And how you can get around it. The Ohio law governing limited liability companies generally allows the operating agreement to determine how the LLC is operated. The operating agreement governs the relationship between members, the behavior of managers, and how the members get paid. There are a few exceptions to this broad law that might […]
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Piercing the Veil in Ohio
Understanding Piercing the Veil in Ohio: Liability for LLC and Corporate Owners When a corporation or an LLC causes injury to a party, sometimes the company’s assets are not enough to pay the judgment against the company. When that happens, the injured party often tries to get the owners of the company to pay the […]
Continue ReadingWhy Every Multi-Member LLC Needs a Buy-Sell Agreement
Imagine you and your partner form an LLC. You sign an operating agreement. Several years later, the business is worth several million dollars. Your partner falls on hard times and needs to cash his share of the LLC out. What do you do now? At this point you face the following issues, just to begin with: […]
Continue ReadingDeadlock Provisions in Buy-Sell Agreements
A standard Buy-Sell Agreement might provide for an appraisal prior to a buyout. These agreements don’t anticipate there being a conflict after the appraisal — what happens if the appraisal comes in lower than the departing member expects, or higher than the remaining member expects? What about situations where appraisal of the company’s value is […]
Continue ReadingQuitclaim Deed v. Warranty Deed – Neither is “quicker”!
I get it. Who the heck has ever used the word “quitclaim” in conversation? It’s an unfamiliar word. So it’s not surprising, then, that many people mishear the term and instead think that they’re hearing “quick claim.” There’s a pervasive notion in the world of real estate that using such a device will somehow be […]
Continue ReadingHousing Discrimination: The story of Mrs. Grybosky
Discrimination is a bad, bad thing — especially in housing. But what if I told you there was a quasi-police force out there who pays shills and plants to apply for your rental apartment, record your every word, and hunt for signs of housing discrimination? What’s worse, when they find something, they sue you, recover […]
Continue ReadingWhat’s the difference between commercial and residential mortgages?
Protecting Your Property: LLC or Not for Commercial and Residential Mortgages? LLC or not? There’s a parade of gurus and booksellers urging us constantly to form trusts, LLCs, offshore partnerships and pay them for their kits to do it. All of these have their place, but the easiest way to achieve our protection goals is to […]
Continue ReadingMortgage Financing Rundown
We detailed the traditional types of financing available to residential property investors in an earlier post. To recap, when you’re about to sign a purchase agreement, it’s important to consider whether you want the property to be titled in the LLC’s name or your own personal name. Generally, it boils down to this: 90% of […]
Continue ReadingOhio Department of Commerce releases Spring ’14 disciplinary report
The Department of Commerce, whose job it is to regulate licensure of real estate brokers, recently released the first-quarter 2014 disciplinary actions. We’re beginning to see the consequences of the new crack-down attitude of the ODC against unlicensed real estate wholesaling, which I have discussed earlier in this article. This is some really bad news for wholesalers. Chad […]
Continue ReadingWholesaling: A Brief Legal Analysis
In my opinion, those involved in wholesaling real estate are facing a losing battle when it comes to state real estate commissions Don’t misunderstand my motivations here–I don’t like licensing statutes (not even, as it were, state bar examinations and licenses). The ethics that these licenses are supposed to bring to their respective professions seem […]
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