Home Mortgage Disclosure Act

In 1975, Congress enacted the Home Mortgage Disclosure Act (HMDA). The statute can be found at 12 U.S.C.S. §2801. In its findings and declaration of purpose, Congress stated the following:

The Congress finds that some depository institutions have sometimes contributed to the decline of certain geographic areas by their failure pursuant to their chartering responsibilities to provide adequate home financing to qualified applicants on reasonable terms and conditions.


The purpose of this [law] is to provide the citizens and public officials of the United States with sufficient information to enable them to determine whether depository institutions are filling their obligations to serve the housing needs of the communities and neighborhoods in which they are located and to assist public officials in their determination of the distribution of public sector investments in a manner designed to improve the private investment environment.

HMDA is implemented by Regulation C, an administrative regulation promulgated by the Federal Reserve Board. Briefly stated, HMDA and Regulation C were designed so that information could be gathered on whether certain financial institutions serve the housing credit needs of the neighborhoods in which they are located.

Institutions Covered

The provisions of HMDA apply to depository and non-depository lenders which meet certain criteria set forth in the law.

What must covered institutions report?

  • data on loan applications, originations, and purchases
  • the race, sex, and income of mortgage applicants and borrowers
  • the class of purchaser for mortgage loans, and
  • the reasons for their decision not to grant credit

The information reported by covered institutions is available for review by the public.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

The Deed in a Residential Real Estate Sale

The Deed in a Residential Real Estate Sale

A transfer of land from a seller to a buyer must be accomplished through written documentation in order to satisfy requirements of the Statute of Frauds. Typically, real estate transactions involve many written documents from the offer, which is usually in the form of a contract to purchase, to the deed.

A present intent to transfer title to a buyer

The deed is the written instrument by which title is transferred to the buyer. By the deed, the seller shows that he has a present intent to transfer the title. To show a present intent, the deed may contain words such as “give,” “grant,” “sell,” “convey,” or any other words which convey the meaning of a present intent to transfer title to the buyer. The deed should clearly identify the buyer or the person who is taking title on behalf of the buyer if the property is being placed into a trust.

Signed by the seller

The deed must be signed by the seller. Although it is not necessary for the buyer to sign, the buyer’s signature shows that the buyer has acknowledged and accepted the deed. An acknowledged deed is a self-authenticating document that can be recorded or admitted into evidence in a court of law.

Description of the property to be transferred

The deed should contain a description of the property to be transferred. The description itself does not have to contain any magic words in order to be effective, so long as it accurately describes the property. The description may be made by metes and bounds, by reference to a recorded document, an address, or a legal description. However, the more accurately the property is described, the less likely there will be any doubt or ambiguity as to which property, or portion of that property, the seller intends to transfer.

Effective upon delivery

A deed is not effective until it has been delivered by the seller. The deed does not have to be physically handed over to the buyer in order to be effective, although the physical transfer of the deed would be conclusive of the seller’s intent to transfer the property. Ordinarily, all that is needed is the seller’s intent to deliver the deed to the buyer. The seller may deposit the deed with the buyer, with an escrow agent, or with a trustee for the buyer’s benefit. In any of these formats, delivery of the deed is effective only if the seller has the present intent to transfer the property to the buyer.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Tangible and Intangible Property

Property is an external thing that can be owned or possessed. Property can be divided into two categories: tangible and intangible. The word tangible refers to something that has a definable physical form that can be felt or touched. The word intangible refers to something that cannot be perceived by the senses.

Tangible Property

Tangible property consists of real property and personal property. Real property is property that does not move, such as land and the things that are attached to or built on that land.

Personal property is property that can be moved or any other tangible property that can be owned. Personal property is also called chattels. Chattels that are attached to the land and that cannot be removed without damaging the land are called fixtures. Examples of fixtures are built-in bookcases and ceiling fans.

Intangible Property

Intangible property consists of property that lacks a physical existence. Examples of intangible property include checking and savings accounts, options to buy or sell shares of stock, the goodwill of a business, a patent, and spousal love and affection.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Prohibition of Discrimination in the Sale or Rental of Real Estate

The Fair Housing Act, which can be found at 42 U.S.C.S. § 3601 et seq., prohibits discrimination in the sale or rental of real estate on certain enumerated bases. In its findings and declaration of purpose, Congress stated the following:

It is the policy of the United States to provide, within constitutional limitations, for fair housing throughout the United States.

42 U.S.C.S. § 3601.

Despite numerous challenges in the years since the law was enacted, the Fair Housing Act has passed constitutional muster.

Specific Prohibitions

The law prohibits a wide range of activities. In particular, the law provides that it is unlawful:

  • to refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin;
  • to discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race, color, religion, sex, familial status, or national origin;
  • to make, print, publish, or cause to be made, printed, or published, any notice, statement, or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on race, color, religion, sex, handicap, familial status, or national origin, or an intention to make any such preference, limitation, or discrimination;
  • to represent to any person because of race, color, religion, sex, handicap, familial status, or national origin that any dwelling is not available for inspection, sale, or rental when such dwelling is in fact so available;
  • to discriminate in the sale or rental, or to otherwise make unavailable or deny, a dwelling to any buyer or renter because of a handicap; or
  • to discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection with such dwelling, because of a handicap of that person, a person residing in or intending to reside in that dwelling after it is sold, rented or made available, or any person associated with that person.

42 U.S.C.S. § 3604(a)-(f)(2).

Statutory Interpretation

In interpreting the Fair Housing Act, courts have accorded the law a broad construction in order to fully effectuate Congress’ remedial purpose. Notably, even where a practice is not clearly discriminatory, it is illegal under the law if it has a discriminatory effect.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Inspection and Use of Fireplaces

Jessica submitted an offer to purchase a home. During the home inspection, Jessica’s home inspector indicated several concerns about the fireplace located in the living room of the home. The home inspector found that the chimney was not topped with the proper covering. Moreover, the home inspector found loose bricks around the base of the chimney. Lastly, the home inspector found the existence of an improper “ash dump.” Jessica asked for more information.

For many home buyers, a fireplace is an attractive feature. In connection with the purchase of a home, it is important that the home inspection include the fireplace or fireplaces located in the home. The home inspector should make sure that the fireplace functions properly and that it is in compliance with any applicable laws and/or regulations. The home inspection should include every aspect of the fireplace, from the chimney cap to the bed of the fireplace.

After the home inspection, a homeowner has continuing obligations with regard to fireplace safety. Generally speaking, a homeowner should:

  • have the fireplace and chimney professionally cleaned and inspected on an annual basis;
  • burn only dry hardwoods so as to minimize the formation of flammable build-up on the inside of the chimney;
  • always use a fireplace screen;
  • supervise young children near the fireplace;
  • not place too much wood in the fireplace;
  • never leave the fireplace unattended when it is in use;
  • maintain unused firewood stacked and covered in an outdoor location;
  • maintain a functional fire extinguisher in a location near the fireplace;
  • keep the area around the fireplace and chimney free of items and debris; and
  • if using fire logs, follow the instructions set forth on the label.

With just a minimal amount of effort and some common sense, a homeowner can enjoy using a fireplace for years!

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Traffic Court

Traffic courts are responsible for trying all cases involving violations of traffic rules and regulations. Generally, traffic offenses are divided into two categories: parking violations and moving violations. Parking violations include illegal parking, parking in a handicapped space without the appropriate authorization, parking at an expired meter, parking during street cleaning, and parking without a permit. Moving violations include driving under the influence of drugs or alcohol, speeding, failing to yield the right of way, failing to obey traffic control devices (not stopping at stop signs or red lights), operating a vehicle without a valid license, and reckless operation.

A person who receives a traffic citation or ticket has the option of paying the traffic ticket or contesting the ticket. Some courts allow traffic tickets to be paid on-line by using a credit card. Traffic tickets can also be paid by telephone, by mail, or in person. If a ticket is contested, it is generally necessary to request a trial date on or before the date that appears at the bottom of the traffic citation. A person who was arrested must report to the traffic court on the date and time written at the bottom of the traffic citation. Failure to appear will result in forfeiture of the bail bond, and an arrest warrant will be issued for the person.

Defendant’s Rights in Traffic Cases

Any person receiving a traffic ticket has the following rights:

  • Right to a copy of the written charge
    The ticket must contain the accused’s name, the charge, the law allegedly violated, and the date, time, and location of the violation.
  • Right to know the penalty for the offense
    The penalties for traffic offenses are set by law and range from a fine to a prison sentence.
  • Right to an attorney
    Any indigent person charged with an offense that carries the possibility of a jail term can have an attorney appointed to represent the person.
  • Right to a jury trial
    A person charged with violating a law that provides for imprisonment of the violator has a constitutional right to a trial by jury.
  • Right to confront witnesses against the person and to present witnesses on the person’s own behalf
    A person charged with violating a law has a constitutional right to cross-examine any witnesses testifying against the person and to call witnesses to testify on one’s own behalf.
  • Right to remain silent
    A person charged with violating a law has a constitutional right to remain silent. The person does not have to say anything. The prosecutor is required to prove the charges.
  • Right to an appeal
    A person is found guilty of a traffic violation has the right to take an appeal to a higher court.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

The Jurisdiction of a State Court

Jurisdiction refers to the power of a court to hear and decide a case. The power of a state court to hear a particular case comes from the constitution and laws of that state. For a court’s decision to be legally binding, the court must have both subject matter jurisdiction (authority to hear a case involving the type of legal matter at issue, such as a contract or a personal injury) and personal jurisdiction (authority over the parties to the suit).

Subject Matter Jurisdiction

State courts generally have authority to hear cases involving transactions that happened within the state or the particular geographical area, such as a county, in which the court is located. However, there are a few types of cases over which the federal courts have sole or exclusive jurisdiction. These include bankruptcy and admiralty cases.

The subject matter jurisdiction of a state court is usually widespread and includes everything from real estate questions to state tax disputes. Most states have special courts or divisions within a court set up to hear a specific type of case. Housing courts, family courts, and probate courts are examples of special state courts. If there is a county probate court, for example, that court would have power to hear all cases involving probate matters, such as contested wills, within the county.

Personal Jurisdiction

A court must have personal jurisdiction over the individuals and companies involved in a lawsuit for a decision to be legally binding on the parties to the suit. Generally, if an individual lives within a state, the state courts will have power to decide a lawsuit involving that individual. The same is true for a company. If the company is located within the state or does business within the state, a state court will have power to decide a lawsuit involving that company. Even if a company is not located within the state, a state court might still have jurisdiction over the company if the company sent mail order catalogs into the state or has other “minimum contacts” with the state. All states have laws allowing a suit against an individual who does not live in a state but who caused a traffic accident while driving through the state.

Service of Process

Personal jurisdiction over an individual or a company is obtained by service of process, which means giving notice of the lawsuit to the individual or the company. Notice of a lawsuit may be given in several ways, depending on what state statutes provide. For example, proper service may include serving the individual or a company officer with a notice in person, by mailing a notice to the individual or company, or by publishing a notice in the newspaper.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

The Court’s Management of High-Profile Cases

Courts are sometimes faced with managing high-profile or notorious cases. A media frenzy surrounding such trials can make it a challenge to provide a fair trial, which is a right guaranteed by the Constitution.

Courtroom Security

Enhanced security measures may be necessary in high profile cases to protect the safety and privacy of parties, witnesses, jurors, the judge, and court staff. A strategy for entry and exit from the courtroom may be needed to assure that the trial will run smoothly. Also, a plan for seating spectators and the media in the courtroom may be necessary to take limited seating space into account.

Courtroom Decorum

It is essential for the judge in a high-profile case to set and enforce clear rules for the management of the case. The judge should insist upon dignity and decorum in the courtroom. The judge should also insist on courteous behavior by all present in the courtroom.

The Media

The judge may establish guidelines for the behavior of members of the media in the courtroom, the hallways, and the area surrounding the courthouse. If cameras are to be allowed in the courtroom, the judge should attempt to minimize the effects of television coverage, which might negatively affect the trial. Also, the judge should consider entering a “gag order,” which prohibits the parties, attorneys, witnesses, and law enforcement from talking to the media about the case being heard by the judge. The U.S. Supreme Court has said that gag orders can be used to control pretrial and trial publicity. Gag orders are allowed when it is likely that a party will be prejudiced without the order or when it will be difficult to assure a fair trial without a gag order.

The Jury

Effective jury management is essential in high-profile cases. The judge is responsible for shielding potential jurors from the media. Once jurors are selected, assuring their privacy and safety becomes crucial in a high-profile case. It is necessary in some instances to sequester or isolate the jury both for their safety and to prevent them from being unduly influenced by the media or outside contacts.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Appeal of a State Court Judgment

The losing party in a civil lawsuit can file an appeal after the state trial court enters a final judgment in the case. Generally, a notice of appeal has to be filed within 30 days after a judgment. The person who files the appeal is called the appellant, and the other party is called the appellee.

Appeals to Intermediate Appellate Courts

In most states, there is a two-tier system for appellate review of a judgment. The appeal is first filed in an intermediate appellate court or court of appeals. Most appellate courts or courts of appeal have a panel of between 9 and 15 judges. After the appellate court reviews the judgment, a further appeal is possible to a court of last resort, usually called the state supreme court. In several states, there is no intermediate appellate court, and all appeals from a trial court’s judgment go directly to the state supreme court.

Records on Appeal

Once a notice of appeal is filed, a record of the trial court proceedings is prepared and filed with the appellate court clerk. The record includes the pleadings in the case and any exhibits introduced in evidence. It also includes a transcript of the trial, which is a written record of every word that was spoken in the trial. An appeal is decided based on the record in the case. In almost all instances, no additional evidence can be submitted to the appellate court and no additional witnesses can be questioned before the appellate court.


Both sides in the appeal submit written briefs to the appellate court. A brief is a memorandum that contains a summary of the questions presented on appeal. An appellant’s brief discusses legal principles showing why the appellate court should reverse or overturn the trial court’s judgment. The appellee’s brief presents legal arguments showing why the trial court’s judgment was correct. The briefs contain references or citations to laws or previous court decisions supporting the legal principles. Most appellate courts have rules that specify the content and format for briefs.

Oral Argument

Generally, the attorneys for both sides present oral arguments to a panel of judges of the appellate court. The appellate judges usually question each attorney during his or her oral presentation. After oral argument, the appellate court issues an order or opinion with the panel’s decision. Some appeals are submitted on the briefs without oral argument. In such instances, the appellate court makes its decision based solely on the arguments presented in the parties’ briefs.

Standards of Review

The appellate court reviews the trial court’s decision to consider whether the trial judge correctly interpreted and applied the law to the facts in the case. The appellate court also considers whether the trial court committed any procedural mistakes or errors in the way it conducted the case. If the appellate court finds no error in the trial judge’s handling of the trial and in his or her interpretation and application of the law, the court affirms the judgment. If the appellate court finds error, it reverses or overturns the judgment. The appellate court can then either order entry of a new judgment or remand (send) the case back to the trial judge for further proceedings.

Appeals to Highest State Courts

A state supreme court typically consists of a panel of up to nine judges or justices. Generally, a state supreme court chooses which appeals it will hear and it may refuse to hear an appeal if an intermediate appellate court has already heard the case. Even in some states that do not have an intermediate appellate court, a state supreme court can decide not to hear an appeal.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.

Legal Ethics and Legal Malpractice

Admission to the Practice of Law

After successfully completing law school, a law school graduate is required to pass a state bar examination before he or she will be admitted to the practice of law in the state. After passing the bar examination, an attorney takes an oath of office. Once admitted to the bar of a state, an attorney’s conduct is regulated by rules of professional conduct.

Rules of Professional Conduct

Every state has court rules which set minimum standards for a lawyer’s conduct. The rules of conduct include such principles as avoiding conflicts of interest or the appearance of impropriety and describe the circumstances under which a lawyer should not agree to represent a potential client. One disciplinary rule prohibits an attorney from engaging in illegal conduct that involves dishonesty, fraud, or deceit. State rules also regulate advertising by attorneys. Ethical rules on representation, intended to protect the public from attorney neglect, require attorneys to represent their clients effectively, competently, and promptly. Most states have a disciplinary agency to enforce the rules of professional conduct.

Legal Malpractice

If you think your lawyer has mishandled your case or made a mistake, you can contact the disciplinary agency in your state and file a malpractice complaint against the attorney. You may also file a civil action for damages. It is legal malpractice if a lawyer does not use the same care and skill other lawyers would have used in handling a similar case. Some examples of legal malpractice include wrongfully retaining or misapplying money or property received from a client and failing to preserve the confidences and secrets of a client. If an attorney is found guilty of legal malpractice, the attorney might be privately reprimanded, publicly reprimanded, suspended from practice for a period or time, or disbarred. Disbarment means that the attorney no longer would be permitted to practice law in the state.

Copyright 2011 LexisNexis, a division of Reed Elsevier Inc.