Marketing tips for dirt lawyers

Standard

bookLast week, this blog discussed technology and marketing issues, and I warned readers to expect more on those topics. I read another great book! This one, The Power of a System, by John H. Fisher, a medical malpractice lawyer, is basically about how to build a successful plaintiff’s practice. Why, you ask, should a real estate lawyer care?

A real estate lawyer should care because Mr. Fisher included some great marketing tips for real estate lawyers. He believes, for example, in identifying the “ideal client” and marketing relentlessly to that person. Here is his quote about the “ideal client” of a real estate lawyer:

“If you are a real estate lawyer, are your ideal clients the homeowners buying a new house? No! The homeowners will use your services one time for a fee of $750, and you will likely never hear from them again…You will be broke by the time the homeowners need you again. The ideal clients for a real estate lawyer are real estate agents who refer a steady stream of new homeowners. The goal is not to make money on a single transaction. Rather, your goal should be to develop relationships with your ideal client that will generate new clients and a steady stream of income for the rest of your career. The lifetime value of your ideal client is far greater than the value of a single transaction.”

This makes perfect sense, doesn’t it? Real estate lawyers in South Carolina should devote their marketing dollars and time to courting the individuals who are in a position to send them business. In addition to real estate agents, local lenders and builders are prime targets. Analyze your market, your community, and determine who will be in a position to direct business to your practice. Call those individuals your “ideal clients” and go after them!

Mr. Fisher has developed three simple marketing tools that he says will make all the difference in a law practice:

  1. Create an information-powerhouse website that provides killer content on a daily basis;
  2. Publish a monthly newsletter targeted to your ideal client;
  3. Host regular seminars and workshops that provide valuable content to your ideal client.

As to the information-powerhouse website, you will need assistance.  There are experts who can assist you with setting up the website as well as providing content. You will, of course, have to comply with the Rules of Professional Responsibility, so you cannot let your website expert work alone. Stay tuned for later blogs about websites.

As to the monthly newsletter, Mr. Fisher was very specific. He believes newsletters are “marketing gold”, but they must be written by the attorney to show personality as well as expertise, and they must be mailed consistently on a monthly basis. He believes that mass-mailing pieces will not do the job.

He said he is always thinking and taking notes about possible articles. (I get this idea because I am always thinking about blog ideas.) He said, with collecting ideas all month, he is able to devote only two hours per month to actually writing. He writes a main article or two on law related topics. Then he answers a legal question or two. After that, he throws in a brief article about his marketing events (“What’s John up to?”). And he adds a goofy picture or two of him and his kids to humanize himself.

He hires a graphic designer to make the newsletter “pretty” and uses a “fulfillment provider” for printing and mailing.

lawyer reading

He wants his newsletter to be so good that his ideal clients (the lawyers who refer medical malpractice plaintiffs to him) will save them and post them on their bulletin boards. Can you write a newsletter that good to promote your practice? I believe you can!

As to event marketing, Mr. Fisher says events should be educational, informational and fun and they should give away secrets! He has seminars for lawyers (his referral partners) to explain his systems, how he treats his clients, etc. He says to promote the heck out of these events to your ideal clients. Mail invitations. Follow with postcards, emails and handwritten notes. He recommends using testimonials from others who have attended successful events. Keep building momentum. Obtain sponsors and vendors to assist. Make sure the events are fun! And then follow them with handwritten notes.

Our office is in the business of consulting with real estate lawyers on marketing and other issues. We can help!  And here’s a further warning about more of these topics in future blogs.

Happy marketing!

Advertisements

Use technology and make more money!

Standard

Grow your business, dirt lawyers!

This blog is supposed to be about South Carolina dirt law, but I saw this great article entitled “Twelve Steps to a Profitable Law Practice” that I thought would benefit most South Carolina dirt lawyers. The author is Ernest Svenson (also known as “Ernie the Attorney” if you are interested in Googling his interesting blogs about technology, marketing and other topics vital for law firms but often overlooked by busy lawyers).

Mr. Svenson is the founder of Law Firm Autopilot, the stated mission of which is to help small firm lawyers transform their practices to improve their quality of life. Check out Law Firm Autopilot’s online courses and coaching services here.

technology money

The article is adapted from a chapter in a book I’m reading, The Secrets to Marketing and Automating Your Law Practice: A Lawyer’s Guide to Creating Systems, Getting Clients and Becoming a Legal Rainmaker by David M. Pitton (Practice Panther, 2018). You can download a free copy of the book at the end of the article linked above. This book is good. Chapter 1, entitled “The Ultimate Checklist for Starting Your Own Firm” blew my mind with its very specific, detailed advice about the technology a lawyer establishing a new practice needs. Most of what the author advised was extremely practical and extremely economical because he understands the financial pressures of a new practice. Example:  design a logo for only $99!

Why am I bothering Dirt Law readers with this topic? I know most of you are not thinking about opening your own practices. I’m troubling you with this because I believe marketing and technology may be two of the most vital components required to maintain healthy and growing practices in 2018. Real estate practitioners are always competing and are always trying to stay ahead of the quickly changing technology landscape. The lawyers who master technology and marketing are the lawyers who will thrive in the future.

Mr. Svenson does not suggest that you must master technology yourself. He believes in hiring experts to push the buttons for you. He says, “If you can follow a clear ‘process roadmap’—such as the rules of civil procedure—then you are capable of radically improving your practice with common technology, most of which you already own.” He believes that digitizing will allow you to simplify your practice and lower your overhead. He believes automation will exponentially increase efficiencies and result in cost savings. And he believes that you can learn to work virtually from anywhere with an internet connection.

Many of you know our staff was displaced in 2012 when our office building was involved in a fire. Thankfully, no one got hurt, and much of our furniture and equipment was eventually saved, despite the layer of soot that settled on everything. But we were displaced for a whole year! We rented a small suite in an executive space downtown, but most of us worked remotely (from home) for an entire year. And we didn’t miss a beat. As far as we were able to tell, we didn’t lose a dollar. The day after the fire, several of us were camped out in my kitchen at home disbursing funds for a large commercial transaction. If I was not a believer in being “paperless” before that catastrophe, I definitely am today. I call myself the poster child for business continuity.

(By the way, I am working in said kitchen as I write. I recently hired a new lawyer despite not having space for him, so I displaced myself instead of our new underwriter until we are able to move to a larger space later this year. Again, I am not missing a beat!)

This article says, “If you want to streamline your practice and reduce clutter and chaos, you need to stop managing information in paper form. Digital information is cheaper to store, easier to transmit, and can be automated more easily.”

And, of course, the author points out, and I want to emphasize, that the more we rely on digital information and automation, the more we have to pay attention to security. There are experts that are available to help with this issue. Use them!

Don’t be surprised if you see more blogs from me on related topics in the future. I’m on a roll, trying to read everything on these topics I can, so that my office and I will be in a position to assist our attorney agents as they grow and thrive. Grow and thrive with us!

FORE!! Now Columbia sees new golf course redevelopment issues

Standard

Golf course redevelopment is clearly a hot topic in the real estate industry, and this is my third blog on the topic in 2018. The first blog discussed the decade-long litigation surrounding two golf courses in Myrtle Beach that eventually allowed for redevelopment despite strenuous objections of neighbors. The second blog discussed the national trend of neighbors objecting to golf course redevelopment on “NIMBY” (not in my back yard) grounds. This blog discusses a golf course closer to home, in Blythewood, The Golf Club of South Carolina at Crickentree.

golf ball

An article in The State newspaper dated July 29 by Jeff Wilkinson discussed the bankruptcy, foreclosure and eventual planned redevelopment of Crickentree. The article states that two weeks ago, E-Capital, the national investment firm that owns the mortgage on the golf course, announced this bad news by email to the neighboring homeowners. A public meeting followed where an attorney for that firm told neighbors that the intent is to subdivide the golf course into small lots and build 450 homes. Basic math would indicate the planned density will be much greater than that in the surrounding neighborhood.

The property must be purchased through the bankruptcy proceeding and then rezoned in order to accommodate a residential subdivision on property now zoned for recreational use. And, of course, the neighbors are quite concerned about potentials hits on their property values.

According to Mr. Wilkinson’s article, the Columbia area may suffer from an oversaturation of the market with golf courses. Recently, he said, the former Rawls Creek of Coldstream golf course in Irmo closed, and its owner, the Mungo Homes Co., donated the 116-acre property to the Irmo Chapin Recreation Commission. The commission plans to link the 4.5 miles of cart paths to the Three Rivers Greenway river walks in Columbia and Lexington County. Donating golf courses for recreational purposes avoids possible rezoning and litigation issues that neighbors may raise.

Many golf communities were built in areas with good schools and work opportunities, making them particularly valuable for residential redevelopment. Developers generally do not want to walk away from that value.

So, what prohibits the development of these properties into residential subdivisions? Zoning is one of the challenges. Many golf courses are zoned for commercial uses to accommodate clubhouses, restaurants, pro shops and bars. Some, like Crickentree, are zoned for recreational purposes. But the main stumbling block may be the NIMBY attitude of neighbors. Residents near golf courses prefer that the properties be turned into parks, open spaces and natural preserves.

In the Deerfield Plantation cases in Myrtle Beach, the golf courses and surrounding residential subdivisions were originally developed beginning in the late 1970’s. The plats contained notes to the effect that the streets were dedicated for public use but the golf courses were to be maintained privately and were specifically not dedicated to public use.

The covenants gave the lot owners no rights, property, contractual, or otherwise, in the golf courses. A Property Report that was delivered to all prospective lot purchasers described the costs of golf memberships, which were not included in lot prices, and stated that to be allowed to use the golf courses, members would be required to pay initial dues and annual dues and fees. The real estate agents made it clear during the sales program that the mere purchase of a lot did not give a lot owner any right or entitlement to use the golf courses. The deeds of the lots did not convey any easements or other interests in the golf courses.

One plaintiff, who was also a real estate agent, testified that he was never told the golf courses would operate in perpetuity and that the real estate agents never told other potential purchasers that the golf courses would always exist on the properties.

What caused the golf courses to fail? When the golf courses opened, there were 30 – 40 golf courses in the Myrtle Beach area. By the time the golf courses closed, there were nearly 125 courses. Property taxes in the golf courses increased from $7,800 per year to $90,000 per year.  And then the economy tanked. These three factors have occurred across the country to varying extents.

Now, let’s look at South Carolina law. In one of the Deerfield orders, Thomas J. Wills, Special Referee, examined the law of implied easements in South Carolina. I’m summarizing and eliminating the citations for this brief discussion.  The Order states that implied easements are not favored by the courts in South Carolina and must be strictly construed. The intent of the parties controls the existence and scope of implied easements, and the best evidence of that intent is the recorded documents. While case law in South Carolina is clear that lot owners in subdivisions hold easements in streets shown on plats by which their lots are sold, the order states that this rule does not extend beyond access, which is necessary and expected for residential purposes. Finally, the order states that no implied easements in views, breezes, light or air exist in this state.

After many years, these Myrtle Beach golf courses will be redeveloped into new residential subdivisions. It may take many years before the Crickentree property will be in a position to be redeveloped. Will we see more of this litigation in South Carolina?  Probably. While the law in South Carolina appears generally to favor redevelopment in these cases, there is no doubt that the facts in some of the situations may give rise to implied easements in adjacent lot owners, even in the face of our law. As long as we have NIMBY attitudes of those who live near defunct golf courses, we will continue to see litigation in this area.

Charleston is exploding!

Standard

The locals are expecting a quarter-million neighbors!

Last weekend, about sixty commercial dirt lawyers attended South Carolina Bar’s Dave Whitener Real Estate Intensive Workshop in Kiawah Island. This workshop is held every-other-year and honors the memory of the late, great real estate lawyer and law school professor who planned and moderated it for many years until his untimely death in 2014. I think Dave would have enjoyed the collaboration and education we all enjoyed last weekend*.

And I think he would have been shocked at changes in the Charleston area!

Charleston Ravenel Bridge

Charleston is exploding! Kiawah Island itself is in the throes of a major renovation anticipating its next PGA tournament in 2021. As we left Kiawah Island early Sunday morning, a time we could survey our surroundings with no traffic, we were amazed at the new subdivisions that have sprung up between the beautiful island and I-26 as well as those in the North Charleston area where the Boeing plant is located. The area is changing so fast it’s hard to recognize even for someone who does business in the area and visits it often.

I was not surprised to see this Charleston Post and Courier article entitled “105,000 homes await construction in the Charleston metro area” by David Slade dated July 18. The article begins with the premise that Charleston-area residents are about to welcome 250,000 neighbors—roughly equal to the population growth Charleston, Berkeley and Dorchester Counties have experienced since 1990. Wrap your brain around that thought! The anticipated housing, according to this report, is nearly enough to accommodate the combined populations of Charleston and neighboring Mount Pleasant, which are the largest and fourth-largest cities in South Carolina.

Traffic is already horrible in the area. We hear from many lawyer friends and their staff members who fight increasing traffic to get into work each morning. When the I-526 bridge over the Wando River was closed recently for emergency repairs, we heard that some lawyers found it easier to take boats to work rather than to deal with the detour around the bridge. The emergency repairs required for this bridge are an example of the challenged infrastructure in the area.

But, as this article points out, area governments will see added tax revenues from the new growth, which will be needed for the roads and other infrastructure. Mr. Slade points out that residents of John Island, Kiawah Island, Seabrook Island and Wadmalaw Island have been waiting for many years for planned improvements to the Maybank Highway and River Road intersection which bottlenecks each day. The islands are beautiful places to live, but getting into Charleston to work can be problematic at best.

Charleston is the number 1 tourist destination in the United States and the number 2 tourist destination in the world. All of us in the real estate business will be looking with interest as this anticipated growth unfolds in the Holy City and its surrounding areas.

 

*Among the speakers this year was Dave’s widow, also a commercial real estate lawyer extraordinaire, Patricia Wharton Whitener, and two of Dave’s best friends, litigator Robert E. Stepp and USC Law Professor S. Alan Medlin. The line-up was excellent, and I encourage other lawyers who practice in the area of commercial real estate to attend this workshop at each offering!

Beware of new deceptive strains of payroll phishing

Standard

hacker dollar

This blog has recommended KnowBe4 previously as an impressive source of news on cybersecurity. I have subscribed to the newsletter and receive weekly, timely and scary cybercrime updates in my inbox. I recommend to all lawyers that they spend the time and funds necessary to remain safe and vigilant in the arena of cybersecurity. Nothing is more important to us than the safety of our clients’ funds. In this case, however, it is our operating funds and our employees’ funds that are at risk. Those funds are important, too!

The July 10 newsletter was particularly interesting in that it reports a new strain of payroll phishing that has surfaced recently. The bad actors pose as employees and request a specific pay stub from a payroll administrator or corporate executive. KnowBe4 reports that it has seen hundreds of these phishing attempts, all almost identically worded and possibly coming from one set of fraudsters. All of the emails came from an “oddball Comcast.net email address” with nonsense usernames of similar length.

Please read this newsletter carefully and pay attention to the emails and supporting documents. In this particular case, the bad actors opened a bank account, ordered checks for that account and used one of those checks to support the phishing attempt.

Unfortunately, many of the targeted payroll employees, always willing to help employees with their payroll concerns, have responded to the requests. The emails are simple, direct and dispense with any attempt to construct believable backstories or pretexts.  According to KnowBe4, the emails invite an unthinking, reflexive response from targeted users.

Share this information with your staff members and encourage them to avoid those unthinking, reflexive responses!

Redevelopment of golf courses might be possible in South Carolina

Standard

In April, this blog discussed the redevelopment of two Horry County golf courses. The North and South courses at Deer Track Golf Resort in Deerfield Plantation have been closed for more than ten years and are finally being redeveloped as residential lots. Adjacent lot owners waged class actions in Horry County seeking to have the use of the properties in question restricted to golf courses or open spaces. While these battles were being waged in court, nature attempted to reclaim the properties. One property owner testified that his views changed from overlooking a manicured golf course to overlooking a “sea of weeds”.

Similar battles have been successful in other parts of the country. The cases are fact intensive and turn on the law of implied easements, which, of course, varies widely from state to state. Plats showing golf courses may provide rights in adjacent lot owners, depending on the recorded documents, the sales program and the law of implied easements in the location.

golf course

I wanted to invite those interested in this area of the law to take a look at an article published in June by www.citylab.com. The article, written by Nolan Gray, is entitled “Dead Golf Courses Are the New NIMBY Battlefield”. In the interest of full disclosure, I had to Google NIMBY. This acronym stands for “not in my back yard”.

The article states that golf is dying, according to many experts. One study cited in Citylab’s article found that the number of regular golfers fell from 30 to 20.9 million between 2002 and 2016. The thinking is that the fall of Tiger Woods may have led to much of this gloom and doom around golfing. But Mr. Gray believes that the bigger story involves the sport’s aging demographics and the fact that millennials are not interested in the expensive, slow sport that provides few health benefits.

Golf courses and golf clubs across the country are closing, leaving the land to be redeveloped. Mr. Gray’s article states that the average 18-hole golf course sits on 150 acres, property that could host around 600 new single-family detached homes. Add to this mix the fact that many golf communities were built in areas with good schools and work opportunities. These properties are, therefore, particularly valuable in areas where housing inventory is a challenge.

So, what prohibits the development of these properties into residential subdivisions? Zoning is one of the challenges. Many golf courses are zoned for commercial uses to accommodate clubhouses, restaurants, pro shops and bars. But the main stumbling block, according to Mr. Gray, is the NIMBY attitude of neighbors. Residents near golf courses prefer that the properties be turned into parks, open spaces and natural preserves.

Let’s look, for example, at the Deerfield Plantation cases. First, the facts: The golf courses and surrounding residential subdivisions were originally developed beginning in the late 1970’s. The plats contained notes to the effect that the streets were dedicated for public use but the golf courses were to be maintained privately and were specifically not dedicated to public use.

The covenants gave the lot owners no rights, property, contractual, or otherwise, in the golf courses. A Property Report that was delivered to all prospective lot purchasers described the costs of golf memberships, which were not included in lot prices, and stated that to be allowed to use the golf courses, members would be required to pay initial dues and annual dues and fees. The real estate agents made it clear during the sales program that the mere purchase of a lot did not give a lot owner any right or entitlement to use the golf courses. The deeds of the lots did not convey any easements or other interests in the golf courses.

One plaintiff, who was also a real estate agent, testified that he was never told the golf courses would operate in perpetuity and that the real estate agents never told other potential purchasers that the golf courses would always exist on the properties.

What caused the golf courses to fail? When the golf courses opened, there were 30 – 40 golf courses in the Myrtle Beach area. By the time the golf courses closed, there were nearly 125 courses. Property taxes in the golf courses increased from $7,800 per year to $90,000 per year.  And then the economy tanked. These three factors have occurred across the country to varying extents.

Now, let’s look at South Carolina law. In one of the cases, a 38-page Order of Thomas J. Wills, Special Referee, examined the law of implied easements in South Carolina. I’m summarizing and eliminating the citations for this brief discussion.

The Order states that implied easements are not favored by the courts in South Carolina and must be strictly construed. The intent of the parties controls the existence and scope of implied easements, and the best evidence of that intent is the recorded documents. While case law in South Carolina is clear that lot owners in subdivisions hold easements in streets shown on plats by which their lots are sold, the order states that this rule does not extend beyond access, which is necessary and expected for residential purposes. Finally, the order states that no implied easements in views, breezes, light or air exist in this state.

Finally, these golf courses will be redeveloped into new residential subdivisions. Will we see more of this litigation in South Carolina?  Probably. While the law in South Carolina appears generally to favor redevelopment in these cases, there is no doubt that the facts in some of the situations may give rise to implied easements in adjacent lot owners, even in the face of our law. As long as we have NIMBY attitudes of those who live near defunct golf courses, we will continue to see litigation in this area.

Lawyer disciplined for involvement in investment scheme

Standard

The SEC is not “another jurisdiction” for the purpose of reciprocal discipline

On June 27, the South Carolina Supreme Court suspended a lawyer for eighteen months based on Securities and Exchange Commission (SEC) charges*. While this case has nothing to do with dirt law, I bring it to the attention of South Carolina lawyers because they often find themselves in the position of forming and representing limited liability companies (LLCs).

SECThe South Carolina lawyer, John Kern, helped form and served as general counsel for Ventures Trust II LLC and Face-Off Acquisitions, LLC, two of the LLCs used in a fraudulent investment scheme perpetrated by Craig Berkman. Berkman fraudulently raised around $13.2 million from approximately 120 investors by selling memberships in the LLCs he controlled. Unfortunately for these investors, Berkman was subject to a $23 million judgment in Oregon, in connection with another fraudulent investment scheme, and was also facing bankruptcy in Florida. Berkman began to use some of the funds from his new ventures to pay his bankruptcy obligations in Florida, and the SEC got involved.

In 2014, Kern signed an offer of settlement and consented to an entry by the SEC of an order imposing sanctions against him. SEC findings included that (1) Kern willfully aided and abetted the fraudulent conduct of Berkman; (2) Kern was ordered to disgorge fees of around $235,000 and to pay a fine of $100,000; (3) Kern was barred from associating with brokers and investment advisors; and (4) Kern consented to being denied the privilege of practicing law before the SEC.

South Carolina’s Office of Disciplinary Counsel (ODC) filed formal charges in 2016 and argued that the SEC is “another jurisdiction” under the Rule 29(e), which deals with conclusiveness of misconduct adjudications against lawyers in other jurisdictions. The Supreme Court found that the SEC is not a jurisdiction for the purposes of reciprocal discipline, but found that Kern was guilty of providing false information in statements to others.

Kern falsely assured Berkman’s bankruptcy attorney that none of the funds used to settle Berkman’s bankruptcy obligations were derived from Ventures II. Kern also issued a false memorandum to investors in Ventures II to the effect that their funds were secure and were not part of a Ponzi scheme orchestrated by Berkman.

Kern’s primary defense in his South Carolina disciplinary proceedings was that he was totally unaware of Berkman’s malfeasance, and that as soon as he became aware, he resigned as general counsel for the LLCs and encouraged a principal in the companies to act as a whistleblower to the SEC. Kern argued that he had no dishonest or selfish motive, did not profit from his misconduct and showed remorse for the harm caused to investors. The Court said that it took these mitigating factors into consideration in imposing sanctions.

Professor John Freeman, who taught ethics to many of us, was qualified as an expert in the case and testified that when a lawyer acts as general counsel for a private securities company, he or she must exercise due diligence to ensure money is invested for the represented purposes.

Despite the fact that the SEC is not considered by the South Carolina Supreme Court to be a jurisdiction for the purposes of reciprocal jurisdiction against attorneys, this attorney was suspended for eighteen months because of his conduct that led to charges before the SEC.

The lesson to us is clear. Be careful in forming and representing LLCs and use proper due diligence in statements made to the investors in those entities. Lacking a dishonest motive is not enough to protect lawyers from discipline.

*In the Matter of Kern, South Carolina Supreme Court Opinion 27820 (June 27, 2018)