Court of Appeals Issues New Ruling on Municipal Construction Contract Disputes

Paul F. Bohn, Esq.

As a law firm with both municipal clients and construction business clients, we see both ends of construction litigation disputes. The latest case out of the Michigan Court of Appeals, DiPonio Contracting, Inc. v. City of Howell, sheds light on the importance of obtaining competent representation in such cases.

DiPonio Contracting, Inc. (DCI) was awarded a bid for a road reconstruction project in the City of Howell. After the contract was received, DCI received a set of revised plans, and DCI was asked by Howell on at least two occasions to stop work on the project and make some emergency repairs that were unrelated to the road project.

DCI requested project extensions so that work could be completed prior to the deadline, given the various additional requests. DCI eventually ceased working on the project, although they believed their work was complete. The City alleged that they were entitled to liquidated damages at $1,550 per day (for 32-plus days) for DCI failing to complete their work, specifically for street sign replacement. DCI believed the City’s changing of the brackets that were needed to replace the signs precluded them from those damages.

DCI filed a complaint against the City alleging a breach of contract and unjust enrichment, for $121,872.52. The City filed a counter-claim alleging they were entitled to $88,350 in liquidated damages.

The trial court ruled that the City wrongfully denied DCI’s request for extensions of time on the project and awarded DCI the full $121,872.50. But, the court also ruled the City was, in fact, entitled to 10 days of liquidated damages of $15,500, resulting in a net judgement of over $105,000 for DCI. The Court of Appeals affirmed the ruling, and ultimately, DCI was awarded an additional $24,000 in attorney fees.

The City accused the court of not enforcing the liquidated damages clause of the contract. However, the Court of Appeals noted that the trial court simply awarded 10 days of liquidated damages rather than the full amount of $88,000, which the court found to be unreasonable.

Large-scale construction projects such as this one can be complex, especially when the need for emergency repairs arise. Matters only become more complex when breach of contract allegations results from misunderstandings and miscommunication. Whether you are a municipality or a business, Fausone Bohn, LLP attorneys have extensive experience in both municipal matters and construction litigation. Don’t hesitate to contact us for a consultation.

Paul Bohn is a partner at the law firm of Fausone Bohn, LLP, and was named one of the Top Attorneys in Michigan in 2014 by Crain’s Detroit Business, and practices in the areas of construction and municipal law. If you need help on a construction or municipal law issue, contact Fausone Bohn, LLP at 248-468-4536, or visit us online at www.fb-firm.com. 

Livonia Chamber to Kick-Off Business Expo with Business Breakfast Roundtable

The Livonia Chamber of Commerce’s 29^th Annual Business Expo is just around the corner. Once again, the Business Breakfast Roundtable will kick off the event.

The Roundtable will be held on Wednesday, May 6 from 8:00 am to 9:30 pm at the Detroit Marriott Livonia, adjacent to Laurel Park Mall, located at 17100 N. Laurel Park Dr.

The cost is $15 for members and $20 for other guests. f you are interested, check out the event registration page and sign up today: http://files.ctctcdn.com/3be7e289001/c7a673df-a17e-4af4-b7f4-3f9414bf5203.pdf

You can contact the Livonia Chamber at 734-427-6055 to reserve your seats.

The Business Breakfast Roundtable brings together a local media and political panel to talk about policy and business issues that impact the state, and in particular the metro Detroit region. And on Wednesday morning, the fate of Prop 1 and road funding will have been decided by the voters; if the road funding measure fails, a “Plan B” could be a hot topic of discussion.

This year’s panel will feature Nolan Finley of The Detroit News and Tom Walsh of the Detroit Free Press; and, Livonia Mayor Jack Kirksey and Westland Mayor William Wild.

Attendees will have the opportunity to ask questions of the panel. And following the event, attendees will get the first look at the Business Expo throughout Laurel Park Mall. 

What Should You Do if the Police Stop Your Car?

It can make your heart sink: Seeing the red and blue police flashers in your rearview mirror. You are being pulled over.

We have all hear about bad encounters with police officers at a traffic stop, but drivers should also understand that traffic stops are some of the most contentious encounters they experience.

First, the police car will park behind you and run your license plate before approaching your vehicle. They are looking to see if you have any priors. Then, they will approach your car.

Once you have rolled down your window, the most important thing to remember is to not make any sudden movements – keep your hands on the wheel. Police are worried about someone reaching for a gun, trying to stash away contraband, or throwing something out the window. Even a quick duck for your wallet could be noted by the officer.

If you have to reach into a compartment to get your registration or insurance, keep your hands on the wheel, and first tell the officer, “I am going to open the glove compartment to get my registration, is that OK?” Once the officer gives the OK, then, slowly, retrieve your registration.

It is also a best practice to respond to every question with “Yes sir” or “Yes ma’am” – no joking around or being sarcastic. This behavior can especially be problematic for younger drivers or new, teen drivers who the officers may believe already have an attitude.

You should also know that police may find any reason to search your car. It could be that the car simply smells like marijuana, whether that is credible or not; perhaps someone in the car smells like they have alcohol on their breath; maybe they believe they see drug contraband or a weapon, even if it is just a cigarette box or the handle of your ice scraper.

The bottom line is that, if they want to give you a hard time, they will. But it will only help your case if you continue to be polite and cordial with the officer. No case has ever been helped by a driver being rude or disorderly in front of the police. Often times the event is caught on camera, and in rare instances, audio is also caught.

If you are asked to get out of your car, once again, do not make any sudden or quick movements. Do whatever they officer may ask of you.

Lastly, make sure you know who you are in the vehicle with. If one of your friends has drugs in their pocket, even if nobody else knew, everyone in the car could be busted for possession of drugs or loitering in the presence of drugs. The charge might not hold up, but it is certainly one you don’t want to face.

If you are facing criminal charges, Mark Mandell is an experienced Metro Detroit defense attorney and a former prosecutor. Call Fausone Bohn, LLP today at (248) 468-4536, and find out how Mark and our other defense attorneys can help you.

Or visit us online at www.fb-firm.com. 

The Good News About Detroit

Paul Bohn

Has this happened to you: You’re out of town, maybe on vacation, and nobody knows where you’re from….so you say, “I’m from Detroit.” And then you get that look, the one that gives you the sense the person is sorry for you.

It’s not surprising, as the mainstream media constantly feeds negative stories of Detroit, from crime, to government mismanagement and corruption, to bankruptcy. A lot of Michiganders even have negative sentiment about Detroit.

The city’s motto states, “We Hope for Better Things; It Shall Rise From the Ashes.” And better things are already happening, and Detroit is “rising from the ashes” of what is, admittedly, a scarred past.

I encourage everybody to check out two great websites: Curbed Detroit and Eater Detroit, which track positive development and rejuvenation, and the great eats and drinks, around the city.

Curbed: http://detroit.curbed.com/

Eater: http://detroit.eater.com/

And here’s a link to the latest piece of big news out of Detroit. Dan Gilbert is buying the historic One Detroit Center, and Ally Financial will be moving in (and it will be renamed Ally Detroit Center). Link: http://detroit.curbed.com/archives/2015/03/dan-gilbert-buys-fills-and-rebrands-one-detroit-center.php

Paul Bohn is a partner at the law firm of Fausone Bohn, LLP, and was named one of the Top Attorneys in Michigan in 2014 by Crain’s Detroit Business. Paul is a huge fan of Detroit and encourages everyone to check out the good news happening around the City.

Does Your Nursing Home Know About Palliative Care?

Daniel J. Williams

Palliative care is specialized medical care for people with serious illnesses, and it focuses on providing patients with relief from the symptoms and stress of that illness. The ultimate goal of palliative care is to improve the quality of life for the patient and their family.

And while palliative care is a great concept, it is shocking how many long term care facility and nursing home managers and employees have little to no knowledge of how to administer such care. A recent study found that over 20% of long-term care facility managers had little to no palliative care experience.

However, 43% of those surveyed did have knowledge of palliative care. That knowledge translated into more compassionate care and less “aggressive interventions,” such as hastily inserting a feeding tube, injections, applying restraints, or an emergency room or hospital trip.

Reading the findings highlights the importance of not only planning ahead for long term care, but also the issues that arise from having a loved one in a long term care facility.

Making sure that you know the risks and benefits of a placement are important. Being present to ensure that proper care is being administered is also a part of the process. The fact that a nursing home administrator and staff are not properly trained on how to administer care to a patient, either end-of-life care or palliative care, or even day to day needs, is not the fault of the patient. Nor should they have to suffer because of inadequate training, and improper use of medical devices and restraints.

However, many of these facilities are improperly treating residents, unnecessarily administering medical treatment to them, and in some cases people are dying who should not be, simply because of a lack of training, understanding, and appropriate action.

If you are looking into putting a loved one into a nursing home or long term care facility, or if you have a family member already in one, be sure to ask the management about their knowledge of palliative care and how they implement it for their patients.

As a former elder abuse prosecutor with the Wayne County Prosecutor’s Office, I now work in the civil courts enforcing the laws to compensate victims for this very type of problem. If a loved one is the victim of abuse or neglect, or if they are not getting the proper care that they need, Fausone Bohn, LLP is ready to assist in getting compensation.

Read more on this issue in Nursing Times: http://www.nursingtimes.net/nursing-practice/specialisms/end-of-life-and-palliative-care/palliative-care-in-nursing-homes-linked-to-managers-knowledge/5083564.article

Contact the elder abuse attorneys at Fausone Bohn, LLP today at (248) 468-4536, or online at www.fb-firm.com. 

IRS Prosecutions Spike in April for Tax Fraud

Mark J. Mandell, Esq.

That start of the month may be April Fool’s Day, but there is no joking around this month for the IRS. In an attempt to flex their muscle, IRS prosecutions spike during the tax season as a not-so-gentle reminder that there can be a big price to pay for tax fraud and tax evasion.

A recent analysis by Syracuse University researchers show that the ten year average for IRS criminal prosecutions is significantly higher in April than any other month of year. Also, the month of March is the second highest month. Last year, the number of prosecutions was higher than the ten year average for most months, but especially for April.

It’s very likely that this peak is a result of the IRS’s desire to remind people and businesses of their responsibility under tax law.

Prosecutors will levy a number of criminal charges in one case, such as money laundering, mail fraud, bank fraud, etc. However, one charge must be selected as the “lead charge.” The top choices for lead charges were: (1) Fraud and false statements, and (2) conspiracy to defraud the Government claims.

Very few taxpayers – about 2% - are ever investigated for tax fraud. However, if you are under investigation, you have a 20% chance of facing criminal charges and/or a civil fines.

Whatever your case, it is important to present a zealous defense. As a former prosecutor, I have experience with the strategies the government will use against you and I know what weaknesses to look for. You don’t want to go up against the Tax Man without aggressive representation.

Are you or your business in trouble with the IRS? Give the Michigan Fraud Lawyers a call today at 248-468-4536, or visit us online at http://www.fb-firm.com/Fraud/Financial-Fraud.shtml and www.Facebook.com/FausoneBohnLLP

To learn more about the April peak in IRS Criminal Prosecutions, see Bloomberg Business News’s recent article: http://www.bloomberg.com/news/articles/2015-04-02/april-is-the-cruelest-month-for-prosecuting-tax-fraud 

Senator Gary Peters to Meet with Local Residents & Businesses

The Livonia Chamber of Commerce will be hosting Michigan’s new Senator, Gary Peters, for a meet and greet with local residents and businesses next week.

Attendees will have the opportunity to hear from and meet with Senator Gary Peters on Monday, April 20 from 8:00 am to 9:30 am at the Italian American Banquet Center, located at 39200 Five Mile Rd. in Livonia.

The cost is $20 for Chamber members and $30 for others. If you are interested, check out the event registration page and sign up today: https://files.ctctcdn.com/3be7e289001/f5818582-1aaa-48b5-854e-1dcb3fca6754.pdf

You can contact the Livonia Chamber at 734-427-6055 to reserve your seats.

This will be a great opportunity to hear what issues Senator Peters has slated on his agenda for the upcoming session, in addition to hearing what Congress’s and the Senate’s agendas are for the next two years. 

Big Nursing Home Settlement Provides Example of How Cooperation Brings Justice for Victims

Daniel J. Williams, Esq.

The Aristocrat Nursing Home in Naples, Florida recently settled a dispute with Florida state authorities for the failure to care for a 90 year old man who was left outside for hours in the hot sun last year.

The settlement requires the nursing home to pay $15,000 in fines to state regulators, which is in addition to the $85,000 fine levied last fall by the feds. And those fines likely do not spell the end of the nursing home’s troubles.

Because an investigation has already been done at both the state and federal levels, those reports provide a huge asset for a family member looking to take the case to a personal injury or elder abuse attorney to begin an action in civil court. While the state and federal fines penalize the nursing home, the reports from this incident in Naples can help a family’s loved one obtain justice and seek damages for the abuse and negligent acts perpetrated by the nursing home employees.

This case provides a prime example of how cooperation can help right the wrongs done by nursing homes and their employees.

If your loved one falls victim to such treatment, remember that while prosecutors may go forward with criminal charges, you can seek a remedy in civil courts and obtain monetary damages by seeking an elder abuse or personal injury attorney. 

Daniel J. Williams is an Elder Abuse Attorney with Fausone Bohn, LLP. The firm has former prosecutors and experienced attorneys who can help you and your family right the wrongs done to your loved one, whether it be nursing home abuse or financial exploitation. Call the Metro Detroit Elder Abuse attorneys today, at (248) 468-4536, or visit us online at www.fb-firm.com. 

Drafting an Enforceable Non-Compete Agreement for Your Business

Paul Bohn, Esq.

A non-compete clause is key part of the toolbox for business owners looking to protect their interests. For business owners, large or small, it’s important to draft a strong non-compete clause that can hold up in court as reasonable and enforceable.

Non-compete clauses are typically used in two situations.  First, upon the sale of a business, this tool can prevent the seller from competing with the person who purchased the business.  Second, they’re used to prevent key employees who leave the company from going to work for a competitor or taking the business’s customers with them.

However, not all non-compete clauses are enforceable.  In order to be enforced, a particular clause must be “reasonable” under the circumstances. It is important that you and your attorney clearly understand the law when carefully drafting these clauses.  Otherwise, a court may strike down a poorly drafted clause that it finds unreasonable.

When determining if a particular clause is reasonable, and therefore enforceable, a court looks primarily at two questions – is the clause reasonable (1) in its duration, and (2) in its geographic scope.  Courts take an in depth look at the facts and circumstances of each situation when determining reasonableness.

You may have heard about Jimmy John’s making their workers and drivers sign non-compete agreements, which could very well prevent them from going to work for Subway for example. Jimmy John’s use of these agreements has stirred up controversy, but it has also drawn the attention of the New York Attorney General Office, which has launched an investigation. As a business owner, large or small, you don’t want to draw that kind of negative attention.

Michigan courts have, in some situations, enforced non-compete agreements for as long as five years. When reviewing the geographic scope, courts will typically look to see if the clause mirrors the territorial scope of the business.  If so, it is more likely to be upheld.  For example, if the business involved is a local business that only services customers within a 20 mile radius, a covenant not to compete that restricts the person in the entire state of Michigan is probably too broad and unenforceable.

Are you buying a business, or do you own a business and are concerned that key employees may leave your business and compete with you? If so, you will want an enforceable non-compete clause in your purchase agreement and/or employment agreements. Don’t fall into the trap of simply copying and pasting a clause off of the internet, which would likely produce a non-enforceable agreement that leaves your business interests unprotected.

If you want to protect your business assets, call a Fausone Bohn Michigan Business Attorney today for a consultation. You can reach out at (248) 468-4536, or online at www.fb-firm.com. 

Ohio Passes Bill to Protect Lake Erie: Should Michigan Follow?

Paul F. Bohn, Esq.

You may remember the news last year when Lake Erie experienced a massive wave of “harmful algae blooms,” or HABs, in its waters. Lake Erie communities were unable to use tap water, restaurants and coffee shops closed due to a low supply of usable drinking water, and even politicians in the heat of election season paused their campaigns to help distribute water.

The spike in algae blooms, and its severe effects on surrounding communities, recently led Ohio to pass Senate Bill 1, which Ohio Gov. Kasich signed last week. The bill aims to protect Lake Erie’s and Ohio’s water quality.

SB 1 restricts the spreading of manure and other fertilizers that contribute to the toxic algae blooms, curbs open-lake dumping of dredged material, and increases monitoring at water-treatment plants. The bill passed the State House and Senate unanimously, which is a rarity in today’s politics, no matter where you live.

You can learn more about the bill’s details in an article from the Toledo Blade:

http://www.toledoblade.com/State/2015/04/02/Gov-Kasich-signs-bill-aimed-at-protecting-Lake-Erie-Ohio-water-quality.html

Great Lakes Environmental Groups hailed the legislation as a positive first step, but noted that more needs to be done. They have called on Governor Snyder of Michigan, Governor Kasich of Ohio, and Premier Wynne of Ontario, Canada to lead a joint effort to cut phosphorous pollution into Lake Erie by 40%.

These groups believe a good first step for Michigan would be to pass similar legislation to Ohio's. 

Paul Bohn is a partner at the law firm of Fausone Bohn, LLP, and was named one of the Top Attorneys in Michigan in 2014 by Crain’s Detroit Business, and specializes in the areas of environmental, real estate, and construction law. If you need help on an environmental issue, contact Fausone Bohn, LLP at 248-468-4536, or visit us online at www.fb-firm.com. 

Nonprofits May Not Be Able to Increase Dues for a PAC

Paul F. Bohn, Esq.

Recently, the Michigan Secretary of State Elections Division responded to the question of whether a nonprofit could specify a portion of a dues increase for members to be dedicated for a “separate segregated fund” (i.e. a PAC), without violating the Michigan Campaign Finance Act (MCFA).

The preliminary response from the state issued last week suggested that any portion of a dues increase specifically dedicated for a nonprofit’s PAC could violate Michigan law, if the dues increase was paid to the nonprofit first.

That could sound a bit confusing – what does it matter whether the dues increase go to the nonprofit general treasury fund first, or to the separate segregated fund first?

Nonprofit corporations – or any corporation – setting up a separate segregated fund can only use their general treasury funds to pay for the establishment, administration, and soliciting of contributions for that separate segregated fund. Therefore, if a nonprofit transferred money from its general fund directly to their PAC for any other purpose, it would violate the MCFA prohibition against treasury funds being used for campaign activity.

In its response, the state said that this prohibition applies even if it is made clear that member’s contributions from the dues increase to the PAC are voluntary.

To clarify, members of nonprofits can donate directly to the separate segregated fund of the nonprofit, as long as it is voluntary and not a condition of membership. In addition to members, a nonprofit may also solicit and accept funds for its PAC from stockholders, employees with non-clerical responsibilities, officers and directors of the corporation, and other separate segregated funds.

For all of the above, contributions must also be voluntary, and not a condition of employment. A separate segregated fund can be a great vehicle for individuals and businesses to advocate for their political preferences in an election – but the key is staying in compliance.

Nonprofits and other corporations need to keep pace with the changing landscape of campaign finance. If you are in need of legal counsel or want to set-up a separate segregated fund or other political committee, contact Fausone Bohn, LLP today and we can help you accomplish your goals and advise you on best-practices to stay in compliance with the law. Contact Jim Fausone or Paul Bohn today at (248) 468-4536, or visit us online at www.fb-firm.com.