Features

Recent developments of interest to corporate counsel.

Features

The Employee Benefit Security Administration of the Department of Labor (DOL) has recently announced a more liberal view toward charging tax-qualified retirement plan expenses against the accounts of participants in 401(k), ESOP, and other defined contribution plans. This article provides a brief overview of the kinds of expenses that plans may pay and then explains how the new DOL guidance provides employers and plan sponsors with greater flexibility in allocating these expenses to participant accounts.

A very important lease provision, particularly from the tenant's perspective, is an effective subrogation waiver. The subrogation waiver essentially provides that in the event of a casualty that is caused by the negligence of one party to a lease, the negligent party is nonetheless not liable for the resulting damage to the extent that the damage is either covered by applicable insurance proceeds or to the extent it would have been covered by insurance proceeds had the other party to the lease maintained the insurance as required under the lease. Subrogation waivers provide, in effect, that both parties to the lease benefit from the casualty insurance maintained by either party. This concept is especially fair to the tenant in net lease situations where the tenant pays its pro rata share of the landlord's casualty insurance. Landlords also benefit from a mutual subrogation waiver to the extent that the tenant's leasehold improvements, fixtures, and personal property are damaged or destroyed due to the landlord's negligence.

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What could be simpler, more mundane, and less worthy of a lawyer's attention than lease provisions dealing with a business term — the square footage of the premises? However, a lawyer's failure to define the agreed-upon method of its measurement properly in the lease can lead to headaches and even litigation as the lease term progresses. Because measurement standards are not mandatory or legislated, the parties are free, depending on their relative market positions, to agree upon the method to be used in the lease. Often the measurement of square footage is referred to in terms that are imprecise and have no legal definition. Depending on the area where the building is located, measurement methods may vary and a landlord may have its own method that is a modified form of a particular standard of measurement. Without a specified measurement standard and the right to confirm a landlord's measurement, a tenant could end up paying more for its space than it intended (or budgeted); and may later find itself unable as a practical matter to contest a landlord's measurement of an expansion space.

Have you ever sent a fax containing a lease agreement, listing agreement, property informational brochure or estoppel certificate? What about a fax with a purchase order, invoice or a request for a proposal from a vendor of property-related services or goods? In the leasing world, who hasn't? At the same time, have you ever considered obtaining prior written consent from the recipient to authorize your transmission of that fax? In many, if not all, cases, the answer is likely to be "who has?" In the not-too-distant future, that answer probably will need to be changed. Read on to find out why — and whether you will be among the crowd that must obtain that prior authorization before turning on your fax machine.

Features

Highlights of the latest Commercial Leasing cases from around the country.

Features

Cries from practitioners balking at last summer's increase in filing fees appear to have intensified as complaints mount about problems with the collection of those fees. The New York State Bar Association is expected to release the results of a survey to the Office of Court Administration this week, which State Bar President A. Thomas Levin said identifies several criticisms with the new state Supreme Court fees required for filing motions, cross motions and stipulations of settlement and discontinuance.

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The theory underlying our adversarial legal system is that each person will hire a bright, skilled warrior who will see the situation completely from the perspective of the client, then present the strongest case possible to the judge. The judge will get the best information from each side, but will be neutral. Then the judge will see the situation "from above" and will render a decision that metes out justice and wisdom. But because of our overloaded and burdened court system, most judges do not have the time to get to know the people behind the caseload. People who go through the court system often end up feeling the judge did not really hear their story, and that they were not given a chance to speak.