Three basic things take place during probate: assets are located, creditors are paid, and what’s left is distributed to beneficiaries.

If the decedent was organized, then locating assets is very quick and simple and can take just a few days to a few weeks. If the decedent had a lot of assets, then this can take longer. If probate takes longer than 4 months, it’s usually because of the amount or complexity of assets.

Before paying creditors, they have to be found. This is done by publishing a notice to creditors in the legal newspaper and giving them 3 months to file a claim. In addition, a copy of the notice to creditors is sent to every possible person who might be a creditor. At the end of the 3 month creditor claims period, the creditors are known and paid, if all goes smoothly. If this takes longer than 3 months, then it’s usually due to a disputed claim or a problem with taxes.

Finally, after the 3 month creditor claims period expires and the creditors are paid, the remaining estate can be distributed to beneficiaries. If it takes longer, then it is usually because there is a will contest or other dispute.

So, as you can see, Florida has a very streamlined probate process that can be completed in just 4 months from start to finish if all goes smoothly. The problem is that things don’t always go smoothly. Avoiding that problem is what we try to do in estate planning when writing wills and trusts.

And all you need is a valid driver license. You don’t even need to be in the vehicle to be the driver: “a person shall be deemed to be the operator of an autonomous vehicle operating in autonomous mode when the person causes the vehicle’s autonomous technology to engage, regardless of whether the person is physically present in the vehicle while the vehicle is operating in autonomous mode.”

This, of course, raises questions about the application of Florida’s dangerous instrumentality doctrine. Who’s at fault when the robot makes a wrong turn into another car? And what if the robot’s uninsured or underinsured?

The law does let one party off the hook: “The original manufacturer of a vehicle converted by a third party into an autonomous vehicle shall not be liable in, and shall have a defense to and be dismissed from, any legal action brought against the original manufacturer by any person injured due to an alleged vehicle defect caused by the conversion of the vehicle, or by equipment installed by the converter, unless the alleged defect was present in the vehicle as originally manufactured.”

If Governor Scott does not veto the bill, HB 1207 will take effect July 1, 2012. So let’s be careful out there.
Note: For another perspective, see The Real Trouble with Robot Cars.

So I’m going to an executive suite. They provide reception, refreshments, conference rooms, and a strong business atmosphere. And I get a private office with room for my own furniture.

It’s the way of the future. More and more we do work online by email. Less and less do we meet in person or talk by phone. But just like being able to do arithmetic, we need to preserve the ability to meet and greet those we work with and for…even though the computer and Internet intercede more and more. A business suite allows us to do both.

Well, the movers from Goodall Brothers are just about done loading the truck, so I’d better go now. I can’t wait to see how my furniture looks in the new suite.

Some lenders choose not to file a claim in probate estates, thinking that they can sue on the mortgage without filing a probate claim. Taking this approach might cost them the mortgage. A recent case provides some groundwork for defending against such a foreclosure.

In its 11/9/11 opinion Taylor v. Bayview Loan Servicing the Florida 2nd District Court of Appeal held that if a promissory note is secured by a mortgage, and if the note is assigned, then the mortgage follows the note and is automatically assigned along with the note, even if no separate assignment of mortgage is recorded.

The court cited the 1938 Florida Supreme Court case of Johns v. Gillian, 184 So. 140 (Fla. 1938), which said that “the mortgage is but an incident to the debt, the payment of which it secures, and its ownership follows the assignment of the debt.”

Therefore, logically, if the note was not assigned but instead became unenforceable due to the Florida Probate Code’s statute of limitations, would not the mortgage that follows it also become unenforceable?

The idea behind having a power of attorney that “springs” into effectiveness upon incapacity was that the principal would be protected from the agent using the power of attorney while the principal was capable of acting on his or her own. But that idea can no longer be put into effect in Florida.

The new law says that a power of attorney signed after 10/1/11 is not effective if it provides that it is to become effective at a future date or upon the occurrence of a future event or contingency.

Of course, powers of attorney still cease to be effective upon death of the principal, a fact which many people still don’t seem to realize.

And, yes, Florida still recognizes durable powers of attorney that remain effective during incapacity, as long as the “magic words” are used.

But, apparently, it’s not clear enough. A recent court decision held that a homestead held “as joint tenants with full rights of survivorship and not as tenants in common” passed to the joint owner and not as homestead property. In Marger v. De Rosa, 2011 WL 252942 (Fla. 2nd DCA 2011), a father who had two minor children purchased a home with his own mother. The deed said the son and his mother owned the home “as joint tenants with full rights of survivorship and not as tenants in common.” The father died. The court held that 100% of the home passed to his mother. No part of the home passed to his minor children.

The court’s reasoning is based on the way the law treats the form of ownership known as joint with survivorship. Upon the death of one of the joint owners, the title to the property passes automatically by operation of law to the surviving joint tenant. The court reasoned that the father’s interest in the home ended immediately on his death so there was nothing to leave to his minor children.

What’s interesting about this case is that 1) it is surprising to Florida probate lawyers and Florida real property lawyers because we have seen the courts expanding the protections of the Florida constitutional homestead over the last twenty years, 2) this case goes in the other direction and limits the protection, and 3) there is nothing new about the theories behind the case. While some interesting theories were presented by the minor children’s attorneys, the court chose not to go with them.

This case shows that long-standing legal theories have built-in potential to clash with each other when the right facts invoke them. In this case, it was a clash between a grandmother and her minor grandchildren over a home she owned with their deceased son/father. Hopefully, those set of facts won’t soon present themselves again.

For many decades, Florida law provided that the surviving spouse received half the estate* and the descendants shared the other half among themselves. This likely arose from public policy that both the surviving spouse and children needed assets to survive, but it also surprised many young couples. If a young father died without a will, half his estate would pass to his wife and the other half would go to a guardian for his minor children. Inheriting half the father’s assets at age 18 is probably not the best way to learn financial independence, so most parents made wills or held their assets in joint names as tenants by the entirety to avoid this result.

Along comes the 2011 Florida Legislature to the rescue. It enacted a law that amends the Florida Probate Code effective October 1, 2011 to provide that the entire estate passes to the surviving spouse if (a) the decedent died leaving a spouse and one or more descendants, (b) all of the decedent’s descendants are also the surviving spouse’s descendants, and (c) the surviving spouse has no other descendant.

It’s still a good idea for a young couple to make a will and to hold assets jointly as tenants by the entirety, but the new law will eliminate the surprise of a surviving spouse having to share assets with children when a spouse dies. It remains to be seen whether those children will be surprised to learn they get nothing.

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*Actually, the current law provides that, if all the decedent’s descendants are also descendants of the surviving spouse, then the spouse receives the first $60,000 before dividing the rest in half.

First, be a filer, not a piler. Create separate folders in your email application (Outlook, Apple Mail, etc.) and drag email from your inbox to a separate folder that best describes the subject of the email. For us lawyers, each separate folder is the client’s name (last name first, of course). For personal email, each separate folder is a subject, like house, insurance, family, financial, etc. Now when you want to find an old email, you at least have a starting point.

Hint: Make it a point to read your email every day and move it from the inbox to a separate folder. The inbox makes a bad to do list so don’t leave email in your inbox as a reminder to do something. There are many to do apps out there, but I just use a simple one page list in Word (or Apple Pages) named ToDo. When I move an email from my inbox to its separate folder, I just add to my ToDo list anything in the email that I need to do or follow up on. (Yes, I have a separate ToDo list for follow-ups; i.e., tasks delegated to others.)

Second, squirrel away attachments. Create a folder in the Documents folder of your hard drive called Work, and then create subfolders in it named just like the ones in your email application. For lawyers, there would be a separate subfolder for each client (last name first, of course). When you receive an email with an attachment, drag the attachment to that client’s subfolder. Now, you have a place where all your attachments (think acorns) are safely sitting for  future use. In fact, I use this for more than just attachments. This is where I keep drafts of Word and Apple Pages documents, pdfs of signed documents, legal research, and everything else.

Hint: Change the filename to something useful. Most attachments have file names that are completely useless to you. The file name might have meaning to the sender or they might just be machine gibberish. I like my files to have dates in them. The date it was signed, the date I received it, etc. If the file is a pdf of a contract dated 6/3/11 that I received from my client on 6/5/11 then I would rename the file “Contract 2011.06.03 from client 2011.06.04.pdf”. (I put the date in year, month, day order so that it sorts correctly, and I use periods because they are easier to type than hyphens.) If I prepare a draft of a contract, I include the draft number, such as “Contract draft #1 2011.06.01.pages.”

Third, divide your work folders into logical subfolders. Your client work folder will quickly fill up with email attachments, draft documents, signed documents, etc. It will look like a big inbox. So create separate subfolders and move the files into them based on some logical ordering that works for you. Here are the categories that work for me:

1-Pleadings (this is where a pdf of each pleading in a lawsuit or probate case gets filed in chronological order)

2-Documents (this is where a pdf of each document in the case gets filed)

3-Drafts (this is where I keep Word and Apple Pages drafts of documents)

4-Letters (this is where I keep a pdf of each paper letter sent or received in the case)

5-Memos (this is where I keep a pdf of (shredded) paper memos in the case)

6-Research (this is where I keep legal research)

7-Title (this is where I keep a pdf of each deed, title search, title insurance commitment, title insurance policy, and recorded documents relating to real estate)

8-Specific types of cases have additional subfolders. For example, probate cases have separate subfolders for Assets, Creditors, Beneficiaries, etc. Litigation cases have separate subfolders for Discovery. Business cases have a separate subfolder for Minute Book.

This is the system I use. It’s worked in my paperless law office for years. Yes, it’s a little like being your own librarian, but it makes sense because being both paperless and organized means not having to say “Sorry, I can’t find it, can you call back next week.”

Under this regulatory scheme, even though you pay your general contractor the full purchase price,  if you do not comply with the requirements of the Florida lien law, you may end up paying construction liens filed by unpaid subcontractors and suppliers even though you already paid the general contractor.  The Florida construction lien law has the effect of shifting the risk of nonpayment to the owner if the owner fails to comply with the lien law.

The first step to protecting the owner against construction liens in Florida is a written contract with the general contractor that sets forth price, payment and scope of work terms. This is a legal document that should be prepared or reviewed by the owner’s lawyer. Even though the contractor is nice and professional, don’t expect the contract submitted by a contractor to protect the owner. The terms and provisions for the owner’s protection are different from ones for the contractor’s protection. (I tell contractor clients the same thing when they do commercial work: don’t use the owner’s form without having it reviewed by your own lawyer.)

The  second step to protecting the owner from liens is to record and post a Florida notice of commencement in compliance with the Florida Construction Lien Law. Many times the contractor prepares the notice of commencement because the building permit cannot be issued without it, but the owner should not rely on the contractor to prepare the Florida notice of commencement because under the lien law it is the owner’s responsibility. If anything is not correctly filled out, it is the owner who will suffer the consequences of not being in compliance with the lien law: a subcontractor or supplier might file a lien on the job even though the owner has paid the contractor. The owner’s lawyer should prepare or review the notice of commencement.

The third step is to treat all notices to owner with care. The Florida notice to owner tells the owner the names of the subcontractors and suppliers (materialmen) who are working on the job. Do not pay any person, who is not your contractor, unless you have received a notice to owner from him.  When you do pay your contractor make sure that there is a lien waiver signed by any person who has sent you a notice to owner.  The waiver should state that it is effective through the date that you make the payment. It’s best for the owner to have the owner’s lawyer prepare or review the lien waiver form.

The fourth step to protect the owner from Florida construction liens is for the contractor to provide the owner with an affidavit of payment and waiver and release of lien from every subcontractor and materialman who gave notice to owner.  These should be provided when each payment application is submitted to the owner. Again, the owner’s lawyer should prepare or review this form. The final payment affidavit is very important under the Florida Construction Lien Law.

The fifth step to protect the owner is to withhold 10% from each progress payment. This is called a retainage. It must be written into the construction contract that the owner can withhold this amount.

The sixth step is for the owner to obtain a title search before making each progress payment and final payment to verify that no liens have been recorded. If a lien has been recorded, the owner’s lawyer needs to advise how to handle it under the circumstances.

Finally, in order to insulate Florida real property from a construction lien, the owner may require the contractor to provide a payment and performance bond. This should be written as a requirement in the contract in order to be legally binding. The Florida Construction Lien Law provides that such a payment bond issued in compliance with the lien law exempts the property from liens as long as the owner complies with certain things. Of course, there is premium that the contractor must pay to the insurance company (surety) that issues the bond, and the contractor will add that premium to the contract price, so it will cost the owner more to have the job bonded than not bonded, but it might be worth the premium.

These are just a few of the things that the owner of Florida real estate needs to do in order to protect his property from Florida construction liens. But it’s not so bad: Florida contractors have even more things to do to if they want to place a lien on a job, and they have less time to do it. Florida’s lien law is unusual and complex for both owners and contractors, which is why construction law in Florida really needs the assistance of a Florida lawyer.

[The above is from a letter I provide clients who are about to undertake construction work on their homes in Florida.]

If approved by the Governor of Florida, Senate Bill 1196 would allow a contractor doing work for a tenant to ask the landlord for a copy of the lease provision that prohibits construction liens. The copy must be verified by the landlord using a penalties-of-perjury clause. If the landlord fails to provide the copy within 30 days, then the tenant’s contractor might be able to lien the property.

This new law would provide additional rights for contractors of tenants and additional duties for landlords.