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16
May
2022

Abandoned Permits

Written by: Guy Jeffress

On April 25, 2022, Prince William County Development Services, Building Development Division, issued Policy 1.03 entitled Abandoned Building Permits and Applications, and is in the process of auditing and revoking “abandoned” permit applications and issued permits. In general, an issued permit may be revoked if work on the site authorized by the permit is not commenced within six months after the issuance of a permit, or if the authorized work on the site is suspended or abandoned for a period of six months after the permit is issued; however, permits issued for plumbing, electrical and mechanical work shall not be revoked if the building permit is still in effect.

If current events including supply chain disruptions have delayed your project be sure to check the status of your permit applications and permits. The full policy along with a process flow chart can be seen below and found here https://www.pwcva.gov/department/building-development-division/abandoned-building-permits-applications.

Call one of the attorneys at Vanderpool, Frostick & Nishanian, P.C., or email and let us see if we can assist you.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

12
May
2022

Prince William County Is Totally Awesome And VFN Is More Gooder Than Other Firms

Written by: Guy Jeffress

In April 2022, the Commercial Real Estate Development Association (aka “NAIOP”), released the results of their national Developer Approvals Index study. The results of the study ranked Prince William County, Virginia in sixth place nationally, with an overall weighted score of 51, and attained a category-leading score of 75 points for “Consistency.” Consistency metrics covered code and ordinance updates, time frames for completed reviews, approval processes, feedback across different organizational levels and functions, including published approvals for project phases, and staff-based results, such as tenure, training, and their ability to handle complex projects. In short, Prince William County, Virginia is open for business.

For the attorneys at Vanderpool, Frostick & Nishanian, P.C., the study reiterated what we already knew, i.e., that Prince William County, Virginia, is a national leader when it comes to the provision of building development services and the approval of innovative projects including world-class data center infrastructure, bio/life science incubators, and higher education. Nor was the result of the study a surprise to some of our county’s most well-known business residents which include Amazon Web Services and the microchip manufacturer Micron.

If you are considering a project in Prince William County, Virginia, or any of the surrounding jurisdictions, the attorneys at Vanderpool, Frostick, & Nishanian, P.C. are able to bring their 80+ years of combined experience and community involvement to mitigate the legal risks and challenges related to your real estate development projects.

Call one of the attorneys at Vanderpool, Frostick & Nishanian, P.C., or email and let us see if we can assist you.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

14
Mar
2022

DON’T RISK YOUR BUSINESS BY IGNORING VIOLATION NOTICES.

Written by: Guy Jeffress

In a January 2022 unpublished opinion, the Court of Appeals of Virginia upheld the immediate revocation of a certificate of occupancy for a hospitality venue located in Fairfax County, effectively closing the business. The revocation was based in part on a single notice of violation issued by Fairfax County almost nine years prior in 2013.

In June 2012 the operator of the establishment obtained a non-residential use permit to open a restaurant located in Fairfax County. In March 2013, the Fairfax County Department of Code Enforcement cited the operator for violating the Uniform Statewide Building Code by constructing unpermitted additions. In May 2013, because the violations remained unresolved, the Department issued a notice of violation and two criminal summonses to the operator. The summonses were subsequently resolved by order of nolle prosequi (a dismissal without prejudice) to allow operator time to submit a “minor site plan,” which was necessary for obtaining the required permits. The operator initially attempted to obtain the minor site plan but ultimately abandoned the effort.

Between April 2014 and October 2019, no inspections were made on the property. However, in October 2019, the county received a complaint about a new structure on the property. A county official researched various records pertaining to, and visually examined, the property. The official observed various violations, including a newly constructed enclosure with a deck, bar, new plumbing and electrical fixtures, and gas fired heaters. The official determined that all of the alterations and additions were completed without appropriate permits.

In early November 2019 the official, accompanied by the fire marshal, returned to the property during business hours. They observed over one hundred people on the premises, which had a certificate of occupancy for a maximum of forty-nine. Shortly thereafter, the Building Official issued a revocation notice for appellant’s certificate of occupancy, effectively closing the business. The revocation notice identified various code violations dating back to the original 2013 notice/citation, and listed safety hazards created by the conditions on the property specified the corrective actions required, and contained information concerning appellant’s right to appeal. The operator appealed the revocation to the Virginia Department of Housing and Community Development State Building Code Technical Review Board (“TRB”). The TRB upheld the county’s finding and the operator appealed to the county circuit court which affirmed the TRB ruling.

The operator then appealed to the Court of Appeals of Virginia arguing that the revocation of the certificate of occupancy was improper on a number of grounds including: (i) that there was no evidence of repeated violations since the only notice of violation was issued in 2013; (ii) the TRB was required to issue a corrective work order and a notice of violation before revoking the certificate of occupancy; (iii) and operator should have been given a reasonable time for compliance before the revocation.

The Court of Appeals dispatched these arguments and affirmed the decision of the circuit court finding that: (i) no applicable law required the county official to provide a notice of violation before revoking a certificate of occupancy, and repeated violations were implied by the improvements to the property constructed between 2013 and 2019, all without the required permits; (ii) nothing in the building code required a notice of violation or a corrective work order before revoking the certificate of occupancy; and (iii) enforcement of the building code is a legitimate use of state power necessary to protect the health, safety, and welfare of its citizens.

Ignoring or shrugging off a single zoning or building code violation, even one made years prior, could jeopardize your business. Don’t wait until it’s too late, call one of the attorneys at Vanderpool, Frostick & Nishanian, P.C., or email and let us see if we can assist you.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

12
Mar
2022

VF&N is pleased to announce that four of its senior associates have been named as partners!

VF&N is pleased to announce that four of its senior associates, consisting of Brett Callahan, Olaun Simmons, Guy Jeffress, and Bradley Marshall, have been named as partners effective March 1, 2022.“Each of our new partners have demonstrated superior legal ability, work ethic and commitment to our clients and our communities,” said Rick Nishanian, the VF&N Managing Partner. “We are lucky and honored to have such talented lawyers practicing at VF&N.”

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

12
Mar
2022

March Fun Friday Employee events

Every second Friday of the month VFN host a fun event for their employees.

This month’s Fun Friday did not disappoint. Murlarkey Distilled Spirits set up a tasting and a few mixed drinks at our office. Thank you MurLarkey Distilled Spirits for creating a memorable event for our staff.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

24
Jan
2022

Labor Reforms Targeted as Virginia Prepares for a Change in Administration

Written by: Monica Munin, Esq.

Republican governor Glenn Youngkin assumed office on January 15, 2022, enacting 11 executive orders including orders that; end mandatory masking for children in grade K-12; ban critical race theory from state classrooms; promise to “investigate wrongdoing” in Loudoun County Public Schools; and, promise to cut workplace regulations.  Consequently, the fate of recent labor reforms in Virginia, including a scheduled increase to the State’s minimum wage, domestic workers bill of rights, and the COVID-19 emergency standard, remains uncertain.  Republicans swept the State’s elections this year, claiming the governor’s office, lieutenant governor’s office, attorney general’s office, and a majority in the House of Delegates. Youngkin cast himself as an employer-friendly candidate who would eliminate “job-killing regulations” and oppose government lead vaccination mandates.

While it is not yet clear how far Republican can or will go to stem or otherwise reverse the policies implemented during the Governor Northam’s administration, Youngkin has wasted no time preparing for a change in priorities.  In addition to the 11 executive orders signed on his first day in office, Youngkin delivered an address outlining his plan for education and tax reform.  Prior to his swearing in, Youngkin had also announced that he intends to appoint George “Bryan” Slater, as state labor secretary.  Slater was a former U/S/ Labor Department official under the Trump administration and served as White House liaison to the Labor Department under President George W. Bush as well. Democrats currently retain control of the State Chamber, which is not up for reelection until 2023.

Nonetheless, incoming Republicans in the State legislature are hoping to capitalize on Youngkin’s win and pass a number of bills, including a freeze on the scheduled increase to the state’s minimum wage which would keep the minimum wage at $11, bills limiting domestic worker protections, and bills intended to prevent cities and counties from using government contracts to ensure wage rates and employee benefits beyond what is currently required by state or federal law.

Worried about what the change in administration means for your business? Confused about how to proceed? Please feel free to reach out by way of phone or email Monica Munin for guidance.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

21
Jan
2022

The Cost-Benefit of Engaging Business Counsel – Part 1

Written by: Tyler Blaser,Esq.

Part I: Protecting You & Your Business from Legal Liability

The Problem. As a young lawyer growing a business transactions legal practice, one of my toughest challenges is helping entrepreneurs in our community understand the cost-benefit value of consulting with a lawyer to plan and prevent legal problems, rather than contacting a lawyer for the first time in reaction to those problems when they happen. And, make no mistake, Murphy’s Law requires that these problems will happen – a fact every business owner will confirm.

While our law firm, Vanderpool, Frostick & Nishanian, P.C. (“VFN”), represents both national and international businesses, most of my personal clients are friends, family, and other close professional connections throughout the Northern Virginia area who have stricter budget constraints. One advantage stemming from these personal relationships is the opportunity to engage in intimate, frank discussions about how they operate their business, calculate and manage risk, and explore client perception of when they believe it is worth their capital to engage counsel. In having these conversations, entrepreneurs will tell me that they would consult with a lawyer more often, but the front-end cost ultimately leads them to incur risk without counsel.

Contrasting Approaches. While this approach may be common, and even understandable, any business lawyer can attest to the fact that this outlook is flawed from a cost-benefit analysis perspective, both in terms of avoiding future liability and securing payment of amounts receivable. This article explores the cost-benefit of obtaining legal advice as it relates to avoiding future liability while considering two hypothetical young entrepreneurs beginning small businesses:

Owner A wants to start a business and keep it afloat, but like many, faces financial constraints and is therefore cost-conscious. Owner A assumes that lawyers are a waste of money but runs into some issues with setting up its business entity. After some thought, Owner A sets up a free initial consultation with business counsel but declines representation to avoid paying the required hourly rate. Owner A decides to go it alone, begins business operation, obtains an SBA loan, executes a commercial lease, and agreements with customers and vendors, all without counsel.

Owner A’s business is thriving until it is served with a lawsuit filed by a disgruntled customer, seeking $100,000 in damages for work that the customer believes needs to be redone, plus another $200,000 in statutory damages and attorney fees, due to non-compliance with Virginia Consumer Protection Act (“VCPA”). Additionally, the customer filed a complaint with the Department of Professional and Occupational Regulation (“DPOR”), putting Owner A’s professional license at risk of revocation. Because Owner A did not follow corporate formalities in forming and operating its business, Owner A’s personal assets, including its home, vehicle, investments, and personal bank accounts are all at significant risk.

Owner A knows it cannot navigate the legal process to deal with complex legal issues of this magnitude and decides to engage counsel to defend this lawsuit. Luckily, Owner A is able to successfully defend the lawsuit, but in getting there, must pay its attorney ~$50,000 to prepare for trial, plus another ~$20,000 for related consultants and experts (both conservative estimates). Despite Owner A successfully defending the customer’s civil claims, DPOR suspends Owner A’s professional license due to violated regulations. Owner A is now ~$70,000 in the hole, without a professional license, or the income from its business, cannot pay its loan or rent payments when due, and eventually must file for Chapter 7 bankruptcy.

Owner B starts in the same position as Owner A, also facing financial constraints, and is also cost-conscious. Owner B knows it does not have the expertise or time to devote to consumer protection or professional licensure compliance (or other legal complexities), so Owner B sets up a free consultation with VFN business counsel. After consultation, Owner B engages counsel to prepare its business entity’s articles and organizing documents. The lawyer provides these services to Owner B, and in related discussions, recommends Owner B forward its customer agreement for review. The lawyer recommends Owner B amend its customer agreement to comply with VCPA and DPOR requirements. The lawyer makes appropriate changes and counsels Owner B on the importance of following corporate formality.

Owner B pays a total of $2,500.00 for these services, but in doing so, avoids significant legal (and financial) exposure. If a lawsuit were filed against Owner B, its attorney is positioned to negotiate or dismiss any claims quickly, avoiding cost for trial prep, and fees for consultants and expert witnesses. Incidentally, Owner B also sleeps well at night, knowing its attorney is losing sleep on its behalf.

The Lesson. While I have intentionally simplified these hypothetical scenarios for contrast, any successful business owner can confirm the lesson they offer invest a little amount now to engage legal counsel and manage risk, to avoid major liability and expense down the road. You will thank yourself. The issues discussed in this article focus on business formation, corporate liability, and regulatory compliance of customer agreements, however, consultation with a business attorney is similarly valuable in the context of

  • purchasing a business;
  • raising capital and extending or obtaining financing;
  • buying, selling or leasing commercial property;
  • negotiating and navigating agreements with vendors and customers;
  • drafting corporate governance agreements related to decision making, distributions, and other ownership rights; and/or
  • selling your business’ equity or assets, when that time may come.

Consult with an Experienced Small Business Lawyer. VFN is one of the most highly regarded law firms in Northern Virginia, with seasoned and well-connected attorneys who can help you in any of these areas. While we also have experienced litigators who can help you in the event of a dispute, we would always prefer to help you avoid legal problems before they happen.

Remaining in contact with an experienced business attorney is the most simple, sure-fire way to avoid legal liability, and the resulting financial stress that comes with it. By doing so, you can make sure your business is in a position to thrive and will continue to do so moving forward.

If you need an attorney or just want more information, please give me a call at 703.479.3181, send an email to tblaser@vfnlaw.com, or visit my firm page at Vfnlaw.com.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

13
Jan
2022

Reporting Requirements For “Non-Financed” Real Estate Transactions In The Works

Written by: Guy Jeffress

On Wednesday, December 8, 2021, the Financial Crimes Enforcement Network (“FinCEN”), a bureau of the U.S. Treasury that works to safeguard the U.S. financial system from illicit use and money laundering, and to promote national security, issued an advance notice of proposed rulemaking (a “ANPRM”) to solicit public comments on proposed changes to the Bank Secrecy Act (“BSA”). The changes would require additional disclosures for persons involved in “non-financed” transactions involving both commercial and residential real estate. The ANPRM can be found at 86 Fed. Reg. 69589 (Dec. 8, 2021).

A “non-financed purchase,” “non-financed transaction,” “all-cash purchase,” and “all-cash transaction” are defined in the ANPRM as any real estate purchase or transaction that is not financed via a loan, mortgage, or other similar instruments, issued by a bank or non-bank residential mortgage lender or originator, and that is made, at least in part, using currency or value that substitutes for currency (including convertible virtual currency (CVC)), or a cashier’s check, a certified check, a traveler’s check, a personal check, a business check, a money order in any form, or a funds transfer.

According to a June 6, 2021, White House Press Release: “For too long, the U.S. real estate market has been susceptible to being manipulated and used as a haven for the laundered proceeds of illicit activity, including corruption. Our real estate market is a relatively stable store of value. It can be opaque, and there are gaps in industry regulation. As a result, criminals and corrupt officials are able to exploit real estate far too often.”

Recently reported cases and studies cited in the ANPRM and the press release indicate that many groups are using cash-only purchases of U.S. real estate to launder money. The end goal of the rulemaking process is to prepare a rule that would impose nationwide record-keeping and reporting requirements on certain persons participating in transactions involving non-financed purchases of real estate similar to those already required in financed transactions.

The ANPRM points out that there are several key factors that make these types of transactions appealing, those factors include, but are not limited to, the following:

First, the lack of transparency in the real estate market contributes to its vulnerability to money laundering activity. Real estate may be held directly or indirectly through nominees, legal entities (such as one or more shell holding companies), or through various investment vehicles. Buyers may use shell companies in many legitimate circumstances, such as when buyers use legal entities to shield themselves and their assets from liability related to the purchase of real property or as a means of protecting their privacy. Illicit actors, however, can take advantage of the opacity of shell companies or other legal entities or arrangements to mask their identity as the true beneficial owners of the property and their involvement in real estate transactions.

Second, the attractiveness of the U.S. real estate market as a stable vehicle for maintaining and increasing investment value also contributes to its vulnerability to money laundering activity. Illicit actors seek to conceal the origins of their illicit funds in a way that grows as an investment, “cleans” as much money as possible with each transaction and allows them to enjoy the fruits of their illicit activity while minimizing potential losses from market instability and fluctuating exchange rates. Consequently, real estate—especially in a relatively stable market with strong private property protections such as in the United States—is an attractive asset to facilitate money laundering. Real estate is highly appealing for this purpose because there are a large number of transactions, and each transaction is high is amount; as of mid-2021 the average residential sale price in the U.S. was about $350,000.

Third, the lack of industry regulation for non-financed transactions exacerbates the money laundering vulnerabilities of the U.S. real estate market. Non-financed purchases of real estate currently are not subject to the same regulatory requirements as those that involve financing underwritten by a financial institution which are subject to BSA requirements. This leaves a substantial portion of the real estate market without the same protections and safeguards as those applicable to banks, casinos, or other financial institutions. Moreover, data on real estate purchases is held in a patchwork of different state and county databases, making investigation and analysis difficult.

Written comments to the ANPRM must be received on or before Feb. 7, 2022.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer

21
Dec
2021

Legal Risk Check-Up

Written by: Brett Callahan

Legal Risk Check-Up

It is almost the end of the calendar year! It is also a busy time for many businesses as they try to wrap up any deals, close their books for end-of-the-year accounting, recognize their employees, and celebrate their past year’s accomplishments. And let’s face it, making it through 2021 with a healthy business is quite an accomplishment. However, you may want to add something new to that end of the year to-do list: schedule a time in January to sit down and take a serious look at how your business has grown or changed over the past year or several years, and what that might mean for your legal risks. After all the new year is a time for new beginnings and what better fresh start could your company have than identifying and fixing threats before they snowball into a major problem?

The most cost-effective approach to business legal disputes is usually to avoid them altogether, but that isn’t always possible. Businesses have limited resources and can’t focus on everything at once. So, if you have to prioritize, what are the most common types of legal issues businesses face that either create legal troubles or make them more complicated and expensive than they need to be?

  1. Using inappropriate, outdated, or unfavorable contracts. Contracts are supposed to protect against legal risk. Odds are good if your business has been “using that contract forever” or no one remembers exactly where the contract came from, that the contract isn’t providing much protection. Remember when considering your potential exposure, even if each individual transaction under a regularly used contract may seem small, when you add them together you can get a big problem.
  2.  Not paying attention to the rules of a licensed or regulated industry. You study, take tests, and pay fees to get your real estate or contractor license. But how frequently do you check to make sure all of your practices and contracts are following the rules, including any new rules, of whatever board or agency issued that license? If your business going to take a serious hit if you (or an employee) lose their license, it isn’t enough just to pay your renewal fees. You need to make sure you are taking basic steps to actively protect that license.
  3. Not performing other business maintenance on a regular basis. When was the last time someone looked at the corporate by-laws or company operating agreement? Are you paying attention to what new labor laws apply as your business grows and adds employees? Your practices and policies need to be in alignment with any governing laws or any controlling documents for the business. Businesses change, sometimes slowly, sometimes quickly. Any major change, such as a large expansion, should prompt an immediate review of what new laws your business might now have to follow. But even if it seems like not much has changed in a while, if you review your legal framework, you might be surprised at what you find.

Risk management requires you actively manage those risks and not ignore them until it is too late. If you have any questions on where to start or need help ensuring you are using favorable contracts and complying with any applicable laws, regulations, or governing documents one of our business attorneys may be able to help.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer