Due diligence is critical in commercial real estate transactions
Because the concept of buyer beware applies to commercial real estate purchases in Florida, due diligence is crucial and rests on the shoulders of the buyer.
The Law Office of David Steinfeld guides both buyers and sellers in structuring certain aspects of commercial real estate transactions. Depending on the property, due diligence may include reviews of rent rolls and the operation of a business or businesses on the property or it may focus more on the condition of the property itself.
Disclosure obligations for residential vs. commercial property
In 1985, the Florida Supreme Court decided in the case of Johnson vs. Davis that "buyer beware" does not apply to residential transactions. The ruling was that sellers must disclose known material facts that are unobservable to a buyer. So in Florida, from that time forward there has been a distinct difference in the manner in which residential and commercial real estate transactions are handled. A seller's failure to disclose material defects is one of the most common disputes in residential real estate.
The seller's disclosure requirement is included in all standard FarBar real estate contracts. In addition, most brokers require sellers to complete a separate disclosure form. This essay discusses what happens when a seller fails to disclose those defects.
What are the key documents use in the purchase and sale of real estate
Florida law requires that all real estate transactions must be evidenced by a writing. So a handshake agreement to buy or sell property is not enforceable in Florida.
Residential property purchases are commonly regulated and documented by a standard contract developed jointly by the Florida Bar and the Board of Realtors. It is called the FarBar contract.
Commercial property is unique as compared to residential real estate. There is no standard approved form for such transactions. They are specially crafted by real estate attorneys who practice in the transactional arena.
Who is the best business lawyer for buy-sell agreements in Florida
For several years, David Steinfeld has edited the Chapter on purchase and sale of businesses in Florida for the Florida Bar in its Small Business Handbook. This is a volume that is used by lawyers throughout the State in understanding how to structure such transactions and even provides sample documents for them to use. Thus, in a manner of speaking, you can say that Board Certified expert business lawyer David Steinfeld literally wrote the book in Florida on how to structure contracts for the purchase and sale of businesses. These are the key concepts to know in buying or selling a business.
Lawsuits explained – Part 8 of 8
Congratulations, you have made it through this series explaining how business lawsuits work in Florida. This entry concludes our study of the topic and examines the trial as part of the third phase of the three basic parts of a business lawsuit.
We reviewed the pleadings stage and discovery phases and conducted a deeper dive into those phases. We also analyzed direct settlements, mediation, and arbitration as mechanisms of resolving business disputes in whole or in part. Now we will turn our attention to the most formal method of resolving business disputes, which is the trial. We will examine what really happens in a business lawsuit trial.
Lawsuits explained – Part 7 of 8
In our examination of the third or conclusion phase of a Florida business lawsuit we previously reviewed the informal resolution methods of settlement and mediation. Those are classified as informal because they are often handled by the parties directly. While it is true that a mediation can and often does have a mediator at the helm, that person is not empowered like a judge or arbitrator to make decisions.
Now we will examine the more formal methods of resolving business disputes in Florida, which are arbitration and the trial. We will split these into two sections with the trial addressed in the subsequent entry.
Lawsuits explained – Part 6 of 8
In our examination of the three basic component parts of a business lawsuit in Florida we have analyzed the pleadings phase and the discovery phases. The pleadings phase is essentially where the parties put their cards on the table so to speak and define what the dispute is about. The discovery phase is where the parties exchange and obtain information and take depositions to both verify their claims and to disclose to the other what their claims are based upon.
We now proceed to the third phase in a business lawsuit in Florida, which is the conclusion or resolution of the dispute in some form or another. Most commonly thought of is the trial, but before that can occur the parties must mediate, which can often lead to a settlement. Therefore, the first possibilities we will examine are settlement and mediation.
Lawsuits explained– Part 5 of 8
In Lawsuits explained Part 4 we started looking at the second or discovery phase of a business lawsuit in Florida. This is part of our overall examination of the three basic phases of a business lawsuit; the pleadings, discovery, and resolution phases. In the preceding section we looked at depositions as one method for parties to use to question another party or a third-party outside of the lawsuit to obtain or clarify information and documents.
In this section we will review how parties can obtain and exchange information other than by depositions. While depositions have their place and are an effective means to obtain information and evaluate witnesses, other discovery devices like interrogatory questions or document requests can be an efficient means to obtaining information in discovery.
Lawsuits explained – Part 4 of 8
In the entry titled Lawsuits explained Part 3 we looked at the pleadings phase of a business lawsuit in Florida. We next turn to the second phase, which is the discovery phase.
In this phase of a business lawsuit, the parties generally exchange and obtain information and take depositions. The focus of this entry is on depositions and how those work. The next entry will examine how the parties can obtain information in a lawsuit other than by depositions.
Lawsuits explained – Part 3 of 8
In Lawsuits explained Part 2 we looked at the three basic phases of a business lawsuit in Florida. Now we will break them down further in this and the next two entries. First we will look at the pleadings stage which is where the issues are framed out with filings to the court like the lawsuit and motions that seek to define the issues such as motions to dismiss.
Lawsuits explained – Part 2 of 8
A business lawsuit in Florida can essentially be broken down into three component parts. The pleadings stage, the discovery phase, and the conclusion.
The first stage is the pleadings stage in which the parties basically file documents with the Court that tell each other what the lawsuit is about. There can be challenges to the claims and refinements of those known as motions to dismiss and amended complaints, but eventually after those issues are all worked out either between the lawyers or by a Judge, this stage comes to an end unless something unique comes up later that causes the parties to have to revisit what they said the lawsuit was about
Lawsuits explained – Part 1 of 8
Lawsuits are our society’s mechanism for resolving disputes between businesses that they are unable to resolve on their own. What happens is a business lawsuit is something every business owner should be acquainted with because they take a good deal of time and money.
Fortunately, David Steinfeld, owner of the Law Office of David Steinfeld in Palm Beach Gardens is a Board Certified expert in business lawsuits with almost twenty-five years of experience.
Making a business in Florida – Part 9 of 9
As we examined in the preceding post trademarks and service marks are one method by which a business can add value to and protect its brand. But they are not the only protection available to your business.
Non-compete agreements, non-solicitation agreements, and non-disclosures are also mechanisms by which a business can place itself in a position to more easily enforce its rights and protect itself. However, there are certain legal restrictions that apply to some of those documents leading one to the recommendation of “don’t try this at home”.
Making a business in Florida – Part 8 of 9
When a for profit business opens in Florida, it will generally either provide a service or sell merchandise. In either case, the intent is usually to operate the business to earn a profit for its owners.
To that end business owners strive to market and promote the business to increase sales and generate that profit. Thus, protecting the business from a lawsuit should be part of its natural development and growth plans.
Making a business in Florida – Part 7 of 9
A foreign or non-Florida businesses is one that is registered in another State or Country. Florida encourages and provides an easy means for those foreign businesses to register to conduct business legally in Florida.
If you want to do business in Florida, you can form a business here or if you already have an out of state business or one in another country, you can continue to use that business entity and legally conduct business in Florida.
Making a business in Florida – Part 6 of 9
The likely primary reason why the LLC has become the dominant business entity in Florida is the relative ease by which it can be managed. The limited liability company has many benefits and that is certainly one of them.
Our LLC laws do not require that the owners, who are either managers or members, necessarily have a written operating agreement between them, but without such governing document, the owners are essentially stuck with what the Legislature has given them, which may or may not be what they desire or intend.
Making a business in Florida – Part 5 of 9
Not every LLC needs an operating agreement or requires one from its inception, but the decision as to whether the LLC really needs one and when it should have one should be made by the owner or owners after understanding the issues that impact the decision.
Without an operating agreement, the LLC is bound by the Revised LLC Act, Chapter 605, Florida Statutes. Therefore, the company gets what the Legislature decided in those Statutes that the business should have. Sometimes, this one-size fits all approach is not appropriate for or tailored to the needs of the business.
Making a business in Florida – Part 4 of 9
To create a business in Florida, all one has to do is log on to the Sunbiz website and follow the prompts. It is no different and no harder than purchasing merchandise online.
While a corporation is said to be “incorporated” and an LLC “organized”, the result is that once approved, Articles are filed with the State and the entity is born.
Making a business in Florida – Part 3 of 9
One of the reasons why the vast majority of all businesses now formed in Florida are LLCs is because it acts like something of a hybrid; it provides and combines the protections of the corporation with which many are familiar with the practical day-to-day use and feel of the partnership.
Making a business in Florida - Part 2 of 9
The most common business entity used at present in Florida is the LLC. This essay examines what was its birth and where did it come from.
Historically, several hundred years ago, the partnership was the only method by which to conduct business with others. Then, in the mid-1500s, the corporation as we understand it as a means to do business came into being to support voyages to the new world.
Making a business in Florida - Part 1 of 9
Your choices for making a business in Florida are one of three types of businesses or business entities in Florida. First there is the corporation, which is designated by the letters Inc. Second is the limited liability company, designated by the letters LLC. Third is the partnership with its various permutations that are represented by letters such as L.P. for limited partnership and L.L.L.P. for limited liability limited partnership.
Contrary to common belief, the S Corp is not a legal business entity, but is merely a tax election that a business owner makes with its accountant. I have a separate entry comparing the Inc. and LLC that provides additional detail as well as more detailed articles on my website.
The Palm Beach Business Lawyer Blog
Board Certified expert in Florida business law, David Steinfeld has almost 25 years legal experience.