Your Hero Is on the Way...

CALL (210) 460-0424 FOR A FREE CONSULTATION - WE FIGHT FOR THE COMPENSATION YOU DESERVE!

A Family Owned Firm With Over 15 Years of Service - We're the "Personal Side of Personal Injury!"℠
GET SCUTT LAW NOW!

A primer on consideration and the law of contracts

adminGeneral

In order for a contract to be legally enforceable, there must be some sort of legitimate consideration. What is “consideration”? Consideration is a bargained-for change in legal position between the parties. Basically, two elements must be present for a valid contract to exist. First, there must be a bargained-for exchange between the parties. And second, that which is bargained for must have legal value (it must be a detriment to the person to whom the promise is made, and should constitute a benefit to the person who makes the promise). Substitute doctrines may permit the enforcement of an agreement without consideration, but those are outside of the scope of this primer. An example of the elements of consideration may help with the concept:

Robert promises to sell his car to Jeffrey for $5,000 in exchange for Jeffrey’s promise to pay $5,000. Both elements of consideration (a detriment and a benefit) are found here. Robert’s promise was bargained for, and it induced a detriment to Jeffrey. Jeffrey’s detriment induced Robert to make the promise. Also, both parties suffered detriments. The detriment to Robert was the transfer of ownership of the car, and the detriment to Jeffrey was the payment of $5,000 to Robert.

Unless the promise induces a detriment and the detriment induces the promise, there is no “bargained-for exchange”.

Additionally, if either of the parties intended to make a gift, he or she was not bargaining for consideration. Also, “past consideration” is generally not sufficient consideration. For instance, if something was already given or performed before the promise was made, it will not satisfy the “bargain” requirement. Here is an example of past consideration:

Jennifer was about to be struck by a speeding car. Eva pushed her out of the car’s path, just in time to save her from being struck. However, Eva was herself struck by the car and was seriously injured. Jennifer later promised Eva that she would pay her $1,000 per month for life. There is no consideration because Eva did not bargain for Jennifer’s promise.

It should be noted here that there is substantial disagreement with this general rule, and therefore many exceptions exist to past consideration issues. However, it is important to be aware that past consideration can influence the legal sufficiency of a contract.

These are just a few things to consider when determining the validity of a contract. If you are contemplating entering into a contract, or if you would like to have an existing contract reviewed, you should contact a licensed attorney to determine the best course of action, or to preserve your legal rights.

*Disclaimer: The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.

Scutt Law, PLLC moves to The Alamo City!

adminGeneral

Scutt Law, PLLC is in the process of relocating to beautiful San Antonio, Texas! We are so excited, and are looking forward to a happy and prosperous new year in the Alamo City. Check back for updates and observations about our new home, and please bear with us as we settle in. We can always be reached via telephone at (512) 590-9903, and also via e mail at jessica@scuttlaw.com (and, of course, through the contact page of this website, as well!). Thank you to all of our Austin clients for making our time in Austin absolutely amazing, we are glad that we will only be about an hour or so away from you after the move. See you in San Antonio!

Good to know: Special warranty deeds

adminGeneral

Special warranty deeds are cropping up more and more in the current real estate market. In Texas, a special warranty deed gives less protection to a home purchaser than a general warranty deed, but more protection than a quitclaim deed. Each of these types of deeds mean something very different for the buyer.

A “general warranty deed” is the typical deed used in Texas in a real estate transaction. This deed gives the most protection to the purchaser. Why? Because when a seller makes a general warranty, the seller covenants with the buyer that not only has the seller not personally done anything to adversely affect the title being conveyed, but neither has anyone else who has ever owned the property. Therefore, if there is a defect in title, the purchaser has a cause of action against the seller, and a purchaser who has conveyed defective title under a general warranty deed will be liable to the buyer under this type of deed.

A “special warranty deed” is being used more frequently in the current real estate market where homes are being foreclosed on by banks and bought up by investors who “turn and burn” properties. This type of deed affords the buyer less remedies against the seller, because the seller is only warranting that the seller has not personally done anything to adversely affect the title being conveyed. This leaves the buyer with essentially no remedy against the seller in the case of a defect in title (unless, of course, the seller did something that caused a defect in title). The warranty limits claims to those claimed by the the seller (the current grantor) against previous grantors, and does not give the buyer a right to claims against the seller, as with a general warranty deed. This could lead to insurmountable hurdles in order to cure defects in title, since the person selling the property may or may not (depending on the type of title they hold) have a claim against prior owners for defects in title, and leaves the current buyer with few or no claims against the current seller.

A “quitclaim deed” affords very little protection to the purchaser. It is only a transfer of whatever interest the grantor (seller) has. Therefore, if the seller holds defective title, the buyer now holds defective title and has no claim against the seller. The buyer would then need to go back in time to the last party that sold the property under a general warranty deed in order to obtain relief for defective title. This affords essentially no protection to the buyer.

In the current real estate market, special warranty deeds are appearing quite a bit. If you are considering purchasing a home and the seller attempts to give you a special warranty deed, think twice. If you are prepared to move forward on a real estate purchase that affords you no remedy against the current seller, at least be sure to include that consideration in your negotiations with the seller. Most importantly, make sure that any contract you sign is reviewed by a competent attorney to make sure that your rights are protected. For most people, the purchase of a home is the largest investment they will ever make, and it is best to make sure it is done right.

*Disclaimer: The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.

The beauty of the Series LLC

adminGeneral

Thinking about forming an LLC? Consider forming a Texas series LLC. Texas is one of only eight states that offers this, and it is a wonderful tool that prevents the need for the formation of multiple LLC’s. It is especially handy if you are interested in holding different types of properties.

For instance, instead of having to form an LLC for each property, with a series LLC, you can hold each property distinctly separate from each other in one LLC. So, let’s say your LLC is called “My, LLC.” You may then hold property #1 in “My, LLC, A,” property #2 in “My, LLC, B,” property #3 in “My, LLC, C.” and so on. This allows the liabilities of each property to remain insulated from the others, so if one property were to go into foreclosure, the other properties would be protected. If all of the properties were instead held under one LLC, that foreclosure would affect the other properties, even if they were successful in their own right. Alternatively, using the series LLC prevents the headache of having to form an LLC for each property.

Series LLC’s are a great tool provided by the Texas Legislature, and they are worth a look if you are considering forming an LLC. Remember, you should always get advice from both a tax professional and an attorney prior to forming any business to determine the tax implications, and to select the correct form of business for your needs.

*Disclaimer: The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.

GOOD TO KNOW: THE EPA’S RENOVATION, REPAIR & PAINTING (RRP) PROGRAM RULE

adminGeneral

So many homes and workplaces are being renovated today…one can hardly drive a block or two in downtown Austin without running into another charming old home being rehabbed for use as an office or hip new condo. But before you buy a renovated home or office, or have a building renovated, you need to be aware of the dangers of lead paint. If you live or work in a home or office that was built prior to 1978, chances are that lead paint is present there. It only takes a small amount of lead paint to cause serious damage, especially to infants and pregnant women. Renovations are dangerous because activities like sanding, cutting, and demolition can create hazardous lead dust and chips by disturbing lead-based paint.

Therefore, to protect against this risk, on April 22, 2008, the United States Environmental Protection Agency (EPA) issued a rule requiring the use of lead-safe practices and other actions aimed at preventing lead poisoning. Under the rule, beginning April 22, 2010, contractors performing renovation, repair and painting projects that disturb lead-based paint in homes, child care facilities, and schools built before 1978 must be certified and must follow specific work practices to prevent lead contamination. This certification requirement applies to renovation contractors and maintenance workers in multi-family housing as well as painters and other specialty trades. Individuals can become certified renovators by taking an eight-hour training course from an EPA-approved training provider.

For more information about the EPA’s new RRP Program Rule, please visit the EPA website at: www.epa.gov/lead/pubs/renovation.htm.

Scutt Law, PLLC takes a moment to honor the men and women who serve and have served

adminGeneral

On Veteran’s Day, Scutt Law, PLLC would like to take a moment to honor those military men and women who serve in our military, as well as the Veterans who have served for our great country. It is easy to go about our daily lives without stopping to think about the people who give their lives for us each and every day. Thank you, and we salute you!

In memory of Dr. Harold J. Kieffer, DC

Veteran of the United States Navy,

World War II

March 21, 1928 – November 18, 2000

CLICK TO CALL NOW!