Building Central Florida – New Member Profile

Building Central Florida, November, 2005

Pohl & Short, P.A. is a business boutique law firm, focusing its practice on the representation of Florida’s small and mid-size companies. A boutique firm is one with a concentrated practice area, providing high quality legal services at a reasonable rate. A boutique law firm serves as an alternative to the large law firms in which clients often lose a sense of personalized service. At Pohl & Short, most of the attorneys have years of experience in their practice area and handle their cases directly, rather than delegating them to less experienced associates.

Pohl & Short has recently joined ABC to highlight its long-standing representation of the various players in the construction industry, including private developers, public owners, general contractors, subcontractors, suppliers, architects, and engineers. Over the years, the firm’s attorneys have handled complex construction matters, including contract drafting and negotiation, scheduling claims, bid protests, terminations, design and construction deficiencies, licensing issues, and lien and bond disputes. James C. Washburn, Esq., an attorney with the firm, is Board Certified in Construction Law, representing The Florida Bar’s highest level of recognition for an attorney’s competency in a particular area of law.

Pohl & Short recognizes that in addition to purely construction-related legal matters, their corporate clients and their principals have issues common to all small and mid-size business owners. The ability to address these other tangential issues - with the personalized service associated with boutique firms - is what makes Pohl & Short the firm of choice for many in the construction industry.

In addition to purely construction related matters, our attorneys practice in the following areas of business law: corporate law, commercial litigation, real estate law, and a combination of probate, tax, estate planning, trusts, and asset protection law.

Pohl & Short’s Business Transactions Department offers sophisticated legal services, drafting documents and providing tax and other regulatory advice regarding the organization, operation and sale of all business entities, both domestic and international.

Our Tax and Estate Planning Department allows our clients to have their personal estate planning and business legal matters met in an atmosphere dedicated to meeting their unique needs, including family business succession planning.

The firm also maintains a Real Estate Department, providing legal guidance on issues such as: commercial land acquisition development, mortgage financing, commercial leasing, zoning and land use, residential real estate, as well as, our own in-house title division.

Pohl & Short’s Litigation Department handles arbitrations, alternative dispute resolutions, mediations, and administrative hearings at the federal, state and local levels.
To discuss how Pohl & Short can serve your legal needs, please contact us at (407) 647-7645 or visit our website at www.pohlshort.com.

IF ONLY…WHEN “FEE SIMPLE” MAY NO BE SO SIMPLE.

Winter Park Home, Fall, 2005

A potential client (who I will refer to as Ann) recently asked me to handle the closing on a property that she owned with her aunt, who had died two months earlier. Ann had already signed a contract to sell the property and was looking forward to a problem free closing. As I read the deed, it became immediately apparent that this wouldn’t be a simple closing process. Unfortunately, the deed did not include the magic words “as Joint Tenants with full rights of survivorship”.

I had to tell Ann that she only owned a half interest in the property and that she would have to probate her aunt’s estate in order to close on the property. Furthermore, unless she is the aunt’s sole heir, Ann will have to share the property and its proceeds with one or more of her aunt’s heirs. Shocked at this unexpected discovery, Ann repeatedly told me that she and her aunt had numerous discussions regarding the disposition of the property in the event of her aunt’s death. These discussions took place before they bought the property and her aunt clearly wanted Ann to assume sole ownership of the property when the aunt died. I had to explain to Ann that although I understood her position, the law says otherwise.

Regrettably, this situation is all too familiar. Unless the intentions of each party are clearly expressed in the deed, the wishes of the parties cannot be acted upon. They simply become unrealized wishes.

There are three “fee simple” (fee simple means unconditional ownership) forms of ownership pertaining to real property (or “tenancy”) by two or more individuals. These forms are tenants by the entirety, tenants in common, and joint tenants. Each form has specific purposes and, when properly stated, will have the intended results.

Tenancy by the Entireties applies ONLY to married couples. If the grantee of a “fee simple” deed is a husband and wife, a tenancy by the entirety is created, even if the deed doesn’t recite the marital status. If a contrary intent is desired, it must be specifically stated in the deed. This means the husband and wife own the property as one entity. If one dies, the property automatically goes to the other. It also means that any judgment against one (and not both) cannot be enforced against the property as long as they remain married. However, if the parties get a divorce, the survivorship and judgment benefits go away and they become tenants in common. Even if they subsequently patch things up and remarry, the newlyweds would have to execute and record a new deed in order to re-establish the marital/entireties status.

The most frequent for of tenancy used by non-married individuals is known as “tenancy in common.” Each individual owns his/her share completely, to the exclusion of the other owners. In a tenancy in common, the proportional shares are whatever the parties want (equal or unequal). The proportional shares must be expressed in the deed or the parties are presumed to be equal shareholders. Each tenant can sell his or her share by separate deed.

If no form of tenancy is stated on the deed, the property is automatically owned as tenants in common. This oversight brought about Ann’s problem. If a party to the deed dies, his/her share must be transferred by will or the laws of intestacy to the deceased’s heirs. In such a case, there will be the additional expense to probate the estate in the circuit court, as well as the time lost in processing the necessary forms. For some people, this process is quite acceptable. For others, it creates a costly and unnecessary hardship. For those individuals, the “joint tenancy” form can be used to avoid the probate process. If two or more non-married individuals want the property to pass automatically to the surviving parties, “joint tenancy” is an excellent way to accomplish that objective without probate.

Each tenant must have an identical interest in the property, and the joint tenancy language, which I referred to earlier as “the magic words,” must be present in the deed. For example, if three people buy property as joint tenants, their interest must be one-third each. If any other percentage is stated, the parties will own the property as tenants in common, even when the words “joint tenants with full rights of survivorship” are stated in the deed. In cases where the joint tenancy language is clearly stated, any one of the joint tenants can still terminate the joint tenancy status by separately selling, mortgaging, or even leasing his/her interest. By doing so, that tenant will now own his/her property as a tenant in common with the remaining property owners. However, the other owners will remain joint tenants as to each other.

Let’s say that Harry, Ron and Hermione take title to property as joint tenants with full rights of survivorship. Later, Ron separately deeds his share of the property to Rubeus. Rubeus now owns his share as a tenant in common. If Rubeus dies, his interest in the property will need to be probated. But, Harry and Hermione will remain joint tenants as to each other. If Hermione dies, her interest will automatically go to Harry, thus leaving Harry with a 2/3 interest in the property and Rubeus with a 1/3 interest as tenants in common.

At the closing table when two non-married people are asked whether they want to purchase the property as joint tenants or as tenants in common, I hear many different responses. Often, there is a hesitation, an unstated query of “what is in my best interest.” The question may be easy for a mother and daughter to answer, but not so easy for two unrelated individuals.

As a morose as it may seem, when entering into a “fee simple” ownership contract, it is important to anticipate the worst case scenario-the death of one of the parties. Otherwise the survivor could be left to sort out a host of legal problems while thinking, “If only I had addressed this issue when we closed on the property.”

Visit our website for more information on this subject.

Frank Pohl founded Pohl & Short, P.A. based upon the belief that a high quality small commercial law firm was needed in the Orlando, Florida area as an alternative to the large commercial law firms. He still believes that client responsiveness and satisfaction has a place in a fast changing legal profession. Frank has been involved in the Central Florida community for more than twenty-five years. He has been a dedicated past board member of many local organizations over the years. Frank graduated magna cum laude with a B.G.S. Degree from the University of Miami in Coral Gables, Florida; attended the University College at the University of London as an undergraduate studying British literature and British history; obtained his Juris Doctorate Degree in 1979; and obtained a Masters of Law and Letters Degree (LL.M.) from New York University School of Law in 1980. Frank is a member of The Florida Bar, the California Bar, and the District of Columbia Court of Appeals. He is also admitted to the U.S. Supreme Court. He has served on the Orange County Bar Association Real Estate Committee and is a member of the The Florida Bar’s Real Property and Corporation and Business Law Section. He has also served on the Florida Bar Grievance Committee.

MECHANICS LIENS & HOW TO AVOID THEM

Winter Park Home, Summer, 2005

As a Winter Park homeowner, you are undoubtedly going to be contracting for repairs or improvements to your property from time to time. For small jobs involving a single tradesperson or a company that performs all facets of the work, the process is usually pretty straightforward. The company does the work and you write a check for the agreed to contract price.

Larger and more complex undertakings can often involve several subcontractors and suppliers brought in by the general contractor. That’s when the Florida mechanics lien law becomes a very important aspect of the project. The law provides the homeowner with certain protections and also requires specific warnings to help the homeowner navigate and assure payment of multiple bills--often from unknown suppliers, subcontractors and laborers.

Let’s assume that you’ve decided to build that new master bathroom. You contract with Slamemup Renovations to handle the job. Slamemup, acting as general contractor, will probably bring in a variety of subcontractors and suppliers to provide the materials and do some or all of the work. You make progress payments to Slamemup and expect the company to pay the subcontractors and suppliers their share. If the subcontractors fail to receive payment for their products and services, they can file a lien against the property to assure payment.

A lien is a statutory mechanism that allows the unpaid lienor to have the property foreclosed and sold, if necessary, in order to receive payment. The mechanics lien law also allows the foreclosing lienor to recover attorneys’ fees and costs as well as the entire value of the lien. Now that you are sufficiently alarmed and all of those unscrupulous contractor horror stories you’ve read over the years have come flooding out of the deep recesses of your mind into the forefront of your consciousness, you should also know that the Florida lien law provides a reporting system that helps you keep track of the entire payment process.

Each supplier, subcontractor, or (in some cases) laborer who is not directly contracting with the homeowner is required by statute to give the homeowner a notice that they have worked on the property. This document is called a “Notice to Owner” and must be delivered within 45 days following the first delivery of materials or first work performed on your home by that supplier or subcontractor. Failure to provide a Notice to Owner within the specified time period results in the absolute loss of any right to later claim a lien against the home.

Depending on the complexity of the project, you should expect to receive these notices from multiple parties. You may not have even been aware of some of them. The Notices are provided so that you can police your general contractor and ensure that at every step along the way each and every party who should be paid has been paid.

The Notice to Owner will also ask you to contact the subcontractor or supplier and ensure that they have been paid prior to disbursing funds to the general contractor. It helps assure that you don’t wind up paying twice for the same services or materials.

These notices will be delivered to your home via certified mail because statutes require that suppliers and subcontractors send their Notice to Owner by that delivery method. The notice process is set up in such a way that the homeowner can rely on certified mail to ensure that the notices are delivered and when they arrive. The homeowner has no obligation to seek out parties who do not provide a Notice to Owner.

Savvy homeowners keep a log of each Notice to Owner received and require proof of payment from the general contractor before disbursing funds or require a progress payment affidavit from the contractor as a condition to making a payment.

Each supplier or subcontractor must record a Claim of Lien within 90 days of the last date that the individual or company worked at or delivered supplies to your home. The statutes also require that the homeowner be provided with a copy of the Claim of Lien by certified mail in order to ensure that the homeowner knows of the outstanding bill prior to disbursing any final payments to the general contractor.

Before making any final payments to a general contractor, the homeowner should require a Final Contractor’s Affidavit, wherein the general contractor swears that all subcontractors and suppliers have been paid in full under penalty of criminal law.

Although few home renovation or repair contracts go awry, it does happen. Whether it’s a well-intentioned general contractor whose business collapses or an unscrupulous contractor who collects the lion’s share of the money and then skips town, the result is the same – a homeowner who must deal with unpaid suppliers and subcontractors. Thus, the advice of an attorney should be sought to explain the “ins and outs” of the Mechanics Lien Law and to assist the homeowner in obtaining the appropriate affidavits from the general contractor with respect payments to all those who participated in the enterprise.

Visit our website for more information on this subject.

Frank Pohl founded Pohl & Short, P.A. based upon the belief that a high quality small commercial law firm was needed in the Orlando, Florida area as an alternative to the large commercial law firms. He still believes that client responsiveness and satisfaction has a place in a fast changing legal profession. Frank has been involved in the Central Florida community for more than twenty-five years. He has been a dedicated past board member of many local organizations over the years. Frank graduated magna cum laude with a B.G.S. Degree from the University of Miami in Coral Gables, Florida; attended the University College at the University of London as an undergraduate studying British literature and British history; obtained his Juris Doctorate Degree in 1979; and obtained a Masters of Law and Letters Degree (LL.M.) from New York University School of Law in 1980. Frank is a member of The Florida Bar, the California Bar, and the District of Columbia Court of Appeals. He is also admitted to the U.S. Supreme Court. He has served on the Orange County Bar Association Real Estate Committee and is a member of the The Florida Bar’s Real Property and Corporation and Business Law Section. He has also served on the Florida Bar Grievance Committee.

Boutique Firm Sticks To Early Roots

Pohl & Short, P.A.
Year founded: 1993
Name partners: Frank Pohl, Houston Short
Attorneys: 14
Total staff: 55
Practice areas: Real estate, business law, commercial litigation and tax and estate planning
Web site: www.pohlshort.com

Pohl & Short, with 14 attorneys, calls itself ‘the alternative to a large law firm.’
By Jill Krueger/Staff Writer

ORLANDO—A dozen years ago when attorney Frank Pohl and Houston Short broke away to start their own firm, they searched far and wide for a formula to sustain what they wanted: a boutique law practice. Pohl, in fact, traveled to New York, Chicago and Los Angeles to observe the inner workings of successful specialty firms.

In shunning a general practice structure, the partners established in 1993 a firm, they say, rooted almost exclusively in four practice area: real estate, business law, commercial litigation and tax and estate planning.

Today, Pohl & Short, P.A. has not wavered from its focus. The firm targets small to midsize businesses that are dealing with complex problems and want more personalized service than large law firms can offer.

“We are the alternative to a large law firm,” says corporate and tax law attorney Gary A. Forster.

‘Preventive law’
Though Pohl & Short started with three lawyers and a paralegal, the firm now has 14 attorneys and a total staff of 55 people.

Pohl gives several reasons for the firm’s longevity.

Among them is the fact that the firm practices “preventive law.” Pohl refers to the firm’s attorneys as “counselors at law” who build relationships with their clients and help them solve problems before they develop into big issues.

Take, for example, Dr. Alan M. Cohen, chief executive officer and medical director of the National Deaf Academy LLC.

“I have not had a single contract with a secretary or a paralegal,” he says. “I have direct access to three senior attorneys whenever I need it.”

Cohen says he’ll continue doing business with Pohl & Short, because “it is a small commercial firm that offers sophisticated legal services.”

Limiting firm’s size
Pohl & Short recently added a new partner and a litigator. But unlike many other small law firms, Pohl says he’s limiting the firm’s size.

“Our goal is no more than 15 or 16 lawyers,” he says. “We don’t want to add clients just to add clients, but to add quality clients.”

Rich Heinle, a corporate business law veteran previously with Foley & Lardner, was recently elected as a partner. Pohl also brought aboard Orlando litigator Steve McDonald, who has more than 20 years of experience.

Their backgrounds are typical of the firm’s attorneys, who have an average of 10-plus years of experience.

Beyond the two recent additions, Pohl says he plans to add two more attorneys at the most.

When you go beyond 15 or 16 attorneys, “it is hard to maintain the quality of what goes out the door,” he says.

Visit our website for more information on this subject.

WHO DO YOU TRUST?

Winter Park Home, Spring, 2005

Trusts can be tricky. Consider the case of a man who turned to me when he ran into a huge obstacle that derailed his efforts to obtain a mortgage from a local bank. Ironically, he had inadvertently created the obstacle by his own actions. Fresh from attended a seminar on trusts and excited about the potential advantages offered by these legal tools, the individual promptly conveyed his home into a trust, using forms he had received at the seminar. Unfortunately, he failed to name a trustee on the deed.

Upon reviewing the trust, I determined he had not only failed to name himself (or anyone else) as the trustee, but also had not granted any powers to a trustee anywhere in the trust. He had, in effect, written his property into an inaccessible box. He could neither sell nor mortgage it until substantial legal work was undertaken to extricate him from this self-inflicted problem.

Trusts are often used to purchase real property. When properly set up, they are an effective form of ownership. Their purposes include, but are not limited to, estate planning, insulating property from the claims of judgment creditors, and/or allowing multiple properties to be purchased without disclosing on the public record the identity of the actual principals. Let’s examine the basic format of a “trust” and some of the issues associated with conveying real property in Florida, when title is held in a trust.

A “trust” is a form of ownership by which a Grantor transfers property to a named individual (a “trustee”), under the terms of a written document (the “trust”), to administer the property for the benefit of one or more individuals or entities (the beneficiaries). In most trusts, known as “active trusts,” the trustee is given the power to make all decisions involving the assets of the trust, including the power to sell, convey and mortgage real property, without interference or direction from any other parties. In other trusts, known as “passive trusts,” the beneficiaries direct the trustee on how to act – the trustee in this example is more of a figurehead, without any real power.

Conveyances involving trusts must include both the name of the Trustee and the name of the trust itself. It is the Trustee acting on behalf of the trust, and not the trust itself, that has the legal power to convey real property. If the land trust powers are recited in the deed, but the name of the trustee is not shown on the deed, the benefits of any land trust will be lost, since the trustee will have to prove his identity on the public record. This can only be done by recording the entire trust, or relevant portions of the trust. If the trust is passive, each one of the beneficiaries will be treated as an actual owner of the property, and will also have to execute the deed or mortgage. Since most trusts are created to avoid letting others know the terms of the trust and the names of the beneficiaries, the advantages of placing the property in the trust will obviously be eliminated in this case.

Homestead is another factor to consider when conveying property into trusts. Under Florida law, if the trustee uses the property as a primary residence, any deed or mortgage by the trustee will also have to be signed by the trustee individually, along with the trustee’s spouse.

There is also a misconception that placing property into a trust guaranties that the property will not have to be probated when the trustee dies. Although this may often be true, it is important to be guided by competent legal counsel. The following example illustrates a situation where property held in trust still needs to be probated.

Michael Johnson, a divorced father of minor children, owns homestead property and places it into his trust, naming himself as the trustee, while reserving the right to revoke the trust at any time. Mr. Johnson then dies without leaving a will. The successor trustee named in the trust now contracts to sell the property.

Even though the language in the trust clearly authorizes the successor trustee to sell the property, Florida law prohibits the successor trustee from transferring the property because Mr. Johnson was survived by minor children. The property will have to be probated because minor children have rights in homestead property that must be probated.

There are obviously many factors to consider when creating a trust.

Before transferring any real property into a trust, you should always obtain competent legal advice to determine the correct parameters of your trust document, and the best language to be placed into the deed when you initially purchase the property on behalf of the trust.

Visit our website for more information on this subject.

Frank Pohl founded Pohl & Short, P.A. based upon the belief that a high quality small commercial law firm was needed in the Orlando, Florida area as an alternative to the large commercial law firms. He still believes that client responsiveness and satisfaction has a place in a fast changing legal profession. Frank has been involved in the Central Florida community for more than twenty-five years. He has been a dedicated past board member of many local organizations over the years. Frank graduated magna cum laude with a B.G.S. Degree from the University of Miami in Coral Gables, Florida; attended the University College at the University of London as an undergraduate studying British literature and British history; obtained his Juris Doctorate Degree in 1979; and obtained a Masters of Law and Letters Degree (LL.M.) from New York University School of Law in 1980. Frank is a member of The Florida Bar, the California Bar, and the District of Columbia Court of Appeals. He is also admitted to the U.S. Supreme Court. He has served on the Orange County Bar Association Real Estate Committee and is a member of the The Florida Bar’s Real Property and Corporation and Business Law Section. He has also served on the Florida Bar Grievance Committee.