Rule Against Perpetuities and Leases in North Carolina

Diana Quarry provides a guest blog post ...

Remember the Rule Against Perpetuities? 

Think back to your days in law school, sitting in your 1L Property class.  Remember the rule against perpetuities?  Remember thinking that it would never really come into play in your actual practice of law? 

Oh, how young and naïve we were back then.

In recent years, the Court of Appeals of North Carolina has handed down two decisions which make very clear that the common law rule against perpetuities doctrine is alive and well in the Tar Heel State, regardless of the State’s 1995 enactment of the Uniform Statutory Rule Against Perpetuities (“USRAP”).  The cases, New Bar Partnership v. Martin (221 N.C.App. 301 (2012)) and Khwaja v. Khan (767 S.E.2d 901 (2015)), both deal with a tenant’s attempt to exercise its right of first refusal to purchase the leased property.  New Bar Partnership v. Martin held that the USRAP, by its terms, does not deal with preemptive rights arising from nondonative transfers, such as a right of first refusal contained in a lease.  In those cases, the common law doctrine still applies.

The common law rule against perpetuities doctrine voids any interest not tied to a measuring life and which otherwise extends beyond 21 years.  The leases in both cases had terms (by virtue of the initial stated term plus available extension options) which extended beyond 21 years.  Since both rights of first refusal were exercisable at any time during the applicable lease term, and since neither lease contained a reference to a life in being, the rights were deemed void under the common law doctrine.  Keep in mind that even if a landlord does elect to sell its property to a third party prior to the 21-year outside date, a tenant may be unable to exercise its right of first refusal at such time – if the provision violates the doctrine, then the provision is void from the outset – regardless of when a tenant tries to exercise it. Including an adequate savings clause into a lease should prevent a right of first refusal from being voided under the common law doctrine, but the key is to remember to include one.

What's an 18 hour city?

Ely Portillo, of the Charlotte Observer, brings us all up to speed on defining commonly thrown about real estate development jargon. 




Low-rise? Mid-rise? Mixed-use? Your guide to jargon in a city of cranes

Development

elyportillo@charlotteobserver.com

Here’s what could pass for a typical sentence from a development company announcing a new project: “We’re going to build a true live-work-play environment, a mixed-use development with activated ground floors and an urban streetscape that speaks to Charlotte’s emergence as an 18-hour city.”

Yep, commercial real estate can be a little jargon-heavy sometimes.


And if you’re wondering what’s going to be built on that corner in your neighborhood where you saw bulldozers, trying to make sense of a City Council zoning meeting or curious about whether Charlotte is building too many apartments, you’ll need to know what some of these terms mean.


Here’s a list of 10 common commercial real estate, development and urban planning terms and what they mean, so you can talk about TOD zoning, TIGs and live-work-play environments like a pro:

▪ Mixed-use: Easily one of the most common pieces of real estate jargon these days, a mixed-use development is one that includes multiple uses: For example, an apartment building with ground-floor retail, or a project that has a hotel, restaurants, apartments and an office building on the same site. The opposite would be single-use: Think of a subdivision with only houses, or an office park with no shops.


For decades, local zoning laws sought to strictly separate uses, and even now, mixed-use projects in Charlotte often require exceptions to the city’s zoning rules.


It seems like every new development calls itself “mixed-use” these days, so to stand out, some plans have started using “extreme mixed-use.” Take the North Tryon Vision Plan, which calls for buildings to house everything from below-market-rate apartments to high-tech business, light manufacturing and 3D printing.


▪ Live-work-play: This term describes the goal of a true mixed-use development, a place where people can get most of their daily tasks done in one place, often without getting into a car. Such developments usually include apartments or houses, offices and shops, restaurants and amenities such as a park. Developments like Waverly and Rea Farms on Providence Road south of I-485 fit the mold: Each includes residences, offices, shops and restaurants in the same project.

One question persists about live-work-play developments in uptown, South End and other hip neighborhoods: Will the millennials expected to fill many of these areas eventually move out to the suburbs, like generations before them?


▪ Activate the ground floor: Planners often talk of “active” ground floor uses in buildings, such as shops, sidewalk cafes, a small park, interactive art – anything passersby can engage with.


The opposite of “active”? Blank walls and parking decks.


▪ Absorption: It’s one of the most common questions I get: Is Charlotte building too many apartments? Or, in real estate lingo, can the market “absorb” all the new capacity developers are throwing at it?

People often talk about how many apartments or how much square footage of new office space has been absorbed, a term that brings to mind images of a sponge soaking something up. Absorption is simply a measure of how much of a given new property type has been leased in a market. For example, Real Data estimates 4,815 new apartments have been leased (absorbed) in Charlotte over the past six months, and JLL estimates the Charlotte office market absorbed 392,231 square feet of new space in the third quarter.


▪ TIG, TIF: These acronyms refer to tax increment grants and tax increment financing – subsidies in which developers receive some of the funds from future property tax revenue increases from their new developments. Sometimes the money reimburses a developer up front for infrastructure, such as new roads, that they’re building as part of their project. For example, Pappas Properties received a TIG as part of the Metropolitan development along Little Sugar Creek Greenway, a portion of the $34 million worth of public money pledged to the project.


▪ Low-rise, mid-rise, high-rise towers: Definitions of these terms aren’t hard and fast, and vary from place to place. The National Association of Realtors defines a low-rise as less than seven stories, mid-rise as seven to 25 stories and high-rise as more than 25 stories.


▪ TOD, MUDD: These sound like names, but they’re zoning designations in Charlotte – acronyms that stand for transit-oriented development and mixed-use development districts. Each allows more flexibility for mixed-use developments, and are often requested by developers seeking to rezone property in Charlotte. Much of the land along the Lynx Blue Line has been rezoned to TOD, for example, allowing high-density developments with apartments, shops and restaurants on the same site.


▪ Workforce housing: Although sometimes used interchangeably with “affordable housing,” workforce housing is a newer term, typically referring to rentals that people can afford if they make a set percentage less than the area’s median income. In Charlotte, workforce housing often refers to apartments for people with incomes between 60 and 80 percent of the area’s median income. Think nurses, firefighters, police officers, teachers – the demographic most commonly cited as target tenants.


▪ Spec space: Office buildings are often built “on spec,” or “on a speculative basis.”
That means the developers don’t have a tenant signed when they start construction, and hope to lease the space as construction progresses. All of Ballantyne Corporate Park has been built on a speculative basis, as has the new office tower at 615 South College Street uptown.


▪ 18-hour city: This category includes Charlotte, the Raleigh-Durham area, Seattle, Denver, Nashville, Portland and more similarly sized cities. They used to be called “secondary cities,” but 18-hour cities sounds a bit nicer.


The term refers to the fact that there’s stuff to do in these cities most hours of the day, but not 100 percent of the time. (We’re not New York City, a 24-hour metropolis that famously never sleeps). Charlotte’s inclusion on lists of 18-hour cities certainly marks a change from 1993, when Observer columnist Doug Smith famously found it near-impossible to buy a Snickers bar after 5 p.m. uptown.

Read more here: http://www.charlotteobserver.com/news/business/biz-columns-blogs/development/article109504297.html#storylink=cpy

"Peanut Buttering is Better than Firebombing"

Hard to argue with the logic of someone drunk on blackberry brandy!  Thankfully, as the deputy wryly notes, she didn't use chunky peanut butter ... oh the carnage!!

Woman Smears 30 Cars w/ Peanut Butter in Trump Protest

Christina Ferguson. (Courtesy Portage Co. Jail)

October 18, 2016

Woman mistook conservation club meeting for Trump rally

By Brandi Makuski
An Amherst Junction woman has been charged with disorderly conduct after allegedly smearing peanut butter on several vehicles parked outside what she mistakenly thought was a Donald Trump rally.
Christina Ferguson, 32, was arrested on Oct. 17 after disrupting what was actually a meeting of the Tomorrow River Conservation Club.
According to the complaint, Ferguson entered the meeting, which was being held on the 3900 block of Second St. in Amherst Junction, at about 9:30 PM on Monday, holding a jar of peanut butter and yelling at the club members about how much she hated the presidential candidate.
Ferguson left the meeting after being asked to do so, but after a few minutes one of the members suggested they check the parking lot to “make sure she wasn’t doing anything to their vehicles after leaving.”
As they went outside, one man saw Ferguson spreading peanut butter on a vehicle. He yelled at her, according to the complaint, and watched her walk into a nearby apartment complex. The man then called the Portage Co. Sheriff’s Office.
When deputies attempted to question Ferguson, a man at the apartment claimed she had been home all night and couldn’t have been involved in the incident. Ferguson also claimed she hadn’t left the apartment that night, and was repeatedly licking her fingers — indicating the presence of an edible substance on her fingers, according to the complaint — while talking to the deputy.
After being identified by a member of the conservation club, Ferguson then admitted to crashing the meeting and smearing vehicles with peanut butter. When asked why she did it, Ferguson become “very emotional”, according to the complaint, and talked about “how much she loved Hillary Clinton and hated Donald Trump.”
She also said she’d been “terrorized” by people who support Donald Trump.
“Peanut buttering is better than firebombing, and Trump plans on firebombing everybody in other countries,” she said, according to the complaint.
After the deputy explained to her that she’d actually interrupted the meeting of a nonprofit conservation organization, and that it was not a political meeting, she apologized and said she was “just fed up about the entire election.”
According to the complaint, Ferguson smelled of alcohol; she later admitted to drinking beer and blackberry brandy that night, and blew a .218 on the deputy’s breathalyzer.
The peanut butter Ferguson allegedly used in the incident was described in the deputy’s report as a “family-size jar of low-sodium, creamy natural Jif.”
“Fortunately it wasn’t chunky peanut butter, so vehicles didn’t get scratched,” said Chief Deputy Dan Kontos.

On the lighter side -- Daddy's Little Angel

Also from The Scottish Legal News ... I especially like the part where the clueless Dad thinks the "job interview" went particularly well!!






A young woman accused of robbing a bank duped her dad into being her getaway driver by telling him she was going there for a job interview.

Chelsea Wilson, 24, was arrested on Friday morning and later admitted robbing a TD Bank in Fort Lauderdale, Florida the previous afternoon.

It transpired that Wilson’s own father had driven her to the heist because she had told him she was actually trying to get a job there.

When later questioned by police, he told them that when his daughter emerged with $300 in cash, he simply believed it had gone particularly well and she had been given an advance.

In fact, according to the Florida Sun-Sentinel, sometime between leaving her father’s car and going to the “interview”, Wilson covered her blonde locks with a red wig and hat and put on sunglasses.

She then allegedly entered the bank shortly before 4pm and handed the teller a handwritten note demanding money:

“You have exactly one minute to give me all your $50 & $100 bills from both your drawers or I will shoot you! No dye packs, no alarms follow these instructions and no one will get hurt, act normal.”

She then took her haul to the bank’s car park and to an SUV that FBI agents later determined was registered to her father.

A witness reported Wilson after recognising her as someone wanted in connection with four other recent robberies, the Palm Beach Post reported.

She later admitted to committing all five robberies and had spent the money from the most recent heist on groceries.

Ministry of Silly Walks? No, it's the Department of Exiting the European Union

In Brexit withdrawal?  Never fear ... here's your fix, courtesy of Hannah Starritt and The Scottish Legal News!

Blog: What is the Department of Exiting the European Union and what does it do?

Hannah Starritt (pictured), solicitor at Turcan Connell, explains the purpose of the Government's new Brexit department.

The Department of Exiting the European Union (EU) was created following the referendum result in June 2016 for the UK to leave the EU.

Theresa May created the department following her appointment as Prime Minister and, in turn, appointed David Davis as its Secretary of State. It is responsible for overseeing negotiations to leave the EU and establishing the future relationship between the UK and EU.

Department Responsibilities

The main responsibilities include policy work to support the UK’s negotiations to leave the EU and to establish the future relationship between the EU and the UK; working closely with the UK’s devolved administrations, Parliament, and a wide range of other interested parties on what the approach to negotiations should be; conduct negotiations and support the PM; to lead and co-ordinate cross-government work.

Secretary of State David Davis made a statement in the House of Common on 10th October regarding the next steps in leaving the EU.

Next steps for Brexit

The first will be by bringing forward the Great Repeal Bill that will mean the European Communities Act will cease to apply on the day the UK leaves the EU. This will end the authority of EU law.

He stated that the Government will reject any attempt to undo the referendum result, any attempt to hold up the process or any attempt to keep Britian in the EU by the back door.

He stated that his whole approach is about empowering the UK and that the Great Repeal Act will convert existing EU law into domestic law where practical. There is 40 years’ worth of laws which require to be reviewed.

Decisions by the European Court of Justice will cease to binding on the enactment of the Great Repeal Act.

The exit of the UK from the EU must work for the whole of the UK. No part of the UK shall have a right to veto however, the Government will consult the devolved administrations.

Article 50

It was noted that the Bill was a separate issue from triggering Article 50 of the EU Treaty. The Bill will prepare the UK for the exit and provide the legal framework.

Article 50 will be triggered no later than March 2017.

• Hannah Starritt is a solicitor at Turcan Connell. View her profile here.