Subsurface Coal Rights and Real Estate Tax Assessments

Exceptions and Challenges of Rausch Creek Land, L.P., 2012 Pa. Commw. LEXIS 311 (2012)

Frank Kosir, Jr., Esquire
fk@muslaw.com

This matter addressed the issue of whether the owner of subsurface coal rights was permitted to challenge, before the County tax claim bureau, the validity of real estate tax assessments levied upon those coal rights.  Rausch Creek Land, L.P. (“Rausch Creek”) was the owner of subsurface coal rights under five separate parcels of real property situated in Schuylkill County, Pennsylvania, designated as Tax Parcel Nos. 13-0-54803019, 13-0-054841304, 13-0-54951301, 22-0-54851319, and 22-0-54930102 (“Parcels”).  Rausch Creek failed to pay the 2009 real estate taxes assessed on these coal rights and, in 2010, the Schuylkill County Tax Claim Bureau (“Bureau”) served Rausch Creek with letters advising that the coal rights would be sold at tax sale if the delinquent taxes were not paid by December of 2010.  In response, Rausch Creek filed individual challenges and exceptions for each parcel under Section 309(c) of the Pennsylvania Real Estate Tax Sale Law (“Law”), (72 P.S. § 5860.309(c)) (which requires that all real property against which a claim is asserted be accurately described), alleging that the Parcels were not sufficiently identified in the Schuylkill County Tax Mapping Department and that the Parcels’ identification numbers were based upon Pennsylvania Department of Environmental Protection surface mining permits, not real property records.  The Bureau overruled the challenges and exceptions, and the trial court affirmed.

 

On appeal, our Commonwealth Court affirmed.  In issuing its ruling, the court concluded that the challenges and exceptions that Rausch Creek had raised before the Bureau did not attack the validity of the liens themselves but, rather, challenged the underlying assessments.  Therefore, the proper course of action for Rausch Creek to undertake would have been to file assessment appeals with the Schuylkill County Board of Assessment Appeals.  However, as it had failed to do so, and Section 314 of the Law (72 P.S. § 314) allows for a tax claim to be set aside or found invalid only “for any other reason not involving a question which could have been raised by an appeal provided for by law,” Rausch Creek’s failure to raise these challenges in the form of an assessment appeal precluded it from raising these issues before the Bureau.  As such, Rausch Creek was not entitled to its requested relief, and the trial court had properly dismissed the challenges and exceptions.

Association of Corporate Counsel of Western Pennsylvania Meeting - January 8, 2013

Ron Hicks and Beth Slagle will be speaking at the upcoming ACC Western Pennsylvania meeting which Meyer, Unkovic & Scott is sponsoring. The presentation is entitled “Drafting Effective Indemnification and Insurance Clauses In Commercial Contracts,” and will be held at the Rivers Club on January 8, 2013.

Click here for more information or to register.

Ensure Fairness To All Heirs

Successful parents know that treating children equally is not a matter of giving them all the same things or supporting them with the same exact funding.  The summer trek across Europe on a bicycle that one teen yearns to take might cost more than the outdoor camp another craves to attend.  It would be foolish to set the same college savings goals for a daughter who won the science fair and a son who gets average grades.  A child with mental challenges may require more support than one without any disabilities.

 

In short, parents should learn to equate fairness with filling needs rather than dividing chips.
 

Estate planning requires the same approach, even for those whose estates fall below the taxable minimum.  Even though it may seem much easier just to split things equally to avoid being seen as unfair, an even split may not be the way to act in the best interests of the heirs. 

 

It’s almost impossible to predict what the individual needs of each child could be, especially when the children are younger when the estate planning is taking place. The way out of this dilemma is to create a pot trust. Rather than establish a separate trust for each minor child, the parent(s) creates one common “pot” from which a trustee draws to cover all the stipulated expenses of the children up to a certain age. The trustee is not required to spend the same amount on each child.  Once the youngest child is of the age stipulated in the trust, the remainder of the pot trust is divided, usually equally, among all the beneficiaries it covers.

 

Another advantage of a pot trust is that the property placed in trust does not have to be divided. A separate trust for each child might require the trustee to sell a business, investment accounts or real estate, which might not be in the best interests of the family.
 

A pot trust makes most sense when children are young and fairly close in age. The older the children are, the more of the costs covered by the typical pot trust will have already been incurred. 

 

The key decision to make for the pot trust is who will be the independent trustee.  The trustee has the final say on whether and how the money is to be distributed throughout the duration of the trust, so the trustee must be both scrupulous and knowledgeable of the family dynamics. The trustee’s decisions are not predetermined, and can’t be automated. 
 

When discussing the creation or updating of an estate plan, it is imperative that you share with your attorney not just your goals, but also your fears of what may happen after your passing.  Once the attorney knows what you want and don’t want to happen with your estate, he or she will be in a much better position to help you reach the goals.

 

______________________________________________________________

 

Amanda Gerstnecker, Esquire
arg@muslaw.com

John W. Powell, Esquire
jwp@muslaw.com



 

Amanda R. Gerstnecker and John W. Powell are attorneys with Pittsburgh-based Meyer, Unkovic & Scott.  They focus their legal practice on estate planning and business formation, governance and succession planning.

 

Home Builders Could Be Liable For Repairs

 

In a case of first-impression in Pennsylvania, the Pennsylvania Superior Court announced that home builders could be liable under the implied warranty of habitability not only to their customers, but also to later purchasers of the residence.
 

On November 5, 2012, in Conway v. The Cutler Group, (No. 803 EDA 2012) the Superior Court held that the implied warranty of habitability applies to subsequent purchasers of a residence down the line from the original purchaser. In other words, not only can the first purchaser of the home bring a claim against a builder, now any subsequent purchaser of the home within 12 years of its construction can bring such a claim.

The facts are these. In September 2003, a builder constructed a home in Jamison, Pennsylvania. The first resident-purchasers bought the home and lived in it for a time. Then, in June 2006, the second resident-purchasers, the Conways, bought the home. The Conways discovered water infiltration around the windows in the master bedroom in April of 2008. The Conways filed a complaint against the original builder alleging only one count: breach of the implied warranty of habitability.
 

The Superior Court held that the implied warranty of habitability should not terminate when the first resident-purchaser sells the property. The Court held that the risk of a hidden defect should continue with the builder.

This is a significant extension of the scope of this theory of liability in Pennsylvania. Now, under the Superior Court's reasoning, any subsequent owner of a residential property is able to file a claim against the builder for a breach of the implied warranty of habitability before the 12 year statute of repose expires.

The Court explained that the liability is still limited by two factors. First, any claims brought after 12 years from the time of the completion of the construction are barred by the statute of repose regardless of when defects are discovered. Second, the Court emphasized that the breach of the implied warranty must still be proven. A plaintiff must show that a defect is latent (hidden) and non-obvious, that the defect is a result of the builder's design or construction, and that the defect affects the habitability of the residence.

Because of the Court's holding, the plaintiffs were permitted to continue with their litigation against the builder. Builders should be aware of this change in the law and realize that latent defects may now subject them to liability up to twelve years after the construction is complete, no matter the number of times a home is sold during that period.

 

_________________________________________________________________

 

Kevin F. McKeegan

kfm@muslaw.com

412.456.2838

 

Mr. McKeegan has more than twenty-eight years of experience in all aspects of Pennsylvania land use and property development law. While primarily representing property owners and developers, Mr. McKeegan has earned a reputation of being able to work in close coordination with all stake holders - community groups, municipalities and his clients - to smooth the development process. His diverse practice has included representing the developers of an over 1 million square foot regional shopping mall and the owners of a multi-phase residential golf course community. Mr. McKeegan took the lead in drafting a "traditional neighborhood development" zoning ordinance that incorporated not only his client's needs for a mixed-use (office, retail and residential) project but also accommodated community concerns regarding landscaping, buffering and preserving environmentally sensitive areas.

Brandon B. Rothey

bbr@muslaw.com

412.456.2544

Mr. Rothey is an associate at Meyer, Unkovic & Scott LLP. He regularly counsels and represents clients with respect to construction, real estate, and commercial litigation. He has worked on cases for both plaintiffs and defendants involving breach of contract, negligence, negligent misrepresentation, products liability, the Pennsylvania Unfair Trade Practices and Consumer Protection Law, insurance coverage, and professional malpractice. Mr. Rothey has counseled and represented clients in the energy, manufacturing, construction, and health care industries. After receiving his B.S. from Pennsylvania State University, he graduated with a J.D. from the University of Pittsburgh School of Law in 2009.

 

OSHA Revises Standard

Jane Lewis Volk, Esquire
jlv@muslaw.com

The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) has recently revised its Hazard Communications Standard.  The new standard aligns OSHA with the United Nations’ global chemical labeling standard.  Once fully implemented, OSHA expects the new regulations to prevent an estimated 43 deaths and result in an about $475.2 million in productivity savings annually for U.S. employers.

 

As many employers know, OSHA’s Hazard Communications Standard is the most often cited of all OSHA regulations. This standard requires chemical labeling, the maintenance of material safety data sheets and safety training of employees.  The labeling is under the control of the manufacturer, but employers are required to comply with the workplace-related provisions. Any employer that has undergone an OSHA inspection knows that compliance officers invariably focus on these matters.

 

The revision of the standard ensures consistent practices both nationally and internationally. OSHA’s new standard will classify chemicals according to their health and physical hazards, and establish consistent safety data sheets for all chemicals made in the United States and imported from abroad.

 

The revised standard will also require new labels on all chemicals.  Previously, chemical preparers were permitted to label containers in a variety of ways as long as it contained the required information. The new labels, however, must adhere to a strict format that contains all of the following:

• Signal word: determines the level of severity of the hazard.  “Danger” will indicate the most severe hazards, while “warning” will be used for less severe hazards.
• Pictogram: indicates the type of hazard posed by the chemical.  The pictogram must be contained within a red diamond.  A black border will no longer be accepted.
• Hazard statement: describes the classification of the hazard.
• Precautionary statement: gives recommended precautions to avoid harm from the chemical.

In the past, OSHA did not enforce the requirement to update labels as new information about chemicals and their hazards became available.  But as part of the new standard, OSHA has indicated that it will crack down on updates to labels, requiring employers to revise labels within six months of becoming aware of any new information.

 

Employers will be required to provide employee training about the new labels and safety data sheet format. Although the new standards will not begin to take effect until 2015, employee training must be completed by the end of 2013.

 

Once fully phased in by 2016, the revised standard is expected to prevent an estimated 585 injuries and illnesses annually. It will reduce trade barriers and result in productivity improvements for American business that regularly handle, store and use hazardous chemicals.  OSHA estimates cost savings of $32.2 million alone will accrue to employers that periodically update safety data sheets and labels for chemicals covered in the standard.

 

Any employer that utilizes chemical substances in the workplace should request updated materials from its suppliers and plan to initiate new hazard communications and training in the workplace to comply with the new standard.

Zoning Issues - Right to use single-family dwelling for multi-family residential purposes?

Frank Kosir, Jr., Esquire
fk@muslaw.com

Salahuddin v. Zoning Hearing Board of West Chester, et. al, 2012 Pa. Commw. LEXIS 317 (2012)

 

This matter addressed the issue of whether a previous non-conforming use of a single-family residential dwelling as a rooming house vested the property owner with the right to use that dwelling for multi-family residential purposes.  In April of 1996, Amna  Salahuddin (“Salahuddin”) took title to a 3,679 square feet parcel of real property (“Property”) situated in the Borough of West Chester (“Borough”), Chester County (“County”), Pennsylvania.  The Property was located in the NC-2 Neighborhood Conservation District under the Borough Zoning Ordinance (“Ordinance), and erected thereon is a single-family, three-story, semi-detached dwelling (Dwelling”).  Up until 1992, the previous owner of the Property had resided on the first floor of the Dwelling, and rented the second and third floors as a rooming house.  The Property was acquired by PNC Bank in a 1992 mortgage foreclosure, at which time the rooming house use ceased.  At the time that Salahuddin took title to the Property, she was aware that the rooming house had ceased, and that the Dwelling was classified as a single-family residence.

After taking title to the Property, Salahuddin used the first floor of the Dwelling as a single-family residence, and made no use of the second or third floors.  In January of 2011, she submitted a zoning application to the Zoning Hearing Board of West Chester (“Board”) seeking a variance to utilize the Dwelling as a multi-family residence and, in support of her position, asserted that the rooming house use constituted a non-conforming, pre-existing use that had not been abandoned, thereby entitling her to use the Dwelling for multi-family purposes.  The Board denied Salahuddin’s application, and the trial court affirmed.

On appeal, our Commonwealth Court affirmed.  In issuing its ruling, the court pointed out that, as the foreclosing mortgage holder, PNC Bank did not have legal authority to abandon the non-conforming, pre-existing rooming house use during the time that it held title to the Property.  Therefore, at the time that Salahuddin took title, the rooming house use remained a legal non-conforming, pre-existing use.  However, once Salahuddin took title to the Property, she made no effort to use the Dwelling as a rooming house and, after holding title for five years, sought to use it as a multi-family use which, under the language of the Ordinance, is a wholly separate and distinct use from that of a rooming house.  As such, the proposed multi-family residential use would not constitute the continuation of the non-conforming, pre-existing rooming house use and, as Salahuddin had failed to establish that the continued use of the Dwelling as a single family residence would inflict a hardship upon her, she was not entitled to the requested variance relief.

Self-Employment: Does it Impact Your Unemployment Compensation Benefits?

 

Beth A. Slagle, Esquire
bas@muslaw.com

So you've been laid off from your job and want to make a little extra side money selling jewelry or mowing lawns. Can you do it without jeopardizing your unemployment compensation benefits? What if you only make $100 a week or work only a few hours doing the side activity? While those side jobs may seem innocuous to you since they pay only a few bills, they may very well put your benefits in jeopardy.

Under Pennsylvania law, when an individual is receiving unemployment compensation benefits, they are permitted to become employed by a company, and subject to the eligibility requirements and income generated, the amounts made in that employment will be used to offset amounts received in benefits. In that scenario, "employment" is the key word. When it comes to starting your own business or accepting an independent contractor job, however, the law treats that situation very differently.

In fact, attempts to obtain alternative side-income through self-employment or independent contractor status while receiving unemployment compensation have generally been met with a critical eye by the Pennsylvania Department of Labor and Industry. Section 402(h) of the Pennsylvania unemployment compensation law mandates that individuals who are self-employed are not eligible for unemployment compensation, and when initially enacted, decisions rendered by referees universally rejected unemployment compensation claims for individuals engaged in any type of self-employment, regardless of whether any money was made.

Apparently recognizing some inequity in that position, a recent line of Pennsylvania appellate cases suggests that some side jobs undertaken, while the claimant is engaged in seeking full-time employment, will not automatically render the claimant ineligible for benefits.

The confusion comes from the fact that "self-employment" is not a defined term in Pennsylvania unemployment compensation law, so courts have to look elsewhere to determine what the phrase means. Universally, they look to the unemployment compensation law definition of "employment" which describes a person as being employed unless: (1) the individual is free from control or direction of an employer, and (2) the individual is providing services and they are "customarily engaged in an independently established trade, occupation, profession or business."

The recent court decisions have placed emphasis on the second prong -- whether the individual is "customarily engaged" in a business. Basically, the common theme through the cases is that if the job and/or income is sporadic or temporary, such as a few hours a week or on nights or weekends, courts are more inclined to rule that the individual is not customarily engaged in business, so that they can continue receiving benefits. This is especially true when the self-employment was undertaken while the individual was actively engaged in searching for full time employment. If, however, the individual is trying to make a living with the recently started business, instead of simply using it as a side activity, then the courts take a much harsher view, regardless of whether the individual has generated any income or no income at all. In this scenario, benefits will likely be denied.

The bottom line is that individuals receiving unemployment compensation should first determine whether the random side job or self-employment activity will render them ineligible for benefits before undertaking that activity. Seeking the assistance of counsel is a wise move before accepting any job that may jeopardize your valuable unemployment compensation benefits.

DMCA Take-Down Wrestles IP Theft

Nicholas J. Bell, Esquire
njb@muslaw.com

An article by Nick Bell was featured in the Business Workshop section of the Pittsburgh Post-Gazette. To read the article, “DMCA take-down wrestles IP theft,” please click here.

Business Workshop: Courtesy Policy Could Be Illegal

Jane Lewis Volk, Esquire
jlv@muslaw.com

Could a simple policy expecting employees to act with courtesy in the workplace be illegal?

According the National Labor Relations Board, it could.

The NLRB recently decided that an employer policy intended to promote courtesy and decorum unlawfully chilled their employees' federal right to engage in conversation among themselves aimed at improving their working conditions or petitioning their employer or union to do so.

The policy seemed simple on its surface: "Courtesy is the responsibility of every employee. Everyone is expected to be courteous, polite and friendly to our customers, vendors and suppliers, as well as to their fellow employees. No one should be disrespectful or use profanity or any other language which injures the image or reputation of [the employer]."

The NLRB reasoned that employees "could construe" this language as prohibiting conversations with their co-workers, supervisors, managers or third parties about objections to their working conditions and support of efforts to improve them. The policy was therefore held to be unlawful, even though no employee had been disciplined under it.

Some employers may contend that this decision takes the "could construe" reasoning to an extreme. As noted in the dissenting opinion, the issue should be whether employees would "reasonably" understand a challenged policy to prohibit protected activity, not whether the language "could possibly" do so.

Until the pendulum swings back to another interpretation, the NLRB decision stands as law. Employers are well-advised to keep this in mind in drafting workplace policies and rules. Employers should not over-reach in their efforts to maintain appropriate levels of decorum in their workplaces.

While profanity can certainly be prohibited, "respect" in the workplace, as anywhere else, cannot be achieved through mandate.

 

For more information on this topic, please contact Jane Lewis Volk at jlv@muslaw.com.

 

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business workshop is a weekly feature from local experts offering tidbits on matters affecting business.

 

Read more: http://www.post-gazette.com/stories/business/news/business-workshop-courtesy-policy-could-be-illegal-662695/#ixzz2CiY6D4hP

Supreme Court Ruling On Resale of Items Produced Abroad Could Affect Many

David G. Oberdick, Esquire
dgo@muslaw.com

Dave Oberdick was quoted in the article, “Supreme Court ruling on resale of items produced abroad could affect many,” that appeared in the Business section of the Tribune-Review.
 

Click here to read what Dave had to say. 

Minority Shareholders Gain Post-merger Rights

Alexis Unkovic McKinley, Esquire
aum@muslaw.com

The Pittsburgh Post-Gazette’s Business Workshop featured an article by Alexis Unkovic McKinley on minority shareholder rights. Click here to read, “Minority shareholders gain post-merger rights.”

 

 

Your Green Project Could End Up In Court

Chad I. Michaelson, Esquire
cim@muslaw.com

It makes sense that more and more building owners want to certify their commercial developments as green. On average, green buildings earn higher rents, have higher occupancy rates and sell for a 13% premium.

 

But overpromising or under delivering on a green project can lead the building developer into financial and legal hot water.

 

Owners and developers usually can’t get the money to build or renovate until they have tenants signed up. To get those tenants, owners and developers often tout the green features of the building and the expectation of green certification. But certification is not awarded until after a building is complete and more than a quarter of all buildings drop out before the certification is awarded.  And in other cases the building is awarded a lesser certification than was represented at the time potential tenants signed leases.

 

Without the promised certification, the building owner can suffer a pernicious domino effect: The tenants may terminate their leases, the lender may declare a default, the owner may lose tax credits or other incentives, and the partners and investors may sue.

 

Owners and developers must not overpromise.  Marketing materials should make it clear that a project under construction is merely registered for LEED certification and that the building in question may perform better or worse once it is operational. Moreover, landlords should not sign leases allowing tenants to terminate if LEED certification is not obtained.

 

Green building also complicates contracts with those who are doing the work. Just as a green building requires a more sophisticated design and construction methods, it also requires more sophisticated contract documents.  Those documents must clearly set forth the owner’s sustainability goals and allocate responsibility for reaching those goals among the owner, architect(s)/engineer(s), general contractor, subcontractors and suppliers.

 

The contract documents must be drafted with the certification process in mind.  They should clearly define who is responsible for maintaining and gathering the information necessary to support certification submittals and who is responsible for the submittals themselves.  The contract should also spell out precisely what type of supporting documents and information must be maintained. 

 

The contract documents also must provide for the possibility of a failure to achieve certification, or to obtain certification at the desired level.  Because the hallmark of green building is a sustainable design, much of the responsibility for reaching certification goals should fall on the architect’s shoulders.  The general contractor, however, has a responsibility to ensure that the building is built in accordance with that sustainable design.  Certification points could be lost if, for instance, the owner and general contractor agree during construction to substitute for a specified material or otherwise modify the design to reduce cost or save time.  In addition, the general contractor exercises control over certain activities that have a significant impact on a project’s ability to meet certification goals, such as management of construction waste.  Consequently, the contract documents must clearly spell out the responsibilities of each member of the team.

Meyer, Unkovic & Scott is pleased to welcome new attorney Valerie Kamin

Valerie B. Kamin, Esquire
vbk@muslaw.com

Valerie is an Associate at Meyer, Unkovic & Scott LLP and a member of the Real Estate & Lending Group.

She graduated cum laude from the University of Pittsburgh School of Law and upon graduating, was accepted to the Order of the Coif. Valerie earned the Thomas M. Cooley II Legal Writing Award for the most distinguished seminar paper, the Benjamin H. Tepliz Award for the highest third-year grade point average, as well as a Dean’s Scholarship. She also served as a Teaching Assistant for several professors and worked as a certified legal intern for the University of Pittsburgh Low Income Tax Clinic and Southwestern Pennsylvania Legal Services. While in law school, Valerie also spent a summer abroad at the University of Oxford studying comparative corporate law.

Deed Provisions and Timber and Mineral Rights

Ralston, et. ux. v. Ralston, et. al, 2012 PA Super 234, 2012 Pa. Super. LEXIS 3467 (2012)

 

Frank Kosir, Jr., Esquire
fk@muslaw.com

This matter addressed the issue of whether a provision in a deed retaining the grantors’ interest in timber and minerals constituted an exception or reservation of those rights and whether, upon the grantee’s violation of a restriction on alienation set forth in the deed, those timber and mineral rights reverted to the heirs of the grantors.  Walter Francis Ralston, Sr. and his wife Elverta Ralston (“Grantors) held title to a parcel of real property (“Property”) situated in Decatur Township, Clearfield County, Pennsylvania.  By deed dated June 30, 1984, the Grantors conveyed the surface estate of the Property to their son, Walter Francis, Jr. (“Junior”), with the deed excepting and reserving in the Grantors, inter alia, “all timber, coal, gas, oil, and all other minerals in and upon the said property together with the right of ingress, egress, and regress, in cutting, digging for, drilling for, or any other appropriate method of removal for said timber, coal, gas, oil or any other minerals, and the carrying away of the same.”  The deed also included a restraint on alienation stating that the surface could not be conveyed during the natural lifetime of the Grantors and that, upon the death of both the Grantors all reservations and exceptions set forth in the deed would be null and void, and title to the timber, coal, gas, oil, and all other minerals in and upon the Property would pass to Junior.

 

Upon the 1986 death of Walter Francis Ralston, Sr., Junior conveyed the surface to himself and his wife, Patricia L. Ralston (“Patricia”) as Tenants by the Entireties. Junior died in 1993 and, by operation of law, title to the surface passed to Patricia as the surviving tenant by the entireties. The original Grantor, Elverta Ralston, died in 1996 and, in 1999, Patricia conveyed her interest in the Property to her son, Bernard R. Ralston (“Bernard.”) In 2011, Bernard and his wife Marissa commenced a quiet title action in the Clearfield County Court of Common Pleas seeking to be declared sole owners of the surface of the Property, as well as the timber, coal, gas, oil, and all other minerals excepted and reserved in the June 30, 1984 deed.  In response, several heirs of the Grantors (“Heirs”) filed a counterclaim alleging a 5/7 ownership interest in the timber, coal, gas, oil, and all other minerals reserved and accepted.  The trial court entered summary judgment for the Heirs concluding that the 1986 deed from Junior to himself and Patricia violated the restraint on alienation clause set forth in the June 30, 1984 deed.  The court further concluded that the provision relating to title in the timber, coal, gas, oil, and all other minerals was an exception to the grant and that, as a result of Junior’s breach of the restraint on alienation, the rights in timber, coal, gas, oil, and all other minerals remained in the Grantors and passed to their heirs upon death.

 

On appeal, our Superior Court affirmed in part and reversed in part. The court affirmed with regard to the restraint on alienation provision concluding that, as the provision was limited in duration, it was a reasonable restraint on alienation and enforceable under Pennsylvania law.  However, with regard to the provision relating to timber, coal, gas, oil, and all other minerals, the court reversed.  In issuing its ruling, the court agreed with the trial court’s conclusion that the language constituted an exception, not a reservation.  However, in reviewing the language of the June 30, 1994 deed as a whole, the court found no provision indicating that a violation of the restraint on alienation would work as a forfeiture of Junior’s rights in the timber, coal, gas, oil, and all other minerals, and there was no evidence that the Grantors ever sought such a forfeiture after Junior conveyed title to the Property to himself and Patricia.  Rather, the “null and void” language evidenced an intention by the Grantors that the exception would terminate upon their respective deaths, and that title to the timber, coal, gas, oil, and all other minerals would pass to Junior.  As such, the trial court erred in concluding that Junior’s violation of the restraint on alienation resulted in a forfeiture of the timber, coal, gas, oil, and all other mineral rights and, upon the death of Elverta Ralston, title to the timber, coal, gas, oil, and all other minerals passed to Patricia as the surviving entireties tenant.

Meyer, Unkovic & Scott Welcomes New Attorney - Gary M. Sanderson

 

Gary M. Sanderson, Esquire
Associate at Meyer, Unkovic & Scott LLP
gms@muslaw.com

Gary's practice will include work in the Corporate & Business Law, Real Estate & Lending, Litigation & Dispute Resolution and International Law & Immigration Groups. 

 

He earned his law degree, cum laude, from the University of Pittsburgh School of Law in 2012, and was inducted into the Order of the Coif.  Gary also earned an additional Certificate in International & Comparative Law. While in law school he served as the Research Editor of the University of Pittsburgh School of Law Tax Review, a legal research and writing Teaching Assistant, a Research Assistant, and was the co-founder and Business Manager of the Business & Corporate Law Association. Gary also received two CALI Excellence for the Future Awards, in Federal Income Taxation and Immigration Law, respectively.

While in law school he worked at Meyer, Unkovic & Scott LLP as a Summer Associate and Law Clerk. Prior to joining the firm, Gary served as a Law Clerk at an immigration law firm, an intern at the Allegheny County Public Defender’s Office, and a Teaching Assistant, teaching international attorneys about the American legal system.

Patricia Dodge wins 2012 Professionalism Award

Congratulations to Patti Dodge who received the 2012 Professionalism Award, which is awarded by the Civil Litigation Section of the Allegheny County Bar Association to a lawyer who exemplifies the highest professional standards of the profession.

 

 

ABA Intellectual Property Roundtable - November 8th

Nobember Topic:  “How Can Fashion Companies Protect Their Designs Using Intellectual Property?”

David G. Oberdick, Esquire
ABA IP Roundtable Host
dgo@muslaw.com

Meyer, Unkovic & Scott is proud to sponsor the Pittsburgh Roundtable for the American Bar Association Intellectual Property Litigation Section.  These quarterly meetings allow IP litigation practitioners to network with other attorneys and discuss topics of interest.

 

All practicing attorneys interested in intellectual property matters are invited to attend.  Need not be members of the ABA IP Litigation Section.

 

Lunch will be provided by Meyer, Unkovic & Scott.

Thursday, November 8, 2012 @ 12:00 noon

Location:
Meyer, Unkovic & Scott LLP
Oliver Building, 12th Floor
535 Smithfield Street
Pittsburgh, PA  15222-2304
412.456.2800

Please RSVP by November 6, 2012 to: rsvp@muslaw.com or 412.456.4600

"Courtesy" in the Workplace?

Jane Lewis Volk, Esquire
jlv@muslaw.com

On September 28, 2012, the National Labor Relations Board ("NLRB") issued a decision that should be of interest to all employers who hope to foster courtesy in the workplace while staying within the limits of the law. In Karl Knauz Motors, Inc., 358 NLRB No. 164, the NLRB reasoned that an employer's policy, intended to promote courtesy and decorum, unlawfully chilled their employees' federal right to engage in conversation aimed at improving their working conditions or petitioning their employer - or a union - to do so.

The policy in question provided:

Courtesy: Courtesy is the responsibility of every employee. Everyone is expected to be courteous, polite and friendly to our customers, vendors and suppliers, as well as to their fellow employees. No one should be disrespectful or use profanity or any other language which injures the image or reputation of the [employer].

The NLRB reasoned that employees could construe this language as prohibiting conversations with their co-workers, supervisors, managers or third parties about objections to their working conditions and seeking the support of others in improving them. Employees could construe protest or criticism of the employer as "disrespectful" or "injur[ious]to the image or reputation of the employer" and thus fear to seek improvements in the workplace. For that reason, the policy was held to be unlawful, even though no employee had been disciplined under it.

Employers will understandably believe that this decision takes the "could construe" reasoning to an extreme. As pointed out in the dissenting opinion, the issue should be whether employees would "reasonably" understand a challenged policy to prohibit protected activity, not whether the language "could possibly" do so.

While the pendulum on this issue may swing back to a more reasonable interpretation, the decision stands as law and represents the position that will be taken by NLRB agents in reviewing employment policies. Employers are well-advised to keep this in mind in drafting workplace policies and rules. Employers should not over-reach in their understandable efforts to maintain appropriate levels of decorum in their workplaces. While profanity can certainly be prohibited, "respect" in the workplace, as anywhere else, cannot be achieved through mandate. Respect for your employees' rights will, one would hope, engender their respect for your employment policies.

Realty Transfer Tax - Shutting Down 89/11’s

Kevin F. McKeegan, Esquire
kfm@muslaw.com

Pennsylvania’s realty transfer tax is imposed on almost all recorded transfers of title to real estate within the Commonwealth.  Creative real estate lawyers and tax planners have long tried to avoid the tax by transferring ownership interests in entities holding title to real estate, rather than conveying title to the property itself by deed. So, for example, the members of a limited liability company or partners in a partnership would sell their interests in the company or partnership and the buyer would thus get control of the property through ownership of the company or partnership.    Since the late 1980’s, Pennsylvania limited the tax free nature of these transactions to only those where less than 90% of a company was sold within a three year period. This gave rise to the so-called 89/11 transaction in which a buyer would acquire 89% of a company holding real estate, and defer for three years acquiring the remaining 11%.  These types of transactions have been criticized by politicians and government officials as an unfair loophole, allowing buyers and sellers of significant commercial real estate buildings to escape a tax that otherwise impacts almost every other conveyance of property in Pennsylvania such as single family homes. As part of recently adopted amendments to Pennsylvania’s Tax Reform Code, however, after January 1, 2013, 89/11 transactions will almost entirely, be a thing of the past. In the legislation, which Governor Corbett signed earlier this month, 89/11 transactions will be fully taxable if there is a legally binding commitment to execute a transfer of the remaining 11% at a later date, the terms of the transfer are fixed and not subject to negotiation and the transferring party receives full consideration for the transfer.  The new statutory language suggests that options to acquire the final 11% of a real estate company, where the option price is “subject to negotiation” might escape realty transfer tax, but the practical business considerations that would make such a transaction unpalatable to most buyers and sellers likely mean that after the end of 2012, 89/11 transactions will be a thing of the past.

 

This article was also published by the Business Workshop section of the Pittsburgh Post-Gazette. To view the published article entitled, “Shutting Down ’89-11’ Property Sales,” click here: http://www.post-gazette.com/stories/business/news/business-workshop-shutting-down-89-11-property-sales-654706/?print=1

PBI Seminar on Green Building - Wednesday, October 31, 2012

Chad I. Michaelson, Esquire
cim@muslaw.com

Energy Efficiency, Green Building and Sustainability

Pennsylvania Bar Institute Seminar

Wednesday, October 31, 2012

 

Chad Michaelson will be presenting at the PBI Seminar on Energy Efficiency, Green Building and Sustainability.  He will discuss "Hot Topics in Green Building".

 

This seminar will provide the latest information related to green building, energy efficiency and sustainability.  Panels composed of attorneys and area experts will help you understand the most recent developments in the field and the legal implications.  By understanding the broader picture, you'll be able to advise your clients more effectively.  As a real estate attorney, construction lawyer, or in-house counsel these are issues you'll want to make sure you are on top of. 

 

CLE Credits will be offered to those who attend.  Please see the attached brochure for additional information.

Is now the time to give gifts to your children or grandchildren?

Amanda Gerstnecker, Esquire
arg@muslaw.com

Both the federal estate tax limit and the tax imposed are set to change at the end of this year, unless Congress takes action. It is widely anticipated that beginning on January 1, 2013, the federal estate and gift tax exemption will revert back to much lower 2001 levels and that estate tax rates will significantly increase.
 
The 2012 estate tax and lifetime gift tax exemption are $5,120,000 per person and $10,240,000 per couple, with a maximum tax of 35%. Beginning in 2013, if Congress fails to enact further legislation, the exemptions will drop down to $1 Million per person and there will be an effective tax rate of 55%. In other words, you will be able to gift free of tax approximately $4 Million less and will be taxed 20% more.

 

For those of you whose estates are at or near the $1 Million mark, now is the time to give gifts to your children or grandchildren to ensure that your gifts are exempt and that you can take advantage of the lower tax rate.

 

Since discussing and drafting a comprehensive estate plan takes time, you should begin thinking about the gifts you would like to make and contact us to ensure that you are able to take full advantage of the current estate tax limit and rate.

China or India: Where's The Best Place to Invest?

Dennis Unkovic
du@muslaw.com

For companies looking to sell their products and services abroad, both China and India seem to offer golden opportunities.  But in both countries, for every opportunity that exists there are also a number of pitfalls.

 

It makes sense that many western Pennsylvania companies would consider India – it’s the world’s largest democracy and a place where English is widely spoken.   Moreover, Pittsburgh’s research universities and high tech community have already created a number of successful ventures throughout the subcontinent. 

 

When 60 million people lost power in India recently, it symbolized India’s poor nationwide infrastructure of roads, bridges, railways, ports and electrical generating capacity.  Upgrading India’s infrastructure offers business prospects to engineers, equipment makers and other suppliers, but for other companies it could serve as an impediment to doing business.

 

Other drawbacks India must overcome include:

• An overly bureaucratic and frequently corrupt system of business regulation.
• A high and seemingly uncontrollable birthrate which threatens to tax the economic system.
• Historical political, religious and ethnic conflicts across India’s vast geographic expanse.

Given the current situation, India could represent a great investment opportunity for a company that needs a highly educated local workforce and for which an efficient distribution system is not essential. Other companies may run into some difficult challenges.

 

Now to China: While the Chinese economy appears to be slowing down, it is still the second largest in the world and growing.

 

Companies with plans to do business in China should keep in mind that there are really two Chinas: “Rich China” runs along the coast from Southern China near Hong Kong to north of Beijing and comprises 450 million people who are Westernized and clamoring for consumer goods.  “Poor China” refers to the rest of the country, still economically challenged.  

 

Other trends affecting China’s economy:

• China has pressing infrastructure needs. Water is not potable in many Chinese cities and railroad lines throughout the country are deficient.  Pollution in China is also a serious problem, as are power shortages that affect factories. China is committed to spending a lot of money internally to address infrastructure challenges, creating both jobs and wealth in China and for foreign companies.
• The Chinese government has announced that it is a national priority to acquire state-of-the-art technology from around the world to raise the level of its existing manufacturing competence and expand into new industries.
• Hu Jintao is the first major Chinese leader in decades to lead a comprehensive crackdown on governmental and institutional corruption.

Despite the recent slowdown of the Chinese economy, the 450 million people in “Rich China” and the government’s commitment to improving infrastructure everywhere means that China offers opportunities to many kinds of businesses, from those that design and build power plants and sophisticated manufacturing systems to those that make consumer goods for both the mass and luxury markets.

 

My conclusion: There are probably opportunities for a wider variety of businesses in China than in India at this point, but all companies should proceed with caution in developing plans for either country.

 

Dennis Unkovic is an attorney at Meyer, Unkovic & Scott who has helped many companies invest in Asia. He can be reached at du@muslaw.com.

Beth Slagle Honored by Dress for Success - Pittsburgh

Beth Slagle and Miss America, Laura Kaeppeler

Beth Slagle, Counsel with Meyer, Unkovic & Scott LLP, received the Founders Award from Dress for Success Pittsburgh at their Evening Of Celebration And Inspiration last week featuring Miss America 2012.  Beth was honored for helping to found the Pittsburgh Chapter and her continued commitment to their mission and significant efforts on behalf of Dress for Success.  

 

The mission of Dress for Success Pittsburgh is to promote the economic independence of disadvantaged women by providing tools and a network of support that help women gain and retain meaningful employment.  For more information on the organization you can visit their website:  www.dressforsuccesspgh.org.

Business Workshop: Will Gun Rights Supersede Employer Rights?

Jane Lewis Volk, Esquire
jlv@muslaw.com

The "at-will" firing rights of Pennsylvania employers could be threatened by those advocating an expansion of the right to carry firearms in public.

At-will employment means that an employer can fire any employee at any time without cause -- as long as the firing does not violate law, contract or public policy.

The "public policy exception" enables employees to fight a termination if they can identify a specific provision of state law or the constitution which states or expresses a public policy that would prohibit their termination.

A recent decision by the Kentucky Supreme Court concluded that Kentucky has a "strong public policy in favor of exempting a person's vehicle from restrictions on the possession of deadly weapons." The court ruled in favor of an at-will employee who brought a wrongful discharge lawsuit against his former employer after being fired for keeping a pistol in his car, which was parked in his employer's parking lot.

The court reasoned that Kentucky's protection of gun rights superseded the employer's right to ban firearms on its property.

Pennsylvania courts tend to review "public policy" claims carefully, and rarely find a clear expression of public policy prohibiting the termination of an at-will employee.

It is an open question as to whether Pennsylvania courts would conclude that there is a well-defined public policy that would trump an employer's right to terminate an at-will employee under circumstances similar to those in the Kentucky case.

But Pennsylvania legislators are working to eliminate the uncertainty. A bill titled the "Preservation and Protection of Firearms in Motor Vehicles Act" is currently pending in the general assembly, and it would recognize every citizen's right to conceal a firearm in their vehicle, and prohibit employers from interfering with that right.

Pennsylvania employers concerned about the possible erosion of their at-will rights as employers should contact their state legislators about the proposed law.

 

For more information on this topic, please contact Jane Lewis Volk at jlv@muslaw.com.

 

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section.  Business workshop is a weekly feature from local experts offering tidbits on matters affecting business.  Read more: 

http://www.post-gazette.com/stories/business/news/business-workshop-will-gun-rights-supersede-employer-rights-652591/#ixzz27oWPCZIm