The Lawletter Vol 47 No 2

Alistair Edwards—Senior Attorney, National Legal Research Group 

            It is not unusual for homes in a subdivision to be subject to restrictive covenants limiting the owners’ use of their property to residential purposes and/or prohibiting the use of the property for commercial, trade, or business purposes. This sort of restriction can also be found in instruments such as declarations governing condominium or townhouse communities. With the increasing popularity of programs such as VRBO and Airbnb, numerous courts have recently dealt with the issue of whether these so-called short-term rentals violate these sort of use restrictions. So far, the courts, strictly construing the covenants, have been fairly hesitant to find a violation.

            For example, recently in Lake Serene Property Owners Association v. Esplin, No. 2020-CA-00689-SCT, 2022 WL 713417 (Miss. Mar. 10, 2022), the Mississippi Supreme Court held that a homeowner's use of his property for short-term rentals was a “residential use” and, thus, did not violate the restrictive covenants governing the subdivision and limiting use to residential use.

The Lawletter Vol 47 No 2

Fred Shackelford—Senior Attorney, National Legal Research Group

        In Capriati Construction Corp. v. Yahyavi, 137 Nev. Adv. Op. 69, 498 P.3d 226 (2021), a motorist brought an action against a forklift operator's employer to recover for injuries caused by a collision with the forklift. At trial, the forklift operator admitted fault, and the plaintiff told the jury that the defendant had discarded the forklift operator’s employment file. After the plaintiff rested, the defendant employer elicited testimony that it had filed for reorganization under the bankruptcy laws. The plaintiff objected on the ground that the bankruptcy evidence was inadmissible because it suggested that the defendant would be unable to pay a judgment. The defendant argued that the evidence was introduced in order to rebut the plaintiff’s allegation of spoliation of the employment file.

        The trial court agreed with the plaintiff and instructed the jury that the defendant had liability insurance to satisfy any verdict. On appeal, an issue of first impression was whether evidence of the defendant’s liability insurance was admissible.

The Lawletter Vol 47 No 2

Brad Pettit—Senior Attorney, National Legal Research Group

            Although most states now have statutes that address the scope of powers of an agent under a durable or general power of attorney, it is safe to say, as a general proposition, that an agent cannot make a gift of his or her principal's property to himself or to a third party unless such a power is given to the designated attorney-in-fact in the power-of-attorney instrument. Dingle v. Prikhdina, 59 So. 3d 326 (Fla. Dist. Ct. App. 2011). Thus, in the absence of specific provision in a power-of-attorney document that authorizes the agent to make gifts of the principal's assets or property, if the attorney-in-fact makes a gift of the principal's money or property to himself, herself, or a third party, a court will presume that the gift was improper or constituted an act of prohibited self-dealing, and the agent carries the heavy burden of proving, with clear evidence, that the principal intended to allow him or her to make the gift in question. In re Estate of Curtis, 83 A.D.3d 1182, 923 N.Y.S.2d 734 (2011).

The Lawletter Vol 47 No 2

John Stone—Senior Attorney, National Legal Research Group

            The Ninth Circuit Court of Appeals has held that assuming a California state statute prohibiting, with certain exceptions, the possession of large-capacity magazines holding more than 10 rounds of ammunition implicated the Second Amendment, the statute did not facially violate the Second Amendment. Under an intermediate scrutiny analysis, the court reasoned that the statute was a reasonable fit for an important government interest of reducing the devastating damage wrought by mass shootings. Because it outlawed no weapon, it interfered only minimally with the core right of self-defense of home and family, and it saved lives. Duncan v. Bonta, 19 F.4th 1087 (9th Cir. 2021). In so holding, the court reversed the decision of a federal district court that had granted a motion for summary judgment filed by the plaintiff gun owners. Duncan v. Becerra, 366 F. Supp. 3d 1131 (S.D. Cal. 2019).

The Lawletter Vol 47 No 2

Paul Ferrer—Senior Attorney, National Legal Research Group

            As part of the check collection process governed by Article 4 of the Uniform Commercial Code (“UCC”), the “midnight deadline” rule of § 4-302 requires that a payor bank pay or return an item, or send notice of its dishonor, before midnight of the next banking day following the banking day on which the bank receives the item. The rule imposes strict liability on a payor bank that fails to meet the midnight deadline requirement. But what if something happens to the payee while the check is being dishonored as part of the collection process? Who has standing to sue the payor bank to enforce the midnight deadline rule?

            That was the unusual question decided by the Virginia Supreme Court in Stahl v. Stitt, ___ Va. ___, 869 S.E.2d 55 (2022).

The Lawletter Vol 47 No 1

Suzanne L. Bailey—Senior Attorney, National Legal Research Group

            The COVID-19 pandemic has been a fertile source of new litigation: challenges to mask mandates, challenges to vaccine mandates, construction of child custody visitation agreements in light of COVID-19, assertion of the defense of impossibility in response to attempted enforcement of a contract, etc. Recently, a federal district court in Virginia addressed whether an individual stated a cause of action against his employer for firing him after the employer denied the individual’s request to quarantine at home in order to avoid exposing his adult paraplegic brother to the coronavirus. The court in Crawford v. Creative Cost Control Corp., Case No. 7:21-CV-00419, 2021 WL 5049768, 2021 Wage & Hour Cas.2d (BNA) (W.D. Va. Nov. 1, 2021), held that plaintiff Christian Crawford (“Christian”) stated claims for (1) interfering with rights provided under the Family and Medical Leave Act (“FMLA”), and (2) retaliation or discrimination in violation of the FMLA. However, he did not state a claim under the Families First Coronavirus Response Act (“FFCRA”).

The Lawletter Vol 47 No 1

Amy Gore—Senior Attorney, National Legal Research Group

            As the world’s efforts to combat COVID-19 continue, most practitioners have adapted their practice by virtual hearings and meetings. Virtual law practice was clearly contemplated before the pandemic, but health concerns and court closures have dragged many practitioners further into the future than may have been contemplated even five years earlier. These adaptations have permitted attorneys to keep their lights on their virtual practices while providing clients with continued access to legal representation. The ever increasing reliance on technology to deliver legal services, however, carries its own set of ethical concerns that must not be overlooked.

            The traditional ethical obligation of competence set forth in Model Rules of Professional Conduct Rule 1.1 includes the obligation to remain competent in changes in the law and its practice, including the benefits and risks associated with relevant technology. The ethical obligation of communication, usually applied in apprising the client of any developments in representation, includes with it the ethical duty relating to disasters. ABA Comm. on Ethics & Prof’l Responsibility, Formal Op. 482 (Sept. 19, 2018). Most attorneys have learned that their ethical obligation of confidentiality includes safeguarding electronic communications. A virtual practice is not inconsistent with these ethical obligations. The practice of law no longer mandates a physical office location.

The Lawletter Vol 47 No 1

Jason Holder—Senior Attorney, National Legal Research Group

     Arthur Lange (“Lange”) drove past a highway patrol officer with his windows down, music blaring, and repeatedly honking on his horn; in short, Lange “was asking for attention.” Lange v. California, 141 S. Ct. 2011, 2016 (2021). The officer followed Lange a short distance before turning on his overhead light and attempting to pull Lange over. Id. Lange was seconds away from his home, however, and chose to continue to his driveway and pull into his garage. Id. The officer continued his pursuit and confronted Lange with the subsequent investigation revealing, perhaps unsurprisingly, that Lange was under the influence of alcohol.See id. (blood test revealed Lange was more than three times the legal limit).

     Upon being charged with driving under the influence as well as a noise infraction, Lange moved to suppress all the evidence obtained by the officer’s warrantless entry into the garage. Id. In response, the prosecution argued that “the pursuit of a suspected misdemeanant always qualifies as an exigent circumstance authorizing a warrantless home entry.” Id. (emphasis added). The state courts accepted this argument and the U.S. Supreme Court granted review to resolve the conflict between the various state/federal courts regarding a categorical rule of exigency when in pursuit of a fleeing suspect. Id. at 2017.

The Lawletter Vol 47 No 1

Trish Sifka—Senior Attorney, National Legal Research Group

      In May 2021, the Eighth Circuit affirmed the denial of the City of Minneapolis’s and a police officer’s motion to dismiss dog owners’ unlawful search and seizure claim under 42 U.S.C. § 1983. LeMay v. Mays, 18 F.4th 283 (8th Cir. 2021). Plaintiffs Jennifer LeMay and Courtney Livingston owned two pit bulls named Ciroc and Rocko, which were service animals for members of the family. Id. at 285. Livingston had accidentally triggered the burglar alarm. Officers Michael Mays and Daniel Ledman responded to conduct a residence security check. Officer Ledman went to the front door and Officer Mays climbed over a six-foot fence surrounding the backyard. After encountering Ciroc in the yard, Officer Mays shot him. The other dog, Rocko, walked from the front door near his owner after Ciroc was shot in the yard. Then, Officer Mays shot Rocko several times. Plaintiffs alleged that neither dog approached Officer Mays in a threatening manner. Although the dogs were not killed, both were critically injured enough so they were no longer able to act as service dogs. “LeMay and Livingston sued Mays and the City of Minneapolis under 42 U.S.C. § 1983, alleging Mays unlawfully searched their home and seized their dogs in violation of the Fourth and Fourteenth Amendments of the United States Constitution and the City was liable under Monell v. Dep't of Soc. Servs., 436 U.S. 658, 694, 98 S. Ct. 2018, 56 L. Ed. 2d 611 (1978).” Id. at 286. The Monell claim was dismissed. However, the district court denied the government’s assertion that Officer Mays was entitled to qualified immunity against the unlawful search and seizure claim.

The Lawletter Vol 46 No 7

Nadine Roddy—Senior Attorney, National Legal Research Group

            Recently, a federal district court sitting in New York held that an employee’s prior release of a claim for compensatory damages for unlawful employment discrimination did not preclude his claim under Title VII for punitive damages arising out of the same conduct. Barker v. Aramark Unif. & Career Apparel, LLC, No. 19-CV-2710, 2021 WL 4859741 (E.D.N.Y. Oct. 18, 2021). The employee in the case filed a charge of race discrimination against his former employer with the State Division of Human Rights. The parties entered into a Settlement Agreement by which the employee “waive[d] and release[d] any and all claims and allegations asserted in” the Division proceeding “arising from or relating to any and all acts, events and omissions alleged or that could have been alleged[.]” Id. at *5. Subsequently, the employee brought a Title VII suit in federal court, seeking punitive damages—a remedy not available in the state agency proceeding. The employer moved for summary judgment, arguing inter alia that because the law does not recognize an independent cause of action for punitive damages, no such right could have been reserved by the Settlement Agreement.