Month: January 2015

Cherokee High School Mock Trial

The high school mock trial program at Cherokee High School is where Ashley T. Carlile, decided that she wanted to be an attorney. Ms. Carlile began competing on the high school competition team when she was in the 10th grade, which would have been around the year 2000. She was coached by several young attorneys’ that have gone on to become judges in Cherokee County, Georgia. The prominent list includes Judge James Drane, the Chief Magistrate Judge of Cherokee County; Judge David Cannon, Jr., Superior Court Judge of Cherokee County, and Judge John Cline, Assistant Probate Judge for Cherokee County.

As a result of the excellent training in high school, Ms. Carlile went on to compete on competitive college and law School mock trial teams. Unfortunately, after Ms. Carlile’s tenure at Cherokee High School, the mock trial program began to die down and eventually became non-existent. Fifteen years later, attorneys Ashley T. Carlile, Cynthia Propst, and Rachel Connolly have joined together with the Honorable David Cannon, Jr. to reintroduce the mock trial program to the students of Cherokee High School. The students are working hard to prepare for the regional competition scheduled on February 7, 2015 at the Bartow County Courthouse.

The students have been learning techniques for direct and cross examinations, opening statement, closing arguments, and objections. The students are working hard to prepare for the competition and we wish them the best of luck at Regionals!

Read the contract, read the contract, read the contract!

During a particularly tough case involving a construction dispute, a sage old attorney told me the favorite saying of an even more sage like and older attorney was “read the contract, read the contract, READ THE CONTRACT.”  While this particular phrase could likely be traced down the line of attorneys through rudimentary contracts drawn on a cave wall, it holds no less true today.  The contract forms the basis for how business is done.  While the law can impose certain behavior on people, it can’t and shouldn’t dictate everything that occurs between people or businesses.  Contracts fill that void and lay out the expectations and duties for each party to the agreement.  While usually beneficial to both parties, contracts can sometimes trap the unwary.

In a recent decision (Progressive Electrical Services, Inc. v. Task Force Construction, Inc., 327 Ga. App. 608), a Georgia court found the president of an electrical contracting company personally liable for the money his company owed to a supplier.  The electrical contractor signed a contract containing a “Signature Provision” above where the president was to sign.  This provision included language stating that the signor of the contract would bind himself, individually, as well as his company to the terms of the contract.  The signature line itself simply had his name and his title within the company.  There was no separate area in the contract where he signed indicating that he was accepting personal liability for the provisions of the contract.

Because otherwise there would be no need for this cautionary tale, things went sour on the project.  The electrical contractor was not able to pay its supplier.  The supplier sued to recover money owed to it, which the general contractor eventually paid.  The general contractor then sued the electrical contractor and its president in an individual capacity to recover the money it paid to the supplier.  The president argued that he signed the contract on behalf of the company and did not sign individually.  The court disagreed.  The court found the language in the paragraph above his signature enough to make the president individually liable for the debt if the company could not pay.  By all appearances, the company could not afford to pay the balance owed leaving the president solely responsible.

As with most things, there are two sides to this outcome.  First is that of the president of the electrical contracting company.  Typically when an individual signs a contract as the agent of the company and do not take on personal responsibility.  The reason for the business’s existence is to limit its investors and employees from the risk needed to operate: taking on debt, performing work, hiring employees, and generally interacting with the world.  If a business fails, the investors would only lose their investment and not their home.  With the signature on this contract, however, the president circumvented all of those protections and made himself personally liable.

The other side of this outcome concerns the general contractor and its good planning that the provision was included in this agreement.  The foresight of its management and counsel increased the likelihood that they would recover against the electrical contractor for any breach of its contract.

This case illustrates two practice points.  It re-enforces the need to actually read the contract you are signing.  An educated review would have revealed the troubling language to the electrical contractor and could have likely been a negotiation point.  The flip-side of that point is that a contract can be a great tool to protect your interests.  By including a simple provision in a contract with a contractor who might be on an unsteady financial foundation, the general contractor minimized its liability.

If you have a question regarding any construction contract presented to you, or need one prepared, feel free to contact Will Tate, attorney with Thompson, Meier and King, P.C., at wrt@dmtlawfirm.com or (770) 479-1844.

Bankruptcy and Student Loans

The most common stance on the ability to discharge student loans has been, essentially, you can’t.  However, court decisions and studies across the country, including a recent Alabama bankruptcy case, give pause to that advice.

Bankruptcy courts apply the Brunner Test (so named for the criteria developed in Brunner v. New York State Higher Education Service Corp., 831 F.2d 395 (2nd Cir. 1987)) in order to determine the whether the bankruptcy petitioner is qualified for a discharge of student loan debt.  First, the petitioner must establish that they maintain a minimal living standard.  Second, the petitioner must prove persistent circumstances precluding future repayment of the loan.  Lastly, the petitioner must have established a good faith effort to pay the student loans.

Typically, successful applications of the Brunner Test have been cases where the petitioner develops a physical or mental disability severe enough to prevent them from working again.  However, a recent opinion from an Alabama bankruptcy court extended protection to a single mother of two who, despite genuine effort to find more lucrative work, could not afford to pay any amount towards her $89,000+ in student loans.  The petitioner maintained a very minimal standard of living which was often supplemented by family members.  And although she was not laboring under any physical or mental disability, the court found that her financial situation would not improve as her sociology decree was not marketable enough to allow her to earn much more than her present pay.  The court ruled in favor of the woman and discharged her student loans.

The process to discharge student loans through bankruptcy is time consuming, potentially costly, and only available to a relatively small group that would meet the stringent requirements of the Brunner Test.  Even if a student loan discharge is not available, the process may help.  Typically student loan payments are deferred while a Chapter 13 bankruptcy is pending.  This will give a petitioner room to focus on the payment of other debts, like a car loan or mortgage, while potentially discharge other debts.  The petitioner could then emerge from Chapter 13 protection with little to no debt and in a position to resume student loan payments.

If you have questions about your student loans and bankruptcy, contact Will Tate, attorney with Thompson, Meier and King, P.C., at wrt@dmtlawfirm.com or (770) 479-1844.