Don’t Dig Yourself Into A Hole

This is a pop quiz on when it is advantageous to hire a lawyer:

At the beginning of a significant matter in your life which could have a financial and/or emotional impact on your future.
After you have – already signed legal documents that could encumber you, or after you have been sued, or after your deadline to pursue a matter have passed.
After a judgment has been entered against you in a lawsuit you did not defend; years after you did not monitor what was happening with a relative’s estate of which you are a beneficiary; after you settled on a piece of property and begin having major problems.

I would hope that most of my readers would have selected A. Yet in my experience, most people do not hire a lawyer until they have experienced problems in B or C. It is definitely easier to dig oneself out of a hole before one is too deep into the hole to do so.

I surmise it is human nature to wait to take action until a situation has reached crisis proportions. I will provide some examples of problems that clients could have avoided if they would have hired a lawyer at the beginning of their matter. Some of the facts of the matters have been changed, and the names are fictitious.

Example One

John Jones decided to place an offer on a house. The agreement of sale was drafted by a real estate agent who was a friend of John’s family. John decided to have us review the agreement of sale after he and the seller had already signed the agreement. Many people do not realize that a written document takes precedence over a verbal agreement, and even if the parties agree to change the agreement of sale, that agreement is often not valid until it is reduced to writing in a specific form. An exchange of e mails is not the necessary specific form.

We pointed out problems with the agreement because there was no limit on the amount of repairs John would have to pay for after he received his inspector’s report, it would have been John’s sole responsibility to pay for any citations the city would have issued prior to the sale, and the seller asked John to waive any disclosures he would otherwise been legally required to make.

Also, John owned 3 cats. John did not see the documents governing the homeowner’s association until after he signed the agreement, and those documents limited him to 2 cats. Although John was told he could move in with his 3 cats, restrictions were placed on him on whether the cats could remain if problems arose, and John was required to pay a deposit that had not been mentioned before. John has decided to cancel the deal and is waiting to see if there will be a problem with receiving a return of his deposit. If there is such a problem he may have to engage in an expensive mediation process.

Lesson: Always hire a lawyer at the beginning of a legal transaction.

Example Two

Debby Doe contacted us because she was told that she had 21 days (this is a federally mandated time period for employees over 40) in which to review a severance package after she was terminated from her employment. There were two parts to the agreement. Debby was told by her manager that if she signed the agreement the day she received it she would be considered for another position. However, Debby was not offered another position. Debby also suffered from some medical problems, of which her employer was aware, and became confused, upset and anxious when she learned she was being terminated. Debby retained us to secure a better severance package than the minimal package she was offered despite years of being a good employee, and because Debby was confused and intimidated and misled, she did not realize that she had signed both of the agreements, instead of one of them. We are now pursuing a discrimination action on behalf of Debby for lack of accommodation by her employer due to her medical condition, as well as not complying with giving Debby 21 days in which to consider the severance package.

Lesson: Do not let your employer bully or intimidate you into signing a severance package. Give yourself the legally allotted time to review the agreement, and have a lawyer review the agreement and either make suggestions to you as to whether changes are suggested, or try and negotiate a better package for you. Remember, that non-monetary changes are often just as important as monetary changes when considering these agreements.

Example Three

Bill Smith’s mother passed away in 2014. She did not leave a will, but Bill agreed that his brother Jim could be named to administer their mother’s estate. Bill trusted Jim, and asked him every few months how things were progressing. Jim said things were fine, but there were many things that had to be done under the law, and that he would distribute Bill’s share of the assets as soon as their mother’s house was sold. In 2017 Bill became suspicious and checked some records at the courthouse. He learned that Jim had sold their mother’s house for $1 to Jim’s son, who in turn sold it to a third party for $100,000. Jim also confessed to Bill that he had spent $50,000 in their mother’s bank account on gambling, and had declared bankruptcy. Bill retained us, but by then very little could be done without extensive and expensive litigation which most likely would not have been fruitful.

Lesson: The law books are full of estate cases in which family members have taken advantage of each other. Greed unfortunately trumps kinship. It is wise to hire a lawyer at the earliest opportunity in estate cases and have that lawyer monitor what is happening and what should be happening. The law gives the administrator/executor of an estate broad discretion to act, and often spend the estate’s funds to defend themselves if they are accused of improprieties. It is preferable to hire a lawyer to monitor the situation, than spend many times that amount to sue an administrator whose fees are covered by estate resources.