Troubleshooting Real Estate Transaction Problems Seminar in Philadelphia, PA

Troubleshooting Real Estate Transaction Problems Seminar in Philadelphia, PA on March 2, 2015

Harper J. Dimmerman, Attorney at Law, focuses his law practice of real estate law. He handles both litigation and transactional matters: (215) 545-0600. If you need an attorney for settlement, negotiation, For Sale by Owner (FSBO) transactions or litigation (mechanics’ liens, confession of judgment, partition, trespass, landlord tenant, foreclosure defense, ejectment, quiet title, breach of contract, contract litigation, seller disclosure fraud, home inspection cases, realtor negligence cases, amongst others).

Mr. Dimmerman will be lecturing to other attorneys on the topic of real estate law and ethics. The full outline (copyright NBI 2015) may be accessed here: http://www.nbi-sems.com/Enbi/Faculty/68011.pdf

The outline for the ethics portion is as follows:

  1. Applying Rules of Professional Conduct in Real Estate Practice
  2. Multiple Representation and Conflicts of Interest
  3. Disclosure Requirements
  4. Dealing with Unrepresented Parties
  5. Attorney Fees

 

Philadelphia Confession of Judgment Defense

Philadelphia Confession of Judgment Defense

Harper J. Dimmerman, Attorney at Law, focuses his law practice of real estate law. He handles both litigation and transactional matters: (215) 545-0600. If you need an attorney for settlement, negotiation, For Sale by Owner (FSBO) transactions or litigation (mechanics’ liens, confession of judgment, partition, landlord tenant, foreclosure defense, ejectment, quiet title, breach of contract, contract litigation, seller disclosure fraud, home inspection cases, realtor negligence cases, amongst others).

Pennsylvania’s Rules of Civil Procedure does permit a defendant to challenge a confession judgment, which is mechanism employed by commercial lenders and landlords in the Commonwealth of Pennsylvania. Upon default, the lender or landlord may confess judgment, assuming that the proper contractual disclosures have been made. This remedy is generally perceived as highly draconian, in that the party alleging a default may have the ability to take an immediate judgment against the other party and for substantial sums of money. If you are the defendant in this type of action, it is imperative that you act promptly and assert any and all defenses. A party’s failure to do this could easily result in a crippling judgment against the defendant.

The pertinent Rule of Civil Procedure provides the following:

“Striking off or Opening Judgment. Pleadings. Procedure

(a)(1)  Relief from a judgment by confession shall be sought by petition. Except as provided in subparagraph (2), all grounds for relief whether to strike off the judgment or to open it must be asserted in a single petition. The petition may be filed in the county in which the judgment was originally entered, in any county to which the judgment has been transferred or in any other county in which the sheriff has received a writ of execution directed to the sheriff to enforce the judgment.

(2)  The ground that the waiver of the due process rights of notice and hearing was not voluntary, intelligent and knowing shall be raised only

(i)   in support of a further request for a stay of execution where the court has not stayed execution despite the timely filing of a petition for relief from the judgment and the presentation of prima facie evidence of a defense; and

(ii)   as provided by Rule 2958.3 or Rule 2973.3.

(3)  If written notice is served upon the petitioner pursuant to Rule 2956.1(c)(2) or Rule 2973.1(c), the petition shall be filed within thirty days after such service. Unless the defendant can demonstrate that there were compelling reasons for the delay, a petition not timely filed shall be denied.

(b)  If the petition states prima facie grounds for relief the court shall issue a rule to show cause and may grant a stay of proceedings. After being served with a copy of the petition the plaintiff shall file an answer on or before the return day of the rule. The return day of the rule shall be fixed by the court by local rule or special order

(c)  A party waives all defenses and objections which are not included in the petition or answer.

(d)  The petition and the rule to show cause and the answer shall be served as provided in Rule 440.

(e)  The court shall dispose of the rule on petition and answer, and on any testimony, depositions, admissions and other evidence. The court for cause shown may stay proceedings on the petition insofar as it seeks to open the judgment pending disposition of the application to strike off the judgment. If evidence is produced which in a jury trial would require the issues to be submitted to the jury the court shall open the judgment.

(f)  The lien of the judgment or of any levy or attachment shall be preserved while the proceedings to strike off or open the judgment are pending.

(g)(1)  A judgment shall not be stricken or opened because of a creditor’s failure to provide a debtor with instructions imposed by an existing statute, if any, regarding procedures to follow to strike a judgment or regarding any rights available to an incorrectly identified debtor.

(2)  Subdivision (g)(1) shall apply to (1) judgments entered prior to the effective date of subdivision (g) which have not been stricken or opened as of the effective date and (2) judgments entered on or after the effective date.”

Philadelphia Foreclosure Defense Lawyer

Philadelphia Foreclosure Defense Lawyer

Harper J. Dimmerman, Attorney at Law, focuses his law practice of real estate law. He handles both litigation and transactional matters. If you need an attorney for settlement, negotiation, For Sale by Owner transactions or litigation (mechanics’ liens, confession of judgment, partition, landlord tenant, foreclosure defense, ejectment, quiet title, breach of contract, contract litigation, seller disclosure fraud, home inspection cases, realtor negligence cases, amongst others).

It is critical that you defend the foreclosure litigation immediately, even if you may be endeavoring to achieve a short sale or work out some other agreement with the lender. Failure to respond accordingly will lead to a default judgment being taken against you, thereby making the prospect of resolving the situation amicably far more challenging. The failure to answer the complaint in foreclosure will be viewed by a court as an admission of the truth of all of the bank’s averments, some of which may not be entirely accurate. Finally, assuming that a court will simply permit the borrower to open that judgment and have a second bite at the apple, if you will, is a highly risky assumption.

Philadelphia Real Estate Lawyer

Philadelphia Real Estate Lawyer

Harper J. Dimmerman, Attorney at Law, focuses his law practice of real estate law. He handles both litigation and transactional matters. If you need an attorney for settlement, negotiation, For Sale by Owner transactions or litigation (mechanics’ liens, confession of judgment, partition, landlord tenant, foreclosure defense, ejectment, quiet title, breach of contract, contract litigation, seller disclosure fraud, home inspection cases, realtor negligence cases, amongst others).

Alert:

Philadelphia’s tax abatement program is a wonderful incentive for homebuyers. However, even when these abatements have been approved and advertised as such, buyers are running into a major problem upon taking ownership if the seller/selling entity has other outstanding tax liabilities with the City of Philadelphia. In these instances, the innocent buyer may not receive the benefit of the abatement, potentially costing that buyer(s) tens of thousands of dollars in unanticipated taxes. Thus, even with title insurance, it is essential that a real estate lawyer be engaged prior to closing to ensure that written documentation be obtained from the City of Philadelphia to confirm that the abatement is ripe.

Philadelphia Legal Malpractice Lawyer

Philadelphia Legal Malpractice Lawyer

Harper J. Dimmerman, Attorney, is a seasoned litigator and has recently added legal malpractice law as a new area of practice.

Statutes of limitation in any litigation matter in Pennsylvania oftentimes present serious roadblocks for otherwise viable claims. In the realm of legal malpractice, generally two years is the operative time frame which an aggrieved party has to bring a claim. Potential plaintiffs frequently ask when this clock begins to run, if you will. The simple answer is that this period commences as soon as the conduct which forms the basis of the action occurs: the happening of the alleged breach of duty. For practical purposes then, this clock may start even during the representation period, with the lawyer or law firm that could possibly be the subject of that very legal malpractice suit.

 

Pennsylvania Real Estate Article Published by “The Legal Intelligencer”/May 2014/Harper J. Dimmerman, Esquire

Lessor Beware: Estoppel by Deed in Oil and Gas Leases Comes to Pennsylvania

ALM 2014. Republication without express written consent is unauthorized.

 By: James M. Lammendola and Harper J. Dimmerman

      “Where a party conveys land to which he had no title, or a defective title, and afterwards acquired a good title, that title immediately inures to the benefit of the grantee.” Dixon v. Fuller, 46 A. 553, (Pa. 1900). This legal principle, enunciated by the Pennsylvania Court more than century ago, represents the essence of the doctrine of estoppel by deed. Still alive and well, this same doctrine, was applied in a notable Superior Court decision, Shedden v. Anadarko E&P Company, L.P, 2014 PA Super 53 (filed March 14, 2014). The result was that Anadarko E & P Company (Anadarko) subsequently secured the rights to more acreage that the Shedden’s actually owned at the time the oil and gas lease agreement was executed. This case illustrates the critical need of a grantor to know the exact extent of his or her ownership interest when conveying an ownership or leasehold interest.

       The facts are relatively straightforward. On May 23, 2006, Leo and Sandra L. Shedden (Shedden) leased oil and gas rights to Anadarko. The property is located in Tioga County and the Shedden’s represented the parcel to be 62 acres. The term of the lease was five years, with one option to extend for another five years. The lease stated that “[i]f Lessor owns less than all of the oil and gas rights in the premises, Lessor shall be entitled to only a share of the rentals and royalties equivalent to the proportion of such oil and gas owned by Lessor.” Id. Critically, the also lease contained the following covenant of warranty provision: “Lessor covenants and agrees that . . . Lessor has full title to the premises and to all the oil and gas therein at the time of granting this Lease, and forever warrants title to the leasehold estate hereby conveyed to Lessee, that Lessee shall have exclusive, full and quiet possession of the premises . . .” Id.

     Upon the execution of the contract, Anadarko remitted a bonus payment to the Shedden’s for 62 acres. In short order, the land agent for Anadarko learned that the Shedden’s only had title to 31 acres. An 1894 deed was discovered in the names of Ezra and Emma Baxter that had reserved to them one-half of the subject oil and gas rights. Subsequently, Anadarko sent a reduced bonus payment for 31 instead of 62 acres. Two years later, the Shedden’s moved to quiet title on the Baxter’s reserved interest; the lower court granted the relief on July 20, 2008. On March 31, 2011, Anadarko sent a check representing an extension payment, with the amount calculated based on all 62 acres. The Shedden’s refused to cash the extension payment, contending that it amounted to an overpayment since the 2006 lease was for 31 acres.

          On October 21, 2011, the Shedden’s commenced litigation against Anadarko, in an effort to obtain a declaratory judgment regarding the issue of whether the underlying 2006 lease was restricted to 31 acres. Anadarko eventually moved for summary judgment, arguing estoppel and estoppel by deed. Shedden’s position was that they lacked the ability to lease the entire 62 acres because they did not own 62 acres when the 2006 lease was executed. They also contended that the initial bonus payment (for 31 acres) amended the lease. The trial court granted Anadarko’s summary judgment motion and the instant appeal ensued.

         In considering the parties’ arguments, theCourt focused on the well-settled equitable doctrine of estoppel by deed. As previously noted in Dixon v. Fuller, supra , when a party conveys defective title and subsequently acquires good title, the grantee immediately is possessed of good title. Dixon holds when “one conveys land with a covenant of warranty against all lawful claims and demands, he cannot be allowed to set up against his grantee, or those claiming under him, any title subsequently acquired by him by purchase or otherwise.” The Court also cited Hennebont Co. v. Kroger Co., 289 A.2d 229, 233 (Pa. Super. 1972) which held that “[w]here one leases property which he at such time does not own and afterwards acquires ownership of such property and then attempts to repudiate the lease, he is estopped from denying the lease on the grounds that he did not have the power to lease the property at the time of the lease.”

             In footnote 3, the Court observed that this is the first Pennsylvania appellate court to apply estoppel by deed in an oil and gas lease dispute. While recognizing that pronouncements of sister states are not binding in Pennsylvania, the court noted holdings by the Supreme Courts of Oklahoma, Greenshields v. Superior Oil Co. 233 P. 2d 959 (1951)  and Texas Duhig v Peavy-Moore Lumber Co. 144 S.W. 878 (1940) that recognize estoppel by deed in the context of oil and gas lease disputes.

          Essentially the covenant of warranty in an oil and gas lease has the same legal effect as a warranty in a special or general warranty deed. Consequently, theCourt was not persuaded by the argument that the initial payment based on 31 acres somehow altered the terms of the lease, The provision in the lease which envisaged the possibility of a lesser payment commensurate with a lesser ownership interest had no effect on Anadarko’s rights, given the breadth the warranty.

          As energy giants such as Anadarko continue to explore for natural gas in Pennsylvania’s Marcellus Shale, our courts may continue to examine the jurisprudence other energy producing states. The consequences are great under the application of this doctrine for unsuspecting landowners. Lessors of land with natural gas deposits, or any minerals, would be well-served to closely craft the language of their leases to exclude any after-acquired property. A lease with limiting language similar to that of a quitclaim deed would serve to limit the scope of the lease should a lessor subsequently learn that his ownership interest is greater than he realized.

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Harper J. Dimmerman is an Adjunct Professor at Temple University’s Fox School of Business. His office represents clients in various litigation and real estate law matters and he may be reached via e-email at hdimmerman@llfnow.com or telephone 215-545-0600.

James M. Lammendola is an Assistant Professor at Temple University’s Fox School of Business who was in private practice for twenty years. He may be reached via e-mail at james.lammendola@temple.edu or telephone 215-204-4124.