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Every lender is obligated to charge interest on loans. However, New York State usury law shields some borrowers from interest rates that are too high. 

New York’s Usury Law

The definition for usury is the lending of money at an exorbitant interest rate. Specifically, under New York law, the maximum interest rate that you can charge is 16 percent annum. if a lender exceeds this, they may be liable for civil usury; if interest is higher than 25 percent, then it could be considered criminal usury. 

Individual Borrower Rules

• NY gives individual borrowers a lot more protection compared to corporations and LLCs.

• Loans under $250,000 to individuals must follow both civil and criminal usury rates.
• Loans between $250,000 and $2,500,000 must only follow criminal rate.

Corporate Borrower Rules 

• Corporations and LLCs can be charged more than 16 percent interest. 
• Loans to businesses under $2,500,000 are typically exempt from the 16 percent civil usury cap, but are subject to the 25 percent cap.
• Loans to corporations for business purposes that are $100,000 or more that are secured under New York’s Uniform Commercial Code (UCC) are exempt from NY’s criminal usury laws if on the date when the interest is charged or accrued, the interest is not greater than 8 percentage points above the prime rate. 

General Rules: All loans above $2,500,000 are exempt from civil and criminal usury laws. 

What Are the Remedies for Breaking NY Usury Laws?

When an individual borrower is a usury victim, they can bring a lawsuit to recover anything paid over the 16 percent or 25 percent interest rate. Additionally, individuals can assert usury as an affirmative defense if the lender brings suit against them for the repayment. This differs from a corporate borrower who can only use criminal usury as an affirmative defense, but just like individual borrowers, corporate borrowers can recover what they paid over the 25 percent interest rate.  

Also, keep in mind that if a loan is criminally usurious, that loan is considered void, and the lender can lose their principal and interest. 

Determining Interest Rates

While NY usury laws determine maximum interest rates, lenders have flexibility to vary interest rates under the limit. Part of the basis for establishing interest rates has to do with the risks of being repaid; borrowers with bad credit, little collateral will likely get a loan with a higher interest rate as compared to borrowers with ample finances. To get around this, some borrowers, (in order to get business loans) give a personal guarantee, which is the individual’s agreement to repay the loan if the business defaults. Typically, a lender can sue the business for repayment. However, if the business doesn’t have any assets, the lender is out of luck. The personal guarantee ensures that the lender can recover from the personal assets of the individual, who made it.   

In some instances, a borrower won’t be able to get the business loan without making a personal guarantee. The flip side of this is that the borrower can use the guarantee as leverage to obtain a better interest rate. But personal guarantees should be approached with caution because there’s great risk for losing your business and personal finances.   

Talk to an Experienced Lawyer about NY Usury Laws

If you think that you’re a victim of a usurious interest rate, you should act in your best interests and talk to a knowledgeable attorney. Our MOWK Law attorneys are ready to work on your behalf. Get in touch with us today.

A pretrial settlement is when the parties in a lawsuit meet before trial to figure out payment for losses and injuries. Instead of going through the entire trial process, the parties try to negotiate and resolve payment issues, rather than depending on the judge to determine the damages award. Keep reading for more information about this common dispute resolution approach.

When do pretrial settlements occur?

After receiving notice of the lawsuit, the defendant has the opportunity to work with the claimant/plaintiff outside of court to come to an agreement about liability and how to measure damages. 

The settlements can occur in any personal injury arena, but they are very popular in auto accident claims, which can be complicated due to the presence of other parties like insurance companies. Pretrial settlements are also common where business owners are trying to avoid taking time out for court appearances in cases like slip and falls or other claims that occur in business establishments. 

After the distribution of the facts of the case, the plaintiff can work with an attorney to draft a formal offer of settlement according to the outlined terms and send it to the defendant for consideration. Alternatively, another option is that both parties can have conversations to negotiate the offer together. 

What are the benefits of pretrial settlements?

If you go the settlement route, all parties may be able to save both time and money. Depending on the case, the costs of legal fees, securing and paying expert witnesses, and other costs associated with the lawsuit can really add up, so the settlement can be a way to reduce this.  

Additionally, under some circumstances, if a settlement agreement is reached, it may be a more accurate compared to the court’s calculation of compensation for damages. 

However, settlement isn’t always a possibility when the parties don’t agree on all of the terms. In such cases, a partial settlement can be reached, and then the disputed terms can be litigated in court.

Helpful hints on negotiation for claimants

There are certain things that claimants should consider when negotiating:

• Envision a settlement range prior to the meeting
• Don’t rush into the first offer. Insurance adjusters tend to start low because they expect that the other party doesn’t realize what their claim is worth
• Get the settlement in writing 

How do pretrial settlements payouts work?

Generally, the parties can decide how the settlement payments are paid out. In some cases, a lump sum is paid to the injured party, but the plaintiff may instead choose to receive a structured settlement; many plaintiffs prefer this periodic schedule because they can avoid paying large amounts of taxes on the money that they get.  

Contact an Attorney for Pretrial Settlement Help

You might want to consult with an experienced personal injury lawyer if you’re considering settlement as an alternative to litigation. Your attorney can assist you in navigating the settlement process from beginning to end. Get in touch with a skilled MOWK Law attorney right away to find out about your options. 

No amount of New York estate planning is complete without protecting yourself while you’re still alive. This is why a power of attorney is important. It’s recommended (in conjunction with a health care proxy) for anyone 18 and above. Here’s what you need to know about New York’s recently changed power of attorney (POA). 

What is a Power of Attorney? 

A power of attorney is a legal document that acts as a planning tool that is used during your lifetime. In a general sense, it allows an individual or multiple other people, the power to manage the financial affairs and make important decisions on another individual’s behalf if they can’t.

The Parties of a POA

The “principal” gives specific authority to others who are the “agent/agents.” The agent is the individual who is authorized to make decisions on your behalf and who agrees to follow the instructions that you have set up. In the absence of specific instructions, the agent is required to act in the best interests of the principal.

You probably want to consider choosing more than one agent in case your agent passes away or somehow becomes unavailable. Otherwise, your family will likely have to endure lengthy and costly court proceedings to handle your personal and financial affairs. They would have to replace the previous agent by having a guardian appointed. You can avoid this by appointing a successor agent or by assigning co-agents.  

What Changes were Made to the NY POA?

Because the old format was convoluted and lead to many invalid POAs, the aim of the new law was to simplify the process. Here are important changes:

• You don’t have to use the “exact wording” anymore and instead it’s “substantial conformity” with the wording of the law 

• There’s built-in forgiveness for making insignificant spelling or wording errors or for using language/formatting from prior law 

• The POA must be signed, initialed, and dated

• The POA form now requires two witnesses, in addition to notarization 

• POA can now be signed at the direction of the principal, which had previously been a major issue if the person couldn’t sign independently due to illness or physical disability

Presumption of Validity

If a POA was validly executed before the effective date of June 13, 2021, it is enforceable under the new law. For all the POAs that are executed after the effective date, there’s a presumption of validity. A financial institution (or other third party) may agree to take a witnessed/notarized POA and may rely on the presumption that the signature is valid; this presumption prevents these third parties from rejecting the POA without cause. 

Effectiveness 

For the POA to be effective, the principal must have capacity at the time of the signing, and the DOA is durable if it remains in effect even after the Principal becomes incapacitated. The POA is effective when the agent has signed the POA in the presence of the notary. If there are two or more agents who are designated to act together, then the POA takes effect when all agents have signed in the presence of the notary. 

Get More Information about New York Power of Attorney

If you have an old POA, it should still be enforceable it was in compliance with the law at the time. However, you may still want an experienced attorney to go over it to ensure that it meets the legal requirements. If you don’t have a POA, you can get an attorney’s help with setting it up and taking care of all your estate planning needs. Connect with a MOWK Law estate planning attorney who can help you sort out your specific situation.   

Shakespeare once asked, “What’s in a name?” Well, to a business owner trying to select a trademark, it means a lot. It’s a very important decision because the chosen word, design, symbol, or phrase (that identifies the source of a company’s products or services) can be one of the most valuable assets that your company will own. Choosing wisely can help you distinguish yourselves from the competition; making a poor choice can trigger costly legal disputes. Find out what you need to know about how to pick a good trademark.

Pick a Trademark That can be Registered

If you can’t register your trademark with the United States Patent and Trademark Office, you really shouldn’t bother with it because there’s no point. There are many benefits to registration, including protection and reassurances of ownership and ability to enforce your rights against other companies.

Typically, the stronger or more distinctive the mark, the more likely it is to register it and protect it from use from others. The following categories will help determine the ease of registering your mark.

·       Generic: These are words that are already accepted and recognized descriptions of a certain type of services or goods. These aren’t eligible for trademark protection. Example: “Ivory” used to describe a product made with elephant tusks. 

·       Descriptive: This mark describes goods, or some quality tied to the goods.  However, these words aren’t eligible for trademarks, unless they achieve a secondary meaning, which means that the word becomes exclusively associated with a specific company. Example: “Holiday Inn.”

·       Suggestive: This includes words that suggest a meaning or connection to the product but doesn’t describe it; they are automatically eligible for trademark protection. Example: “Chicken of the Sea” for tuna and “Coppertone” for sunscreen.

·       Arbitrary: This includes words that offer no meaning or clue to the product or service. A common word applied in an unfamiliar way. Example: “Urban Decay” for cosmetics.

·       Fanciful:  These are made up words that aren’t related to the product or service. Example: “Klorax.”

Based on this list, you will want to avoid generic words (because they can’t be protected) and descriptive (because they have to be accompanied with secondary meaning to be protected). Instead, you want to choose fanciful, arbitrary, or suggestive words for your trademark.  

Conduct a Trademark Search

A complete trademark search will help to ensure that you don’t pick something that can be confused with an already registered trademark. You want to avoid this because it creates a “likelihood of confusion.” If you pick a mark too similar to one already in existence, then your mark can’t be registered.  

Speak with a Lawyer about Trademarks

Picking your trademark and registering it seems like an easy task. However, it’s not always so simple. An experienced attorney can help you evaluate the strength of your mark and can identify any potential problems. You can talk to a skilled Mowk Law attorney who can provide insight into all intellectual property matters. Contact us today for assistance. 

Writing a will helps you to control how your possessions are distributed after your death. While many will put off this important task, one way that isn’t as time-consuming is to complete the process online. Although one of the best things about creating your will online is that it’s convenient, it is more than just plugging in information into the site. You obviously have to take some time to think about what you want to do and to make sure that the document will ensure that your wishes are carried out. Read on for information about creating your will online.  

Inventory of your Assets

An individual’s assets can determine their estate planning strategy; you don’t want to overlook any of your possessions so that you make a mistake concerning distribution. Before you start, you need to take stock of your assets.  Although many people mistakenly believe that the will covers all your assets, it only covers assets that aren’t passed by operation of law, through a trust, or have a beneficiary designation listed, such as a life insurance policy where the named recipient gets the assets after your death. This is relevant information that you should know before starting an online will so that your intentions will be reflected in your will.   

Leaving Money to Minors/ People with Disabilities

Online wills simplify the process of passing down your assets to children. It usually allows you to leave money to children outright. However, this presents myriad problems if a child is a minor or has a disability. Leaving money to a minor child can cause issues in probate and a guardian will need to be appointed, which can lead to excessive administrative fees and other complications. With disabled children, you often want to leave their part of the inheritance in a supplemental needs trust, so that they can maintain eligibility for government benefits. These are very significant details that aren’t always contemplated when using online software.  

When You Don’t Have a Spouse or Children

There can be issues when it comes to online wills if you don’t have a spouse or children. Online will sites often default to requiring information about a spouse and children. If this is the situation, the probate process is more complex and the closest relatives of the deceased need to be identified. Any New York estate planning attorney would have their client fill out an extensive family tree, but the online site may not necessarily provide for this.

Additionally, in situations where an individual doesn’t have a spouse or children, a revocable trust is generally advisable. However, when you create your will online, it won’t necessarily provide you this information that might help you accomplish your goals more successfully.

Need Help Preparing Your Will? Talk to an Experienced Attorney

Although you can create a valid online will as long as it’s executed properly, the details of your case might be such that a generic site isn’t as helpful to you. You can get valuable insight from an experienced MOWk law New York estate planning attorney. Contact us today to follow up with more information.      

Usually when you’re selling your home, you make repairs and improvements so that it is in the best condition to fetch the highest price possible. However, when you sell your house “as is,” you forgo those repairs and put your home on the market in its current condition, without negotiations with the buyer for any credits to fund any upgrades. Whether you’re in a hurry to unload your property or you simply don’t have the additional funds for renovations, there are various reasons for wanting to go this route. Read on for information about what you should know about selling an “as is” home in New York.

1. The role of real estate agents and real estate lawyers:

Although it isn’t a requirement to have a real estate agent for your home sale, it’s a very good idea because they can offer a lot of support and knowledge, especially with an as-is sale. The agent can help you navigate through home selling procedures and advise you on setting a price. New York requires the participation of a lawyer in all home sales and their duties include drafting a purchase contract, analyzing the title report, and assisting with documentation at closing. 

2. As-is sellers offer significant discounts:

Many buyers are hesitant to purchase because the homes are is disrepair and will require a lot of effort to fix. Thus, the offer will be well below a normal listing. It’s a trade-off: The buyer gets a lower price in exchange for the efficiency of a quick sale. The price that you set is significant because it will determine the final sales price and how soon you get an offer; it needs to be competitive, yet fair to reflect the as-is status.

3. Cash buyers can be good sources: 

If a quick sale is a priority, consider selling to a cash buyer. This means that the buyer pays with cash and you don’t have to wait for them to secure financing, which slows down the home sales process. You can even list the house as “cash offers only.” The drawback is that the offer will likely be a lot lower than fair market value. 

4. Requirements for an as-is sale: 

New York law mandates that all as-is sellers disclose any known issues. If not, the seller must pay a credit to the buyer. If you don’t want to make such disclosures, then you can just pay a credit without the disclosure. The fee will protect you from liability in most cases. However, this liability protection doesn’t always apply; for instance, if the buyer is in a special relationship of trust with the seller, it will not protect the seller. An attorney can provide clarity on these issues. Sellers aren’t required to obtain a pre-listing inspection or make any attempts to discover any problems that they weren’t already aware of. However, an inspection might be helpful because it could potentially protect you from some liabilities later on. If you’re working with a real estate agent, they can help you gauge whether it’s worth pursuing. You might also consider making some low-cost repairs because they can have a significant effect on your home’s final sales price. 

5. Closing costs associated with as-is sales: 

As a seller of an as-is home, you will have to pay for a title search, mortgage prepayment fees, real estate transfer tax, attorney fees, and realtor commission fees. This will probably be at least 1-3 percent of the home’s final sales price. 

Get Help with an As-is Home Sale 

Before you sell your home as is, you will want to make sure that you understand how it differs from a normal listing. An experienced real estate attorney can guide you through the process. You can consult with the skilled MOWK Law real estate attorneys to get answers to your real estate questions. Contact us now to get started. 

The Covid-19 crisis has had a devastating impact on every pretty much industry. With businesses struggling to operate under the shadow of shelter-in-place orders, many parties are in the difficult position of not being able to meet their contractual obligations. The business entities that are experiencing this struggle are seeking solutions in their contracts and hoping that they have provisions that can excuse a breach of contract during these unprecedented times. 

Some contracts that have been implicated are IP licenses, which can contain agreements with sales minimums or royalty agreements that are difficult, if not impossible to fulfill during this time of cancellations and business closures. Both licensees and licensors have recourse to excuse or enforce provisions due to the coronavirus. Because the events of Covid-19 will not automatically apply to excusing a nonperformance of a contract, you must first look at the specific license to determine the possibility. 

Does the License have a Force Majeure Clause? 

Many licenses have “force majeure” (superior force) clauses that expressly relieves a party from performance or postpones performance when events or “acts of God” that are beyond their control occur. Although it may seem that the unpredictable environment of Covid-19 is tailor-made for the applicability of a force majeure clause, it depends on the specific license and the ensuing circumstances as to whether the force majeure excuses a given type of nonperformance. 

When analyzing the specific language of the contract, look at the following:

• The definition of force majeure: Some will mention a pandemic or epidemic specifically, but the contract may still excuse Covid-19 related occurrences if it mentions quarantines or travel restrictions or there is a “catch-all” provision which defines force majeure broadly. However, some majeure provisions are limited to the events mentioned.
• Identify the performance that the force majeure refers to: Establish whether the clause applies to the type of breach being contemplated. Also, some clauses are drafted to excuse liability that concerns not only nonperformance, but also underperformance. 
• Any preexisting conditions that must be met: A party might have to complete a prerequisite before the clause is invoked as a nonperformance excuse.  

When there is no force majeure provision or it doesn’t apply, then the parties must rely on the common law contract doctrines of frustration of purpose and commercial impracticability. Unfortunately, they usually don’t result in excusing the performance. However, it’s possible that nonperformance may be excused on “impracticability” or “impossibility” grounds due to an unforeseen change in circumstances due to Covid-19.

Bankruptcy Issues

The coronavirus also triggers issues for IP licenses, such as the potential for bankruptcies and pledges of non-enforcement of IP rights. If there is bankruptcy of a licensor, the license might be rejected by the licensor, making the licensee to either force compliance or pursue a breach. On the other hand, if a licensee declares bankruptcy, some IP licenses have clauses that attempt automatic reversion or termination of IP rights. 

Talk to an Attorney about IP Issues

The Covid-19 crisis will continue to impact business and how contracts are performed. If you’re concerned about how your intellectual property issues are handled during the pandemic, then you may want to talk with a MOWK Law attorney who is well-versed in IP law. Contact us today for more information on how we can help you.

When people own property as tenants in common, they own it with other co-tenants and any one of them can force a partition (division) and sale of the property. For centuries, partition actions have had unfortunate consequences for many individuals trying to retain property. More recently, real estate investors used this tactic to their advantage by acquiring shares of property at well-below market rates; often, with the end result forcing owners to leave their family home. To help combat this, states like New York have passed a version of the Uniform Partition of Heirs Property Act (UPHPA). 

Tenants in Common

Family members can inherit property from a parent or other relative from a will or through New York’s

intestacy laws when the relative doesn’t have a will. The UPHPA only applies if the family members were left the property as tenants in common with their other family members. 

A tenant in common relationship is one where two or more individuals share the ownership rights in property. Each independent tenant in common is considered an individual owner.  For example, a father dies and leaves his home to his four daughters as four tenants in common, with each one owning a 25 percent interest in the house. Alternatively, they could own different shares. For instance, one daughter could be a tenant who owns 40 percent, and the other three daughter/tenants could each own 20 percent. 

Tenants in common have the right to pass down their own share of the property to any beneficiary in a will or trust; family members can independently sell their part of the ownership, or they can borrow against it. However, one tenant can’t sell their portion without the approval of the other owners unless the court issues a partition action. 

When Owners Don’t Agree

If there is disagreement about whether or not to sell the property, the owner that wants to sell may file a lawsuit for a partition. These types of lawsuits have grown in popularity due to an increase in property values and more siblings inheriting property they want to sell while their sibling/co-owners (often those living on the property) don’t. 

In these situations, (prior to the enactment of the UPHPA) many commercial real estate investors would buy a share of the property. Then the investors would request a partition action, which would result in family members being forced to sell their family home at an auction sale; these homes sell for much less at auction than they do on the open market. 

What the UPHPA Does

Although the owner still has the right to force the sale of jointly owned property, the New York legislature wants to ensure that family members have the opportunity to first buy out one another’s interest before selling the property to a third party. When families can’t agree as to whether or not to sell a property, they will need to attend a mediation session. The purpose of the mediation is to work out the issue before a partition occurs. If the owners can’t reach a resolution through mediation, then a New York judge may require the sale of the property through the open market, not an auction.  

New York Real Estate Lawyers

If own property with someone else and are having difficulty agreeing with them, then you might have to consider a partition action. Although this impasse may be difficult, talking to an experienced real estate lawyer can help you through the strain going through this process. That’s why it’s a good idea to get in touch with the skilled MOWK real estate lawyers. Let us answer your questions. Contact us today. 

Why Racial Bias in the New York State Court System Matters to You 

The results of a review of racial bias in the New York State court system were published this month.

 On June 9, 2020, Chief Judge Janet DiFiore of the Court of Appeals and of the State of New York appointed Jeh Johnson as Special Adviser on Equal Justice to review hostile opinions about racial groups in the courts. This independent inquiry arose because of race-related issues across the country, including the death of George Floyd, which resulted in unrest and rioting. 

Results of the Independent Review on Racial Bias 

Not surprisingly, the review found that racial bias exists in the New York court system. The study cited specific examples of bias: 

• Court officers could not report incidents of unfair treatment because of adverse career consequences or 
• Court officers yelled more at litigants of color or at those who did not speak English as a first language 
• Court officers are more likely to require litigants and attorneys of color to show identification or enforce the policy of no cell phone usage against them. 

We at MOWK Law understand that this widespread racial bias against individuals of color or from ethnic backgrounds can result in unfavorable results in court. As this study confirmed, we also understand that employees of color or ethnic employees may be treated unfairly in their employment in the New York court system.

Recommendations Resulting from the Review on Racial Bias IN New York Courts

Mr. Johnson and his team interviewed hundreds of people across the court system. They came up with many recommendations to address and fix racial bias problems that are rampant in the New York court system, including:

• Court system’s leadership should have zero tolerance for racial bias, applicable to everyone working in the New York court system.
• All court personnel should be trained against racial bias and informed about cultural sensitivity.
• Jurors should be educated about biases and prejudices they are exposed to in society, including with specific rules and jury instructions.
• Court personnel should adhere to a policy restricting use of social media for racially or culturally offensive remarks that reflect poorly on the court system. 
• There should be better practices to improve complaints and investigations to better handle racial bias and race discrimination incidents.
• Legislation and rules should be reviewed for possible bias or negative impact on people of color.

What this means for You

Have you been involved in the New York court system on a civil matter or criminal defense matter? If so, have you had a negative experience due to your race? Would any of the Special Adviser’s recommendations help address your experience in the New York court system? 

Have you been employed by the New York court system and have been treated unfairly because of your race or ethnicity?

If you answered yes to these questions, you may have recourse.

New York Lawyers Familiar with the Court System

If you have gone through the New York court system and have been treated unfairly because of your race or ethnicity, you may want to explore whether you have options to address your outcome. If you have been employed by the New York Court system and have been treated unfairly due to your race or ethnicity, you may have an employment action. 

The skilled attorneys at MOWK Law can help assess your situation. Please contact us for more information.