Articles Posted in Business

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contract fists.JPGThis is part two of our article about cancelling contracts within a three day cooling off period in Georgia. The three day cooling off period is actually federal regulation which is very narrowly applied, so make sure you carefully read part one of our article before reading the following.

It is also important to understand that even if the three day cooling off period does not apply to the facts of your case, there may be other conditions and reasons (fraud, misrepresentation, mental/age incapacity, illegality unfair trade practices, and more) that may permit you to rescind (get out of) a contract. Thus, it is is well worth your while to schedule a legal consultation to immediately determine your rights.

Nevertheless, if in fact the three day cooling off period does apply, in connection with any door-to-door sale or sale that is anywhere other than the place of business of the seller, (i.e. NOT the seller’s store but at a place like your home, a conference center, a dormitory, etc…), it constitutes an deceptive act or unfair practice for any seller to:

(a) Fail to give the buyer a fully completed copy of any contract in the same language, (e.g., Spanish), that was primarily used in the oral sales portion of the presentation showing the transaction date, name and address of the seller, and near the section in the contract for the buyer’s signature or on the front page of a receipt, the following notice of cancellation, in bold face, in a minimum of size ten font stating:

“You, the buyer, can cancel this transaction at any time prior to midnight of the third business day after the date of this transaction. See the notice of cancellation attached for explanation of this right.”

(b) Fail to furnish each buyer, a notice of cancellation that explains that they may cancel the transaction, without any obligation or penalty, within THREE BUSINESS DAYS from the above date.

If the buyer cancels, they must receive back their money within ten days and the buyer must make available to the seller at his or her home, any product that had been delivered to them under the contract. They need to return the product in good condition, or they must follow the instructions of the seller regarding the return shipment of the goods at the seller’s expense and risk.

If the buyer makes the goods available to the seller and the seller does not pick them up within 20 days of the date of Notice of Cancellation, the buyer may keep or dispose of them. If the buyer fails to return the goods, then they remain liable for the contract.

(c) Fail, before providing copies of the “Notice of Cancellation” to the buyer, to complete the notices by entering the name of the seller, the seller’s business address, the sales transaction date, and the date of cancellation.

(d) Fail to inform the buyer orally, at the time of the contract, of the buyer’s right to cancel.

(f) Misrepresent the buyer’s right to cancel.

(g) Fail to honor any valid notice of cancellation by refunding payments, etc.

(h) Sell the contract to a third party before the three day cancellation period is up.

(i) Fail, within 10 business days of receiving cancellation, to notify the buyer whether they intend to repossess any goods that were sold.

As stated earlier, this three day cooling off period falls under a federal regulation, specifically from the FTC (Federal Trade Commission) which outlines the rules concerning the cooling off period for sales made at homes or certain other locations. The three day cooling off period only applies to a specific, select type of sales. However, as mentioned previously, we cannot over-emphasize the importance of obtaining legal counsel, because even though the “three day cooling off period” may not apply in your situation, other legal theories may apply which might permit you to rescind (get out of) a contract.

However, time is of the essence in all of these situations. Thus, it is important to immediately meet with an attorney who can actually sit down and review your contract with you and listen to all the facts and circumstances of your situation in order to be able to properly advise you of your legal rights.
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Under Georgia law, can a home buyer sue a seller who is unhappy with the house? Unless the house seller is also the house builder, the answer is “Generally no.”

Fortunately for sellers, the law in Georgia protects home owners who sell their house to people who later suffer from “buyers remorse” and want to sue them to rescind the sale. Unfortunately for buyers, unless the seller was also the home builder, there is not much you can do to rescind a sale agreement even if the home seller fraudulently misrepresented or hid a housing defect. Nevertheless, the law is very specific, so if you find yourself in this situation, time is of the essence and it is imperative you seek competent legal counsel right away to ascertain your rights.

In general, home sellers are protected from home buyers who later try to rescind the sales agreement by various Georgia doctrines. Today’s article discusses the Doctrine of Caveat Emptor:

Doctrine of Caveat Emptor:

The rule in Georgia is Caveat Emptor (let the buyer beware). This is a common law doctrine which serves as the general rule regarding the purchase of realty. Cendant Mobility Financial Corp. v. Asuamah, 285 Ga. 818 (2009). If a home has mold, termites, a rotten roof, or any other defect—it is the buyer’s responsibility to fully investigate this prior to buying the home. In general, the buyer is put on warning and notice that they are responsible to discover such defects and if they discover them after the real estate transaction, unfortunately it is a case of too little, too late.

Consequently, the doctrine of Caveat Emptor defends and protects home sellers and our housing market from being “vexed to economic death by lawsuits by every purchaser of a house who discovers a defect which he believes the previous homeowner should have discovered and revealed. . . [when there] is probably no such thing as a perfect house” and all purchasers know that an older house is almost certainly not perfect. Cendant Mobility Financial Corp. v. Asuamah, 285 Ga. 818, 821 (2009). Thus, this affirmative defense often soundly defeats a buyers claims in a lawsuit.

Thus the morale of the story is Buyer Beware! Regardless, if you are a home seller who is being threatened by a lawsuit, or if you are a home buyer contemplating a lawsuit against a seller—the laws are very specific to one’s situation and it is absolutely important that you seek competent legal counsel as soon as possible in order to protect your rights.
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“Can I plead both fraud and breach of contract in suing over a business dispute?” is a question our business litigation clients sometimes ask.

You may be wrongly informed by the Defendant that you as a Plaintiff cannot plead both fraud and contract. Nevertheless, this is incorrect and flouts over forty years of Georgia law:

a. For over four decades Georgia courts have allowed a complaint to contain “as many separate claims against defendants as one may have, regardless of inconsistency. They may be based on legal grounds and equitable grounds, and may arise out of tort and also out of contract.” Giordano v Stubbs, 129 Ga. App. 283, 286 (1973).

b. A party may sue under one theory and recover under another if supported by the evidence. See Barnett v. Freeman, 157 Ga. App. 760.

c. An individual’s affirmation of a contract that he claimed he was induced to enter by fraud does not bar him from seeking damages because the two remedies are coexistent. Atlanta Car Wash, Inc. v. Schwab, 215 Ga. 319, 1959 Ga. LEXIS 463 Ga., September 11, 1959, decided.

d. It has been well established for decades in Georgia law that the Plaintiff can plead alternative theories of both breach of contract and fraud and is entitled to pursue inconsistent remedies until judgment. Accord Larkins, Ga. Contracts §3-18.

Consequently, there is no doubt: Georgia law absolutely permits Plaintiff to plead both fraud and breach of contract. Thus, even though these are two inconsistent remedies, as a matter of legal strategy a good business lawyer may utilize both causes of action in an effective legal pleading.
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How do you protect your business brand name and trademark? Naming a business or a product is usually one of the more fun parts of a startup. It might be time consuming, but when you come up with the perfect name for your company or product, it’s much more satisfying than filing incorporation paperwork. Once you have that name, it’s important to protect it.

The first step in protecting your name is to make sure no one else is using it. You want to protect your business from an expensive trademark suit by another company.
You should conduct a full search to make sure no one else is using the name. It is crucial to make sure no one is using the name in your industry or any other related industries. Do a google search of your name. Check the trademark filings with the US Patent and Trademark Office Check the trade name registrations with the Georgia Secretary of State , and with the Secretary of State of states in which you plan to sell your product. Conducting as full a search as you can will save you from being sued for infringement by someone who was using the name first.

You can also pay for a trademark service to do the search for you. While these services are expensive, they are fairly comprehensive and can give you peace of mind that no one else is using your name.

The next step in protecting your brand and product is to register your trademark with the US PTO and your state registry. Registration gives you the exclusive rights to use your name without interference and confusion by use of anyone else, and to sue for damages in federal court if anyone else does use your name. Federal registration presumptively establishes that the trademark is valid, and that you are the owner of the mark, which is not confusingly similar to any other registered mark. This gives you an advantage in any litigation, shifting the burden of proof to infringers or potential infringers to prove that the presumptions are incorrect. The owners of unregistered marks first have to prove the validity of the mark, ownership, and first use.

This protection is quite beneficial when building a brand. While you may not want to pay the fees to register each product name, you should register your brand name, as well as any product names that are gaining in popularity.
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checkbook.jpgNaturally, when someone owes you money and sends you a check for less than the amount owed, many people feel that they should be able to cash the check and still collect the rest of the money owed to them. But what if you were sent a check that said “paid in full” (or something to that effect), and you cashed it? Could you still collect the rest of the money you’re owed? In Georgia, the answer is tricky, and you need a good lawyer to help you deal with this situation.

Briefly, if you cash a check for less than the amount owed to you and that check has “paid in full” written on it, you do not necessarily lose your right to the rest of your owed money. Several factors come into play. For example, do the facts of your case demonstrate that you and the other party disagree about the amount owed? If the answer is yes, and you cash a check for less than the amount owed to you, then you may have extinguished your legal right to the rest of your money, even if the check does not have conditional language such as paid in full written on it.

To the contrary, if no dispute exists, then cashing a check that is for less than the amount owed to you may not extinguish your legal right to the rest of your money, even if the check has conditional language such as paid in full written on it.

As said, the situation can be complex and involves much more than the above-mentioned scenarios. The facts of your case as applied to Georgia law will determine the claims you have against the other party.
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