Establishing Property Ownership Rights in Property in Utah, Part 2

Sunrise over Willow Pond Park, Murray Utah

Property disputes are common. Unraveling a property dispute, however, can take some fancy footwork and legal wrangling. You have questions, so let me give you a few answers. There are a number of legal avenues to assert rights to property including ownership rights, possession rights, and use rights. I previously wrote about the ownership right established by adverse possession. I will leave possession and use rights for another time. For this article, I will focus on the second of the following three ownership rights: (1) boundary by acquiescence, (2) boundary by agreement, and (3) boundary by estoppel. Any one of these three can establish rights of ownership. The first of the three articles can be found here. Continue reading “Establishing Property Ownership Rights in Property in Utah, Part 2”

Interesting- Utah Supreme Court Affirms Disbarment of Attorney for Violations of Professional Conduct

The Utah Supreme Court upheld the disbarment of attorney Susan Rose for conduct in violation of the Utah Rules of Professional Conduct. It’s a reminder to attorneys and the clients who hire them that there are limits to the judicial process and how cases are conducted in court. Continue reading “Interesting- Utah Supreme Court Affirms Disbarment of Attorney for Violations of Professional Conduct”

Establishing Property Ownership Rights in Property in Utah, Part 1

Fences make good neighbors?

Part 1 of 3: Fences Make Good Neighbors.

Property disputes are common. Unraveling a property dispute, however, can take some fancy footwork and legal wrangling. You have questions, so let me give you a few answers. There are a number of legal avenues to assert rights to property including ownership rights, possession rights, and use rights. I previously wrote about the ownership right established by adverse possession. I will leave possession and use rights for another time. For this article, I will focus on the first of the following three ownership rights: (1) boundary by acquiescence, (2) boundary by agreement, and (3) boundary by estoppel. Any one of these three can establish rights of ownership. Continue reading “Establishing Property Ownership Rights in Property in Utah, Part 1”

The Utah Supreme Court Again Requires Reasonable Conduct Under the Circumstances

Mountain biking in St. George, Utah

The Utah Supreme Court ruled against a debtor who asserted a novel defense to repayment of a $250,000 loan in default. The case is Crapo v. Zions Bank. The debtor claimed that once the bank sent him a Form 1099-C discharging his debt, the bank could no longer attempt to collect the bad debt from him. Failure to act reasonably by the debtor, however, ultimately barred the debtor’s defense. And, while the debtor’s defense appeared a bit stronger on its face than it actually was, you can see in details are below it appeared he was gaming the system by not getting more information before purportedly relying on the bank’s conduct. Continue reading “The Utah Supreme Court Again Requires Reasonable Conduct Under the Circumstances”

Utah Law Governing Non-Competition Agreements – April 2017 Update

20150823_175608The Utah Legislature recently passed and Governor Herbert signed a law in 2016 limiting non-competition agreements. It can be found at Utah Code Ann. 34-51-101, et seq. Please note that I updated this article as of April 2017. When the law initially started through the Legislature, it seriously limited non-competition covenants. The end result was much tamer.

Here are the highlights of the non-competition statute:

  • Post-employment restrictive covenants, i.e., non-competition agreements, are limited to one year from the date of separation;
  • The statute does not apply to clauses concerning non-solicitation, non-disclosure, or confidentiality;
  • Exceptions to the one-year time limitation include the following:
    • Severance agreements that are reasonable and mutually and freely agreed upon in good faith after separation; and
    • Agreements in conjunction with the sale of a business.
  • Attorney fees: The employer will be liable to the employee if the non-competition agreement is found to be unenforceable. Although Utah has typically found attorney fee provisions to be reciprocal (i.e., both sides can be the recipient of fees, depending on who prevails), the statute does not expressly provide for fees to the employer. The prudent employer, therefore, will include an attorney fee provision providing fees to the prevailing party to ensure that the employer can recoup attorney fees if it prevails.

The statute defines non-competition agreements as any agreement in which an employee or former employee agrees they “will not compete with the employer in providing products, processes, or services that are similar to the employer’s products, processes, or services.”

One other note: the law in Utah is unsettled as to confidentiality agreements that act like a non-competition agreement but you should tread carefully. Utah courts are often pragmatic and if it talks like a duck and walks like a duck, the court will likely call it a duck. See Is Your Non-Disclosure Agreement a Non-Compete Agreement in Disguise? This simply means that you should carefully draft your confidentiality and non-competition agreements. You may find yourself with a void agreement if it is poorly drafted.

Effective Date: The law affects any agreement entered on or after May 10, 2016. The statute is not expressly retroactive.

Bad-Actor Employers Warned: Lastly, the statute imposes damages against an employer who seeks to enforce non-competition provisions that are found to violate the statute. The damages available to an employee include any costs of an arbitration, attorney fees and court costs, and actual damages.

Take-Away: Employers should reevaluate their severance agreements and employment agreements to ensure that such agreements are consistent with this new law. For many employers, the non-competition provisions are part of the employment contract signed when the employee is hired. Its effect is not felt until (hopefully) many months or years later when the employee leaves. It is important, then, that employers review their employment contracts now since later is too late.

There are issues and nuances that cannot all be addressed here. If you have questions, you should get specific legal advice. If you would like more information about employment, non-competition, non-solicitation, confidentiality, or non-disclosure agreements, call me, Utah attorney Ken Reich, directly. I have represented both companies and individuals in business matters and disputes involving employment agreements and related matters, including non-competition issues. Using my many years of experience and backed by a firm of legal specialists in nearly every legal field, I can help you or your company evaluate your situation and help you make smart decisions about your business and your life that will best fit your circumstances.