Real estate investor partners: Is your word good enough?
With prices appreciating, and loan rates and inventory low, there is an increased willingness to own real property by two or more investors who need to combine their capital and/or credit to participate in buying, and flipping or renting the property. Often, the investors’ focus is on selecting the property or raising the down payment, with little or no consideration for what happens if co-owners disagree, one wants out, or the optimistic expectations are not realized.
A popular formula in the current flipping frenzy is for one investor to obtain the loan because of a superior credit rating and taking title, while the silent investor contributes funds for the down payment, and perhaps occupies the property as a de facto tenant paying “rent” as the monthly mortgage payment, and sharing the insurance, taxes, and other costs of the property. This allows the purchase and investment by investors who could not otherwise participate by themselves, and increases the number of players in the market. Continue reading
With Deception, Comes Consequence
For transactions with a middleman that deceives both the seller and buyer, section 3543 of California’s Civil Code can break the tie where both parties are negligent, stating where one of two innocent persons must suffer by the act of a third (i.e., middleman), he, by whose negligence it happened, must be the sufferer. Huh? What does not mean in simple English?
In other words, if both parties are negligent in closing a sale after being deceived by the middleman, the one who is more responsible for the loss must suffer and bear the loss. That appears easier to understand, but the application of section 3543 depends on the facts.
First, being the victim of deception can be interpreted as negligence or unreasonable conduct, a rather sad commentary on our internet society that almost demands that you mistrust, confirm and verify everything you may be told. So it may not be enough to prevail by claiming there was no resisting the false promises or conduct of the middleman. Continue reading
Q: My neighbor’s camphor tree has branches that overhang the wall between our properties, and its roots are extending into my yard and damaging both the wall and my patio deck. Can I cut the branches and roots and bill my neighbor?
A: With recent developers positioning houses very close to the property lines to maximize the number of houses in the development, it is more common for branches and roots of a tree to extend over and into the property of the adjacent owner. Although the adjacent owner has rights to cut the intruding branches and use any overhanging product, such as fruit, both the tree’s owner and the adjacent owner have certain duties and responsibilities depending upon the particular circumstances.
First, the location of the trunk of the tree determines who owns it, even if the roots grow into the land of another. If the tree is located directly on the boundary line between the properties, then both landowners have common ownership of the tree which affects application of the rules described below. Neither owner has a right to cut down a tree on the property line or cut any part without the consent of the other owner, even if the tree is causing damage. Continue reading