Lawyer Joke WEEKEND

The philosopher, Diogenes, went to look for an honest lawyer. After several years of searching, someone asked "How's it going?" "Not too bad", said Diogenes. "I still have my lantern."

Enjoy the weekend.

Too Bad, Tough Luck, Oh, WELL!

An article in today’s New York Law Journal by Glen Banks, Esq., discusses the recent decision by the Appellate Division, First Department, in Jordan Panel Systems, Corp. v. Turner Construction Co., 841 N.Y.S.2d 561 (1st Dep’t 2007). Essentially, the case holds that if a party clearly expresses its intention not to be bound until it executes a written agreement, no contract will be formed prior to such execution unless the party specifically retracts or waives its expressed intention.

In Jordan Panel, a general contractor sent a term sheet to a subcontractor (with which it had prior dealings), concerning the construction of a commercial airline facility at Kennedy airport. The term sheet set forth all terms except price, and contained a clause stating that the general contractor would not be bound by any subcontract unless it executed the document. The parties later agreed on a price of $3.9 Million for the work, and the the subcontractor was later advised verbally that: (a) it had been awarded the subcontract for the project; and (b) it was to proceed with design and development work pursuant to a “fast track” schedule.

The subcontractor complied, but was soon informed that the subcontract was being awarded to another firm. The subcontractor sued for breach of contract, but the general contractor’s Motion to dismiss was granted on the ground that the contract claim lacked merit since the term sheet stated that the general contractor would not be bound until it executed the subcontract. The trial court gave no weight to the subcontractor’s argument that the general contractor’s words and actions, subsequent to issuance of the term sheet, constituted a waiver of the term sheet’s provisions and evidenced an intent to be bound without formal execution of a subcontract document. The subcontractor appealed.

The Appellate Division affirmed the dismissal. I’ll spare you all the minutiae and legal mumbo jumbo. In short, the appellate court (in a 4-1 decision) held that the lower court’s reasoning was correct and that the subcontractor knew there was no intent to be bound absent a signed agreement. So, the general contractor’s directives to the subcontractor that it had been awarded the subcontract and to proceed with certain preliminary work became meaningless, despite the subcontractor’s ostensibly reasonable reliance based on the parties’ past dealings. In my view, the dissenting opinion correctly reasoned that a waiver existed; the general contractor’s actions after issuance of the term sheet constituted an express, verbal contract and the parties’ prior course of dealing was such that it was common for the subcontractor to begin work without an executed agreement.

This case may have a broad impact in the construction industry where things tend to get done on a “handshake” and many subcontractors begin work in anticipation of a later, formal contract. I’m not too happy with clients who do that, but it is an unfortunate fact of business life. Based on the holding in Jordan Panel, contractors would do well to review any preliminary documentation issued to them before performing work without a fully executed agreement. Even better would be to refuse to do any work until a signed, written agreement is in place [wishful thinking, I know].

I think this one deserves review by the Court of Appeals.

Only in America, Kids!

So, I get a telephone call from a prospective client ("PC"). Here's the exchange:

PC: "I'm callin' 'cuz I just got fired from my cashier's job at the pharmacy."
ME: "What was the reason they gave you for the firing?"
PC: "They said I was doing drugs in the store room."
ME: "Well, were you doing drugs in the store room?"
PC: "Sure I was, but that's no reason to fire me."

Yikes! You can't make this stuff up, folks.

"No Gossip" Policies

There has been a recent rise in the number of employers, both public and private, who have implemented "no gossip" employment policies in the workplace. Essentially, such policies prohibit the creation, dissemination or circulation of any rumor, gossip, negative comment, or other pejorative statement about fellow employees or management personnel. In many instances, the penalty for violation of the policy is termination of the employment.

I can see where such a policy, albeit possibly draconian in nature and/or implementation, could be beneficial in boosting employee morale by eliminating a negative element; it could even insulate the employer from liability against allegations that it suffered or permitted discriminatory statements in the workplace. That's fine for a private employer. However, what about the public employer (e.g., libraries, schools, municipalities, etc.)? Does such a policy constitute a governmental regulation or prohibition of speech, thereby violating the First Amendment? At this juncture, I'm inclined to say that it does, although there is a paucity of precedent squarely on point. I hope to see a Constitutional challenge on this as the issue matures.

Lawyer Joke WEEKEND

Here's a funny one to tide you over this weekend:

"You seem to have more than the average share of intelligence for a man of your background," sneered the lawyer at a witness on the stand.

The witness replied: "If I wasn't under oath, I'd return the compliment."

New I-9 Form

Many thanks to Harvey Randall, Esq. over at the New York Public Personnel Law blog for the head's up on the Federal government's recent announcement concerning the release of a new I-9 form to be used with respect to verifying an employee's authorization to work in the United States. Essentially, the new form deletes certain types of documents which were acceptable previously for purposes of satisfying the I-9 requirements. While use of the new form is not mandatory until notice is published in the Federal Register, it may be best to start using it now to ease the transition. The new form can be found here.

Introducing ... Lawyer Joke WEEKEND

Sometimes, it's tough to post on a Friday. Just when you think there's some down-time to kick back and relax as the weekend approaches, the realities and practicalities of legal practice again rear their ugly, time consuming heads. So, I'm transforming Lawyer Joke Friday into Lawyer Joke WEEKEND to give me a bit more time, and to make you keep checking the blog for the latest in lawyer humor. I'm such a little *$&#, ain't I?

Anyhoo, here's this weekend's ditty:

Q. What do lawyers do after they die?
A. They lie still.

On another note, today (Sunday) is Veteran's Day and many folks will be observing the holiday tomorrow. Regardless of your view on the Iraq war (and I don't like it one bit), please take a moment to remember all the brave men and women who are currently serving there and those who have served us in the past. Freedom is not free, and despite the historic trend of dubious and oftentimes ludicrous government policies, our soldiers deserve high praise for all of their sacrifices on our behalf.

New York Gets Tough On Worker Misclassification

Recently, New York's Governor issued an Executive Order establishing the “Joint Enforcement Task Force on Employee Misclassification.” The Task Force will, among other things: (a) assist with inter-agency cooperation in the enforcement of current laws against employers who misclassify workers as independent contractors instead of employees, or as being exempt from minimum wage and overtime requirements; and (b) establish a telephone hotline for complaints of wage violations.

Worker misclassification has been a pervasive problem for decades and, truth be told, many employers have gotten away with way too much for way too long. It's encouraging to see government engage in SOME redeeming action for a change.

NLRB Issues Ruling That HELPS Employers ... Are You Kidding?

Nope. It's no joke. It really happened. Here's the down and dirty on this one.

On September 29, 2007, the National Labor Relations Board (the “NLRB”) issued a decision in Dana Corporation/Metaldyne Corporation, 351 NLRB No. 28, which ruled that an election bar will not be imposed after a card-based recognition unless: (1) employees in the bargaining unit receive notice of the recognition and of their right, within 45 days of the notice, to file a decertification petition or to support the filing of a petition by a rival union; and (2) 45 days pass from the date of notice without the filing of a valid petition. Further, the NLRB stated that it will process a valid election petition if it is supported by 30 percent or more of the unit employees and is filed within 45 days of the notice.

The ruling in Dana modifies the traditional recognition-bar doctrine by which a union’s majority status is irrebuttably presumed for a reasonable period after a voluntary recognition. With Dana, employees can now petition for a secret-ballot election to reverse an authorization-card recognition as long as they take prompt action to challenge the union’s majority status by filing a decertification petition or by assisting another union to file a rival petition with the NLRB. The decision is important from a practical standpoint as it provides a mechanism to quickly counter possible union improprieties in obtaining authorization cards to achieve voluntary recognition. Although organized labor is, no doubt, none too pleased with all of this, the ruling is a home run for employers.

Lawyer Joke Friday

Fall is in the air, and here's this week's offering:

Q. What's the difference between a lawyer and a boxing referee?
A. A boxing referee doesn't get paid more for a longer fight.