Step #1: The legal process begins once a “complaint” is filed in court. The complaint outlines the reasons why one person feels the court should award some remedy, typically making a party pay damages. Complaints are often “verified” which means the person bringing the lawsuit swears that the facts in the complaint are true. The “plaintiff” is the person bringing the lawsuit and the “defendant” is the person being sued. District Court is designed for cases less than $25,000 and Superior Court for cases in excess of $25,000.

Step #2: After filing the complaint, a copy of the complaint must be delivered to the defendant. This is called “service.” Service is usually by a sheriff’s deputy or through certified mail. Once served, the defendant must “answer,” or respond to the complaint within 30 days (an extension of 30 additional days is available and customarily taken). If the defendant doesn’t timely answer, the plaintiff may get a “default judgment.” A default judgement means the plaintiff wins because the other side didn’t respond. Other than small claims, when a suit is filed no court date is set. Many defendants who lose by default claim to have been waiting for a court date but that is not what the summons says.

Step #3: In the defendant’s answer, he or she could bring a counter-suit against plaintiff (“counterclaim”), bring a claim against a co-defendant (“crossclaim”) or bring a suit against a third party (“third-party complaint”). An answer might also include “affirmative defenses” or things that, if true, mean the plaintiff cannot win. An example of an affirmative defense would be if the time for bringing a lawsuit (the statute of limitations) has expired.

Step #4: After the answer is filed, discovery begins. Discovery is a period before trial where parties gather facts about the case. Discovery can take months and can last right up until a trial. Discovery includes depositions (taking the testimony of a witness or party), request for admissions (a set of statements for the other side to admit or deny), interrogatories (a set of written questions to the other side), and request for production (request for documents and exhibits). If you send discovery or the other party sends discovery to you, the response is due in 30 days although it is typical to obtain a 30 day extension on that deadline.

Step #5: Parties can also file motions during the discovery phase. A motion is simply a request for court action. An attorney might file a motion to compel if the other side has not responded to discovery, for example. A common type of motion is called “summary judgment.” Summary judgment is an attempt for a relatively quick end to the lawsuit without a trial available when the facts are not disputed and the judge can decide the case ruling only on legal issues.

Step #6: Prior to trial, cases are typically ordered into mediation (Superior Court) or arbitration (District Court). A mediation is a meeting for the parties to discuss the case with the assistance of a certified mediator and attempt to resolve it. The parties determine whether the case is settled or not; the mediator cannot force a decision. If the case does not settle, it goes on to trial. Court ordered arbitration, is essentially a mini-trial heard in front of an arbitrator (usually a local lawyer). The arbitration lasts only one hour and at the end, the arbitrator makes a decision. The decision is binding on the parties unless someone appeals it within 30 days. Your attendance at mediation or arbitration is required.

Step #7: Many cases are resolved before going to trial. However, if both sides have good arguments or are unable to find a middle ground, a trial is the next stage. Trials are decided by a judge unless either party requests a jury. Court dates can be set by the parties, once discovery is done, or by the clerk of court. District Court cases typically take around 6 months to get to the point of being ready for trial and Superior Court cases are closer to 1 year. Many cases are set on the same hearing date. If your case is not reached or one party is granted a continuance, a new trial date is necessary (you do not roll over to the next day or week). New trial dates for District Court usually mean a minimum 6-8 week delay and new trial dates for Superior Court cases may result in a 6-12 month delay.

Step #8: Once the trial is over, a judgment is issued. A judgment is the court’s decision in a matter. For these purposes, we will assume a plaintiff has won a money judgment. Before beginning the collection process, you have to wait 30 days for the appeal period to run.

Step #9: If you have a judgment against an individual, you must first serve the defendant with a Notice of Rights to Claim Exempt Property. Individuals have 20 days to fill out and file their response asking that certain property be excluded from the sheriff’s collection efforts. It is not unusual for people to ignore this paperwork and thereby waive any exemptions. After the 20 days, you submit a Writ of Execution, basically a paper for the court to calculate exactly what is due, to the clerk of court. If you have a judgment against a company, you do not have to deal with the Notice of Rights and you can submit a Writ of Execution without any further delay.

Step #10: Once filled out by the clerk, the Writ of Execution is delivered to the sheriff for collection. This process can take some time and some defendants have no property from which to collect the judgment. It does help to provide information to the sheriff regarding the location of debtor’s bank or any property the defendant may have. The sheriff will typically contact the defendant and will also search tax and DMV records to learn if there is any property to sell to obtain payment. If property is located, the sheriff will ask for a deposit to cover its costs in the sale. If property is not located, you can send a questionnaire to the defendant about his or her assets. Failure to answer the questions can eventually be punishable by contempt of court and the process can be used as leverage to obtain payment. Judgments are good for 10 years (and can be extended for another 10 years). You can go through the process as many times as needed to obtain full payment.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at (919) 861-0693.

Lawsuits begin when talks between parties end. Once a lawsuit begins, your main focus should be its efficient resolution. In reality, people are not so focused. Many times people are so angry and hurt, their only motivation in the initial stages of litigation is revenge. Be assured that revenge does not lead to either good decisions or an efficient resolution of a lawsuit. So how do you get rid of this lawsuit?

First, begin the process of getting rid of your anger and disappointment. Emotional involvement in the case varies depending on the facts, but you should consider it. Lawsuits not only cost money, they create stress. Most lawsuits are not worth your emotional and physical health. Many people involved in a lawsuit seem to believe the lawsuit is a life or death matter. In the long run, you will find that it is not. Most lawyers are not good therapists. You may need to consult a therapist if the emotional strain of a lawsuit is great.

Next, change your perception to view a lawsuit is a business deal. This is important. If you are looking for “truth, justice, and the American way,” rent a movie. The fact that you are 100% right (a rare position in spite of the fact that most parties believe that they have done nothing wrong and they cannot lose) only increases your chances of a favorable resolution of the dispute, it does not guaranty anything. Every lawyer knows that a trial is a gamble. Every lawyer can tell a story of going before a judge believing the facts and the law are so clear as to only produce one outcome and then to be surprised by the judge’s ruling. No case is a “sure thing.” This is why most cases settle.Settlement is (or should be) a business decision made after weighing the costs of going forward with the dispute and the probability of actually recovering money damages against the current settlement offer. Your lawyer should be your adviser on these factors.

Factor #1: Costs of going forward. Lawyers cost money. Realize that when lawyers advertise that “you won’t have to pay legal fees unless you recover” it is another way of saying “I won’t take your case unless I think it will make me money.” Your lawyer should be able to provide you with a budget breaking down legal fees into the various phases of a trial. A budget will help you decide questions like: do I settle now for $25,000 or do I pay $3,000 for the next phase and hope for a settlement offer of $30,000? As long as clients understand a budget is an estimate, a budget can protect both lawyers and clients by avoiding later confusion.

Factor #2: Probability of actually recovering money damages. A lawyer cannot ethically guarantee results. An experienced lawyer, however, should be able to provide you with a fair estimate of your chances of winning at trial. This advice helps you make a decision like this: do I settle for $20,000 when my lawyer says I have a 10% chance of getting a $100,000 recovery? In reality it is not that simple to come up with such a mathematical equation, but you get the idea.

Note the word “actually” in the bold phrase. Many people do not realize that the only thing a judge/ jury can give you is a piece of paper that says your opponent owes you money. If your opponent does not have 1.9 million dollars, you may get a judgment for that amount, but you will not be able to actually recover that amount. Accepting a settlement offer of a negligent driver’s insurance limits is a better decision than paying for a trial and getting a piece of paper that is worth no more than the insurance limits despite the fact that it says you are owed more.

Viewing settlement as a defeat or as “selling out” is a mistake unless your sole desire is to hear a judge/ jury say you were right and your opponent was wrong. This type of self-gratification is a luxury most people cannot afford. Remember: all cases should be settled- if the price is right.

Finally, learn the valuable lessons from this lawsuit and avoid the next one. Maybe this lawsuit is over a miscommunication that a few letters would have avoided. Create new systems in your business to document events and communications. Maybe this lawsuit was caused because you dealt with someone that you shouldn’t have. Establish a method of checking the background of the people with whom you work. Maybe you were too trusting and you didn’t get a signed contract. Resolve to never do work without a written contract that clearly states the duties of each party. Whatever the lesson is, learn it. Do not get so consumed with the lawsuit that you forget that when it is over, you have a life/ business to return to.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

_When a person comes to a lawyer, he or she usually has a story and two questions. The story is the set of facts that makes them believe they need legal help. The two questions are: 1) Do I have a case? and 2) Can I collect attorney fees?

Any client knows that attorney fees can be substantial. Sadly, the cost of bringing a lawsuit can prohibit people and companies from bringing legitimate cases. Conversely, people and companies all to often settle frivolous cases simply to avoid legal fees. Many people are frustrated with this situation and feel something should be done. These people believe it is unfair to have to pay legal fees to get something you are legally entitled to have or to defend something that has no merit. These people suggest a “loser pays” system where the legal fees of both sides are paid by the loser. While this idea may have merit, it is not the law in North Carolina.

In this State, in the majority of cases each party pays for its own legal fees. That should be a client’s reasonable expectation when heading into litigation. The exception to this rule is where a statute specifically allows a party to collect attorney fees. Even in those cases, the decision to award fees as well as the amount is in the discretion of the judge. In North Carolina there are a number of statutes which allow people to recover attorney fees. Some of the most common are listed below:

N.C.G.S. § 6-21.1  Attorney fees can be awarded in claim for personal injury or property damage less than $10,000.
N.C.G.S. § 6-21.2  Attorney fees in amount of up to 15% of principal are collectible on “evidence of indebtedness.” To enforce this, a notice must be sent.
N.C.G.S. § 6-21.6  Attorney fees can be awarded in a commercial contract if the provision is mutual.
N.C.G.S. § 44A-35  Prevailing party in lien or bond claim can collect attorney fees if other side unreasonably refused to settle matter.
N.C.G.S. § 75-16.1  Prevailing party can collect attorney fees in claim for unfair or deceptive trade practices.

In addition to these state claims, many federal statutes provide for attorney fees.

The stark reality is that when you choose to proceed with litigation you should not anticipate recovering your attorney fees.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

Court ordered arbitration in North Carolina is a procedure used to find resolutions to relatively smaller disputes (district court). It is not voluntary and your personal attendance is required. Arbitrators are typically local lawyers or retired judges. The proceeding, which is very informal, lasts a maximum of 1 hour. After the presentations, the arbitrator makes a decision. The decision is usually made on the spot but can be mailed within 3 days. The parties are required to split the $100 cost of arbitration before leaving the courthouse (some courts do not accept personal check). Your payment is due at the time of the arbitration. If the parties do not appeal the decision in 30 days, it becomes final.

With that foundation, here are some basic rules which every person who is going to testify in an arbitration should follow:

1. Tell the truth. Remember that you are under oath just as if you were testifying at trial. While you are encouraged to make a thoughtful answer, do not stop (ie. long delay) to figure out whether your answers will help or hurt either side. Just answer the questions to the best of your memory.

2. Listen to the entire question. Questions with traps often include half-truths, assumptions, or facts which you do not know to be true or facts you are unsure of. Do not let the examiner (typically the lawyer for the opposing side) put you in the position of adopting half-truths or unknown facts.

3. Answer the question you are asked (and none other). The examiner is entitled to an answer to the question he asks, but only to that question. Do not provide the examiner with extra information, just the information he/she requests. Do not attempt or expect your answer to persuade the examiner with your answer. Remember that your lawyer will also be asking you questions; that is the time to bring out facts that support your case. Don’t be evasive. Try to answer the question directly and then provide any qualifying or explaining information.

4. Do not answer a question you do not understand. It is up to the examiner to ask good
questions; if he/she cannot, do not help by saying “do you mean X or do you mean Y.” (If you do, expect to be asked both of these questions.) If you are confused by a question, simply ask the examiner to rephrase the question.

5. Think before you speak. Give yourself a few seconds before answering each question. This allows your lawyer to make an objection, if necessary, and allows you to think through your answer.

6. Speak in your own words. Do not try to memorize what you are going to say. Doing so will make your testimony sound “rehearsed” and unconvincing. Instead, prior to the arbitration, get by yourself and go over in your mind those matters which you will be questioned.

7. Answer in complete sentences. Answers like “yeah” and “uh huh” may be misunderstood. Give positive, definite answers when at all possible. Speak in terms of facts. Avoid saying, “I think,” “I believe,” or “In my opinion” unless you are asked your opinion.

8. Do not speculate or guess. You only know what you have seen or head. Do not speak for other people. Do not be tricked into answering a question to which you do not know the answer. If you do not know or cannot recall something, say so in spite of the examiner’s attempts to make you look stupid for not knowing something. Answer as specific or as vague as your memory allows. Likewise, avoid conclusions. Let the facts as you remember them speak for themselves.

9. When testifying about conversations, make it clear whether you are paraphrasing or quoting directly. If you feel you need to relay someone else’s words, know that hearsay, or reporting what someone else said, is generally not admissible. You might get an objection but don’t be put off by this. Also, don’t ask invite an objection by saying “Now I know this is hearsay but...” A big exception to hearsay are the words of the opposing party.

10. Do not characterize your own testimony. Saying “and this is the honest truth” is an indicator that you may be lying- even if you are not. If you are not lying, it comes across self-serving. There is no need to bolster your own testimony. You are already under oath.

11. Do not paint yourself into a corner. Avoid superlatives like “Never” and “Always.” Unless you are certain, do not say “That was all that was said.” Instead say, “That’s all I recall.” It may be that after more thought or another question, you will remember something else.

12. Do not testify as to your “state of mind” unless you are specifically asked about it. For instance, if the question is: “Did you read that document?”, the answer is: “Yes.” Do not respond “Yes, and I believe every word in it.”

13. Look it up. If information is in a document that is available, ask to see the document unless you are very certain of your answer. If information is in a document which is not available, answer the question only if you can recall the answer. Feel free to refer to the document. For example, “I recall the closing was January 1 but the settlement statement would have the correct date.”

14. Do not let the examiner put words in your mouth. Do not accept his/her characterization of time, distances, personalities, or events. Rephrase the question into a sentence of your own, using your own words. Take your time when dealing with these kinds of details. Likewise, do not adopt the examiner’s summary of your prior testimony.

15. Do not answer a “compound question” unless you are certain that you have all the parts of it in your mind. A compound question would be: “Did you run the red light and were you looking straight ahead?” Your best bet for a compound question is to request that the question to be rephrased.

16. Take a break. If you need a rest or a drink of water, ask. (This may be difficult in court ordered arbitration due to the limited nature of the hearing.)

17. If you are caught in an inconsistency, do not collapse. State your present answer to the question. Give your reason for the inconsistency only if you are asked.

18. If you have finished your answer, remain quiet. Do not expand upon it. Do not add to your answer because the examiner looks at your expectantly. If the examiner asks you if that is all you recollect, say yes, if that is the case. Lawyers use uncomfortable moments of silence to see if you will volunteer something.

19. If your lawyer objects to the question, listen to the objection very carefully. You may learn how you should answer the question if the arbitrator makes you answer it.

20. Remain clam. Never express anger or argue with the examiner. Always be courteous, even if the examiner appears discourteous. However, do not be a push over. If you are interrupted, let the examiner finish his interruption and then firmly but courteously state that you had not finished your answer to the previous question; then, answer that question.

21. Do not trust or attempt to become the friend of the examiner. If he/she is being nice, remind yourself who is paying him/her.

22. Do not be surprised if the examiner gets “good” information from your testimony. If the examiner is asking questions which call for answers that do not help your case, accept the fact that every lawsuit has two sides. If your story did not have problems, the dispute would have probably settled long ago.

23. Avoid jokes. Especially avoid sarcasm and even the mildest obscenity. Avoid absolutely any ethnic slurs or references which could be considered derogatory. Do not cuss.

24. If the examiner appears totally confused about your business and its technical aspects, do not attempt to educate him/her. Just enjoy the moment. On the other hand, if the arbitrator looks confused, stop and re-explain yourself.

25. Every witness makes mistakes and says things in ways that are later regretted. Do not become upset if you do this. If you realize you made a mistake, notify your lawyer. Otherwise, let him/her decide if it’s better to correct it or just let it go.

26. Dress to impress. This is your only opportunity to be seen and heard by the arbitrator. You will be judged by them as to such things as your honesty, frankness, and overall “appeal.” Therefore, you should appear on time, dressed as you would expect to dress if you were actually going to Court to appear before the a judge or jury. Remember that making a good impression is your goal and that you only get one chance to make a first impression.

27. If the examiner asks if you talked with anyone about the case, know that it is perfectly proper for you to have talked with your lawyer or family members before you testify. Knowing this, respond truthfully to this question as you would any other.

28. Review. In anticipation of the arbitration, review the document you filed in the case
(complaint if plaintiff or answer if defendant) as well as your discovery responses. Go over the critical events in your mind. Talk to your lawyer and make sure you understand what are the critical issues and upon what facts those issues turn. Have at least some understanding of your claim or defenses. If you are asked a question about your case that you cannot answer, it is fine to say you are not sure and that is why you hired a lawyer.

Note that the arbitrator may also ask you questions. Treat a question from the arbitrator as an opportunity to “sell” your position to the arbitrator. It goes without saying that any hint of frustration or tone of anger should evaporate from your voice and demeanor when answering an arbitrator’s question.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

In North Carolina, all cases filed in Superior Court are ordered into mediation, also known as mediated settlement conferences. The purpose of this procedure is to resolve cases more efficiently saving time and money. Here’s how the system works:

After the pleadings are closed (ie. complaint and answer are both filed), parties with Superior Court cases in North Carolina are notified that their case has been ordered into mediation. A party may make a motion asking for mediation if the court fails or delays to order it. Conversely, a party ordered into mediation may make a motion seeking to get out of the mediation for some reason. The mediation usually takes place after parties have had a chance to engage in discovery but before extensive trial preparations begin.

After a case is tagged for mediation, the first step is to select a mediator. If the parties do not agree to a mediator, the court will appoint one from a list of certified mediators. Once the mediator is chosen, the time of the conference is scheduled. The mediator is charged with finding a time that is mutually convenient, but in the end, the mediator chooses the date and location.

Attendance at the conference by the parties, their attorneys, and any insurance company representatives is required. If a company is a party, then a representative of the company with decision making authority must attend. Failure to attend can result in sanctions. The mediation continues until a settlement is reached or the mediator declares an impasse. Mediation is different from arbitration in that the mediator has no decision making power. He/she is only there to facilitate a resolution- not make a determination in the case.

The mediator’s compensation can be by agreement between the parties and the mediator or by court order. Unless otherwise agreed, the parties share this cost equally.

The mediation begins with the mediator setting certain ground rules. Then the plaintiff’s attorney provides a summary of the case. Exhibits are helpful and may be used. Once the plaintiff is done, the defendant’s lawyer gets to state the reasons why the claim is disputed. Most mediators give parties the opportunity to speak. Parties should discuss with their lawyers beforehand whether anything will be said. Typically at this point the two sides separate into two rooms and the mediator shuttles between them. Mediators usually begin by asking probing questions to understand the claims and defenses. Soon, however, things turn toward carrying settlement offers back and forth. If settlement is reached, it is advisable to get the terms in writing. Mediations typically only last one day.

Mediation has proven to be an effective means to resolving disputes. A successful mediation is not “a win.” Settlement requires compromise. If you want to take a chance at “winning,” understand mediation is not a trial and the mediator has no authority to render a decision. Mediation is a great opportunity to obtain an efficient resolution to a lawsuit. It requires that you listen to the other side and understand their position and evaluate the costs and likely outcome of a trial.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

Once you are involved in a lawsuit, you quickly realize that most TV court dramas are nothing like reality. The simple fact is that most cases settle long before a judge or jury ever even know the case existed. The idea is to posture your case so that it is more cost effective for the other side to settle now than to proceed to trial. One of the best posturing tools a lawyer has is a deposition. The purpose of this article is provide some tips on how to be an effective witness during a deposition. But first, here is an explanation of what a deposition is and how it works.

What is a deposition? A deposition is a formal legal proceeding in which the oral testimony of a witness is recorded under oath. Depositions are private. They usually occur in a lawyer’s office. The people present are the lawyers, the parties, and a court reporter.

How does it work? First, you (the person giving the testimony) are sworn in. You will need to show the court reporter your ID so be sure to bring that. Then the lawyer taking the deposition proceeds to ask questions related to the case. You answer the questions. Sometimes a lawyer may interrupt with an objection. If that is your lawyer, he/she may instruct you not to answer a question. After the first lawyer has asked its questions, any other lawyers in the case gets to ask questions and clarify any problems.

What is the purpose of a deposition? There are a number of reasons to take depositions. First, it provides the parties a chance to discover facts they otherwise would not know. Once educated, both sides can approach settlement with a more realistic view. Second, depositions allow lawyers to evaluate the strength of a case and a witness’ ability to testify. Although a witness may be telling the complete truth, due to the intimidating environment, he may sound unsure of himself. In contrast, a confident witness increases the strength of his testimony. Third, depositions can be used to record a person’s testimony. If the person later changes his story, the lawyer can produce the record of the deposition and point out the inconsistency. Also, depositions can be used to record the testimony of someone who may die before trial or move far away.

With that foundation, here are some basic rules which every witness should follow:

1. Tell the truth. Remember that you are under oath just as if you were testifying at trial. Do not delay answering by trying to figure out whether your answers will help or hurt either side, just answer the questions to the best of your memory.

2. Listen to the entire question. Questions with traps often include half-truths, assumptions, or facts which you do not know to be true and facts of which you are unsure. Do not allow the examiner put you in the position of adopting half-truths or unknown facts.

3. Think before you speak. Give yourself a few seconds before answering each question. This allows your lawyer to make an objection, if necessary, and allows you to think through your answer.

4. Answer the question you are asked (and none other). The examiner is entitled to an answer to the question he asks, but only to that question. Do not provide the lawyer with extra information, just the information he requests. Do not attempt or expect your answer to persuade the examiner with your answer. Remember that your lawyer has the opportunity to ask you questions later.

5. Do not answer a question you do not understand. It is up to the examiner to ask good questions; if he cannot, do not help him. Do not help the examiner by saying “do you mean X or do you mean Y.” (If you do, expect to be asked both of these questions.) If you are confused by a question, simply ask the examiner to rephrase the question.

6. Speak in your own words. Don’t try to memorize what you are going to say. Doing so will make your testimony sound “rehearsed” and unconvincing. Instead, prior to the deposition, get by yourself and go over in your mind those matters which you will be questioned.

7. Answer in complete sentences. Answers like “yeah” and “uh huh” are difficult for the court reporter to record. Feel free to make gestures, but remember they will not be recorded. Give positive, definite answers when at all possible. Avoid saying, “I think,” “I believe,” or “In my opinion.”

8. Do not speculate or guess. You only know what you have seen or head. Do not speak for other people. Do not be tricked into answering a question to which you do not know the answer. If you do not know or cannot recall something, say so in spite of the examiner’s attempts to make you look stupid for not knowing something. Answer as specific or as vague as your memory allows. Likewise, avoid conclusions. Let the facts as you remember them speak for themselves.

9. When testifying about conversations, make it clear whether you are paraphrasing or quoting directly.

10. Do not characterize your own testimony. Saying “and this is the honest truth” is an indicator to lawyers that you are not. Besides, it sounds self serving.

11. Do not paint your self into a corner. Avoid superlatives like “Never” and “Always.” Unless you are certain, don’t say “That was all that was said.” Instead say, “That’s all I recall.” It may be that after more thought or another question, you will remember something else.

12. Do not testify as to your “state of mind” unless you are specifically asked about it. For instance, if the question is: “Did you read that document?”, the answer is: “Yes.” Do not respond “Yes, and I believe every word in it.”

13. Look it up. If information is in a document that is available, ask to see the document unless you are very certain of your answer. If information is in a document which is not available, answer the question only if you can recall the answer. Be careful not to tip off the examiner as to the existence of documents he does not know and has not asked about.

14. Do not let the examiner put words in your mouth. Do not accept his characterization of time, distances, personalities, or events. Rephrase the question into a sentence of your own, using your own words. Take your time when dealing with these kinds of details. Likewise, do not adopt the examiner’s summary of your prior testimony.

15. Do not answer a “compound question” unless you are certain that you have all the parts of it in your mind. A compound question would be: “Did you run the red light and were you looking straight ahead?” Your best bet for a compound question is to request that the question to be rephrased.

16. Take a break. If you need a rest or have a question for your lawyer that you do not want the other side to know about, ask for a break. Also, if you are hit with a flash of insight or recollection while testifying and this has not been previously discussed with your lawyer, hold this to yourself, if possible, until you have had an opportunity to go over it with your lawyer at a break.

17. If you are caught in an inconsistency, do not collapse. State your present answer to the question. Give your reason for the inconsistency only if you are asked. Let your lawyer worry about fixing the problem.

18. If you have finished your answer, remain quiet. Do not add to your answer because the examiner looks at your expectantly. If the examiner asks you if that is all you recollect, say yes, if that is the case. Lawyers use uncomfortable moments of silence to see if you will volunteer information.

19. Do not agree to supply any information or documents requested by the examiner. Let your lawyer worry about that. You can say, “I will do what my lawyer tells me to do.”

20. If your lawyer objects to the question, listen to the objection very carefully. You may learn how you should answer the question. Generally speaking, you must answer all questions asked in a deposition. If you should not answer a question, your lawyer should make it very clear to you.

21. Remain calm. Never express anger or argue with the lawyer asking the questions. Your lawyer should speak for you if the deposition is getting out of hand. Always be courteous, even if the examiner appears discourteous. However, do not be a push over. If you are interrupted, let the examiner finish his interruption and then firmly but courteously state that you had not finished your answer to the previous question; then, answer that question.

22. Do not trust or attempt to become the friend of the examiner. If the examiner is being nice, remind yourself who is paying him/her.

23. Do not be surprised if the other side gets good information from your testimony. If the examiner is asking questions which call for answers that do not help your case, accept the fact that every lawsuit has two sides.

24. Avoid jokes. They are not funny on the record. Especially avoid sarcasm. Avoid even the mildest obscenity. Do not cuss. Avoid absolutely any ethnic slurs or references which could be considered derogatory.

25. If the examiner appears totally confused about your business and its technical aspects, do not attempt to educate him. Just enjoy the moment.

26. Most witnesses makes some mistake or say something they regret at a deposition. Do not become upset if you do. If you realize you made a mistake during the deposition, correct it. Mistakes discovered after a deposition may be corrected when you sign the errata sheet to the transcript.

27. Dress to impress. At the time of the deposition, you should remember that this is probably the first opportunity that the opposition has to meet you. You will be judged by your honesty, frankness and possible “jury appeal.” Therefore, you should appear on time, dressed as you would expect to dress if you were actually going to Court to appear before the jury. Remember that making a good impression is your goal.

28. If the examiner asks if you talked with anyone about the case, know that it is perfectly proper for you to have talked with your lawyer or family members before you testify. Knowing this respond truthfully to this question as you would any other. However, refrain from discussing the subject matter of conversations with your lawyer.

29. Review the court documentation- the lawsuit, answer and discovery responses. Be sure you understand the nature of your claim.

30. Some lawyers will attempt to make your position seem ridiculous in order to pressure you into making a concession. Hold the line.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

This may be your first time to testify in court or you may be an experienced veteran. In either case, take a minute and go over this list of reminders. Hopefully the list will orient you to giving testimony such that your time on the stand will be successful (and not too stressful!).

1. Most important, remember you are obligated to tell the truth. Tell it. Do not stop to figure out whether your answers will help or hurt either side. Just answer the questions to the best of your memory. Begin by answering the question directly- don’t be evasive.

2. A neat appearance and proper dress in court are important. The trouble with an appearance that seems very casual or very dressy is that it will distract the jury during the time you’re on the stand and they won’t concentrate on your testimony. Look nice, but be comfortable. In most instances this means to wear what you normally wear to work.

3. Before you testify, try to picture the events, the scene(s), the objects there, the distances and exactly what happened so that you can recall the facts more accurately when you are asked. If the question is about distances or time, and if your answer is only an estimate, be sure you say it is only an estimate. Beware of suggestions by attorneys as to distances or times when you do not recall the actual time or distance. Do not agree with their estimate unless you independently arrive at the same estimate.

4. When you are called to testify, you will first be sworn in. When you take the oath, stand up straight, pay attention to the clerk, and say “I do” clearly. If you prefer to affirm, please tell your lawyer so he/she can alert the clerk. This may avoid an unnecessary scene in front of the jury.

5. When a witness gives testimony, he is first asked some questions by the lawyer calling him or her to the stand. This is called the “direct examination.” Then the witness is questioned by the opposing lawyer in “cross examination.” (Sometimes the process is repeated two or three times to help clear up issues.) The basic purpose of cross-examination is to raise doubts about the accuracy of your testimony. Don’t get mad or frustrated if you feel you are being doubted in cross-examination; that is the other lawyer’s job. Stand your ground and tell the truth.

6. Remember that you are always being watched when in the courtroom. You should pay attention and be interested in the case. Don’t read the newspaper. Jurors (or the judge if you do not have a jury trial) who are or will be sitting on the case in which you are a witness may be present in the same public areas where you will be. For that reason, you should not discuss the case with anyone except privately with your lawyer. Remember, too, that jurors may have an opportunity to observe how you act outside the courtroom. For that reason, even on breaks it is usually advisable to avoid emotional extremes of loud laughter or sobbing.

7. When you are called into court, it is generally a good idea to be serious. Take notes and remain focused on the process.

8. Avoid distracting mannerisms such as chewing gum while testifying. Smoking is not allowed. Present your testimony clearly, slowly, and loud enough so that the juror farthest away can easily understand everything you say. Make sure cell phones/ pagers are OFF.

9. Do not nod your head for a “yes” or “no” answer. Speak so that the court reporter (or recording device) can hear the answer. Remember that any hand motions or gestures you make will not be recorded so you may need to describe what you are doing as you do it. However, use of hand gestures can be instructive to the jury.

10. Although you are responding to the questions of a lawyer, remember that the questions and answers are really for the jury’s benefit. Always speak clearly and loudly so that every juror can easily hear you. Face the jury when you answer a lawyer’s question.

11. Answer only the question asked you. Do not volunteer information not actually requested. This generally applies even when you think adding something will help your case. This is particularly true when you are examined by the opposing lawyer.

12. Listen carefully to the questions you are asked. Have it repeated or clarified if necessary. When you understand the question, give a thoughtful, considered answer. Do not give an answer without thinking. While answers should not be rushed, neither should there be an unnaturally long delay to a simple question if you know the answer. Don’t season an answer with irrelevant emotional pleas or self-serving statements. Stick to the facts.

13. Explain your answer if necessary. Give the answer in your own words. If the opposing lawyer demands a “yes” or “no” answer and you feel an explanation is necessary, try to answer directly and then give the explanation. Not all questions can be answered “yes” or “no.” If this is the case, simply state the reason the question cannot be answered in that way.

14. When being questioned by the other lawyer, don’t look at your lawyer or at the judge for help in answering a question. For the moment, you are on your own. If the question is improper, your attorney will object. If a question is asked and there is no objection, it’s your job to answer it truthfully.

15. When the judge interrupts you or when an attorney objects to a question, stop and wait for the judge to tell you to continue. If an objection is “sustained” that means you cannot answer. Sit quietly and wait for the next question. If the objection is “overruled” then proceed with your answer.

16. Speak in your own words. Don’t try to memorize what you are going to say.  Doing so will make your testimony sound “rehearsed” and unconvincing. Instead, prior to trial simply go over in your mind those matters which you will be questioned. You cannot bring notes to the stand to help your memory. Likewise, if the other lawyer makes a statement and wants you to testify whether the statement is true or false, remember that it is true only if it is 100% true. Usually the best way to deal with these “questions” is to say no and put the statement in your own words.

17. A witness who is angry may exaggerate or appear to be less than objective, or emotionally unstable. Keep your temper. Always be courteous, even if the lawyer questioning you appears discourteous. Don’t appear to be a “wise-guy” or you will lose the respect of the judge and the jury.

18. The judge and jury are interested in the facts that you have observed or personally know about. Therefore, don’t give your opinions and don’t state what someone else told you (called hearsay), unless you are specifically asked.

19. Sometimes, witnesses give inconsistent testimony. Something they said before doesn’t agree with something they said later. If this happens to you, don’t get flustered. Just explain which statement is accurate and why you were mistaken or why the other statement appears to contradict something. The jury, like the rest of us, understands that people make honest mistakes. If you try to be evasive, the jury will pick up on this. Deal directly with inconsistencies.

20. Don’t argue or talk back to the opposing lawyer. If a question is improper, your lawyer should object. It is fine to say you do not understand a question, but don’t respond by saying “I think that is irrelevant and don’t want to answer.” While sometimes it is an effective tool when asked one question, to respond by saying a truthful statement that reflects your position, this tactic can be overdone. If used too much, you appear evasive and uncooperative. If the judge seems like he/she is getting impatient and instructs you to answer the question asked, abandon this tactic and answer remaining questions directly.

21. If your answer was not correctly stated, correct it immediately. If you feel your answer was not clear, clarify it immediately. It is better to correct a mistake yourself than to have the attorney discover an error in your testimony. If you realize you have answered incorrectly, say, “May I correct something I said earlier?”

22. Give positive, definite answers when at all possible. Avoid saying, “I think,” “I believe,” or “In my opinion”. If you can, be positive. If you don’t know, say so. Don’t guess or make up an answer. You can be positive about important things which you naturally would remember. If you’re asked about little details which a person naturally would not remember, it is best just to say so if you don’t remember.

23. Unless certain, don’t make broad statements. For instance, don’t say “That’s all of the conversation,” or “Nothing else happened.” Instead say, “That’s all I recall,” or “That’s all I remember happening.” It may be that after more thought or another question, you will remember something else.

24. Sometimes an attorney may ask this question, “Have you talked to anybody about this case?” It is perfectly proper for you to have talked with counsel or family members before you testify. You should, therefore, respond truthfully to this question. Say very frankly that you have talked with whomever you have talked with. All we want you to do is to tell the truth as clearly as possible.

25. You may be asked about claims or defenses in the lawsuit or the damages you are seeking. Be sure you understand these before testifying. Now is the time to get clarification from your lawyer.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

_There are two ways sellers can expose themselves to liability in the sale of real property. The first is to make a statement that is false and the second is to omit a statement about a material defect in the property. Both of these statements are types of fraud. To qualify as fraud a statement must be: factual (ie. not an opinion), false, “material” (ie. the passes the “so what?” test), intentionally made, and reasonably relied upon by the buyer (ie. cannot claim fraud if it is obvious the statement is not true or the buyer had the chance to verify the statement or perform an inspection which would have revealed the truth).

When determining whether fraud exists, courts will look at a couple of important factors. First, the court will look at the parties involved. Courts look to see if the parties are both equally skilled and savvy in business matters. When a contractor purchases land, the court will generally assume that the contractor possesses the skill to determine if the land is satisfactory for its purposes. However, regular consumers may not be held to the same standard as a contractor. Next, a court will look at whether the buyer had full opportunities to investigate the property, and whether the buyer took advantage of these opportunities. If a contractor buys land, but doesn’t do soil tests and doesn’t ask the seller pertinent questions, establishing a fraud claim is very difficult. Likewise if a buyer requires a home inspection before the closing, the chance of a seller being liable for withholding information is greatly reduced.

In the case of the second type of statement, a seller who is in a relationship of trust or a seller who knows the buyer is unaware of an important fact that it is not likely to discover may have a duty to affirmatively disclose “material” defects. Here’s the $64,000 question: the seller knows of a problem but is not sure if it is major, should he/she disclose it? We suggest one of two approaches: go with your gut feeling and hope for the best or require the buyer to have a home inspection and make them sign something that you make no guarantees as to the condition of the home.

IF YOU ARE THE BUYER: Ask the seller direct questions. If you don’t get a direct answer, check things out. Get a home inspection. If the home inspection raises issues, get those checked out. The amount you’re spending on the home is worth knowing what you’re getting.

IF YOU ARE THE SELLER: Opinions are not facts so saying the home is in “good condition” is usually not a problem. You also should not have a problem about defects you do not know about. The problem is the thing you know about but don’t want to say because you really want to sell. If you are having sleepless nights about whether to disclose something, it’s probably major. If it bothers you, it would likely bother a jury. So either disclose it or make it clear that the buyer has the responsibility of inspecting the home and you are selling it “as is.”

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

Lots of people dream of building a home (or substantially renovating their existing home). Ask anyone who has ever built a home and they will tell you that it can be incredibly stressful. The best chance you have to avoid your dream becoming a nightmare is to choose the right builder.

You see, it is not a matter of whether there will be problems, the question is how many and how severe will the problems be. The right builder knows how to solve problems and this is the kind of person you want on your side in making your dream a reality. That really is the key to success- you and the builder being on the same team to get the home completed on-time, in-budget and in a workmanlike manner.

First you need to locate some builders. Some suggestions include: ask your friends and associates for recommendations, contact the local Home Builder’s Association, drive around town till you see a neighborhood or house you love and ring the door bell, or do the Parade of Homes. I would use a phone directory or web search as a last resort.

Once you have some names, narrow the list. Find out each builder’s experience. Ask how long he (she) has been building homes and how he learned the business. How many homes does he build per year? How long has he been building in the area you’ve selected? How long does he take to build a home, on average? Which jobs does he subcontract, and which does he perform himself?

Ask about finances. How is the builder’s credit rating? Which lending institution(s) provides his construction loans? Will he purchase the lot and construct the loan on his credit line, or will you be expected to facilitate financing? How is payment expected during the project? What about payment for changes?

Ask for references (get a recent customer as well as one that is a few years old). A spec buyer and a presale buyer may give you different viewpoints. Ask for a list of addresses of several homes he has built- a new home and one about five years old, and at the very least take a look at the exterior of these homes.

Ask about license and reputation. What is his general contractor’s license number and what level of license does he hold? Check with the General Contracting License Board to verify license status and any complaints. Is he a member of the local Home Builders Association, the Board of Realtors or another local trade organization? Call the Better Business Bureau and/or NC Attorney General’s Office to check for complaints against the builder. (Just because there is a complaint, don’t automatically write off that builder. There are two sides to every story and some consumers use these complaints to get leverage over builders. Conversely, just because there is no record is not a guaranty.) Check at the county courthouse to see if a builder has any outstanding judgments, liens or lawsuits against him.

Ask about the process. How often will you get to meet with the builder during construction? Which decisions will he make and which ones will you make? How does he prefer to communicate with you? For example, phone calls, e-mails, on-site visits? How should concerns be expressed and addressed during construction? Are signed change orders used for any changes in the contracted work?

At this point you should have some names of builders whose work you like that seem professional. Now you’re shopping for the best value. If the plans are selected, get price quotes. Ask how long the builder estimates construction will take. Learn whether the builder provides any warranty and what kind of punch list work is provided after closing.

Armed with this information, you should be able to make the best choice. Before signing the contract, however, you should talk with someone else who has built a home. Find out what they liked about the process and what they would change. Then, take a deep breath and decide if this is something you’re ready to commit to. Finally have a lawyer review the contract to see if it is fair and reasonable.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.

Buying a home is generally the biggest purchase of a person’s life. First-time buyers typically go on an emotional roller coaster from the time they first enter a real estate agent’s door to the day of closing. While you’re excited about fulfilling a dream, you realize you don’t even know what questions you need to ask.

There are a number of issues you will face in purchasing a home: How much house can I afford? Should I buy a re-sale or a new home? What features do I need to look for? Where is the best available location? You will also encounter a number of legal issues. This article will focus on identifying and discussing legal issues to help you make informed decisions.

The agent. After you decide on a real estate agent, you will be asked to sign an agency agreement. You have a number of choices: buyer’s agent, seller’s agent or dual agent. Unless you know what you’re doing and have a really good reason otherwise, you should consider a buyer’s agency agreement. (You want them working for you, right?) As your agent, this person owes you certain fiduciary duties such as honesty and loyalty. Make sure communication lines are always open to avoid any dispute with your agent. Finally, whatever agreement you choose, read it before signing and get any questions answered.

The contract. Most all agent’s use a standard form contract titled “Offer to Purchase and Contract.” Once you have decided on a home and want to make an offer, you should sit down with your agent and fill out an offer. Be careful what you put in it! If the seller signs it, you may be legally bound to buy the property. What to look for in the contract:

1. Is everything you want in the offer specifically included? Don’t assume the seller will leave those ceiling fans or window treatments. List every fixture or appliance that you want to be part of the deal. Assume that if it’s not in the contract, it’s not part of the deal.

2. Is your offer conditional? Again, don’t assume the seller will know that your offer is conditional on the sale of your current home or on you obtaining financing. If a condition is not met, you should not lose your earnest money. It’s not enough that you talked about these conditions, they must be in your offer.

3. What about the condition of the home? Whether new or old, you should have the house inspected by a qualified and licensed inspector. Most lenders require this anyway. The condition of the home and property should always be a condition of your offer. Be sure and review the disclosure statement. It is difficult to close on a home and later come back and complain about conditions/ defects. Do a proper inspection before closing.

4. What about timing issues? If you want the offer to expire after 10 days, say it. If you need the closing to take place before 60 days, say it. Timing is always an issue in real estate transactions, so put any deadlines in your offer. Note: unless your contract sets a closing date and states “time is of the essence,” you probably cannot recover damages for a delay of the closing.

There is an Additional Provisions Addendum which allows for you to address many of these issues. Agents are pretty good about raising these issues, but you should also be aware of them so that your offer is the best it can be. Finally, read and understand each paragraph of your offer before signing it. Although the language may be “the standard legal stuff,” the standard wording is not necessarily be to your benefit.

The earnest money. When you make an offer you obviously intend on following through with it. But what happens if the deal goes south? Then you start to think about that earnest money. Here’s the law in general terms: If the offer is signed, a contract is formed and the only ways for you to get your money back are if: 1) the seller breaches the contract or 2) a condition is not met. If you just want to back out of the deal, you forfeit the earnest money. It’s best to work out earnest money disputes with the seller because real estate agents will not turn over earnest money until everyone agrees on a resolution. If things start to get nasty, consider contacting an attorney.

The closing. Everything is falling into place and you want to sign the papers so you can move in and get on with your life. Not so fast. It is not uncommon for people to be scurrying around at the last minute putting out fires and pulling out hair. Do everything possible to give yourself plenty of time in and around the closing to deal with delays and surprises. You are only adding more stress to your life if the moving truck is to arrive 1 hour after the closing is scheduled. Don’t be rushed into signing unless you understand the details of the transaction and are comfortable that the paperwork properly reflects the true deal. Review carefully the settlement statement. Ask if you are a named insured on the title policy and about exclusions on the title insurance.

You may feel pressure to close even though there are some loose ends, such as a repair that has not yet occurred. At closing, make sure any loose ends are covered by a written, signed agreement.

If you still can’t sleep at night because you feel you’re in over your head, you might consider buying an hour of an attorney’s time. You’re probably spending well over $100,000 on the house. Spending a $200 or so to obtain a level of comfort about your decision is not only reasonable, it makes sense. But remember, if you’ve already made your offer, the lawyer is basically limited to advising you of your rights and obligations.

This article is meant as general knowledge and not meant to substitute for legal advice on specific issues. If you have a question, please call Doug McClanahan at 861-0693.