Dividing Up Smaller Unplatted Tracts of Land Within Larger Cities

Last Updated on Sunday, 27 August 2023 03:20 Written by Chris Griswold Tuesday, 12 November 2013 10:41

With all the current activity in the marketplace, lots of people are selling and/or acquiring land, in particular, highly desirable, relatively smaller, unplatted parcels of land which lie within the city limits of larger cities.  Due to that activity (and the phone calls I’ve received due to such activity), I wanted to take this opportunity to share a few ideas with everyone.  This is good stuff for everybody to know… (don’t forget to click on my Facebook or YouTube links below to also see my short video on this material).

Dividing Up Smaller, Unplatted Tracts of Land Within Larger Cities

In Oklahoma (and please know that this Oklahoma law has “close cousins” in neighboring States), if the tract proposed to be carved out and sold off to a proposed buyer: i) is unplatted (which means it has a “metes and bounds” legal description which identifies it), ii) lies within the city limits of an incorporated city having a population of greater than 200,000 people, and iii) has an aggregate size of five (5) acres or less, then the respective city’s zoning and planning commission must first approve the proposed deed before the proposed sale can occur (which means the deed must actually bear the written approval of the city’s zoning and planning commission before the deed is recorded in the relevant land records of the county clerk).

For example, if you own twenty (20) acres of property (which is a mix of both platted and unplatted property) which lies within a larger city and seek to sell off only three (3) acres of unplatted property to your best friend, you first have to get your city’s zoning and planning commission to first approve of the transfer (and you have to get their signature on the deed you will use to convey the property to your best friend).  Obviously, you want to get started on obtaining the approval of the city’s zoning and planning commission prior to actually closing upon the property, not after you’ve already taken your friend’s money and recorded the deed….  So, you’ll definitely want to run those traps prior to closing.

However, what if you don’t get the zoning and planning commission’s written approval on your deed before taking the money and recording the new deed to your best friend?  If you don’t get it, you’re still okay if you, as grantor, i) previously acquired those same three (3) unplatted acres all at one time and in a single conveyance and, ii) that deed to you was filed of record for at least five (5) years prior to selling the property to your best friend and recording that new deed to your best friend.

What My Clients Are Saying

 “I have been extremely pleased with the legal services provided by Chris.  He is an expert on real estate issues; devotes immediate attention to our needs and follows through with all required action.  I look forward to a continuing relationship with Chris.” Harrison Levy / President / Grubb & Ellis I Levy Beffort / Oklahoma City, Oklahoma

Things To Remember When Starting A New Business

Last Updated on Sunday, 27 August 2023 03:20 Written by Chris Griswold Saturday, 12 October 2013 11:50

I get quite a few phone calls from people starting new businesses.  From the questions I normally receive, I wanted to share a few of these good ideas with everyone (and for the benefit of everyone).  This is good stuff for everybody to know… (don’t forget to click on my Facebook or YouTube links below to also see my short video on this material).

Things To Remember When Starting A New Business

1. Get a line of credit established before you quit your day job and start your own business (not afterwards when you probably won’t qualify),
2. If you don’t have a written agreement with your business partner, then the law deems you both to have formed a general partnership (and hence each of you are liable for the other’s acts/omissions and debts incurred),
3. If you enter into a business contract (e.g., an advertising contract with the yellow pages for a full-spread ad, to the tune of $30,000) and haven’t yet formed a corporation or an LLC, you’ll be deemed a “promoter” in the eyes of the law, and, as such, you will be personally liable for the debt,
4. If you form an LLC, another LLC, corporation, business trust, etc… can be members of such LLC.  However, if you form a corporation, then only natural persons (i.e., individually named persons) can be shareholders (not other entities like an LLC can use),
5. Carry professional and/or general liability insurance on your business.  Your personal, homeowner’s insurance (and any umbrella upon same) will only cover your personal activities and liabilities, not your professional and business liabilities.  So, obtain such policies (and their corresponding umbrellas) in the name of your business, lest you not be covered for business and/or professional claims,
6. Get an accountant involved early on.  Why?  People think that being in business is just about earning money and paying taxes; however, it can be more complicated than that….  Filing taxes is an ongoing process when you factor in both federal and State wage withholding reports for employees, unemployment tax withholdings, franchise/business activity tax, and quarterly estimated taxes.  These requirements can occur before you file your annual return.  Even if you do not plan to hire any employees, you should still be aware of the IRS “reasonable compensation rule” which says that you’ve got to pay yourself personal income in an amount at least equal to 30% of the gross amount your business produces.  Salary pays federal tax, state tax, and FICA tax….  Most of today’s LLC and Sub-S Corp’s will flow net profit/loss to your personal tax return (schedule K) and will require an additional annual Corporate Tax Return to be filed for your business.  The net profit will then be subject to Federal and State tax at your income bracket, and
7. Once you’ve formed a business entity, you need to open up an operating account (i.e., a bank account) in the name of your business.  When you make money from operations, you deposit it into your operating account.  When you pay yourself your personal payroll, you draw against such operating account and deposit it into your personal bank account (Note:  you don’t commingle the funds from one account with another).

What My Clients Are Saying

“I was referred to Chris from a friend of mine who has used him for years. I have 23 offices nationwide and tons of legal items that I don’t have time to deal with myself (nor would I trust just any attorney).  What a blessing to find Chris…. Here is someone I know will get it done right, day or night.  Chris’ good legal services free me up to run the day to day operations of my business with the peace of mind that the legal details are covered; all at an honest, fair price.  Thanks Chris!”
James Gray / President & CEO / Full Circle Financial Group / Oklahoma City, Oklahoma

Big Picture on Personal Guaranties and Bankruptcy Laws

Last Updated on Sunday, 27 August 2023 03:20 Written by Chris Griswold Monday, 9 September 2013 11:28

At some point along the way, we’ve all signed personal guaranties and, likewise, we have also asked others to sign them for us.  Why?  It’s time to clear the air on what is accomplished when a personal guaranty is secured in a business transaction (whether it’s a loan, a lease or some other form of contract) and, conversely, how bankruptcy laws enter into the picture with their own set of mandates.  This is good stuff for everyone to know… (don’t forget to click on my Facebook or YouTube links below to also see my short video on this material).

Big Picture on Personal Guaranties and Bankruptcy Laws

Personal guaranties ensure that, regardless of whether the person with whom we’re dealing uses an incorporated entity (e.g., a corporation or an LLC) to conduct their business with us, we can always go find that person (referred to as a “natural person” under the eyes of the law) to collect our money.  In other words, if the natural person later on: a) defaults on their contractual obligations, b) dissolves their incorporated entity, and c) then goes down the street, and resumes their business operations under the name of a newly formed, incorporated entity, we can always go find the natural person and collect the debt.

Against this backdrop are the bankruptcy laws which, among other things, declare that any payments received by a creditor from a debtor within ninety (90) days of such debtor personally filing a petition for bankruptcy are avoidable by other creditors (if other creditors later complain and challenge such payments made to you).  What this means is that if the debtor works out a payment arrangement (or a settlement arrangement) with you and starts making payments, then, if within ninety (90) days later they personally file a petition for bankruptcy, then the payments made to you during the ninety (90) day period are avoidable if other creditors complain.

Accordingly, if you’ve got a personal guaranty and go get cash from the debtor, that’s great….  However, keep your “eyes open” as to whether your debtor later files (or may likely file) bankruptcy within 90 days of your receiving the money.  In certain situations, you may be better off to avoid all trouble by taking a lump sum settlement early on before the debtor’s financial picture further deteriorates and decides to personally file for bankruptcy.

What My Clients Are Saying

 “Chris is a crucial extension of my company for any and all legal aspects of my business.  He always keeps my best interests in mind when preparing and executing legal and business documents.  By having an honest attorney with great integrity like Chris, I can better focus on my company’s business operations and take comfort in knowing that he’s able to handle any legal situation.”
Brant Seaton / Owner / Red Rock Foods, LLC / Haltom City, Texas