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Super Lawyers

Four Mette, Evans & Woodside Attorneys Named “Super Lawyers”

Super Lawyers

Attorneys pictured (left to right): Kathryn Simpson, James Goldsmith, Michael Farrell & Victoria Edwards

Mette, Evans & Woodside attorneys Kathryn L. Simpson, James L. Goldsmith and Michael A. Farrell were named as top attorneys in Pennsylvania by Super Lawyers. Attorney Victoria P. Edwards was also recognized by Super Lawyer as a Rising Star. The Super Lawyers honor is reserved for attorneys who exhibit excellence in their legal practice with just five percent achieving the recognition in the state.

Ms. Simpson’s practice is in commercial litigation, professional liability defense, labor and employment, and health law. Since 2004, Ms. Simpson has been recognized as a Super Lawyer for her litigation work. She is a frequent speaker and author of continuing legal education course materials for the Pennsylvania Bar Institute.

Mr. Goldsmith focuses his practice on professional liability defense, professional licensure defense and real estate litigation. Since 2006, he has been recognized in the professional liability defense category. Mr. Goldsmith also provides legal expertise to professional trade associations such as the Pennsylvania State Association of Boroughs, and several Associations of REALTORS® across Pennsylvania.

Mr. Farrell, who has been recognized for seven years, has been practicing in the field of insurance defense litigation for 32 years. He is a certified specialist in the practice of workers’ compensation law by the Pennsylvania Bar Association’s Section on Workers’ Compensation Law as authorized by the Pennsylvania Supreme Court. He has published articles and has taught seminars relating to Pennsylvania Workers’ Compensation Law.

Ms. Edwards dedicates her practice to workers’ compensation and social security disability. Since 2016, she has been recognized as a Rising Star by Super Lawyers. Ms. Edwards also is a certified specialist in the practice of workers’ compensation law by the Pennsylvania Bar Association’s Section on Workers’ Compensation Law as authorized by the Pennsylvania Supreme Court.

“Having so many of our attorneys recognized as “Super Lawyers” over the last decade is a testament to Mette, Evans & Woodside’s dedication to providing top-notch legal counsel,” said the firm’s President Tim Hoy. “We’re proud to have these outstanding attorneys as a part of our legal team.”

Mette, Evans & Woodside has a long-standing tradition of providing comprehensive legal representation in Litigation, Estates and Trusts, Business and Real Estate. Founded in 1969, the firm provides clients throughout Pennsylvania with sound legal counsel for all facets of their professional and personal life.

Getting Creative

By James L. Goldsmith, Esquire

Agreement Photo

The most dangerous clause in the Standard Agreement for the Sale of Real Estate (ASR) is found in our current Paragraph 32(B), Additional Terms. Here’s where agents can let loose with the most creative use of the pen imaginable! A problem is, that when these works of art fail for any reason, they are likely to penalize the author (agent) and his or her client. Most of you are familiar with the legal maxim “ambiguities are construed against the drafter.”

We, the Hotline attorneys, hear from many of you who understand the potential risk of drafting special clauses and who want us to provide the language. Involvement in a specific transaction is beyond the scope of what the Hotline provides, but I understand why you ask. You really want to help your client even if it involves undertaking a job with which you are not completely comfortable. You think your client may think less of you if you say that this is something you don’t traditionally provide or that feel uncomfortable drafting the language.

Entering into an agreement of sale involves risk. The risk belongs to the buyer and seller. Drafting unique provisions that may be required in a particular transaction has tremendous impact on the buyer and seller. Out of concern for your client, it is best to refer them to a lawyer experienced in the type of transaction in which your client is involved.

Some modifications may be easily made without resorting to lawyers. Unless the modification is one commonly made, discuss the issue with your broker or office manager and have them review any language you propose. Better to have someone else draft it and have it be their problem.

To be sure, the Pennsylvania Supreme Court has ruled that real estate licensees may draft agreements that arise from the efforts of a licensee in a specific transaction without engaging in the unauthorized practice of law. That decision, however, dates back to 1934 and times have changed. Today, it is fairly easy to rely on the standard agreement and the many standard addenda available. It’s rare that a transaction calls for unique or specialized language and if that is the case then it’s likely to be a complicated provision. Rather than tackle a drafting challenge, refer the buyer or seller to their lawyer. Not only will you duck any potential bullet, you won’t have the angst of doing something you are uncomfortable with. Not only that, your pay remains the same and your client is getting the level of service he or she needs.

When a Hotline caller asks me to help draft special clauses I, of course, delve into the situation and the need for unique language. The explanations vary. One recent caller was trying to accommodate a 1031 exchange. I asked how many 1031 exchanges the agent had handled and the answer was “this is my first!” I advised that after 40 years of practicing law I did not feel comfortable handling 1031 exchanges as I’ve referred these transactions to my tax attorney partners in the practice who know what they are talking about. Tell the client that the task falls outside of the scope of what a licensee skilled in the marketing and sale of real property generally undertakes. Refer your client to an attorney. It is my belief, that undertaking such a task may very well fall under the unauthorized practice of law, in addition to subjecting you to license revocation or disciplinary measures.

Another caller was trying to draft a swimming pool inspection clause. This one was easy because it is already in the agreement in Paragraph 12, Home/Property Inspections. If you have any concern write that the swimming pool is one of the items to be inspected pursuant to the elected inspection provision.

Lawyers are criticized for taking a simple concept and turning it into a page-long provision. The reason, however, is that lawyers understand the importance that no ambiguities exist and that every “what if” is addressed so that there are no questions. And we don’t always get it right.

In this business the pen is indeed far mightier than the sword. Wield it carefully.

Copyright © James L. Goldsmith, Esquire, 2018
All Rights Reserved

What’s the Biggest Mistake a Licensed Professional Can Make, When Faced with a State Board Investigation Notice?

By: James Goldsmith. Esq.

James Goldsmith. Esq.

Responding on your own to a licensing investigation or meeting with the board investigator, without legal representation, is one of the biggest mistakes a licensed professional can make when faced with an investigation notice from the state board.

If you receive an investigation notice from the state’s professional licensing board, immediately contact an attorney who is knowledgeable in professional license defense and familiar with state licensing boards and the disciplinary process. Not having an experienced attorney to provide a vigorous defense can adversely impact the outcome of the inquiry and put your professional license in peril.

The laws and regulations surrounding Pennsylvania’s professional licensure are complex and can widely vary from one profession to another. Our attorneys have an in-depth understanding of professional licensing and provide experienced representation. From a wide range of issues, from representation at administrative hearings to complaint investigations and disciplinary actions we guide clients through each step of the process to protect their professional licenses.

A Question of Coverage

by James L. Goldsmith, Esq.

Mistakes happen. Consider the case of listing agent Robert. Robert happened to be on vacation when he received an offer at list price. He reviewed the standard form on his cell phone and reported to the sellers that it looked great. The agreement was executed electronically as was the sellers’ estimate of closing costs.

At settlement the sellers and listing agent were surprised that the net proceeds were $9,000 less than estimated. The reason: the agreement of sale called for seller assist that accounted for the $9,000 discrepancy. Robert has filed to take note when reviewing the offer on his cell phone. Nearly two years later when a claim was asserted and I was engaged to defend Robert, he readily admitted his error.

The claim asserted against Robert was a disciplinary complaint (order to show cause) filed by prosecutors with the Commonwealth of Pennsylvania, Bureau of Professional and Occupational Affairs. Robert was ready to sign my engagement letter, though I first suggested that he determine whether his errors and omissions (“E&O”) insurer would cover this. Many E&O carriers will pay defense costs for their insured’s involved in disciplinary matters, though they will not pay any fines levied. In most cases, a deductible will not apply.

Determining whether coverage existed was difficult. Robert was employed by Broker A on the date of his error. Though Robert then discussed the matter with his broker, his broker decided not to report it to the E&O carrier. Robert’s broker reasoned that the sellers were equally culpable for their loss because they failed to read the agreement of sale and because no threat of a suit had been communicated to her or Robert. Why risk having E&O rates increase over a report that does not come to fruition, the broker reasoned.

At the time of his receipt of the order to show cause, Robert was practicing with Broker B. At issue is whether Robert is insured for his defense costs and, if so, whether through the insurer for Broker A or Broker B.

My advice to Robert was to have both Broker A and B report the claim to their E&O insurers. Broker B did so and the quick response from the insurer was that there was no coverage. Robert was not affiliated with Broker B at the time of the occurrence.

Broker A was less compliant. Why report a claim for a past sales agent when it may lead to increased premiums? My advice to Robert was to insist that Broker A submit the claim. Robert’s contract with Broker A stated that Broker A would provide E&O coverage. Robert had kept his end of the deal as a sales affiliate, the broker who benefitted from Robert’s service should likewise fulfill her obligations. Broker A eventually relented and submitted the claim. Because the occurrence at issue happened while Robert was with Broker A, her coverage was the applicable policy and the claim should be covered.

Robert’s identifying the right E&O carrier was not the solution to Robert’s dilemma, unfortunately. All policies require claims and potential claims to be reported promptly and you will recall that Broker A upon learning of the matter had decided not to report it to her insurer! Years later when a case was initiated and after relenting to Robert’s demand that she report it, the E&O insurer wanted to know why the broker had not notified it of the problem. Whether Robert or his broker had knowledge of a potential claim. While the sellers did not threaten to file suit nor advise Robert that they would be filing a disciplinary matter, Robert certainly knew that his error might subject him to liability. And no, he didn’t make the report because as you read above, his broker did not want to do so.

Whether Robert will have coverage under Broker’s A insurance is, as of this writing, not determined. If Robert is denied coverage, does he have a claim against his broker for failing to report it to the E&O insurer at or near the time of the occurrence? There are too many issues to state with certainty, including Robert’s failure to insist that his broker report the occurrence. Regardless, it is a situation that pits an agent against his former broker.

The lessons to draw from this situation are several. When a mistake is detected, report it. Your premium is not increased because you have reported a potential claim. When a claim is subsequently filed, you can then determine whether you will have it covered through your E&O policy. [Note: I always suggest that an insured broker/agent submit a claim to their E&O insurer! It is risky not to do so because even the smallest claims can cost more to defend than imaginable and damages have a way of aggregating as time passes.]

Another important issue is determining what your coverage includes. Ask questions of your insurance agent. If a claim is asserted against a former sales agent, but does not include the broker as a defendant or respondent, does the former sales agent have coverage through the broker’s policy? Agents, ask questions of your brokers. When transferring to a new broker, find out who the E&O carrier is and ask questions about coverage for incidents that occurred previous to your employment. Learn the differences between a claims-based and an occurrence-based policy.

Lastly, and this is especially so if you determine that coverage exists, don’t fret. As I told Robert, his mistake was hardly a condemnation of his skills and competency. It happened. He has undoubtedly made worse mistakes that could have far graver consequences (e.g., looking at a text message while driving). It happened, it is not a “deathbed issue” (one that will be Robert’s last thought on that fateful day) or anything more than a financial burden. Make the right decisions with regard to E&O coverage and sleep peacefully.

Vituperativeness: Is There Ever a Reason?

Vituperativeness-Is-There-Ever-A-ReasonBy: James L. Goldsmith, Esq.

My wife and I were recently sharing a farewell dinner with a couple moving from the mid-state. Their home was sold and packed. They were letting down their hair after a week that was particularly demanding, both physically and mentally.

The wife of this couple, Betsy (not her real name) had called me a month earlier about their buyers’ demand to visit the house with a contractor to take measurements and make observations. The buyers’ agent claimed that this was one of two pre-settlement walk-through inspections to which the buyers were entitled. “Pre-settlement walk-through” is not defined in the agreement, but we know its purpose is to enable the buyer to assure that all conditions prerequisite to closing have been satisfied. Whether this was such a walk-through is not so important to this article and, in fact, Betsy would ordinarily have permitted it without a blink. The problem was that her parents were visiting from out of town on the day the buyers were demanding access for their entourage, and Betsy’s mother was recently found to be in the early stages of Alzheimer’s. Betsy’s adult children were in town and it just wasn’t a good time to have strangers bumping about the property. So, Betsy tried to put her foot down.

Ultimately the standoff was resolved and the buyers came through the property as they desired and Betsy’s angst was short-lived. The problem, and the point of this article, involves the communication between the buyers’ agent, demanding the visit, and the listing agent who was trying to guard her clients. Because the property is located in my neck of the woods, I knew both salespersons. I believed both to have sterling reputations and the buyers’ agent is on my short list of agents to whom I would gladly refer business and about whom I have given glowing reports.

Though the standoff between the buyers and sellers was brief, a few emails were lobbed from buyers’ agent to listing agent and back. Betsy was particularly distressed to read an email from the buyers’ agent that her agent forwarded it to Betsy. It referred to Betsy in rather unflattering terms. Had I been the listing agent I would not have forwarded it to my client, but would have passed along the relevant part of the message. No transaction benefits from high emotion and Betsy went off the rails upon reading the email.

By the time Betsy and her husband were sharing this story over our farewell dinner, she probably had repeated the same complaint to countless others; and I am sure she referenced the buyers’ agent by name. In a business, largely based on word-of-mouth, I can’t imagine how deleterious it is to have stories like this repeated.

By contrast, I recently defended a broker in an ethics proceeding brought by a consumer. The broker was not specifically involved in the transaction, but had provided advice to one of his agents who was representing the buyer. This broker, too, has a sterling reputation. I have never known him to be other than a gentleman in his comportment, dress and communication.

To properly defend him I asked and received all of his email exchanges with his agent. By contrast to the bomb Betsy received, this broker’s emails were thoughtful and considerate to the point where the introduction of his file would cast him in a good light, regardless of the relevance of the email to the issues at hand.

My immediate thought when reading his email was to contrast his approach to that involving Betsy’s situation. In fact, I talked to this broker about the contrast and how impressed I was that he was thoughtful and articulate in his email. He told me that he always made a point of doing so and always avoided invectives, vituperatives, and other euphemisms for insulting and abusive language. Fittingly, this is a man who always wears a suit and who at all times comports himself as a businessman, respectful of his colleagues, clients and adversaries.

There are other reasons for maintaining decorum in your communications. When defending brokers and agents, my first request is for a complete copy of all files including notes and email. I require the production of the same from adversaries through rules of court that require production of documents. Cases are won and lost on a judge’s and/or jury’s assessment of a plaintiff’s and defendant’s written communication. When a jury dislikes a party it is hard to overcome the prejudice. But even a party who’s made a critical error will garner sympathy from gentlemanly and gentlewomanly behavior. Save your invectives for private moments. Draft your written communications as though you will be judged by it.

Expletive Deleted

Expletive-DeletedBy James L. Goldsmith, Esq.

In news and other articles, another’s profanity is frequently replaced with “expletive deleted.” Some use the term in self-censorship. More often, we just let the expletives fly. At that moment it might feel quite good to do so; upon reflection, not so good. Realtors® hold no ownership on profanity or expletives deleted, the inspiration for this article did, however, arise in the context of a Realtor®-related dispute.

The matter involved the termination of a broker- salesperson relationship. The salesperson was moving on and the broker was quite unhappy. A dispute arose over payment for transactions that were pending at the time the salesperson gave notice, and about other money matters and file possession. The details matter to the disputants, but not so much to us.

The aggrieved salesperson enlisted the aid of an attorney who, like many of us, believe that every effort should be made to spare a brawl. He wrote to the broker and explained the issue from his client’s perspective and made a financial demand to be exchanged for a release from further liability.

Replies to a demand are best fashioned once one has cooled off. The broker, however, was not of this mind and before reading the entire letter called the attorney and let him have it. Expletive deleted. Expletive deleted. Expletive deleted.

Not unpredictably the broker’s call did not bring the lawyer to his knees or send him packing. Instead, the lawyer hastened to sue the broker and brokerage. The broker assumed his errors and omissions insurance policy would cover the costs of defense and losses, if any. It did not. The matter was not asserted by a consumer claiming to have been harmed by the Realtor®’s malpractice. By the time the insurer declined coverage, the broker was beyond the 20 days provided to respond to the complaint. The lawyer sent a 10-day notice of intent to take a default judgment and assured the broker, in writing, that there would be no extension of time for any reason (most lawyers will grant an extension). It seems that the broker’s initial telephone call had left its mark!

It was I who was ultimately engaged by the broker to defend the suit. Noting the notice of intent to take a default, I immediately called the Plaintiff’s lawyer and after introducing myself and the matter in which I had been engaged, I was cut off. There followed a well-articulated harangue about what an EXPLETIVE DELETED my client was! I would receive no courtesy (no personal animosity intended) and that the lawyer and his clients would not capitulate, mediate or take any action that might resolve the matter without my client having to pay the maximum penalty. Further, as a result of my client not deleting his expletives, but instead letting it all hang out there in that call, the agent was going to the Real Estate Commission to file a complaint.

In my 40 years of practice I have had exchanges with opposing counsel that had been, expletive deleted, miserable. But I know I will not make another attorney unball his fist because of what I say. While their credibility may be markedly diminished in my eyes due to their rants, I do not reply in kind. “We will agree to disagree” conveys enough.

I know my broker client will spend much more in attorneys’ fees because of that call. My broker client has lost the ability to compromise a claim because of that call. My broker will suffer a slight loss of credibility in the eyes of one or a few folks because of that call.

Animus is not our friend. A heightened emotional state can bring out the worst. We reveal information we might otherwise hold back. We arouse anger in others and jeopardize compromise that might be in our client’s best interest.

So what to do when the position taken by another player in our transactional setting is annoying if not angering? First, take a chill pill. Feign another call or a situation that calls for you to remove yourself from the conversation. Cool down and call back later.

Second, orient yourself. The transaction is not about you, but rather your client. The client bears the fallout though you may lose a fee. Divest yourself of some baggage by understanding who it is that benefits or loses from the situation. Client disappointment comes with the territory. While your client deserves your best effort, this is not a situation where a ship is sinking or you are losing a loved one. Stay oriented.

Third, take advantage of your adversary’s emotional state. Let him or her talk. You might get something. Ask for the basis of their position: “I’d like to understand your position and will give you the floor and listen to the reasons by which you conclude . . .” Ask for supporting articles or citations that support their position. I’d prefer to see the cards my adversary is holding so that I can best prepare a course that will most benefit my client.

There must be dozens of other helpful tips, and I’d love you to share yours with me. I’ll leave you with this broad principle. Consider your own reputation and comport yourself in a way that does nothing but enhance it. Be the voice of reason, particularly when in an adversarial situation. How can it be any better than to be well regarded by the person with whom you are having a dispute? Be firm, but be willing to be wrong if indeed you are. My standard line when defending a Realtor® in litigation is to say something to the affect that if you are right I will be more than happy to help you reach a fair resolution and get the funds to which you are deserving; on the other hand, I need a factual basis by which you conclude my client’s liability.” If my client has committed a wrong, I’d rather have a dispassionate opposing counsel who is willing to discount the loss in exchange for a prompt resolution. When my Realtor® client has beat me to the punch and has ranted and raved at the attorney . . . well my chances are way less than otherwise.

A Listing Agent’s Right to See your Buyer Agency Contract

Buyer-agency-contractBy James L. Goldsmith, Esq.

Does a listing agent have a right to see your buyer agency contract? At the moment, I can’t think of a good reason! It is not prerequisite to your being paid a cooperating commission. Your entitlement to that is wholly dependent upon whether you are the procuring cause of the sale. The terms of cooperation, established by your local MLS, make that clear. It is NAR’s policy, applicable to Realtor owned multi-list systems, that the only prerequisite to a fee is procuring cause.

The Real Estate Licensing and Registration Act (RELRA) provides that a licensee may not perform a service for a consumer for a . . . commission . . . paid buyer on behalf of the consumer unless the nature of the service and the fee to be charged are set forth in a written agreement between the broker and the consumer that is signed by the consumer. See my article entitled “Buyer agency contracts: When?” recently published by your local association.

As noted in the above-referenced article, services may be performed before the employment contract is signed ” . . . but the licensee is not entitled to recover a fee, commission or other valuable consideration in the absence of such a signed contract.” So, can a listing broker demand to see a buyer agency contract of the broker whose office procured a buyer as prerequisite to payment? I suggest that the answer is no, and I am not aware of any case that has held to the contrary. That a buyer agent is to have a written contract with a consumer in order to be paid is clear from the language quoted from RELRA. But is also flies in the face of the contract establishing payment terms between listing broker and selling broker that are established by the multi-list. It’s only predicate is that the buyer agent procured the buyer.

I have no doubt that a buyer agent would not succeed in recovering a commission to be paid directly by the buyer in the absence of a written contract signed by the buyer. So why is a listing broker obligated to pay the fee offered in the MLS to a buyer agent without a contract? Because the relationship between the listing and selling agents are established by the terms of the MLS where there is but one prerequisite to payment: procuring cause.

It is possible then for a selling agent to succeed in Realtor® arbitration against the listing broker who promised to pay a fee, but also face disciplinary charges for not having a written buyer agency contract. Disciplinary charges are handled by the Bureau of Professional and Occupational Affairs which is concerned primarily with the enforcement of RELRA and the Rules and Regulations of the Commission and not interested in terms of cooperation as provided by the multi-list service. Further, in a direct suit filed by a selling broker against a buyer, the broker’s efforts would fail because of lack of a signed contract.

The question of whether a listing broker can demand to see a buyer agent’s contract should be irrelevant in a world where agency contracts are executed at the beginning of the relationship. No buyer agent should find himself or herself without a contract when an agreement of sale is executed much less when settlement occurs. Yet, it happens.

So, can a listing broker ever demand to see the buyer agency contract? Perhaps there is a situation that would justify it, but none come to mind at this writing. Can buyer agents demand to see a listing broker’s contract? It never happens, but then again it’s a rarity for someone to take a listing without also having a signed listing contract. By the way, if the norm is to get a listing contract at the beginning of the relationship, why doesn’t that hold true for buyer agency contracts?

Super Lawyers

Four Mette, Evans & Woodside Attorneys Named “Super Lawyers”

Super Lawyers

Attorneys pictured (left to right): Kathryn Simpson, James Goldsmith, Michael Farrell & Victoria Edwards

Mette, Evans & Woodside attorneys Kathryn L. Simpson, James L. Goldsmith and Michael A. Farrell were named as top attorneys in Pennsylvania by Super Lawyers. Attorney Victoria P. Edwards was also recognized by Super Lawyer as a Rising Star. The Super Lawyers honor is reserved for attorneys who exhibit excellence in their legal practice, with just five percent achieving the recognition in the state.

Ms. Simpson’s practice is in Commercial Litigation, Employment Law, Health Law and Mediation & Arbitration. This is the ninth year that Ms. Simpson has been recognized as a Super Lawyer for her work in business litigation. She is a frequent speaker and author of continuing legal education course materials for the Pennsylvania Bar Institute.

Mr. Goldsmith focuses his practice in professional licensure defense and real estate litigation. He was recognized in the professional defense category. He has also provided legal expertise to professional trade associations such as the Pennsylvania State Association of Boroughs, and currently the Pennsylvania Association of REALTORS®, the Greater Philadelphia and Harrisburg Associations of REALTORS® and the Greater Scranton Association of REALTORS®. He has written and lectured extensively on real estate issues.

Mr. Farrell’s practice is in the defense of workers’ compensation claims. Mr. Farrell is a certified specialist in the practice of workers’ compensation law by the Pennsylvania Bar Association’s Section on Workers’ Compensation Law as authorized by the Pennsylvania Supreme Court. Mr. Farrell is a member of the Dauphin County and Pennsylvania Bar Associations, where he is also a member of several sections related to workers’ compensation and civil litigation. He has published articles and has taught seminars relating to Pennsylvania Workers’ Compensation Law.

Ms. Edwards dedicates her practice to workers’ compensation and social security disability. Ms. Edwards also is a certified specialist in the practice of workers’ compensation law by the Pennsylvania Bar Association’s Section on Workers’ Compensation Law as authorized by the Pennsylvania Supreme Court.

“The Super Lawyer recognition of four attorneys in the firm is a confirmation of Mette, Evans & Woodside’s dedication to providing top-notch legal counsel,” said the firm’s President Tim Hoy. “We’re proud to have these outstanding attorneys on staff.”

The selections for Super Lawyers are held each year as a result of a rigorous multi-phase selection process that includes a statewide survey of lawyers; independent evaluation of candidates by Law & Politics’ attorney-led research staff; a peer review of candidates by practice area and a good-standing and disciplinary check.

Mette, Evans & Woodside has a long-standing tradition of providing comprehensive legal representation in Litigation, Estates and Trusts, Business and Real Estate. Founded in 1969, the firm provides clients throughout Pennsylvania with sound legal counsel for all facets of their professional and personal life.