San Diego Contract Attorneys. We Have Specialists Who Reduce Your Risk, & Protect Your Equity.
Our attorneys have decades of experience drafting, structuring, and negotiating contracts across a broad spectrum of real estate and business transactions. Our attorneys’ extensive litigation background allows us to provide our clients with a forward-looking preventative approach in reviewing and/or drafting contracts for their business and real estate transactions. Our unique ability to assess and foresee potential pitfalls with the goal of avoiding costly future litigation from the outset – this is a key advantage for our clients. This allows our clients to best develop and protect their equity positions in their respective real estate and business dealings.
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Real Estate & Business Contract Lawyers
It’s very common to see business owners spend very little time on their contracts. When in fact, it’s one of the most important pieces when it comes to protecting your equity and reducing risk. A contract that is properly setup can offer protection, but more importantly grow your wealth. Contracts, and the strategy used to craft an ironclad contract is a cornerstone of our legal practice. We assist clients everyday in real estate leases, purchase agreements, or business contract dealings.
You Need An Ironclad Contract To Protect Yourself In Business.
At Equity Legall LLP, we specialize in drafting contracts that meet your needs, and perhaps even your future needs you have not yet anticipated. It’s one of the most important skills in drafting contracts is to think about your future self, and plan now for where you want to be.
We also are experts in contract defense, lease negotiations, real estate contracts, and buy sell contracts. Schedule your free consultation today.
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Real Estate Purchase Agreements for Commercial and Residential Transactions
Real estate contracts seal real estate transactions. The types of contracts vary, but the basic contract is the real estate purchase agreement. Because this contract is essential, it must be drafted correctly to avoid disputes. Large amounts of money change hands during real estate transactions. Therefore, it is important that the correct purchase contract be use for a land or residential transaction.
The statute of frauds in each state requires that a real estate contract be used. All the contracts must be drawn up in writing. The same law applies to lease purchase contracts. By putting a real estate agreement in writing, the chance of errors, fraud, or issues with the chain of title are reduced.
What is Included in a Basic Purchase Agreement?
The paperwork that is included in a contract depends on whether the agreement is residential or commercial. Usually, basic purchase contract contains the following information:
Contract forms may include addendums that contain provisions for new home insulation, environmental assessments, and release of liability. Unlike other contracts, real estate agreements must be in writing. Transfers of real property or leases over a year must be in writing to be enforced.
Types of Written Agreements Used in Real Estate Transactions
Each state, including California, requires purchase agreements and other real estate contract forms, such as leases for property over a year, easements, and the seller’s disclosure statement, to be in writing. The statue of frauds requires written agreements for the following:
- Contract for deed
- Amendment to purchase agreement
- Lease agreements
- Right of first refusal contracts
- Power of attorney
- Lead-based paint disclosures
- Easement agreements
- Deed forms
- Mechanic’s liens
- Satisfaction of mortgage (used by the lender when a mortgage is paid)
- Assignment of mortgage (for mortgage transfer)
- Lease with an option to buy
- Heirship affidavit
- Eviction notice
- Security deposit accounting (used when a lease terminates, to provide any deductions from the security deposit)
- Promissory note (always recommended, as proof of a debt, when a sizable monetary transaction is made)
- Real estate partnership or joint venture agreements
- Notice of recording, for a rental agreement
As you can see, real estate contracts must be well executed so disputes are avoided. State laws provide protection in these matters for both the consumer and seller.
Vacant Land Purchase Agreements
Vacant land purchase agreements are made when a buyer wishes to buy an undeveloped parcel of land. The contracts contain the following information:
- A description of the land. The agreement should be backed by a survey
- The price
- The deposit amount
- Seller financing, if applicable – the amount should be stated, along with the interest rate, repayment terms, or if the seller has the right accelerate (claim the full amount) if the payment is late
- Good title – delivery of title so they buyer can claim ownership once the loan is paid
- Closing date, and possibilities for extension
- Seller cooperation – or the assistance the buyer needs to ensure that the proper information is gathered to close the deal.
- Right to inspect – the right for the buyer to inspect the land before purchase.
- Specific performance and liquidated damages – covers the seller if he or she does not go forward with the deal, or the buyer (limiting his or her damages to the deposit amount).
A number of conditions are normally included in these agreements, such as the testing for hazardous materials, bank financing, or the evaluation of ground water or soil. Included in the agreement, as well, are representations and warranties, and the names of the real estate brokers.
When people purchase a home, they normally sign a buyer broker agreement with their agent or broker before a purchase agreement is created. Broker agreements are designed to show, precisely, who represents a buyer. Various types of broker agreements are used in the US. Some allow the buyer to hire more than one broker while others only limit the buyer to one broker. This type of agreement represents an exclusive right to represent.
Partnership agreements are business contracts made between two more partners in a business. They are set up to avoid disputes, and establish the profit and loss distribution as well as the roles and obligations of each party. Other rules are also included so each partner in the contact is clear about his or her role and the business’s general set-up.
When two or more persons form a temporary partnership for carrying out a project, the partnership is sometimes called a joint venture. Each party, in this arrangement, is called a co-venturer. However, a joint venture is normally considered to be a contractual relationship created between two companies to perform a specific activity. By comparison, a partnership involves a contract, as noted, between two or more people where they agree to share a business’s profits and losses.
Joint Venture (Making a Distinction between It and a Partnership)
Corporate Stock Agreement
Corporate stock agreements, or stock purchase agreements, outline the terms of a stock purchase between the owner of shares of stock and another party. The stockowner in the agreement may be the corporation, or one of the corporation’s stockholders.
If you are in a business arrangement that involves shares of stock, an investor agreement can define and secure your interests. Whether the business is investor-backed or you are the investor of the capital, this type of agreement will protect you.
How Investors’ Agreements Are Used
Use this type of contract for the following reasons:
- To avoid shareholder disputes.
- To protect your interests as a shareholder and investor in a company.
- To safeguard you when seeking investors and selling share.
An investors’ agreement answers concerns you may have as to share management, including the following:
- The number of shares of each investor.
- The distribution of dividends.
- The management of the business
Any disagreements can be circumvented by the use of an investors’ agreement.
A financing agreement serves as an outline for the terms established between a lender and borrower. While a finance agreement may be used for loan transactions, it generally is directed for project finance activities. Project financing is an activity that uses debt where the obligation is paid back from the financing generated for the activity.
For instance, project financing may entail issuing a bond to pay for the construction of an arena and using the proceeds from ticket sales to pay back the financing. Because project financing can be complex, it is frequently used in such industries as transportation or telecommunications. Many times, a company will establish another corporation for a project to protect itself from any financial hardship should the project debt go into default.
Loan Purchase Agreement
A loan agreement states the rights, terms, and conditions that apply to a mortgage loan, such as the amount, rate of interest, and repayment terms. With the agreement, you can lend or borrow money. Default conditions and the costs of collection are also included in the contract.
Contracts for the Purchase of Goods and Services
These contracts may include a statement of work (SOW) that outlines the tasks or milestones that must be attained within a specific period. Some of the terms that are associated with these contracts include the following:
- Milestones and due dates
- Equipment delivery dates
- Costs of goods and/or services, including travel
- Dates due on invoices
- Payment due dates
- Supplier responsibilities, deliverables, and promises
Contracts of this type must be administered so the services and delivery of goods can be monitored and checked. This also ensures that all the terms have been fulfilled.
Home Improvement Contacts or General Contractor Agreements
A home improvement contract or general contractor agreement is helpful to draw up when you are building an extension or making an improvement on a property. Better than a verbal commitment, the contact establishes the relationship between the property owner and contractor. Legal professionals advise using the contract when you are a contractor, and are being hired for a home remodel, or you are hiring a contractor for a home improvement project.
Bulk Sale Agreements
A bulk sales agreement establishes terms and conditions with respect to the transfer of a large portion of a seller’s merchandise or items. The contract is set up for the purpose of transferring the assets of a business. One of the distinctions made for this agreement is that it is used for transferring inventory that is normally not used in the regular course of a seller’s operations.
Therefore, the items that are sold via a bulk sales agreement are assets that a business owns that are sold outside the normal course of business activities. Usually, a business will draw up a bulk sales contract while it is selling the business to another company. When businesses are offered for sale, the buyer purchases the business assets and business in its entirety. The assets may include furniture, fixtures, or equipment.
Commercial Lease Drafting and Negotiations
The preparation and negotiation of a commercial lease starts with certain basic elements, including the following:
- The rent
- Size of the premises
- The improvements that will be added in the space
- The terms of the lease
One of the most important elements used in a lease negotiation is the selection of a form. For example, the owner of a shopping center usually provides a form lease on which to base negotiations. By making this choice, he or she dictates the boundaries of the negotiation. The owner typically maintains the right to make any changes to the form, and, by so doing, controls any concessions that are given to the tenant.
In turn, the lease should be drafted so it is understandable and clear. If you do not take this approach, a dispute may result over the meaning of the contract terms. Any unclear terms are usually construed against the person drafting the lease. Therefore, each party needs to keep in mind that a lease that is enforceable clearly defines each party’s intent.
Option Agreements and 1031 Exchanges
If you are the owner of investment property and want to sell it, you should have a knowledge of 1031 tax-deferred exchanges. You also need to work with a real estate attorney who is well versed in this area. This process permits the owner of investment real estate to sell a property and purchase like-kind real estate while deferring the capital gains tax.
A 1031 exchange references Section 1031 of the US Internal Revenue Service (IRS) code, which gives investors the latitude to sell a property and reinvest the proceeds, within a certain timeframe.
An Option to Buy Contract Can be Used to Extend Time
The time for the exchange can be extended, if needed, through an option agreement. An option to buy or an option to purchase contact permits an investor to find a potential buyer for a property that has been relinquished. However, it also delays the actual release of said property until a replacement property has been found.