Frequently Asked Questions of the Massachusetts Real Estate Attorneys of Topkins & Bevans

The following information includes real estate questions frequently asked of the real estate attorneys of Topkins & Bevans. The answers given are general in nature and are not intended to apply to every real estate situation. Each case is different and carries its own set of circumstances which must be taken into consideration by competent legal counsel.By contacting the Waltham real estate lawyers of Topkins & Bevans, you can receive a personal consultation regarding your specific legal claim.

What is the Statute of Frauds?

The Statute of Frauds is a state law which denies the enforcement of certain types of contracts unless they are in writing. Subject to a very few exceptions, it makes no difference how strong the case is or how many witnesses witnessed the agreement, the case will be dismissed if it pertains to subject matter governed by the statute. All contracts for the transfer of any interest in real estate property fall within the Statute of Frauds and must be in writing.

What is Eminent Domain?

Eminent Domain is a legal proceeding under which the government can seize a piece of privately owned real estate, even if the owner objects to the seizure, so that the land can be used for some public purpose. Traditionally, eminent domain has been invoked when the government needs the land in order to complete some public project such as a road or a bridge. A recent decision by the United States Supreme Court held that eminent domain proceedings were appropriate even in a case where the government’s intention, in seizing the land, is to sell it to some third party in order to complete a private development project seen as beneficial to the public interest. In exercising its authority under eminent domain, the government is required to pay the owner the fair market value of the property.

The land seizure itself is rarely the subject of eminent domain litigation. Most eminent domain lawsuits involve a dispute over the price the government wants to pay for the land.

What is inverse condemnation?

Inverse condemnation is similar in some ways to eminent domain. The difference is that in eminent domain proceedings the government wants to force the landowner to sell his property, while in inverse condemnation proceedings the land owner wants to force the government to buy it.

The theory of inverse condemnation is that a government action has destroyed or substantially reduced the value of the property. Typically, inverse condemnation will involve, for example, situations in which the government passes zoning or other regulations which make it difficult if not impossible for the land owner to continue using the land for its then existing use. In essence, inverse condemnation urges the court that since the government action has destroyed the value of the property to the owner, the government should have to buy it for fair market value.

What is “commercial real estate?”

The answer to this relatively complex question is often more a question of context than of the physical properties of the real estate. Consider, for example, a typical 3-bedroom, 2-bath house. If the owner lives there, it is probably “residential” real estate. If the owner moves out, however, and continues to hold the property for business or income-producing purposes, it is probably “commercial” real estate, even though the house itself remains unchanged. Although an apartment house is, by definition, a place where people reside, it is “commercial” real estate. So is a motel or a hotel. Industrial real estate is almost always “commercial,” while agricultural real estate might be either one, depending on the context.

How do “commercial” real estate transactions differ from “residential” ones?

As a general rule, “commercial” real estate transactions are riskier and far more complex than “residential” ones, and they are usually a lot more expensive. But there are other differences, some of them quite significant. We all generally know what’s involved in owning a house, in terms of maintenance costs, potential liability and other routine everyday aspects of home ownership. Because of long-standing restrictions on the use of hazardous materials on residential property, there are few instances, apart from lead paint or asbestos ceilings/insulation where you have to worry about toxic torts. If you buy a vacant commercial lot, however, you may not realize, without spending a lot of money on testing and research, that the property may once have been used as a gas station, leaking having created a massive underground lake of gasoline. The cost of cleaning up the mess and insuring against potential toxic tort liability could amount to several times the purchase price of the property.

There are all manner of consumer protections built into the laws governing residential property purchase, but many of them have no application whatsoever to commercial real estate transactions. The problems surrounding commercial real estate transactions are by no means insurmountable and the transactions are often very profitable. But it would be dangerous to think that a past experience, however extensive, in buying and selling residential real estate will necessarily help you avoid disaster in dealing with commercial property.

What is a title defect?

In a real estate transaction the seller is expected to convey “clear title” to the property, or “title free of defects” to the seller. Sometimes a title defect is referred to as a “cloud” on the title. A defect in the title to real property can delay or even prevent a sale from taking place. Sometimes it becomes necessary for the owner to prosecute what is called a “Quiet Title” action – a form of lawsuit asking the court for an order removing the defect in the title.

There are several types of title defects. Easements can be title defects. An easement is the right to go across or do something on someone else’s property. It can be acquired either by written conveyance (which may be recorded) or by operation of law, depending on events which may have occurred long before you ever even heard of the property. Easements acquired by operation of law are usually not recorded until someone has successfully sued the property owner to enforce one.

All liens are regarded as title defects. If a lawsuit results in a judgment against a landowner and a copy of the judgment is filed with the local Recorder’s Office, it becomes a “judgment lien” on the property.

How can I protect myself from mechanic’s liens?

A mechanic’s lien cannot attach to your property without prior notice to you. Before releasing funds to your general contractor, be certain there is a discussion of any lien notices which may have been filed against the property by employees, sub-contractors or suppliers. Remember, if you pay the general contractor and he does not pay any of those people, they can foreclose a mechanic’s lien against you.

What is a deficiency judgment?

In some states, when the proceeds of a foreclosure sale are insufficient to pay the underlying obligation, the lender simply applies the proceeds against the debt and the foreclosure costs then sues the defaulting borrower for the remaining balance (called the deficiency). If successful, the lender obtains a “deficiency judgment” against the defaulting borrower.

After the Great Depression in the 1930s, however, many states enacted laws called “Anti-Deficiency Judgment” statutes, designed to regulate, limit, or even eliminate a lender’s right to obtain a deficiency judgment. Not every state has such statutes, and there is a good deal of variance from state to state. In its purest form, the statute provides that a lender’s sole recourse is to the land. This means that after a foreclosure the mortgage obligation is completely discharged regardless of the amount of the sales proceeds.

In other states, including Massachusetts, the lender retains the right to seek a deficiency judgment, but there is a strictly enforced time period for accomplishing this purpose, as well as strictly enforced procedural rules. If the lender fails to act within the time period, or if the lender fails to give proper and timely notice to the defaulting borrower, any deficiency is waived.

How much does Topkins & Bevans charge for legal representation in real estate matters?

There is never any charge for an initial consultation to determine how the firm can best serve your needs. Before you retain the firm to represent you, the fees likely to be incurred will be explained to you in detail. You will find the fee schedule at Topkins & Bevans to be very reasonable and competitive and all fee agreements are in writing. There will be no hidden costs and no surprises.

If you or someone you know in Waltham, Massachusetts, or anywhere within the Commonwealth of Massachusetts, needs the assistance or trusted legal advice of an experienced Real Estate lawyer, please contact Topkins & Bevans, today at (866) 786-4821, or complete the contact form provided on this site to begin your free consultation with a skilled real estate lawyer.