- QUESTION: What is the legal significance of the phrase "intending to be legally bound" commonly found in an agreement?
- QUESTION: Can an out-of-state corporation file a lawsuit in Pennsylvania without being registered there to do business?
- QUESTION: Does title insurance insure the "value" of the property?
- QUESTION: What Do Notaries Do?
- QUESTION: Are Computer Consultants Liable For Professional Negligence Like Lawyers And Accountants?
- QUESTION: Someone who owes me money just filed for bankruptcy. What should I do?
- QUESTION: Under what circumstances can I recover my costs and attorneys' fees in a lawsuit?
Back to Question and Answer Index
QUESTION: What is the legal significance of the phrase "intending to be legally bound" commonly found in an agreement?
ANSWER: The phrase "intending to be legally bound" is not just legal jargon, but is necessary to protect a party from subsequent challenges to the validity of the consideration exchanged in the agreement. Pursuant to Pennsylvania's Uniform Written Obligations Act, a signed written agreement cannot be invalidated for lack of consideration, even if no consideration is given, so long as the agreement contains an express statement that the signer intends to be legally bound. Thus, all agreements should include a statement that the signatories intend to be legally bound to avoid a potential challenge to the validity of the agreement for failure of consideration.
QUESTION: Can an out-of-state corporation file a lawsuit in Pennsylvania without being registered there to do business?
ANSWER: Generally, an out-of-state corporation "doing business" in Pennsylvania must obtain a certificate of authority from the Pennsylvania Department of State before filing a lawsuit. Otherwise, the lawsuit could be dismissed. The key question is whether your company is "doing business" here, depending on the nature and extent of your company's activities. For example, if your company simply orders supplies from a Pennsylvania business, it probably would not need a certificate before filing suit. However, if your company's activities here are more substantive, like servicing customers, maintaining an office for local business or owning real estate for general business purposes, it would likely need a certificate before filing suit.
By: Mohammad A. Ghiasuddin, Esquire
QUESTION: Does title insurance insure the "value" of the property?
ANSWER: In the case of an owner's title policy, the policy insures the owner's title to the property, and in the case of a loan title policy, the policy insures the validity and priority of the lien of the lender's mortgage against the property. A title policy does not insure that the property is worth what the purchaser is paying for it. Nor does the policy insure that the value of the property will be sufficient to pay the amount of a lender's mortgage, or that the mortgage will be "collectible". The policy also does not insure that the property can be used for the purchaser's intended purpose. In short, title insurance does not insure the "value" of the property.
By: Michael P. Coughlin, Esquire
QUESTION: What Do Notaries Do?
ANSWER: Notaries Public are appointed by the state to (among other things) administer oaths, take acknowledgments and swear in witnesses. Pennsylvania and New Jersey notaries have statewide powers. An affidavit is a document sworn true before a notary. The notary memorializes that fact by countersigning and sealing it. Giving a false affidavit may constitute perjury, a serious crime. The notary public is essential to virtually every real estate transaction, because all deeds, mortgages and similar documents must be acknowledged before recording. Acknowledgment is the signer's affirmation to the Notary that he or she indeed signed the document, intending that it be entered into the land records. Notarial duties, properly performed, help assure the reliability of affidavits and the authenticity of signatures on land records. Never ask a notary to seal a pre-signed affidavit, or to acknowledge the signature of a person not present. This puts the notary's appointment at risk, and undermines the very purpose of notarization.
By: William J. Levant, Esquire
QUESTION: Are Computer Consultants Liable For Professional Negligence Like Lawyers And Accountants?
ANSWER: A Pennsylvania trial court has said no, reasoning that professional negligence applies only to professionals unlikely to guarantee results from their services that can be described in a contract. These related cases dismiss professional negligence and other tort claims against computer consultants and enforce contracts limiting a consultant's liability for breach to the amount of fees paid. Suing in tort can make a big difference because negligent conduct may not be a breach of contract, limitation of liability terms may not be enforceable in a tort action, and punitive damages cannot be recovered in a contract case. So don't overlook the 'boilerplate" when engaging a computer consultant.
QUESTION: Someone who owes me money just filed for bankruptcy. What should I do?
ANSWER: There are three things that you should do. Number one, stop all efforts to collect the debt. Bankruptcy imposes an automatic stay on creditors, and violating it can be costly. You don't have to actually see a copy of the bankruptcy filing to be bound by the stay. You can verify a filing by calling (215) 597-2244 and following the prompts. Number two, in most cases you should file a Proof of Claim. Number three, contact an attorney to discuss your claim. There are many variables to be considered, and it is impossible to give across-the-board advice without reviewing the particulars of each situation.
By: William J. Levant, Esquire
QUESTION: Under what circumstances can I recover my costs and attorneys' fees in a lawsuit?
ANSWER: A party is generally responsible for the payment of its own costs and attorneys' fees in a lawsuit. Under the so-called "American Rule," a party cannot seek to recover its costs and attorneys' fees from an opposing party unless (1) there is express statutory authorization; (2) a clear agreement of the parties entitles one party to recover its costs and attorneys' fees; or (3) there is "some other established exception" that would permit the recovery of costs and attorneys' fees.
An example of express statutory authorization would be the Pennsylvania Contractor and Subcontractor Payment Act, which enables a party to recover attorneys' fees under certain circumstances. An example of a clear agreement of the parties would be a costs/attorneys' fees provision in a written contractual agreement between the parties that provides that a non-breaching party may recover its costs and attorneys' fees in the event of litigation.
If none of the exceptions to the "American Rule" are applicable, a party will generally be responsible for the payment of its own costs and attorneys' fees in a lawsuit.
