- When should I hire an attorney?
I believe the earlier you get an attorney involved the better. This is even more important in matters involving environmental issues. Early involvement by an attorney allows early negotiations with enforcement agencies. Negotiations can possibly prevent the matter proceeding into court and costly litigation. With early negotiations, it can produce a workable solution for environmental compliance with a budget spread out over time. There are many benefits of having an attorney involved early in any environmental action which include early resolution which means lower attorney fees and likely lower environmental penalties and interest.
- What can an attorney do for me that I can’t do?
Hiring an attorney gives an individual or business the ability to negotiate with environmental agencies. An attorney can take the emotions out of any negotiations and he will bring a certain degree of credibility to the discussion. He will also know the law and know when to apply or use the law to counter enforcement agency arguments or demands. If an individual or business has been cited for an environmental violation it is often for more than one issue. Environmental laws often include very specific or technical requirements. This may be as simple as where a sample is taken for testing. Failure to take the sample in a specified place or manner is a violation and can subject the violator to stiff penalties. As an example, a trailer park that supplies drinking water from a well must sample the water from the kitchen sink. To take a sample from the outside faucet because to owner was not home would be a violation. Fighting such a violation may prove costly in attorney fees and yield little in the way of escaping the reach of the regulations. A better approach may be to negotiate an early resolution and move on with as little discomfort as possible.
- Should I fight or roll over and comply?
A violation of any environmental regulation normally carries significant fines and penalties. To fight a citation may allow the fines and penalties to grow quite large since most environmental penalties accrue on a daily basis. Meaning that each day you are in violation adds to the amount of the penalty. Protracted litigation may delay the payment of the penalty but it may also allow the penalty to grow very large for each day you remain in violation. Delay brought on by litigation may, in the end, come back to bite you. At the end of litigation you may have won some minor victories but now face significant penalties and will have incurred large attorney fees.
- What are the benefits of early compliance?
When you have been cited by the EPA and the matter ends up in court you are in a very serious situation. An individual or business must understand that the state or federal agencies have virtually unlimited money and time to fight for enforcement. They also have an incentive to see the heavy hand of the regulations and the legal system come down hard to send a message to others who think noncompliance or fighting noncompliance may yield financial benefits. They want others to see that the better path is compliance and if cited to make corrections in compliance. Early negotiations with environmental agencies tend to be well received if they believe it is likely to lead to early compliance. Often times the agency will be willing to work with individuals by providing additional time to become compliant, including a payment plan that is workable for the violator. Early compliance can significantly reduce attorney fees and those funds saved can be applied to penalties or to compliance costs. Unless the violator has some overriding reason to fight or has some desire to try and clarify the law early compliance is almost always less costly and accomplished with a less pain.
- Should I hire a big law firm or a small law firm for help?
Normally big law firms represent big companies and small law firms represented smaller businesses and individuals. Big firms are presumed to have more expertise and the staff to handle complex environmental issues. Technology has changed this concept. Small firm attorneys have access to unlimited resources via the internet. They also now have the ability to work with other small firm attorneys and to hire staff and experts on an “as needed” basis. This can reduce costs and make a small firm very attractive. Small firms tend to offer more personal attention and are more accessible to their clients. Small firm attorneys also may have significant expertise since they may have come from industry or from a large firm and started their own practice. Selecting a small firm will require careful considerations and through understanding of the individual you are hiring. You need to understand the strengths and expertise any small firm may bring to the matter. Finding the right small firm to represent you in an environmental matter can yield significant benefits from reduced costs to reduced stress.
- Can bankruptcy discharge environmental fines and penalties?
Like taxes environmental fines and penalties are not dischargeable in bankruptcy. Bankruptcy may buy an individual some time to pay but at some point the fines and penalties will have to be paid. Bankruptcy may discharge some other debts which may free up assets to pay fines and penalties. The consideration to file bankruptcy is always a complex one and rarely will it be the answer for all of the problems that likely exist. Sometimes filing bankruptcy just means you step out of the frying pan into the fire.
- What happens if I can’t pay the fines and penalties?
Almost any time there is an environmental citation there will be some fines and penalties with it. Inability to pay does not get a violator off the hook or garner any special treatment. It is just like a traffic ticket for speeding. An individual’s inability to pay does not get him any special treatment or consideration. If an individual or business determines very early on that they are going to have trouble paying environmental penalties then it would be in their best interest to hire an attorney and start negotiations. Their position should be one of willingness or desire to comply and how can the environmental agency assist in structuring payment of the penalty such that the violator may come into compliance. Remember the environmental agency does not want to close businesses but they do want the regulations followed. No business or individual should have a financial advantage in the marketplace because they do not follow environmental regulations.
- I did not know my business was covered by that environmental regulation.
You know the old saying “ignorance of the law is no excuse.” This could not be truer regarding Environmental Regulation. Often times the regulations contain the most unusual and technical requirements. Failure to meet each and every one of these could result in a citation for noncompliance. Once you have caught the attention of an environmental agency you are likely in for a total environmental review. That’s why it may be prudent to seek early resolution without a fight. The goal is to get off the agency’s radar and let them move on to someone who has violations. Normally staying out of the legal system is a healthy thing for any company, large or small.
- If I buy an existing business, am I responsible for past environmental violations?
Depending on how the sale is structured there is a real possibility a buyer of an existing business could assume responsibility for past environmental violations. Certainly the type of business will play a role in determining what the real risk may be. Also, important is whether the sale includes the real estate on which the business is located. If you are thinking about buying a business with potential environmental risk get an attorney involved early. It is also prudent to invest in some investigation of the business and the past businesses that may have operated on or near the site. A little money spent investigating may be the best money spent in the entire sale. The old adage “knowledge is power” is true. Investing in and acquiring the knowledge about the business, the property and adjacent property will give the buyer the ability to make an informed decision. This provides the opportunity to possibly include in the sale documents language that protects the buyer or reduces his liability for environmental issues that may arise.
Ohio Consumer Sales Practices Act (CSPA)
- What is a consumer transaction?
For the Ohio Consumer Sales Practices Act to apply a consumer transaction must have occurred. Basically, a consumer transaction means a sale, lease, or other transfer of goods or services between a supplier and a consumer that are primarily personal or family in nature. A supplier means a person engaged in the business of providing goods or services to consumers. It is very important to note that violations of the Act can occur before, during or after the sale of the goods or services. Clearly a business providing building goods such as windows, roofing, and construction materials is covered by the Act. A business providing the service of installing building materials is covered by the Act. Home construction and Home remodeling is covered by the Act which provide consumers with valuable rights and remedies. Courts must liberally construe the Act in favor of the consumer.
- What are my remedies for a violation?
Remedies for a violation of the Act may include up to three times your actual damages and possible attorney fees. There are certain requirements that have to be met before an individual will be eligible for damages equal to three times their actual damages. These requirements are technical in nature and best discussed with your attorney. The Act also allow for recover of attorney fees however such recovery is at the discretion of the trial judge. The judge could award all of the attorney fees, some of the attorney fees or none of the fees requested. Again this is a complex point and best discussed with your attorney.
- How much will it cost to bring a lawsuit?
In this area of the law most attorneys charge an hourly fee. The client will pay some or the entire hourly rate as the case progresses if the case goes to trial and the attorney is successful then a motion for attorney fees will be made and the judge will decide what to award if anything. The client is only entitled to attorney fees if the case goes to trial and the attorney wins. If the matter is settled out of court or the attorney is not successful at trial then there is not opportunity to collect your attorney fees.
- How long will it take to resolve the matter?
I tell my clients that on average you can expect it to take about two years from the date that the lawsuit is filed. If you are involved in a home construction project or remodeling project it may be some time before you are aware of a problem. Even after learning of a problem you will have to get an expert involved to review the problem and who is willing to testify about his opinion. This can sometimes be difficult and may require more than one expert. Depending on the nature of the problem you may be best served in getting it fixed right away to avoid or minimize damage. This will also fix or quantify the damages of repair. After this time your attorney will attempt to settle the matter and if that is not successful then a lawsuit must be filed. As you can see it may be a year or more from the date the construction problem is discovered before a law suit is filed and then it will take about two years from the date filed.
- Insurance and bankruptcy
First, insurance is available for builders and remodelers. The insurance is only going to cover and pay for damage to surrounding property and never provide coverage for the work performed by the contractor. As an example if you are having a new concrete driveway installed and the contractor bangs into your car with his hand tools and dents or scratches the paint his insurance will pay to repair your car. If the concrete is defective such that it has huge pot marks or the surface flakes off in a large amount, this would not be covered by his insurance because the problems are directly related to his work and workmanship. Be careful because sometimes a contractor will say he is insured, when in fact all he has is Workman Compensation Insurance which does not cover the homeowner for any damage to his property.
Second, bankruptcy is available to all builders unless they have already filed for bankruptcy. If they have filed then the type of bankruptcy they filed will determine how long they need to wait to file again. If a client sues a supplier under the consumer sales practices act and wins he must be prepared for the supplier to file bankruptcy. If the supplier files for bankruptcy the client may be able to argue in court why he should not be discharged. If the court determines that a discharge is appropriate then the client/homeowner cannot collect his settlement or judgment from the supplier.
- Change in the law
The Ohio Consumer Sales Practices Act was modified by the legislature on July 3, 2012. The changes include provisions for suppliers who have been served with a lawsuit an opportunity to “cure” the problem. The supplier must make his offer to cure or correct the problem within 30 days of receiving notice of the lawsuit. The cure must include a monetary amount to resolve alleged violations and reasonable attorney fees not to exceed $2500.00 plus court cost to file the lawsuit. The consumer has 30 days to accept or reject the cure offer. If the consumer rejects the cure offer and a judge, jury, or arbitrator awards damages that are not greater than the value of a supplier’s cure offer the consumer is not entitled to triple damages, court costs, or attorney fees.
- What are deceptive acts?
The Ohio Consumer Sales Practices Act protects against deceptive acts. The focus of any inquiry into whether an act is deceptive is the likely effect on the mind of the consumer. An act is deceptive if it has the likelihood of inducing in the mind of the consumer a belief which is not in accord with the facts. An act is deceptive if it has the tendency or capacity to mislead consumers concerning a fact or circumstance material to a decision to purchase the product or service offered for sale.
- Arbitration: pros and cons
Many building and remodeling contracts have or contain an arbitration clause. This is an agreement that in the event of a dispute the parties will go to arbitration. The parties will present their side of the dispute to a neutral third party who will decide the matter.
The benefits of this type of resolution are that it is faster than going to court. The process is often promoted as being cheaper than going to court however; this may not be entirely true. The decision of the arbitrator is final and binding on the parties; therefore brings closure to the matter and eliminates any opportunity to appeal to a higher court. The decision of the arbitrator is enforceable just like that made by a judge or jury.
The drawbacks of this type resolution are that the arbitrator may not have any experience or understanding of the issues involved. It is only one person making the final decision rather than a jury. The arbitrator is not obligated to follow rules of procedure such as what may or may not be considered as evidence. The arbitrator is not obligated to follow the law or past legal decisions. He may decide the matter on the most trivial facts and once his decision is made it is binding on the parties and becomes unreviewable. An individual should be very careful about entering into a contract that contains an arbitration clause.
- What does workmanlike mean?
Once a contractor or builder agrees to perform a construction contract the law imposes upon him a duty to perform in a workmanlike manner. To perform in a workmanlike manner means to perform in the customary way of doing or performing the work in the community where the work was performed. The test of workmanship is not what either party individually expects or would like. It is a performance of the work equal to that done by others in the same trade in the same community for the same type of work. It has been determined that a contractor who consistently maintains a pattern of inefficiency, incompetency, or continually stalls and evades his legal obligations to consumers, commits a violation of the Ohio Consumer Sales Practices Act.
Law Office of Timothy J Walerius, Ltd.
316 North Michigan Street
Toledo, OH 43604