Virginia State Bar

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Real Property

A Section of the Virginia State Bar.

Meeting Minutes - September 12, 2003

Minutes of the Virginia State Bar
Real Property Section
Board of Governors

Charlottesville, Virginia

The Fall Meeting of the Board of Governors of the Real Property Section of the Virginia State Bar was held on Friday, September 12, 2003, at the offices of Virginia CLE in Charlottesville, Virginia.

The following persons were in attendance: Paula S. Caplinger, Douglass W. Dewing, Cynthia A. Nahorney, Karen S. Davis, Jean D. Mumm, Ray W. King, Lucy Davis, Mark D. Williamson, C. Grice McMullan, Jr., J. Page Williams, Pamela H. Sellers, Courtland L. Traver, Randy C. Howard, Stephen B. Wood, James P. Magner, Stephen R. Romine, Steven W. Blaine, and Eric V. Zimmerman. Douglass W. Dewing, Secretary of the organization, kept the minutes.

Ms. Caplinger called the meeting to order at 10:03 a.m. (See official Agenda below.) and the attendees introduced themselves.

Ms. Caplinger reported a number of members had requested a substantive law component to the meeting, in addition to conducting business matters. To debut the program, Courtland L. Traver presented a short summary of the law on letters of intent.

Mr. Traver noted that letters of intent receive one of three possible treatments: they mean nothing; they create an obligation of good faith; they create an enforceable agreement. He mentioned cases arising from Illinois, the District of Columbia, Texas, various states in the northeast, and a recent Federal District Court case from Northern Virginia. He warned that the DC case raised the specter of promissory estoppel to the other legal issues. The Virginia decision was based entirely on common law contract principles of offer and acceptance, but warned that the court had remanded for a finding on the "fair dealing" issue. After noting that a letter of intent is like having a frozen snake in your lap, which you should not allow to thaw out, he suggested the following considerations for drafting a letter of intent:

It should expressly state that it is non-binding
It should be in writing
It should contain an expiration date
It should state it could not be amended, except by a writing specifically incorporating the letter of intent.
It should state whether or not there is exclusivity.
It should state whether or not there is an obligation to deal in good faith
It should state whether it is to be interpreted by objective or subjective standards
It should state it is not subject to specific performance.
It should state whether or not there is a confidentiality requirement.
It should set out a termination process if the parties wish to terminate prior to expiration.

He closed the presentation by noting that attorneys had incurred liability by assisting the client in "torpedoing" the contract negotiations when the client decided they no longer wished to sell the property to the other party.

The minutes of the meeting for June 20, 2003, were presented. Upon the information that the term of Richard Mendelson has not expired, his re-election to a new term was deleted from the minutes. Mr. Mendelson's term will expire in June 2004. Upon motion duly made and seconded, those who attended the June 20 meeting unanimously approved the minutes, as amended. Those not in attendance at the June 20 meeting abstained.

The financial report showed the Section incurred $48 in printing expenses during the July reporting period, the most recent for which information was available. The section's budget allocated $12,000.00 to the printing of the Fee Simple newsletter, and over $5,000 to the distribution expenses (postage and mail handling).

Ms. Caplinger announced she had recruited two new Area Representatives. Jim Magner from Tidewater was present and was introduced. Mark Thackston from Southside was unable to attend. Upon the nomination of Ms. Caplinger, and the second of Ms. Lucy Davis, both were elected as Area Representatives.

Mr. McElwain and Mr. Schoenberger were not present, but had provided the chair with a summary of their progress on the Advanced Real Estate Seminar, scheduled for April 2 and 3, 2004, at Kingsmill in Williamsburg. Possible members of the faculty include Pat Randolph, Gus Baum and Tom Spahn. Attendance has been low in the past, and all members of the section were encouraged to attend.

Ms. Mumm presented the schedule for the Annual Real Estate Seminar: May 4 in Fairfax; May 5 in Norfolk; May 12 in Roanoke; and May 13 in Richmond. The program will include the recent cases and legislative developments components as in years past. Jack Marshall had agreed to present the Ethics portion in all four locations. Other topics are still being discussed. Based on comments received at the 2003 seminar, the afternoon program will contain three one-hour presentations, rather than two longer segments. Topics being considered include bankruptcy, foreclosures, the wet settlement act and CRESPA.

Mr. Dewing reported that he wanted to contact members of the construction law and contracts section to determine the feasibility of a "point-counterpoint" type program for the Annual Meeting discussing "hot button" issues included in the standard AIA architect, general conditions and construction contracts, but was open to other ideas.

Mr. Traver noted an objection to the State Bar's present policy of not awarding CLE credits to those who attend the section CLE presentations even though they do not register for the entire Annual Meeting program. Mr. Dewing recalled Annual Meetings several years ago in which a limited registration was available. Ms. Caplinger responded that this objection had been the topic of an earlier meeting, and as a result, a proposal to authorize a limited registration or permitting CLE credits regardless of registration was going to be presented at the Better Annual Meeting subcommittee meeting, currently scheduled for late September. General discussion on the topic followed which included the possibility of holding the section CLE and meeting at an alternative location, the power the State Bar held over the section through its funding, and the birth of the Trial Lawyers Association. The matter was tabled until the January meeting to learn the results of the Better Annual Meeting subcommittee meeting.

In other Old Business, Ms. Caplinger noted the Bar's restrictions/guidelines regarding a student writing competition to encourage articles for the Fee Simple. The Bar suggested a moderate sized prize, something in the $200 range. Mr. Traver reported the students in his class last year were bright, articulate, driven, and very, very busy. One question raised from the floor was whether the competition would be a single topic, with the winner receiving the prize, and publication, or if any real estate topic would be appropriate, with the best two or three authors being published. Whether or not the section had the resources to review and edit the submissions led to the comment that the sections focus might better be on energizing committee members to produce articles. The matter was tabled until the January meeting to review the questions raised.

Ms. Caplinger passed around the section's list of officers, board members and area representatives and requested those present review and verify their address and other contact information. The Board's calendar was also circulated. Meetings for the remainder of the year are scheduled for January 16, 2004, at a time and place in Williamsburg to be announced, April 2, 2004, at 10 a.m., at Kingsmill, in conjunction with the Advanced Real Estate Seminar in Williamsburg, and June 18, 2004, at a time and place in Virginia Beach to be announced.

Ms. Caplinger solicited volunteers on behalf of Mr. Zimmerman, who had not yet arrived, to join the ad hoc subcommittee to investigate the needs of all the section members, and draft a mission statement and goals for the section. Despite being one of the largest sections as far as membership, the small core of active participants suggests the section could be doing something else or something different. Ms. Sellers and Ms. Lucy Davis volunteered to serve as subcommittee members.

Under New Business, Ms. Caplinger presented a request from Mr. Waugaman requesting funds to purchase additional forms on disk from the Virginia Bar Association, for use as a recruiting tool at the First Day of Practice seminar. There was a general discussion about whether the forms were still current. Alternatives were suggested, including obtaining a limited license to the Virginia CLE forms contained in the Real Estate Transactions Book, or a discount for a real estate publication or seminar. Mr. Waugaman is to discuss the matter with Lee Hickok of Virginia CLEto learn if there was some better "handout" to use to introduce the section to newly licensed attorneys.

Ms. Caplinger stated she had been contacted by a representative of the National Title Examination Standards Resource Center in Oklahoma City. The center was updating its records, and inquired if Virginia had enacted title examination standards, or created a task force to investigate such standards. She inquired if there was any interest in such a process. Given the widespread use of title insurance companies and freelance title examiners to examine title in the urban record rooms, it was suggested the Virginia Land Title Association might better address the topic.

Ms. Mumm requested the section allocate funds to contract with National Legal Research Group again this year to provide the recent case law developments. She noted the expense in 2003 was slightly more than $2900, and that the presenters had needed a little more time to review the cases than they received due to a delay in obtaining the funding resolution last year. Ms. Mumm moved the section allocate no more than $4,000 to obtain the research services this year, the motion was seconded by Ms. Nahorney, and unanimously approved.

Mr. Howard presented the membership report. The section is third in overall membership with 1,845 members. He noted that 12.6% of the criminal law section's membership was made up of judges, compared with 1.3% of our membership. It was suggested that complimentary copies of the Fee Simple be delivered to each circuit court's law library in an effort to encourage more judges to become members of the section. Mr. Traver agreed to discuss the subject with Judge Roush, our judicial liaison. Mr. Howard agreed to investigate other methods to increase judicial membership.

Mr. Dewing presented the technology report. Although more land records are going on line, there is increased resistance to remote access. He distributed a recent article from Virginia Lawyers Weekly describing the efforts of privacy advocate Betty J. Ostergren, who claimed credit for knocking Scott County, King George County and Loudoun County remote access land records off the Internet, and prevented Hanover County from going on line. Pursuant to a legislative compromise enacted last year, all remote access land records will be by subscription only, which addresses the largest concern of many privacy advocates, preventing casual review of public, but potentially sensitive, data. He also passed on an unconfirmed report that the Virginia Information Technology Agency is supposed to report out a set of security regulations in mid September.

The fall submission deadline for the Fee Simple is October 22. Ms. Meier had proposed an article dealing with the catastrophic consequences of losing data on a small office PC to equipment failure or viruses. Mr. Page Williams offered to attempt an article on Gramm Leach Bliley and its impact on real estate attorneys for the Spring issue. Mr. Traver is going to ask Ms. Trigiani if she could prepare an article on association lien priority. Mr. Zimmerman agreed to author a comparison of the 1992 ALTA title policy and the 1998 Residential Owners Policy, and whether attorneys have a duty to explain the differences to their clients. Wetlands and the Elizabeth River Reclamation Fund were mentioned, but no article emerged. Mr. Romine indicated there were some "brownfield" developments that might provide material for an article and agreed to review that topic. Ms. Lucy Davis agreed to look at the topic of Judgments and Liens for the Spring issue. Mr. Dewing agreed to reprise the Yamada case, in light of Trent/Bullock and the recent change in 64.1-57. Mr. Romine recalled a recent 4th Circuit case involving wetlands and regulatory agency authority, and agreed to also review that case for a possible article.

The Commercial Real Estate subcommittee was to meet after the meeting, and had no report.

The Creditors Rights and Bankruptcy subcommittee is looking for members. Mr. Wood had prepared an article last year, but withdrew it because of pending appeals. Now that the cases are final, he will update and present that article.

The Ethics subcommittee will meet before the January meeting.

Mr. Blaine proudly reported the Land Use and Environmental subcommittee had recruited a new member, Mr. James Downey, who has a wealth of experience in wetlands, brownfields, zoning and other areas.

Mr. King reported that the State Bar was seeing more receiverships. Often these are solo practitioners who die at the desk, without a succession plan. Closing down the practices cost the Bar $178,000 last year.

There being no further business, upon motion duly made, seconded and unanimously passed the meeting was adjourned at 11:56 a.m.

Respectfully Submitted,

Douglass W. Dewing




10:00 a.m.-12:00
September 12, 2003
The Virginia CLE Building
Charlottesville, Virginia

1. Welcome/Introductions-Caplinger

2. Presentation (10:05 a.m. -10:20 a.m.): Letters of Intent-Traver

3. Approval of minutes from June 20, 2003 meeting-Caplinger
(Correction to minutes to reflect Board term of Richard Mendelson. Erroneously reelected and his term had not yet expired.)

4. Financial Report-Dewing

5. 2003-2004 Budget-Caplinger

6. New Area Representatives-Caplinger

A. Jim Magner (Tidewater)
B. Mark Thackston (Southside)

7. Annual CLE Seminars

A. 8th Annual Advanced Real Estate Seminar (April 2 and 3, 2004, Kingsmill, Williamsburg, VA)-Schonberger
B. 22nd Annual Real Estate Practice Seminar( May 4, 2004-Fairfax, May 5, 2004-Norfolk, May 12, 2004-Roanoke and May 13, 2004-Richmond) -Mumm
C. Annual Summer CLE (June 18, 2004)-Dewing

8. Old Business

A. Report on CLE credits for our seminar at VSB Annual meeting-Caplinger
B. Law Student articles for Fee Simple / remuneration-Caplinger
C. Updated and revised list of Officers and Board members-Caplinger
D. Volunteers for ad hoc subcommittee, chaired by Eric Zimmerman to draft Section mission statement, goals, investigate the needs of our members and how we can best respond to those needs and plan Section retreat-Caplinger

9. New Business

A. Request by Waugaman for Section to purchase additional forms discs
B. Interest in establishing an ad hoc subcommittee to work with VBA to develop title examination standards? Volunteers?

10. Subcommittee Reports

A. Membership*-Howard
B. Programs*-See Item 7 above
C. Technology*-Dewing
D. Fee Simple*-Butler and Traver -Deadlines for Fall submissions. -Ideas for articles.
E. Commercial**-McMullan and Williamson
F. Creditors' Rights and Bankruptcy**-Wood
G. Ethics**-Davis
H. Land Use and Environmental**-Blaine
I. Title Insurance**-Gregory and Waugaman
J. Residential*-Meier

(*= Responsible for a substantive article for the Fall Fee Simple)
(**= Responsible for a substantive article for the Spring Fee Simple)

11. Liaison Reports

A. Bar Counsel-King
B. Old Dominion Bar Association-Holmes

12. Adjourn

(If previously scheduled with subcommittee members, optional subcommittee meetings may follow Board meeting.)