In the context of Real Estate transactions, due diligence is the level of prudent inquiry that is proper and ordinarily exercised by a reasonable and prudent person under the particular circumstances.

For example, verifying the legal chain of title and ownership of the property; inquiring about the environmental conditions of the property; identifying zoning restrictions; determining the status of tax payments on the property; and other inquiries which are relevant to the particular real estate transaction constitute “due diligence”.

Environmental Site Assessments are types of “due diligence” known as “All Appropriate Inquiries” which are required in industrial and commercial transactions. You may only be protected from liability for contaminated property that you buy or lease if you conducted “all appropriate inquiries” before you purchase or lease the property.

Due diligence is the necessary inquiry to ensure that you acquire property which not only meets your expectations, but which can be used as you intend to use it, is properly valued, and does not trigger liability for unsafe conditions, which you did not create.

Often, a preliminary title report for a property will contain “scheduled exclusions” from Title Insurance coverage, which are not appropriate for your transaction and, therefore, need to be modified or removed by legal counsel prior to Closing in order to protect your investment.

Additionally, lender security documents such as mortgages, assignments of rent, and UCC financing statements are often coordinated with the Title Company and need to be confirmed against the terms and conditions of your unique transaction. Also, legal counsel can ensure that any zoning or use variances are in place before Closing.

Finally, the Title Company will issue a preliminary Closing Statement outlining the financial aspects of the transaction, and those numbers should be confirmed and approved prior to Closing.

Stimler Law Offices can help you at your Closing to be sure that these and other matters unique to your real estate transaction are properly coordinated to achieve your expectations.

A business activity or enterprise can be conducted by:

1. a sole proprietor
2. a general or limited partnership
3. a corporation
4. a limited liability company [commonly referred to as an LLC]
5. or other legal entity.

The “choice of business entity”, therefore, is important because it determines:

1. the level of protection your individually-owned assets will have when a claim is brought against the business
2. what tax structure the business will have
3. what type of legal requirements will be necessary to maintain the business’ legal status
4. a myriad of other determinations which can affect your business.

At Stimler Law Offices, we will help you evaluate the pros and cons of each relevant business entity option you have, and guide you in the selection of the type of business entity which is best suited to your business needs.

A workbook specifically developed by Attorney James T. Stimler to facilitate your information gathering will be sent to you if you enter the following:

Services we offer:

• Estate Planning [wills and trusts] – Request a Workbook!
• Powers of Attorney [POA], including health care powers and financial powers
• Living Wills
• Advanced Directives or DNR [Do Not Resuscitate] instructions

Test your knowledge, take our Wills, Trusts & Estates Quiz! Learn what the Ohio State Bar Association's Specialist Certification means for you.

Question One

What are the advantages of a funded Living Trust?

1. Helps avoid probate of the estate of the maker of the Living Trust
2. Allows the family to keep the estate private at the death of the maker of the Living Trust
3. Can avoid the appointment of a Probate Court guardian over the financial estate of an incompetent maker of the Living Trust
4. All of the above
5. None of the above

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Question Two

Which of the following individuals may NOT make a valid Will?

1. A competent, retired eighty year old woman
2. A competent sixteen year old high school student
3. A competent thirty year old unemployed man
4. All of the above
5. None of the above

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Question Three

Which event should trigger a review and possible update of an existing Estate Plan?

1. An inter-state move
2. Death or incompetency of an adult child, who has children of their own
3. Engagement to be married of a single-parent
4. Divorce
5. Death of a spouse
6. All of the above
7. None of the above

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Question Four

Which of these provisions for distribution of an asset at the death of an owner are changed by the general beneficiary designations of the owner’s Last Will and Testament?

1. The Joint & Survivorship provisions of a real estate deed
2. The Joint & Survivorship designation on a bank account
3. The Transfer on Death designation of an interest in a Limited Liability Company agreement
4. The Transfer on Death provisions in a real estate deed
5. The death beneficiary designations in life insurance policy
6. The death beneficiary designations regarding a pension plan
7. None of the above

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Question Five

What is the primary purpose of a Living Will in Ohio?

1. A document that designates an agent for making medical care decisions for someone who is too ill to discuss, understand, and validly give instructions regarding their medical care options
2. A document that designates persons to be contacted by the Probate Court to testify regarding a controversy involving the termination of medical care, the withdrawal of which is anticipated to end someone’s life
3. A directive issued by a physician specifying that CPR should not be administered to someone
4. All of the above
5. None of the above

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Question One

Which of the following legal entities is subject to double taxation, i.e. tax to the entity and to the individual owners, at the sale of all, or substantially all, of the business assets as part of a liquidation of the business?

1. General Partnership
2. Limited Liability Company
3. Ohio Corporation with Federal Subchapter S Status (S-Corporation)
4. Ohio Corporation without Federal Subchapter S Status (C-Corporation)
5. Limited Partnership
6. All of the above
7. None of the above

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Question Two

What is a typical exclusive listing arrangement with a real estate broker?

1. The broker earns a commission only if he or she finds a qualified buyer
2. The broker is the only agent entitled to a commission from seller if that broker finds a qualified buyer
3. The broker is entitled to a commission even if the seller finds the buyer without the broker’s aid
4. Only b and c
5. All of the above
6. None of the above

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Question Three

Which of the following legal entities does NOT require State registration for formation?

1. General Partnership
2. Limited Liability Company
3. S-Corporation
4. C-Corporation
5. Ohio Close Corporation
6. All of the above
7. None of the above

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Question Four

Who has legal authority to make most of the partnership management decisions in a Limited Partnership?

1. General Partners
2. Limited Partners
3. Members
4. Shareholders
5. All of the above
6. None of the above

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Question Five

Ownership in which of the following entities is transferable without the permission of the other owners, unless there is a written agreement restricting transfer?

1. General Partnership
2. Limited Partnership
3. Limited Liability Company
4. C-Corporation
5. S-Corporation
6. All of the above
7. Only d and e

Read The Answer Here

Services we offer:

• Due Diligence /All Appropriate Inquiries – Explain…
• Purchase Agreements
• Leases
• Financing / Lender Documents
• Closing Coordination – Explain…

Test your real estate knowledge, take our Real Estate Quiz.

Question One

A new owner/operator of real property can avoid liability for existing pollution on the premises by establishing that they are an innocent landowner because:

1. They took possession of the property without having actual knowledge of the pollution or environmental problem
2. They can document that they performed All Appropriate Inquiries before becoming the owner/operator and that due diligence did not reveal the pollution
3. They swear they did not actually contribute to the pollution or other environmental problem on the property
4. All of the above
5. Only b

Read The Answer Here

Question Two

What is a typical exclusive listing arrangement with a real estate broker?

1. The broker earns a commission only if he or she finds a qualified buyer
2. The broker is the only agent entitled to a commission from seller if that broker finds a qualified buyer
3. The broker is entitled to a commission even if the seller finds the buyer without the broker’s aid
4. Only b and c
5. All of the above
6. None of the above

Read The Answer Here

Question Three

What are the customary steps to obtain good “marketable” title to real property?

1. A title insurance company or an attorney searches the official records to determine if there are any unacceptable restrictions or interests held by previously unknown third parties affecting the title to the real estate
2. A title insurance company insures the buyer against losses caused by a claim against the buyer's title after closing, subject to potential possible claims that are listed as excluded from coverage
3. A deed with a proper description of the land is executed and delivered
4. The deed is officially recorded with the appropriate agency
5. All of the above
6. Only c and d

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Question Four

Which of the following rental issues can cause significant, expensive problems for a business if not properly investigated, negotiated and documented in the lease by management before the lease is signed?

1. The Lease does not prohibit the tenant/lessee from assigning the Lease or subletting to a person who is not known to the landlord/lessor
2. The landlord performs significant leasehold improvements on the property without obtaining financial statements from a corporate tenant to be sure that corporation can pay the lease over time
3. The sole shareholder of a corporate operating business does not have a written lease for the business property, which is owned individually by that sole shareholder
4. A failure by the tenant/lessee to obtain the contractual ability to extend the lease were the business relies upon repeated consumer visits to the retail location being rented, e.g. a restaurant or dry cleaner
5. All of the above

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Question Five

Binding restrictions on the uses and operations of a business location exist in:

1. Municipal Zoning Codes
2. Deed and Platt restrictions
3. Regulations affecting the license to operate at that location
4. Environmental laws and regulations
5. All of the above
6. None of the above

Read The Answer Here

Business Practice Quiz

Wills, Trusts & Estates Quiz

Real Estate Quiz