in the first place.  And Leno got back what he apparently never wanted to give up in the first place.

It's relatively unlikely that these three parties would all have wound up where a relatively brief period of intense negotiating got them.   And it would certainly have cost all of them A LOT more had this gone the litigation route.  Sometimes, it really isn't possible to resolve things among the parties themselves.  However,as a practical matter, it is almost always better for the parties themselves - who know and understand the situation better than any outsider could- to find their own resolution.

           THIRD - Leverage always matters.  In this case, it was the network affiliates -who were contractually obligated to run Jay Leno's 10 PM show - who really got the ball rolling.   And ultimately got exactly what they wanted...  They were losing money and they were not happy.  So even though - contractually - they didn't have a leg to stand on, none of the rest of this sordid affair would have tumbled out, but for NBC's desire to placate this important customer. Then there's Jay who was rumored to have an ironclad contract guaranteeing a hefty payment whether his show aired or not, thus perhaps presenting the economic decision for NBC that it would cost less to keep Jay than to get rid of Conan.  And Conan - well he had the ability to make the whole situation a truly horrendous mess both legally and perhaps more importantly from a PR standpoint, thus giving the impetus to NBC to pay him some money instead of insisting that he continue to perform.

In many contract disputes, there may be a well-written contract on which one party can rely from a legal perspective to enforce their position.  But that doesn't always mean that's the smart thing to do - never mind about what the "right' thing to do would be.  The point is: the law can preserve your options, but the decision must still be made in the context of the surrounding business world.

So, does all this mean lawyers and their contracts are an unnecessary evil to be dispensed with?  No - a well written contract helps set the parameters for what is open for discussion and can in some cases influence the amount of leverage one has or doesn't have.  it's simply important to understand that neither they, nor their breach, exist in a vacuum.

• Email This
• Print
• Comments
• Trackbacks

Franklin County Common Pleas Court has finally joined the courts of other large Ohio counties, and more than a few smaller counties (including Delaware County),  by making pleadings FILED on or after December 1, 2006 available on-line in PDF form.  The key here is FILED, 

In new cases filed on or after December 1, 2009, ALL pleadings will be available on-line.  Incases already pending on December 1, 2009, pleadings already filed will not be available on-line, although dockets showing their filing will continue to be available just as they have been,  However, NEW  pleadings filed in these older case WILL BE available on-line as they are filed, 

Pleadings filed in Tenth Appellate District/Franklin  County Court of Appeals on or after December 1, 2009 will aso be available on-line according to news reports in Business First.  Judges of the juvenile, domestic, and probate divisions of Franklin County Common Pleas Court have elected not to make records in those cases available on-line - probably a good thing given the nature of those sorts of cases. There are also plans to go back and add pleadings already filed to those on-line. 

No additional software or passwords are necessary.  Nor is there any additional charge to view pleadings.  Once on the Franklin County Common Pleas Clerk of Court's website, cases may be searched just as they have been.  When the desired case is located and the docket sheet displayed, a PDF icon will appear to the right of those pleadings available on-line.  Click the icon to view the pleading which can then be downloaded and/or printed, 

Cuyahoga County (Cleveland), Hamilton County (Cincinnati), and Montgomery County (Dayton) have already had pleadings available on-line for quite a while.  In fact, Montgomery County intends to begin requiring electronic filing of pleadings in 2010; this may be available in Franklin County sometime in 2011. 

It's amazing how happy small things ike this can make me.   

• Email This
• Print
• Comments
• Trackbacks

It's always the little things you tend to take for granted that you really should be the most thankful for having.  Until recently, I had NO IDEA of how thankful I should be for the way Ohio courts have embraced and incorporated technology.  In the last few weeks, however, I have had substantial exposure to the way things work court technologywise in...  well let's just say, an adjacent State.  I felt like I'd travelled back in time ten years or more and could hardly believe how inefficient it all seemed.   

Among the modern technology I sorta thought EVERYBODY had was internet access to case docket sheets showing pleadings filed in particular cases.  In fact, I sometimes groused because my local trial court's Clerk of Courts website -- unlike those in Cleveland and other areas of the state -- would ONLY allow me to see the name of the pleading and the date filed and might be a few days behind to boot.  All federal courts (with a password) and many trial and appellate courts in Ohio also allow you to download from their Clerk of Court websites -  immediately and for free  (or at least at nominal cost) -- copies of the actual pleadings filed.  And, in some Ohio courts I can even electronically file pleadings right from my computer.    

Well, no, apparently that's not so normal in at least some other States.  In this particular State bordering Ohio, some of the trial courts don't even have a website at all and one heckuva lot have NO internet access to docket sheets.  Is this a big deal?  Well it is if you're used to being able to answer your own questions quickly about service and what's been happening in a case with which you're not familiar, but now need to jump in as a pinch hitter. 

Suddenly, I'm back to the time where I'd have to write a note to my secretary giving her the case number and party info, getting her to call the court and perhaps beg for information and/or documents BEFORE we sent them a search or copy fee, and if not successful, waiting hours, days, or weeks for information I need as a lawyer before I can decide what should be done next.  And of course, if it's a few days or weeks later that the information finally comes in, now I have to refresh my memory about what the issue in the case was that made me ask for the information in the first place.  Obviously, the additional time and effort now saved with implementation of modern technology is substantial.  And it's only when that sort of access isn't available instantly that you truly appreciate the impact of technology on your practice of law.

Ohio has benefited from a substantial emphasis on the importance of courts implementing technology.  When the Ohio Supreme Court  first began surveying courts in 1989 about whether any technology was available and being used, less than two thirds of the courts even bothered to respond to the survey.  In 1993, Chief Justice Thomas J. Moyer created a program of direct technical assistance to trial and appellate courts in Ohio to support various initiatives and implementation programs. 

As the bi-annual survey of technology use in Ohio courts continued, there has been a 100% participation response rate since 1996. Since 2002, all Ohio Clerks of Court have automated records and approximately 85% (and I would add from personal experence all major population centers) have websites of their own allowing some sort of access to case dockets.

For more detailed information on the progress and scope of the implmentation and integration of technology in Ohio courts, take a look at some of the bi-annual surveys:

• Technology and the Courts-2008 Survey
• Technology and the Courts-2004 Survey
• Technology and the Courts-2002 Survey

There's also this interesting 2003 speech by the Chief Justice.

Technology has interjected itself slowly into the way I practice law and I haven't  always initially been happy about changes it brought (I was orginally very NOT excited about electronic case filing aka ECF when that first came out - don't know how I managed without it now).   But it seems to have worked out well in the end an I'm not going back. 

Now I realize this isn't like world peace or anything, but in my day to day work life it matters.  Personally, I have now sworn to never ever complain about my access to Ohio court records again.

• Email This
• Print
• Comments
• Trackbacks

Until he retired a few years ago from Iowa State University, my Dad Jorgen Rasmussen taught Political Science, specializing in British and European politics.  So, carrying on his Anglophile tendencies, the advent of the Supreme Court of the United Kingdom seems rather too important to ignore, notwithstanding the relative lack of notice it seems to have attracted here in the States. 

Officially, as described in this Official Press Release 01/09, the new court came into existence on October 1, 2009 and has apparently been six years in the making.  It replaces the Appellate Committee of the House of Lords which seems to be more commonly known as the Law Lords.  Although the new Supreme Court had already heard arguments, Queen Elizabeth  II (or as the Court’s second press release refers to her, “Her Majesty The Queen”) made it official last Friday (October 16) in formal opening festivities.  Here’s some video of the festivities.

The change is intended to provide greater independence to the judiciary which has previously been much more intertwined with the legislative branch than is the case in the United States.  Physically, the new court will be moving out of the House of Lords and into its own quarters.  In some respects this seems an unimportant, almost trivial, change.  Yet it also seems like looking back years from now, the move could be huge in charting a perhaps more independent (from the legislative branch) course the UK Supreme Court takes.  In another break from the past, the new “Justices” will no longer be members of the House of Lords while they are sitting on the Court.  (Imagine if the U.S. Supreme Court Justices were all at-large members of the united States Senate.) 

In a move that puts it technologically ahead of the U. S. Supreme Court, the UK Supreme Court will allow video recordings of its proceedings  that will be made available to broadcasters in an effort “to be as transparent as possible in its judgments and proceedings.”  And apparently, the wigs are history… 

Although most Americans didn’t pay much attention, there’s lots of info and comment in the blogosphere about Britain’s new court.

• First stop might be the BBC News’ fine Q&A: UK Supreme Court which provides the basics in a easily understood fashion 
•  
• Cassell Bryan-Low and Jess Bravin of the Wall Street Journal provide some additional background and context in their article A U..K. Court Without Wigs. 
•  
• I also rather liked Library Boy Michel-Adrien Sheppard’s selection of coverage and comments in the British press about the change.  For some more of that from other publications, click here,  
•  
• For the most concise rundown with some great links to related material and information about the new Supreme Court’s inaugural case, check out this post on Jurist.
•  
• SCOTUK by Diane Marie Amann of IntLawGrrls blog focuses on the first case now before the new Supreme Court of United Kingdom which relates to the freezing of assets in a terrorism suspect case.
•  
• And there is a fledgling UKSC Blog which appears to intend to emulate the well known SCOTUS blog

‘Course not everyone’s happy about the new court as you can see by visiting The Not-Supreme Court of the United Kingdom post on the  The TaxPayer’s Alliance website which opines that

The proper name should be the Not-Supreme Court, or perhaps the Supreme-ish Court.  This is because British law is not in fact supreme in our country, European law is. 

And from more mainstream media, Fear Over UK Supreme Court Impact is reported by the BBC News in an interview with Lord Neuberger who didn’t want to make the transition to the new court.  According to Lord Neuberger, there is a real risk of

judges arrogating to themselves greater power than they have at the moment…. [The UK Supreme Court seems to have been created]as a result of what appears to have been a last-minute decision over a glass of whiskey… The danger is that you muck around with a constitution like the British Constitution at your peril because you do not know what the consequences of change will be.   

My Dad’s take on it? “Supreme? Not really.  Parliament is still supreme.  Furthermore, in some instances the final word lies with the EU’s Court of Justice.”  So one interesting conundrum in the years ahead for the new UK Supreme Court is that although it may be more independent domestically from other branches of government than in the past, its overall power may be become less as Europe becomes more one. 

One thing I don’t get, however, is why you’d swap the neat names these folks used to have  – Lords of Appeal in Ordinary – to being simply a “Justice”  And I’m really surprised and disappointed they couldn’t come up with something a bit more, well British, than ”President” to refer to the head Justice. 

Our legal heritage has deep roots across the pond.  Now it seems that the child may be influencing the parent.  Always interesting to compare the answers each finds. 

• Email This
• Print
• Comments
• Trackbacks

In recent years we have all become far more conscious of the importance of our personal identification information and the undesirable consequences that can result if the information falls into the wrong hands.  Now Ohio courts will join many other judicial and other governmental agencies in taking steps to protect this sort of information. 

Effective July 1, 2009, the Ohi Supreme Court issued Public Access Rules in the form of new Rules of Superintendance 44-47 requiring the redaction of "personal identifiers" in pleadings, orders, and judicial administrative records.  The new rules are applicable to any court filing in any court, including even Small Claims Court.     

"Personal identifiers" are defined in Sup, R. 44 as

social security numbers, except tor the last four digits, financial account numbers, including but not limited to debit card, charge card, and credit card numbers, employer and employee identification numbers, and a juvenile's initials or a generic abbreviation such as "CV" for "child victim"  

The Ohio Supreme Court has a link on the right hand side of its home page to a subpage on its website with a great deal of information about the new rules.  In addition to the text of the rules, there is:

• Summary of Rules
• Frequently Asked Questions - this is very helpful
• a very short executive summary type Important Points to Understand About the New Access Rules 
• a very nice PowerPoint presentation explaining the new Public Access Rules
• Comments by the Chief Justice
• Sample Confidential Personal Identifiers forms which must be completed separately when this sort of information is important to the disposition of the case (Sup. R. 45(D))

The various Common Pleas Courts, Municipal Courts, and Courts of Appeal are left to their own devices as far as developing implementation procedures for these rules.  The Rules of Superintendence also contain some procedures those wishing to obtain access to redacted infromation can follow.  No specific penalties for violation are included in the rules. 

While the intent of the rule was probably primarily focused on protecting the privacy of individuals, the language of the new Public Access Rules also encompass businesses and other commercial ventures.  In this respect, they are more restrictive than those that have already been in force in Bankruptcy Court  which pertain only to personal information of individuals. 

In addition, it is important to remember that the rule applies not only to the text in pleadings and order, but also to EXHIBITS that might be attached.  So, for example, if a promissory note being sued on has a "note number" or "obligor number", or a purchase order has an "account number", that information should be redacted to be safe. 

>>>>>>>

And on a personal note, today was a glorious day to be a University of Michigan graduate in Columbus, Ohio: Michigan beats Notre Dame in a tight football game in the Big House while Ohio State loses at home to USC.  It'll be a long football season this year for UM, but at leasr for a few days I can be happy. 

• Email This
• Print
• Comments
• Trackbacks