GET IT IN WRITING ... SIMPLE, RIGHT?

Have you ever purchased something without getting a receipt? Have you ever promised someone that you're "good for it", and shook the other's hand?  Have you ever agreed to help someone do something, but not put the arrangement down in writing?  My bet is that most of us have.  The reason we have is that, in most instances, the arrangement is finalized or completed without problem.  There are times, however, when such an arrangement fails or is completed with resulting problems.  This can cause lots of headaches, heartaches, and financial dilemmas.  In fact, sometimes, the issue is simply that the parties making the deal were not detail-oriented, and had not thought of the issue until it became one.

Solution - GET IT IN WRITING!  In California, taking after the Common Law principle known as the "Statute of Frauds", certain agreements must be in writing.  Civil Code section 1624 identifies many such agreements:

1.  An agreement that by its terms cannot be completed in 1 year from the making of the contract (An employment contract where the employee signs on for a 1+ year term, for instance);

2.  A special promise to answer for the debt, default, or miscarriage of another (ie, a personal guaranty);

3.  An agreement for the leasing for a period more than 1 year (similar to #1 - a residential lease for 1 year or more);

4.  An agreement retaining someone to sell/buy real estate on promisor's behalf (a listing agreement) or to procure a lease of more than 1 year;

5.  An agreement that, by its terms, is not to be performed during the promisor's lifetime. (a will - which is an agreement by the executor to transfer property pursuant to the wishes of the promisor/dead person);

6.  An agreement  by the purchaser of real property to pay an indebtedness secured by a mortage or deed of trust ... (the mortgage);

7.  A contract/agreement to lend money in excess of $100,000 for a purpose not principally deemed for personal, household, or family purposes by someone in the business of lending. (A business loan).

There are a few other well recognized agreements that must be in writing as well: for instance, an agreement to purchase goods (tangible property) for $500.00+.  Most real estate transactions require that disclosures be in writing.

But, there are also many instances where there is no formal written agreement.  A simple example is employment.  Most of us who have jobs, are employed "at-will".  Usually, such "at-will" employment (meaning either side can terminate the relationship without reason at any time) is made without a formal written agreement in place.  There may be an employment handbook that provides the employee with the policies of the particular employer; but, there is nothing in writing that is signed by the employee that guarantees that employee a job with the employer.

Partnerships result from at least two parties deciding to go into some form of business together.  Partnership agreements need not be in writing ... but they should be!

Corporations are bound by an agreement known as the "Bylaws" of the corporation; the "Bylaws" must be in writing; however, many corporations, especially small corporations, fail to maintain buy-sell agreements (shareholder agreements), and otherwise fail to keep explicit minutes (records) of annual board meetings.

My suggestion is that, to the extent you have promised to do something for another (or with another), you set forth the arrangement in writing, dated and signed by the parties to the arrangement.  The more specific and detailed, the better.  Better yet, retain legal counsel early in the process to guide you.

What are your thoughts?

LEGAL JARGON 101 - Interrogatories

Happy New Year!

Continuing my collection of tidbits related to the litigation process, I thought I would delve into a topic that I am certain is confusing to many people ... legal jargon.  For instance, during discovery, there are a number of different methods of collecting information to assist you in proving your case.

One such method is by asking your opponent (whether plaintiff or defendant) written questions or requests about facts.  Written questions or requests seeking written responses are also known as "interrogatories".  For instance:

"Identify all writings from 2009-2010 that show communication between YOU and Company."
"State all facts that support YOUR allegations in YOUR complaint that Defendant harmed YOU."
"How long have YOU been licensed to drive a tractor trailer in the State of California?"
"Are YOU a corporation?" "Are You a Joint Venture?"

In California, Code of Civil Procedure Sections 2030.010, et seq., pertain specifically to Written Interrogatories.  There are two types of written interrogatories: "Form" and "Special".  "Form" interrogatories are official universal questions that the California Judicial Council puts out - the questions are numbered and are the same for everyone.  You don't have to use "Form" interrogatories, but such questions get some of the simple/common fact questions out of the way.

"Special" interrogatories are not universal, but drafted by the person requesting the information.  In California, a party asking "Special" interrogatories is limited to 35 such questions/requests, unless a declaration accompanies the set of interrogatories indicating why more than 35 questions/requests are necessary in this case.  (CCP Section 2030.030.)

Written interrogatories may be used pretty much at any time by one party seeking written responses from any other party.  They may not be used to obtain documents, physical evidence, or to obtain responses from a non-party (such as a witness).

Responses must be verified by the answering party, and must generally be provided not more than 30-35 days after being served with the interrogatories.  There are plenty of objections available to protect the responding party's interests that I will not go into here.

I often utilize interrogatories to obtain facts relevant to other sources of evidence: "Identify all documents ..." Then you can send out a request for documents requesting all identified documents responsive to that interrogatory.  Or, "Are you a Corporation?" You can then seek information specific to the corporation, or learn who the management of the corporation is/was. 

I am often explaining the meaning of certain terms to clients.  "Request for Documents" may be easy to understand; "Form Interrogatories" can be confusing.  I hope you found this information helpful!

More to Come!