September 24, 2015

An Offering Memorandum Triggers Duty of Inquiry and Statute of Limitations in Investments Gone Bad

In the matter of WA Southwest 2, LLC v. First American Title Ins. Co. (2015) 240 Cal.App.4th 148, investors in a real estate deal alleged that their broker had made material misrepresentations and committed fraud. Specifically, the investors alleged that their  broker had represented that the property had been subjected to a thorough due diligence review and that the sales load would be less than 10%. According to the investors, however, this was not true. Rather, the actual sales load was purportedly in excess of 20%.

Putting aside the alleged oral representations, the court noted that a written Offering Memorandum provided to the investors had indicated that the sales load exceeded 10%. Thus, the court held that the inconsistency between the Offering Memorandum and the alleged oral representations of the broker put the investors on notice of a falsity and that the investors had a duty to inquiry thereafter. The investors failure to inquire was not only in breach of their obligations, but also started the running of the statute of

limitations on any claims by the investors. As the investors failed to timely bring suit against their broker based on the time of the receipt of the Offering Memorandum, the court concluded that their claims were barred by the statute of limitations and the case was dismissed.

August 10, 2015

The Ponist Law Group Obtains a Favorable Judgment After Trial for Special Needs School

The Ponist Law Group represented a school serving special needs students against lessor attempting to terminate school’s lease. After a bench trial, the judge rejected lessor’s efforts to terminate the lease early and, instead, awarded the school an extension of its lease.

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August 10, 2015

The Ponist Law Group Obtains Favorable Judgment After Trial for Client Special Needs School

A judge has ruled an Allied Gardens school, which caters to special needs students, will be able to stay at its location until 2021, despite objections from the San Diego Unified School District.
In May, Excelsior Academy filed a lawsuit against the SDUSD, claiming the district violated the terms of the school’s lease when it told administrators to vacate their location by March 2018.
The SDUSD sold the property to the Islamic School of San Diego for $2,775,000 in February.
“The reason the school district did not want Excelsior to stay in the property longer, as far as we understand it, is that they received a notice from the Islamic School of San Diego requesting that we be thrown out, or Excelsior be thrown out,” said Sean Ponist, the attorney for Excelsior.

June 1, 2015

Going to the Source: Minimize your liability by providing attributions

Commercial Investment Real Estate Magazine (May/June, 2015)
Sep 16, 2015, San Francisco Bar Association 

A presentation addressing legal issues that arise when real estate agents “go rogue” and engage in conduct which may or may not be within the “scope of their employment.”

April 27, 2011

Recovering Lost Profits In Real Estate Transactions

Real Estate Quarterly Supplement to the Daily Journal (April 27, 2011)

This article discusses the recent Greenwich decision which has opened the door to the recovery of lost profits, but just slightly. As explained in the article, “Aggrieved investors should seek lost profits, but need to be mindful that courts are still skeptical of lost profits damages and will not allow them where even remotely uncertain or speculative.”

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October 17, 2010

The Nonrefundable Deposit—Not!

“In many transactions, the seller requires that the buyer pay earnest money in the form of a non-refundable deposit. The deposit is one way the buyer can communicate to the seller that he or she really means business. Indeed, such deposits have for years been commonplace. Recently, however, the court of appeal ruled that a non-refundable deposit is in reality a form of liquidated damages and voided the practice despite the clear contractual documents that called for it…”. 

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August 5, 2010

Should Equitable Indemnity Apply Against Negligent Misrepresentation Claims?

San Francisco Daily Journal (August 5, 2010) 

“The law is clear that a party is entitled to seek equitable indemnity against negligence claims alleged against it. Similarly, the law is clear that a party is not entitled to indemnity against fraud, intentional torts and other torts for which the application of indemnity would violate public policy. But the law is much less clear as to a party’s right to indemnity for negligent misrepresentation, a cause of action which straddles the line between negligence and fraud. Although the issue arises frequently between joint tortfeasors, the appellate courts have yet to address it. In their silence, trial courts have been all over the map…”

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