construction contracts

Construction Contracts: Why a Handshake Is Not Enough

Business deals, especially in the construction industry, have traditionally relied on handshakes. However, this is no longer the 90s and you need more than oral agreements or verbal promises to prevent possible conflicts and disputes from arising in the future.

Business lawyers can swiftly and easily draft a construction business contract and ensure all the terms and conditions are fair and valid. The primary purpose of a written contract is to keep tabs on any potential alterations from the originally agreed terms and to resolve the situation without compromising your interests.

Essential Provisions in an Alabama Construction Contract

Many contractors operated for decades without running into any serious conflicts or disagreements over project terms. In relation to this, things can take a pretty nasty and expensive turn if a disagreement does arise. The consequences of such disputes can be disastrous. Comprehensive and clearly written contracts can save all parties a lot of money, headaches, and time.

You probably don’t need a 100-page behemoth contract. Moreover, you need to ensure that these features are clearly included in your construction contract:

Scope of work

There should be clarity about the jobs that a contractor or subcontractor has to complete. You should also mention who will pay dividends in case a dispute occurs over what is done or not done.

Timing of the work

Construction delays are common and inevitable. They usually result in finger pointing. Contracts can clearly lay out the deadlines. Any exception to the deadlines or the cost associated with a delay can be mentioned in the contract as well. This can prove to be just the balm required in such painful situations.

Breach/termination

What if the contract doesn’t make any progress payment or a subcontractor is unable to complete the job? These questions can be addressed to avoid ambiguity.

Payment terms

Terms of payment including how and when the payment will be made can be addressed through a contract. Nobody wants to work for free. The last thing needed by a construction professional is a dispute over the payment terms. There should be a good understanding of retainage. This subject often causes disagreements and confusion.

Dispute resolution

How are the parties meant to handle disputes over certain aspects of the project? Disputes may result in a stoppage of work and stalemate without a contract for handling them. These kinds of conflicts don’t benefit anyone and only cost money and time.

This list is not exhaustive and there can be other provisions that you find necessary to enter into your construction contract. You should consider speaking with a business attorney that has experience in the construction industry to create an iron-clad contract.

 

Why are Handshakes No Longer Enough in the Construction Industry?

Disputes can arise

‘Shaking on it’ can spell disaster in the business world. Disputes are inevitable when one party considers the handshake deal to be legally binding and the other doesn’t. Written agreements can solve this. It can also make it easier to resolve disputes. Each party’s credibility gets questioned or established by a judge when handshake deals go to court.

Difficulty in enforcing the terms

You will need to prove the terms of the handshake deal and what they mean in order to enforce them. Interpretation of the terms may be very different from the other party. They can also just lie about whatever was agreed if they realize the terms are not favorable to them.

You need testimonies from all parties and details about how the parties acted before and after the deal was made to prove the terms of the handshake deal. More often than not, parties’ testimony devolves into a ‘he said, she said’ argument. Inconsistencies in the rendering of events are another reason why handshake deals are unreliable and not credible.

Recalling different versions

It can be difficult if you and your trading partner remember different versions of the truth. It doesn’t matter who is lying, when people work together, they need to be on the same page. This is unfortunately quite common in contractual agreements.

For instance, you and a subcontractor may have shaken on a particular price for a job. However, the prices of raw materials have increased since. The sub-contractor may go back on their word or ask for more. It doesn’t matter who is right or wrong in such situations.

Written Agreements are Always Helpful

Players in the construction industry try to be optimistic about the future of their contractual relationships and don’t want to think about bad things happening. Unfortunately, everyone cannot be trusted. There may be some people that fail to agree or cover all aspects of the construction business deal. Memory tends to fade as well. You or the other party may find it difficult to recall certain terms of the deal down the road.

Choose an Experienced Alabama Business Attorney for Your Construction Contract

The right construction business attorney can make the management, presentation, and negotiation of your contract agreements legible and simple. The skilled lawyers at BHM Law Group can draft construction contracts that reduce the risk of unfair deals and future disputes. We are happy to provide you with the legal assistance you need to take your construction business to the next level. Call us at (205) 994-0902 or reach us online to schedule a free consultation.

blockchain is changing real estate

Blockchain Technology is Changing the Real Estate Industry

The real estate industry is one of the oldest and most economically significant industries in the United States. Real estate companies have contributed to the building and maintenance of a robust residential and commercial physical infrastructure in the country. The industry also plays a major role in the global economy even though it faces the challenges of slow transaction times and bureaucracy.

Fortunately, things are beginning to change in real estate because of blockchain technology. Here are six ways in which the real estate industry contours are getting transformed due to blockchain technology:

  1. New Ways to Trade

Traditionally, real estate technology has been majorly concerned with connecting buyers with sellers through listings. Blockchain has revolutionized the industry by introducing new ways to trade. Online marketplaces and trading platforms are now enabled for supporting real estate transactions in a more comprehensive fashion.

Blockchain technology has been developed by ATLANT which allows sellers to tokenize assets. It facilitates rental and real estate property transactions. Real property is tokenized as assets that are then traded in a manner similar to exchange stocks. Transactions can be easily completed online.

ATLANT handles the sale and purchase of real property as a stock sale. Assets can be liquidated using the platform through a token sale. Tokens that are collected can then be exchanged for fiat currency with buyers owning a percentage stake in the property.

  1. Intermediaries are Not Required Anymore

Banks, lawyers, and brokers have been part of the real estate industry for a long time. Blockchain may soon be able to usher in a period that doesn’t require any intermediaries. The role and participation of intermediaries are soon to change with the advent of blockchain technology as per a report by Deloitte.

New platforms will eventually be able to assume functions, such as legal documentation, payments, and listings. Buyers and sellers will be able to get more out of their money by cutting out the intermediaries. They will save on the fees and commissions charged by the intermediaries. This will also help in making the process much quicker as there will be no more back and forth between middlemen.

  1. No Longer an Illiquid Asset

For the longest time, real estate has been considered an illiquid asset. This is because it takes time for concluding a sale. This is not a limiting factor where crypto tokens and currencies are concerned. In theory, cryptocurrencies can be readily traded through exchanges for fiat currencies.

Real estate can be readily traded when in the form of tokens. Sellers don’t need to wait for buyers that will purchase the entire property to get some value. They can divide the property into tokens and assign a value to each of them.

  1. Allows Fractional Ownership

Blockchain can lower the barriers to real estate investing by allowing fractional ownership. Investments generally require significant upfront money for acquiring property. Investors earlier had to pool their money for purchasing bigger ticket properties.

Blockchain technology lends access to a trading app for purchasing and selling fractions of tokens as the seller sees fit. In relation to this, fractional ownership avoids the hassles of managing, leasing, and maintaining the property. Upkeep on its own can be expensive. It may be a troublesome effort to deal with tenants. Related activities, such as lending are also affected.

  1. Decentralization in Real Estate

Blockchain is a decentralized technology that commands security and trust. Information on blockchain is accessible by all peers on a particular network. This makes data immutable and transparent. Lack of transparency and greed can quickly create catastrophic consequences as was seen in the great housing bubble crash of 2008.

The decentralized exchange has increased trust built into the system. Buyers and sellers can have more confidence in carrying out transactions since information is verifiable by peers. Blockchain technology reduces fraud attempts. Smart contracts can provide enforceability beyond technology.

  1. Lowered Costs 

Decentralized networks afford special transparency that can trim down costs associated with property transactions. In addition to savings made by cutting out middlemen commissions and professional fees, blockchain technology mitigates costs related to inspection, loan, registration, and taxes.

These costs differ depending on the jurisdiction of a particular territory. They can be eliminated and reduced from the overall equation in the same manner as intermediaries. Blockchain platforms can help in automating the processes and making them an integral part of the system. Global real estate is currently dominated by large and wealthy corporations even though it is worth hundreds of trillions of dollars.

Blockchain technology is expected to make the industry more secure, transparent, and equitable. Lowered costs by getting rid of middlemen and tokenization have made it possible for small investors to enter the industry. It’s expected that real estate transactions may truly become peer-to-peer eventually. Blockchain-powered platforms will do most of the work.

Hire a Competent Real Estate Attorney for Best Advice

The technological advancements in the real estate industry can make things tricky for an individual investor. The capable and diligent attorneys at the BHM Law Group can help you understand your legal position in all matters related to real estate. Schedule a free and confidential consultation with us today. Call (205) 994-0902 or write to us online.

eviction laws in Alabama

Reasons You Can Evict a Tenant in Alabama

The eviction process may be different for every lease or rental agreement that a landlord and tenant will sign. It’s dependent on a wide array of factors. You should be aware that there are only certain situations in which a landlord can evict the tenant legally in Alabama.

Landlords should seek advice from an experienced real estate attorney and maintain a meticulous file for avoiding errors that may be exploited by the tenant in the event of an eviction. Similarly, the tenants should be aware of their rights and seek legal advice to help prevent an illegal eviction.

Here are a few legal reasons landlords can evict tenants in Alabama:

  1. Not Complying with Rent Deadlines

In Alabama, a tenant’s rent is considered late if they haven’t paid even after a day past the deadline. Moreover, a grace period may be applicable if the rental or lease agreement states it. The landlord is required to provide the tenant with an official written notice to pay at least a week before the eviction process can be started. The filing for eviction needs to cease if the rent is paid within these 7 days. The landlord reserves the right to evict the tenant if they are unable to pay after the grace period.

  1. Violation of Terms Mentioned in the Rental Agreement

The terms in the rental lease agreement need to be upheld by the landlord as well as the tenant for the entire duration of the stay. These terms may differ between agreements. The landlord has to issue a 7-Day Notice to Comply if any of the terms are violated by the tenant. The eviction process cannot continue if the tenant resolves the issues.

These are a few examples of lease violations:

  • Smoking in areas that are designated as non-smoking
  • Damage to property
  • Keeping pets if they are not allowed

The landlord may continue eviction if the violations are not taken care of. Landlords should know that if the same violations are committed by the tenant again within 6 months, they are not legally obligated to give the tenant an opportunity to resolve the issue before presenting them with the notice to evict.

  1. False or Misleading Information

Landlords have the right to remove tenants if they were dishonest while filling out the rental application. Examples of false and misleading information include, but are not limited to:

  • Number of people living in the rental unit
  • Employment status of the tenant
  • Personal information of the tenant
  • Criminal and eviction history of the tenant

The tenant doesn’t get an opportunity to correct false or misleading information. A landlord can issue a 7-Day Notice to Quit by which the tenant gets 7 business days for vacating the property.

  1. Carrying Out Illegal Activity

The landlord has the right to issue an official 7-Day Notice to Quit in writing if the tenant is engaged in any illegal activity or behavior on the property. Examples include:

  • Assault, theft, or violence.
  • Involvement in the distribution, creation, or consumption of controlled substances.
  • Involvement in the distribution, creation, use, or possession of a firearm. This is not valid in the case of self-defense.

Tenants charged with illegal behavior are given 7 business days to leave the property after receiving a written Notice to Quit.

  1. Safety Violation or Material Health

Alabama takes into account the safety, building, health, and housing codes. The landlord is obligated to issue a 7-Day Notice to Comply if any of these codes are violated by the tenant. This is to give the tenant enough time to fix the problem. Violations may include:

  • Damaging the electrical wiring
  • Ruining plumbing fixtures
  • Not throwing the trash out for extended periods of time

If the tenant is unable to fix the problem by the end of the 7 business days, the landlord may file for eviction.

  1. Not Renewing the Rental Lease

Landlords in Alabama cannot force a tenant to vacate the property without a legal reason. The tenant may continue staying on the property till the rental period ends. The landlord has to issue a 30-day Notice to Quit instead of a 7-day notice if the lease agreement is categorized as monthly. Landlords can issue a notice to move in writing if the tenants remain on the property even after the expiry of the rental or lease agreement.

Common Defenses Employed by Alabama Tenants

Tenants may claim the landlord failed to maintain the premises as per the applicable building and housing codes. This can include not providing essential services or making necessary repairs that impact the tenant’s health and safety. The tenant in these cases is required to provide the landlord with a written notice.

They need to allow at least 14-days for the landlord for making the requested repairs and notifying them of their noncompliance. The tenant has the right to contact the health department or a housing inspector for property inspection. This is to demonstrate the hazardous conditions in the house.

Choose a Seasoned Real Estate Attorney in Alabama to Protect Your Rights

Alabama laws surrounding rental agreements and eviction can be complex and confusing. You may miss out on something vital that could have been in your favor. The attorneys at BHM Law Group have deep domain knowledge and years of experience in dealing with eviction disputes. We are happy to provide you with a free consultation to discuss your concerns. Call us at (205) 994-0902 or reach us online.

 

zoning variance lawyer in Birmingham, Alabama

How to Obtain a Zoning Variance from a Municipality for a Commercial Project

You may require a zoning variance for your commercial project if your business is different from the zoning use specified for the particular area. Variance, in these kinds of cases, is necessary whether you want to build, lease, or buy. You would need to contact the local planning or zoning board to request a variance or an exception to the current zoning type before you proceed to open your business.

Zoning variance can be complicated with numerous rules and regulations at play. It is recommended that you consult with a hard-working real estate attorney in Alabama to understand the procedure and available options.

Who Makes Zoning Decisions in Alabama?

A zoning variance is a restriction that allows a particular piece of land to be used for purposes other than the ones stipulated at the time of zoning of that area. Localities and municipalities allow variances for enterprises when they present valid reasons for their requirements. The enterprise will need to demonstrate that the variance will not interfere with or reduce the property values of other local residents.

Typically, zoning decisions are made by the zoning or planning department within the municipality. These departments are responsible for proposing zoning ordinances and overseeing land use and zoning hearings. They are also responsible for making decisions regarding conditional use permits, variances, and other issues related to land use and zoning ordinance laws.

The first procedural step in obtaining a zoning variance will be to attend the public hearing. You would be asked to present your case to the department at this hearing. The government has allowed the public to make comments regarding individual proposals or complaints. You can always appeal the decision made by the department to a court if it is unfavorable or unfair.

Applying for a Zoning Variance

It is important to understand that zoning variance is not a change in the zoning law. It is a specific waiver of requirements as laid down by the zoning ordinance. Variances are typically granted when the property owner is able to demonstrate that existing regulations are making it practically difficult to use the property.

There are individual rules for each municipality in Alabama to seek variance requests. Generally, the landowner needs to request the variance through a written application in the prescribed format. There is a fee associated with the request that needs to be paid at the time of filing the request form.

Generally, the requests are first sent to the zoning board regardless of the municipality. The board is responsible for notifying adjacent and nearby property owners. The zoning examiner is required to hold a hearing as well for determining if the variance is necessary and should be granted. The applicant is then required to appear before the city council or governing body of the municipality. This is when the final determination takes place.

When is a Zoning Variance Necessary?

Zoning permits allow a property to be used for a purpose different from the one designated by the zoning authority. This is only till the time the business or enterprise doesn’t impact the neighborhood negatively. Zoning permits are similar to variances.

You may need to apply for a zoning variance or permit in a number of situations, such as:

  • If you are considering a modification or construction of a building that will alter the area’s classification
  • You want to change the use of an existing building to a different classification
  • You desire to construct on vacant land
  • You want to alter the use of your land to another type of zoning
  • You want to bring changes in a non-conforming use, such as changing the current zoning requirements of a ‘grandfathered’ building

What is Conditional Use Permit?

Conditional use permits allow a property to be used in a different manner as specified by the zoning code. Typically, these permits are granted in front of a political body at a public hearing. They are accompanied by the understanding that the building’s new use is not going to be determinantal to the public.

Permissible Restrictions

Generally, nonconforming uses are disfavored. A wide variety of restrictive techniques are implemented in most cases that can be generally upheld. Common restrictive techniques used are:

  • Enlargement
  • Resumption
  • Amortization

Penalties for Violating Land Use or Zoning Regulations

Individuals violating land-use regulations are usually subject to injunctions. This is a formal order that allows or bars an individual from doing something. In addition, violations of land use regulations can subject an individual to damages if the party has suffered economic losses because of the violation. Both government and private entities are subject to land use violation lawsuits.

Speak with a Knowledgeable Real Estate Attorney

Zoning variances and changes open up a whole world of possibilities for a particular property. They may have a disastrous impact if not sought after following due consideration. It is recommended that you consult with the competent real estate attorneys at BHM Law Group to discuss possible changes and make the right decisions. To request a free consultation, call us at 205-994-0902 or contact us online.

 

adverse possession attorney birmingham alabama

Who Can Claim Property Based on Adverse Possession in Alabama?

Adverse possession is a Middle Ages legal concept that can prove to be a threat to your Alabama land. You probably have 2 to 3 neighbors with property lines bordering yours. Did you know that those neighbors may be able to get their hands on the legal title to certain pieces of your property? The law also allows unknown trespassers that have squatted on land for a certain period of time to claim ownership.

It is recommended that you familiarize yourself with Alabama’s rule on adverse possession to ensure that your land remains yours. Or you may want to assert an adverse possession claim over a piece of land that you have developed and want to continue using.

Understanding Alabama’s Adverse Possession Law

The Homestead Act of 1862 enacted the adverse possession law of Alabama. Individuals are allowed by these laws to come into possession of a property if they have publicly lived on it for a specific time period and made improvements. Typically, they would have a deed to the property and would have paid property taxes or rent on it.

In Alabama, the original owner is burdened with the task of using their property or forcing squatters to leave. In many states, it is incumbent on the property owner to ensure that the unoccupied land they own improves the community around it and serves a purpose. Any land that is left untouched for years will probably be voted in favor of the squatter by the courts that tried making improvements on it.

Property owners and landlords need to prove that they legitimately own the land. This is because squatters have the right to become legal owners of a piece of land if they have used it and lived there for long enough. You should get in touch with a capable real estate attorney in Alabama if you have concerns about adverse possession regarding your land.

Adverse Possession Effects and Requirements

Adverse possession doesn’t result in legal title transfer automatically. It lends vested property rights to the person in the possessed area. Individuals can initiate a quiet title action for obtaining the legal title to a certain property after meeting statutory requirements for adverse possession.

State statute governs the requirements for adverse possession. These are the adverse possession statute elements that need to be met in Alabama:

  1. Open and Notorious

It is important for the person seeking adverse possession to occupy a piece of land in an open and obvious manner. The parcel of land cannot be occupied secretively. The person should not make any efforts for remaining undetected. Landowners are not required to have any actual knowledge of the occupation.

  1. Exclusive

The parcel of land should be exclusively occupied by the person seeking adverse possession. They may not share it with the true owner or public.

  1. Hostile

In Alabama, adverse possession requires the land occupation to be adverse and hostile to the interests of the true owner. Possession is not considered hostile if the landowner gave permission to use the land. However, the landlord doesn’t really need to have actual knowledge of the occupation as long as the occupation is adverse to their interests.

For instance, a landowner may not realize that their neighbor’s fence extends over his property line. This occupation can be termed sufficiently hostile since the landowner never gave the neighbor permission to encroach on their property.

  1. Statutory Period

The land possession needs to continue for the predetermined statutory period of the state. This statutory period can be as short as three years or for a period extending twenty years. In Alabama, the statutory period for adverse possession is 20 yrs. (Bradley v. Demos 599 So.2d 1148).

The squatter needs 10 years for the Color of Title and should have paid taxes on the property for 10 years. It is necessary for the possession to be continuous and exclusive in Alabama. The trespasser cannot share the land or property possession with others. They need to be in possession of the land for an uninterrupted time period.

  1. Uninterrupted and Continuous

Before you get too worried about trespassers taking over your land, you should know that they need to meet all elements of adverse possession at all times during the statutory time limit. Adverse possessors can use the property in a consistent manner with the type of possessed property. For instance, a ski lodge may be determined to be used continuously even when it is only used during the winters.

Contact an Experienced Alabama Real Estate Attorney Today

Adverse possession and real estate laws can be confusing. You can understand your rights and responsibilities pertaining to adverse possession and other real estate matters by getting in touch with capable attorneys at the BHM Law Group. We offer legal advice after understanding all aspects of a client’s case because we know that a cookie-cutter approach rarely works in matters of real estate. Get in touch with us today by calling 205-994-0902 or using our online form.