If you have a legal problem and know you need a lawyer, the first question that comes to mind is "Who do I get?" Here are some things to look out for while choosing the right lawyer for you.
1. How do I find a lawyer in the first place?
Your first resource is a lawyer you've used before, so long as you were satisfied with their services. That lawyer may be able to help you with your current problem, or at least refer you to someone who is familiar with that area of the law.
Many state bars or bar associations have referral programs that can help you find a lawyer in your area. Google the name of your state along with the word 'bar' or 'bar association' to find the website, and then see if there is a tab for a referral service within the site. Here's the one for North Carolina:
Word-of-mouth referrals from people you know can also be valuable. Ask your friends and acquaintances if they've ever used a lawyer and how satisfied they were with the results.
Check your local yellow-pages listings as well. Most yellow pages sections have sub-headings within the 'attorney' section, such as 'divorce', 'real estate', criminal and traffic', and the like. Even if they don't handle your type of case, most attorneys keep a list of attorneys to whom they refer cases
3. Is the lawyer familiar with the type of law that covers your problem?
The days of 'one size fits all' lawyers are pretty much over. Law practice has become so complex that even country lawyers have to narrow the scope of their practices. You want someone who is either thoroughly familiar with they type of law needed, or who has the time to catch up very quickly.
4. Should you have to pay the lawyer to 'catch up' on the law?
That depends on the nature of your case. Most lawyers should have a good foundation in the particular area of law, and you shouldn't have to pay for that general education. But resarch that bears more directly on the facts of your particular case may involve billable time. Your lawyer will need to be properly armed with relevant and current case law directly related to your problem.
5. Should you go to a 'TV' lawyer?
Again, this depends on the nature of your case. Most lawyers who advertise heavily on television handle only personal injury, medical malpractice, or other such cases where high-dollar amounts are involved and there are insurance companies available to pay the bill if they win. They generally will have quite a bit of experience and may be the best ones to handle the case if you've been injured by someone else. If not, you might want to go to their website to see if they handle the type of case you have.
6. Will you be able to talk directly to the lawyer?
Many tasks in larger law firms are handled by paralegals and other staff, but you should always have the opportunity to speak directly with the lawyer. Your lawyer should be the one who explains major legal issues to you. On the other hand, costs can be held down when you deal with staff on the day-to-day tasks.
7. Is it important to know the lawyer's win-loss record in court?
You'd probably want to avoid using a lawyer who never wins a case, but the win-loss record doesn't always tell the whole story. A lawyer with a very high win record in court may be one who only takes on cases that look like winners from the start. A lawyer who doesn't have such a high win record might be one who's willing to take on more difficult cases that still might have a chance. Every case that goes to trial has one winner and one loser, which means that half the lawyers who take cases to trial lose. (In a later post, we'll talk about alternatives to trial.)
8. Can you 'fire' a lawyer?
By all means, if you don't feel that your lawyer is doing a good job for you, you can get another lawyer. You should express your dissatisfaction with the lawyer first and see if there's a way to fix the relationship. Also, it's best not to fire the lawyer right before some imoportant date in the course of the trial.
If you do engage another lawyer, be sure that the first one does a proper withdrawal from the case and that you get your file back. In North Carolina, the lawyer's own notes, etc., are not part of the file that must be returned. Also, North Carolina does not allow a lawyer to hold your file 'hostage' if you haven't paid all the fees. You may be liable for fees due to the lawyer, but you can still retrieve your file right away.
I hope these suggestions have been helpful. If you have more questions, please be sure to ask.
Friday, April 16, 2010
Wednesday, January 13, 2010
Trial Evidence
When a trial is held, both sides want to get in as much evidence as they can that they think will convince a jury to see things their way. Over the years, courts have had to grapple with the issue of what a jury should be able to hear and see, and a key job for the judge in a trial is to determine what should be allowed and what should be kept out.
Eventually, sets of rules were developed to guide judges as they decided issues of evidence. In North Carolina, the rules are written out in Chapter 8C of the General Statutes.
Evidence for a trial might consist of eyewitness testimony, a document or set of documents, three-dimensional objects, audio or video recordings of some kind, or other things that can help tell the story of what happened.
Very often, before a trial, the attorneys will stipulate, or agree, that certain kinds of evidence will be allowed without objection. When there is really no argument that the evidence should be heard or seen, this helps shorten the trial and makes the process smoother for everyone. However, sometimes attorneys for one side or the other would rather that certain critical bits of evidence not be seen by the jury.
If someone objects to any evidence being used at trial, then the judge must use the rules as a guideline to decide whether the jury should see or hear it. One initial threshold for the evidence to pass is whether it is 'relevant' to the issues being tried. In other words, would it make any difference to the outcome of the case whether the evidence is heard or not. Sometimes, the answer is pretty obvious but other times, it can get fairly tricky.
Some other factors a judge must consider when deciding whether to allow evidence include:
a. whether there is some special reason it cannot be allowed (such as sensitive state secrets);
b whether the witness is 'competent' (old enough and mentally alert enough to understand what he or she saw, or really has sufficient personal knowledge, for example);
c. whether the evidence is 'hearsay'. (This is a difficult concept, even for lawyers and judges sometimes, but generally hinges on whether the witness is testifying to what somebody else said.);
d. whether the witness has enough education and experience to talk about technical evidence that is being presented or to give opinions about technical matters;
e. whether a document or object is the genuine article.
Since the evidence a jury gets to see and hear can make or break a case, attorneys often appeal the juge's decision to a higher court. The Court of Appeals must decide first whether the trial judge's decision had a potentially significant effect on the outcome of the trial, and then whether the decision was correct or not.
Eventually, sets of rules were developed to guide judges as they decided issues of evidence. In North Carolina, the rules are written out in Chapter 8C of the General Statutes.
Evidence for a trial might consist of eyewitness testimony, a document or set of documents, three-dimensional objects, audio or video recordings of some kind, or other things that can help tell the story of what happened.
Very often, before a trial, the attorneys will stipulate, or agree, that certain kinds of evidence will be allowed without objection. When there is really no argument that the evidence should be heard or seen, this helps shorten the trial and makes the process smoother for everyone. However, sometimes attorneys for one side or the other would rather that certain critical bits of evidence not be seen by the jury.
If someone objects to any evidence being used at trial, then the judge must use the rules as a guideline to decide whether the jury should see or hear it. One initial threshold for the evidence to pass is whether it is 'relevant' to the issues being tried. In other words, would it make any difference to the outcome of the case whether the evidence is heard or not. Sometimes, the answer is pretty obvious but other times, it can get fairly tricky.
Some other factors a judge must consider when deciding whether to allow evidence include:
a. whether there is some special reason it cannot be allowed (such as sensitive state secrets);
b whether the witness is 'competent' (old enough and mentally alert enough to understand what he or she saw, or really has sufficient personal knowledge, for example);
c. whether the evidence is 'hearsay'. (This is a difficult concept, even for lawyers and judges sometimes, but generally hinges on whether the witness is testifying to what somebody else said.);
d. whether the witness has enough education and experience to talk about technical evidence that is being presented or to give opinions about technical matters;
e. whether a document or object is the genuine article.
Since the evidence a jury gets to see and hear can make or break a case, attorneys often appeal the juge's decision to a higher court. The Court of Appeals must decide first whether the trial judge's decision had a potentially significant effect on the outcome of the trial, and then whether the decision was correct or not.
Friday, September 18, 2009
On The Light Side
Usually, the courtroom is a very serious place where serious business takes place. But there are exceptions once in a while, usually unintentional.
Many years ago, I was waiting for my case to come to trial and there was a short trial before mine with unrepresented defendants. They asked the judge if they could bring in some evidence and he said OK. Their evidence was a 20 foot tree that their neighbor had cut down. They carried it down the aisle and set it down in front of the judge's bench. He just laid his head down in his hands.
One of our district court judges was active in our community theater group, and was excited about the sets he'd designed for the local production of 'The Sound of Music' in which I was playing the captain. I'd also done some set design and building for a few shows before that. I happened to be passing through the courtroom one day and he called me to the bench with a most serious tone to his voice. I wondered what I was in trouble for. When I got to the bench, he had all his drawings for the set laid out and wanted me to go over some details with him.
One of our county lawyers once had a bad case of shingles or something that caused severe pain to his legs if anything touched them. He still had to practice law, so he got a dispostion from the judges to wear bermuda shorts with his coat and tie for a while. Quite a sight in the courtroom.
Anybody else have any courtroom stories?
Many years ago, I was waiting for my case to come to trial and there was a short trial before mine with unrepresented defendants. They asked the judge if they could bring in some evidence and he said OK. Their evidence was a 20 foot tree that their neighbor had cut down. They carried it down the aisle and set it down in front of the judge's bench. He just laid his head down in his hands.
One of our district court judges was active in our community theater group, and was excited about the sets he'd designed for the local production of 'The Sound of Music' in which I was playing the captain. I'd also done some set design and building for a few shows before that. I happened to be passing through the courtroom one day and he called me to the bench with a most serious tone to his voice. I wondered what I was in trouble for. When I got to the bench, he had all his drawings for the set laid out and wanted me to go over some details with him.
One of our county lawyers once had a bad case of shingles or something that caused severe pain to his legs if anything touched them. He still had to practice law, so he got a dispostion from the judges to wear bermuda shorts with his coat and tie for a while. Quite a sight in the courtroom.
Anybody else have any courtroom stories?
Tuesday, July 14, 2009
Power of Attorney
I've had people ask from time to time whether they can still use a power of attorney that someone signed over to them after that person dies.
A North Carolina Power of Attorney is only effective as long as the person who signed it is still living. In fact, unless it's what's called a Durable Power of Attorney, it could become void even before that.
The normal North Carolina Power of Attorney (POA) allows someone to handle financial and property matters for the person who signed it (the Principal), but does not give that person 'power' over the Principal. The person who can do things in addition to the Principal is called an Attorney in Fact (AIF). The Principal is still free to handle his or her affairs even though they've named an AIF to help them
The ordinary POA is only effective as long as the Principal is competent, but in North Carolina, the Principal can sign a Durable POA, which will continue in effect even if the Principal becomes incompetent or incapacitated, or even unconscious. However, if the Durable provision of the POA has to be be used, then the POA must be recorded at the Register of Deeds office in the Principal's county of residence.
Once the Principal dies, the POA automatically becomes void and that person's will takes effect, leaving whoever is named as Executor to handle the financial and property matters.
In some instances, if a person becomes incompetent or incapacitated for a long time and has not signed a POA, then someone may need to be appointed as his or her Guardian. Guardianships will be discussed in a later post.
As always, the discussions in this blog pertain to North Carolina law as it affects North Carolina residents or property holders. If you have more specific questions, you should consult your own attorney. However, I will be glad to answer any further general questions you may have about this topic.
A North Carolina Power of Attorney is only effective as long as the person who signed it is still living. In fact, unless it's what's called a Durable Power of Attorney, it could become void even before that.
The normal North Carolina Power of Attorney (POA) allows someone to handle financial and property matters for the person who signed it (the Principal), but does not give that person 'power' over the Principal. The person who can do things in addition to the Principal is called an Attorney in Fact (AIF). The Principal is still free to handle his or her affairs even though they've named an AIF to help them
The ordinary POA is only effective as long as the Principal is competent, but in North Carolina, the Principal can sign a Durable POA, which will continue in effect even if the Principal becomes incompetent or incapacitated, or even unconscious. However, if the Durable provision of the POA has to be be used, then the POA must be recorded at the Register of Deeds office in the Principal's county of residence.
Once the Principal dies, the POA automatically becomes void and that person's will takes effect, leaving whoever is named as Executor to handle the financial and property matters.
In some instances, if a person becomes incompetent or incapacitated for a long time and has not signed a POA, then someone may need to be appointed as his or her Guardian. Guardianships will be discussed in a later post.
As always, the discussions in this blog pertain to North Carolina law as it affects North Carolina residents or property holders. If you have more specific questions, you should consult your own attorney. However, I will be glad to answer any further general questions you may have about this topic.
Wednesday, April 22, 2009
How Long Will it Take to Close an Estate?
Clients generally wonder how long an estate process will take. Unfortunately, there is no clearcut answer in most cases. There is a minimum amount of time that must be allowed in North Carolina to give notice to creditors and allow them to make claims against the estate, but beyond that, it's a question of how complex the estate may be.
A host of factors can cause delays in administering an estate. Sometimes there are provisions in a will that take a certain amount of time to fulfill. Occasionally, finding heirs may cause a delay. Other delaying factors may include finding assets, accounting and taxation problems, setting up trusts, selling assets to pay creditors or even to make distributions to heirs if the will so directs, adjusting or resisting creditor claims, handling challenges to the will, dealing with heirs who are minors, etc.
In North Carolina, you can expect a minimum of 90 days after the estate is opened for the time allowed creditors to make their claims. Some very simple estates can be closed soon after that time period and some take several years to complete.
A host of factors can cause delays in administering an estate. Sometimes there are provisions in a will that take a certain amount of time to fulfill. Occasionally, finding heirs may cause a delay. Other delaying factors may include finding assets, accounting and taxation problems, setting up trusts, selling assets to pay creditors or even to make distributions to heirs if the will so directs, adjusting or resisting creditor claims, handling challenges to the will, dealing with heirs who are minors, etc.
In North Carolina, you can expect a minimum of 90 days after the estate is opened for the time allowed creditors to make their claims. Some very simple estates can be closed soon after that time period and some take several years to complete.
Thursday, April 2, 2009
Do I Need a Will?
The answer to whether someone should have a will is almost always "yes". The next answer is, "Yes, you should see a lawyer about having it done."
A SIDENOTE
Something that amazes me is how often people who seem perfectly sensible will buy a very expensive 'trust kit' from someone from out of town who rents a motel conference room for an 'estate seminar'. I once had someone come to see me who started having second thoughts about buying into one of those, but who wanted to vigorously defend the decision to do so instead of listening to my advice about it. I suppose that once you've thrown that much money at one of those over-priced do-it-yourself kits, you don't want to think that you've made a bad decision.
WHAT DOES THE WILL DO?
Your will is your say-so as to what happens to your stuff after you're gone. There are a few limits. For instance, in North Carolina, you can't leave your fortune to your cat (although you can leave it to a trustee with instructions that the money be used for the cat's care). You can't completely leave your spouse out of your estate either, unless you've got a valid pre- or post- nuptial contract that allows it. And if someone can prove that your were incompetent when you wrote the will or that somebody seriously took advantage of you or forced you to write it the way you did, they might be able to overturn it. Otherwise, what you say goes. If you choose to leave nothing to the grown kids because they've ignored you for years, that'll work. Your children have no inherent right to receive anything from your estate (although your estate may still be liable for the support of your minor children).
If you choose, you can leave everything to one person, or you can divide the estate among any number of people. You can leave specific items to specific people and the rest to others. You can even use the will to set up a trust or trusts. The will is your chance to divy it up any way you want.
WHAT IF I ALREADY HAVE A TRUST?
Even if you have a trust and have beneficiaries named on all your insurance policies and accounts, you still should have a will as a backup. At some point, you might forget to title some new asset (such as a car) into the trust, or you might forget to change beneficiaries on an account after one of them has died. Your will can act as a catch-all to direct where those undesignated assets will go.
IF I DON'T HAVE A WILL, DOES THE STATE GET ALL MY STUFF?
Short answer: No. Slightly longer answer: Maybe, if nobody's left to get the stuff. A set of laws called the 'Intestate Succession Act' sets out a pecking order of relatives who will share in your estate if you have no will. The only time it goes to the State is if you have no relatives who can be found. Even then, the state will not own your property; it goes into what's called an 'escheat' fund until someone shows up who can prove kinship to you.
The pecking order starts in a vertical direction, once your spouse is taken care of. Children and parents take first. If you have no children or parents surviving, then it starts going sideways, to siblings, aunts, uncles, and the like, as far as necessary to find someone within some degree of kinship. Your attorney can tell you more precisely how the pecking order works.
DO I NEED A TRUST?
Not everyone needs a trust. A small percentage of the population might need one to avoid some estate taxes (sometimes called death taxes) for. Also, people who have combined families and want a little more assurance that their separate assets go to their own children might benefit from a trust. There may be other specific reasons to create trusts as well. Keep in mind though, that creating a trust simply to avoid creditors can be a risky proposition--you'll pretty much need to lose control of your assets for it to work.
If you think you might have a reason to need a trust, talk to your attorney. 'Avoiding probate' is not necessarily a good reason to have a trust, especially in North Carolina, where probate is not that expensive.
CAN I WRITE MY OWN WILL?
Sure you can. But you take your chances that it won't do what you think it will. Every once in a while, I'll come across a home-made will in which someone downloaded a form from the internet or copied one from some other source, but completely botched filling in the blanks, or failed to have it properly witnessed, for example. Your attorney will know what it takes to make the will valid and will know what language to use to put your wishes on paper. The attorney will also be able to advise you about what you can't do.
As always, this has been a short talk on the subject at hand. If you have more general questions about wills, please feel free to post them. For more specific questions about your own estate planning, you should consult your own attorney.
A SIDENOTE
Something that amazes me is how often people who seem perfectly sensible will buy a very expensive 'trust kit' from someone from out of town who rents a motel conference room for an 'estate seminar'. I once had someone come to see me who started having second thoughts about buying into one of those, but who wanted to vigorously defend the decision to do so instead of listening to my advice about it. I suppose that once you've thrown that much money at one of those over-priced do-it-yourself kits, you don't want to think that you've made a bad decision.
WHAT DOES THE WILL DO?
Your will is your say-so as to what happens to your stuff after you're gone. There are a few limits. For instance, in North Carolina, you can't leave your fortune to your cat (although you can leave it to a trustee with instructions that the money be used for the cat's care). You can't completely leave your spouse out of your estate either, unless you've got a valid pre- or post- nuptial contract that allows it. And if someone can prove that your were incompetent when you wrote the will or that somebody seriously took advantage of you or forced you to write it the way you did, they might be able to overturn it. Otherwise, what you say goes. If you choose to leave nothing to the grown kids because they've ignored you for years, that'll work. Your children have no inherent right to receive anything from your estate (although your estate may still be liable for the support of your minor children).
If you choose, you can leave everything to one person, or you can divide the estate among any number of people. You can leave specific items to specific people and the rest to others. You can even use the will to set up a trust or trusts. The will is your chance to divy it up any way you want.
WHAT IF I ALREADY HAVE A TRUST?
Even if you have a trust and have beneficiaries named on all your insurance policies and accounts, you still should have a will as a backup. At some point, you might forget to title some new asset (such as a car) into the trust, or you might forget to change beneficiaries on an account after one of them has died. Your will can act as a catch-all to direct where those undesignated assets will go.
IF I DON'T HAVE A WILL, DOES THE STATE GET ALL MY STUFF?
Short answer: No. Slightly longer answer: Maybe, if nobody's left to get the stuff. A set of laws called the 'Intestate Succession Act' sets out a pecking order of relatives who will share in your estate if you have no will. The only time it goes to the State is if you have no relatives who can be found. Even then, the state will not own your property; it goes into what's called an 'escheat' fund until someone shows up who can prove kinship to you.
The pecking order starts in a vertical direction, once your spouse is taken care of. Children and parents take first. If you have no children or parents surviving, then it starts going sideways, to siblings, aunts, uncles, and the like, as far as necessary to find someone within some degree of kinship. Your attorney can tell you more precisely how the pecking order works.
DO I NEED A TRUST?
Not everyone needs a trust. A small percentage of the population might need one to avoid some estate taxes (sometimes called death taxes) for. Also, people who have combined families and want a little more assurance that their separate assets go to their own children might benefit from a trust. There may be other specific reasons to create trusts as well. Keep in mind though, that creating a trust simply to avoid creditors can be a risky proposition--you'll pretty much need to lose control of your assets for it to work.
If you think you might have a reason to need a trust, talk to your attorney. 'Avoiding probate' is not necessarily a good reason to have a trust, especially in North Carolina, where probate is not that expensive.
CAN I WRITE MY OWN WILL?
Sure you can. But you take your chances that it won't do what you think it will. Every once in a while, I'll come across a home-made will in which someone downloaded a form from the internet or copied one from some other source, but completely botched filling in the blanks, or failed to have it properly witnessed, for example. Your attorney will know what it takes to make the will valid and will know what language to use to put your wishes on paper. The attorney will also be able to advise you about what you can't do.
As always, this has been a short talk on the subject at hand. If you have more general questions about wills, please feel free to post them. For more specific questions about your own estate planning, you should consult your own attorney.
Wednesday, March 11, 2009
Why Does My Spouse Have to Sign the Deed?
Sometimes, when we're handling a real estate closing, a seller wants to know why their spouse has to sign the new deed if the spouse was never on the original deed.
In North Carolina, when a man and woman become husband and wife, the law gives them some automatic rights in each other's property. One of those is the right receive a share in a deceased spouse's estate. This means that, ordinarily, your spouse can't entirely write you out of the will. Sometimes this right can be overridden by a properly done prenuptial agreement or separation documents, but it stays put otherwise.
The spousal right in property happens automatically as soon as you marry, and cannot be taken away by the other spouse just by deeding the property away. For instance, if only a husband signs a deed over to someone and then dies, his wife could still be a partial owner of the property along with the person the husband deeded to. On the other hand, if the wife also signs the deed, then she voluntarily gives up any rights she has in the property.
Any time an attorney is conducting a real estate closing, that attorney will need to have both the husband and wife sign the deed unless a valid pre-nuptial agreement, separation agreement, or other document showing the other spouse no longer has rights in the property is presented. Even then, some lenders tend to be overly cautious and still will insist that both spouses sign.
This answer does not cover all the issues that may come up about spousal rights in property. If you have other questions or comments, please post.
Friday, March 6, 2009
Get it in Writing
I often have clients who have entered some sort of business arrangement with someone but never got the details in writing. If you do this, you are courting disaster, whether the other person is a family member, a friend, or a stranger (sometimes, the closer the person is to you, the worse the problem can be).
Too often, each person who enters this type of arrangement walks away with a completely different understanding of the agreement. the best protection for everyone is to have a well-written contract that sets out the details. Otherwise, you have nothing to show to a court if you wind up having to enforce the agreement later. I sometimes joke that a verbal contract is "worth the paper it's written on" for this reason.
The cost of having a competent attorney put your agreement in writing is a whole lot less than the cost of losing what you thought you had, so before you shake hands on the deal, see a lawyer.
Do you have a horror story to add or a question? Please feel free to post.
Too often, each person who enters this type of arrangement walks away with a completely different understanding of the agreement. the best protection for everyone is to have a well-written contract that sets out the details. Otherwise, you have nothing to show to a court if you wind up having to enforce the agreement later. I sometimes joke that a verbal contract is "worth the paper it's written on" for this reason.
The cost of having a competent attorney put your agreement in writing is a whole lot less than the cost of losing what you thought you had, so before you shake hands on the deal, see a lawyer.
Do you have a horror story to add or a question? Please feel free to post.
Monday, March 2, 2009
I Want to Lien Somebody
Question: Somebody owes me money and I want to put a lien on their property. How do I do that?
Answer: A lien is a document that gets put on record saying that someone has claimed rights in someone else's property pending the payment of a debt. There are several ways that liens can be placed on real estate in NC, but simply going out and filing a paper that says somebody owes you money is not one of them.
If a person owes you money and you can prove it in a court of law, then the judgment you win in court becomes a lien on any property that person owns, subject to some exceptions. Exceptions include any statuory or constitutional rights that may protect some of their assets from seizure, and the fact that your judgment has to be against both the husband and wife for you to go after certain property they may own together (known in NC as a tenancy by the entirety property).
Another type of lien is a Deed of Trust, or mortgage, that puts property up as collateral for a loan. This type of lien was covered in Post One. The property owner has to agree to let this type of lien be placed on the property.
Governmental liens might come up because taxes or assessments have gone unpaid. The governmental body that wants the lien has to follow certain steps before the lien can be effective.
Certain people who provide material or labor for the improvement of real estate can place what's called, in NC, a mechanic's lien, against the property if they are not paid. There are very strict rules about how this can be done, but it provides some protection for people in the building industry. I believe much confusion about liens may come from misunderstandings about this process, which leads people to believe they can simply file a paper against anyone who owes them money.
No matter how or why the lien was filed, it doesn't do much until you enforce it. You acutally have to take the steps to have the person's property legally seized and sold to produce the cash that is owed to you. However, if the person sells the property in the meantime, your lien is public notice to anyone who buys it that the property is subject to such seizure. Often, this means that you will be paid out of sale proceeds so that your lien can be cancelled.
Once the debt that caused the lien to be filed has been paid, you are obliged to cancel the lien from the public record.
As always, if you still would like more information or want to comment, please feel free to post.
Answer: A lien is a document that gets put on record saying that someone has claimed rights in someone else's property pending the payment of a debt. There are several ways that liens can be placed on real estate in NC, but simply going out and filing a paper that says somebody owes you money is not one of them.
If a person owes you money and you can prove it in a court of law, then the judgment you win in court becomes a lien on any property that person owns, subject to some exceptions. Exceptions include any statuory or constitutional rights that may protect some of their assets from seizure, and the fact that your judgment has to be against both the husband and wife for you to go after certain property they may own together (known in NC as a tenancy by the entirety property).
Another type of lien is a Deed of Trust, or mortgage, that puts property up as collateral for a loan. This type of lien was covered in Post One. The property owner has to agree to let this type of lien be placed on the property.
Governmental liens might come up because taxes or assessments have gone unpaid. The governmental body that wants the lien has to follow certain steps before the lien can be effective.
Certain people who provide material or labor for the improvement of real estate can place what's called, in NC, a mechanic's lien, against the property if they are not paid. There are very strict rules about how this can be done, but it provides some protection for people in the building industry. I believe much confusion about liens may come from misunderstandings about this process, which leads people to believe they can simply file a paper against anyone who owes them money.
No matter how or why the lien was filed, it doesn't do much until you enforce it. You acutally have to take the steps to have the person's property legally seized and sold to produce the cash that is owed to you. However, if the person sells the property in the meantime, your lien is public notice to anyone who buys it that the property is subject to such seizure. Often, this means that you will be paid out of sale proceeds so that your lien can be cancelled.
Once the debt that caused the lien to be filed has been paid, you are obliged to cancel the lien from the public record.
As always, if you still would like more information or want to comment, please feel free to post.
Saturday, February 28, 2009
Post One
Hello and welcome to Your Law, a place for non-lawyers to get down-to-earth answers about the law and how it works. I'll start with a few of the questions I frequently hear in my law practice, and we'll go from there.
Keep in mind that the answers are geared toward North Carolina law, and may have some variations from state to state. Also, none of the answers will be direct legal advice to the person asking the question or anyone else. If you have a personal legal question, I encourage you to talk to a lawyer near you.
Okay, let's go.
A question I've heard recently is, "I paid off my mortgage, but I didn't get my deed back. Why not?"
The fact that a mortgage document is often called a 'Deed of Trust' causes a lot of confusion. The real proof that you own your real estate is the Deed you got when you bought the property. That Deed should have been recorded at your local register of deeds, or similar governmental recording place (that I'll call the Registry) so that there is a public record of your ownership. After it was recorded, the original Deed should have been returned to you for safekeeping, but a copy remains on public record.
A Deed of Trust, on the other hand, is a mortgage document that puts your real estate up as collateral for a loan. It may have even been the loan you took out to buy the property. It gives you no ownership rights in the property--your original Deed already did that. It does give some rights to the bank or person who loaned you the money, especially the right to have the property sold if you don't pay. (One of the best short descriptions I've heard from a client is, "If you pay you stay: If you don't, you won't.") The mortgage is one form of lien that can be placed on your property. We'll talk more about liens in a later post.
Once you pay off your mortgage, the bank is obliged to cancel the Deed of Trust, which means they have to send some kind of notice to the Registry to tell the public that you've paid your mortgage off and they no longer have an interest in the property. This is called cancelling the lien or cancelling the mortgage.
Traditionally, the bank sent the cancelled note (your written promise to pay them) and the Deed of Trust back to the borrower, but that may or may not happen any more. You've probably read about the problem some big banks and mortgage brokers are having trying to find original documents. The important thing for you is that they record the cancellation at the Registry. You still should insist on getting your original papers back, though, to be on the safe side.
If this answer still doesn't help, or if it raises more questions, let me know. I'll be happy to answer any other general questions you may have about the inner workings of the law.
Keep in mind that the answers are geared toward North Carolina law, and may have some variations from state to state. Also, none of the answers will be direct legal advice to the person asking the question or anyone else. If you have a personal legal question, I encourage you to talk to a lawyer near you.
Okay, let's go.
A question I've heard recently is, "I paid off my mortgage, but I didn't get my deed back. Why not?"
The fact that a mortgage document is often called a 'Deed of Trust' causes a lot of confusion. The real proof that you own your real estate is the Deed you got when you bought the property. That Deed should have been recorded at your local register of deeds, or similar governmental recording place (that I'll call the Registry) so that there is a public record of your ownership. After it was recorded, the original Deed should have been returned to you for safekeeping, but a copy remains on public record.
A Deed of Trust, on the other hand, is a mortgage document that puts your real estate up as collateral for a loan. It may have even been the loan you took out to buy the property. It gives you no ownership rights in the property--your original Deed already did that. It does give some rights to the bank or person who loaned you the money, especially the right to have the property sold if you don't pay. (One of the best short descriptions I've heard from a client is, "If you pay you stay: If you don't, you won't.") The mortgage is one form of lien that can be placed on your property. We'll talk more about liens in a later post.
Once you pay off your mortgage, the bank is obliged to cancel the Deed of Trust, which means they have to send some kind of notice to the Registry to tell the public that you've paid your mortgage off and they no longer have an interest in the property. This is called cancelling the lien or cancelling the mortgage.
Traditionally, the bank sent the cancelled note (your written promise to pay them) and the Deed of Trust back to the borrower, but that may or may not happen any more. You've probably read about the problem some big banks and mortgage brokers are having trying to find original documents. The important thing for you is that they record the cancellation at the Registry. You still should insist on getting your original papers back, though, to be on the safe side.
If this answer still doesn't help, or if it raises more questions, let me know. I'll be happy to answer any other general questions you may have about the inner workings of the law.
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