A CAUTIONARY TALE

Richard Winger, editor of Ballot Access News and a longtime advocate for the rights of minor parties, has, along with several others, been held liable to pay $243,279.50 in attorney’s fees after losing a lawsuit brought to invalidate California’s new “top-two” primary system, adopted in a June, 2010 referendum.  I understand that a motion for reconsideration has been filed, and I am hopeful that this penalty will be vacated so that Richard’s important work in the area of electoral reform will not be crippled.

This unfortunate situation is a cautionary tale for those of us who seek to advance the cause of electoral reform through the courts. 

Richard and I have worked together for many years in various efforts to open up the electoral process and level the playing field for independent voters and minor parties. We differ strongly on the issue of top-two.  In Richard’s view, top-two hurts minor parties by limiting the candidates on the general election ballot to the two highest vote getters in a non-partisan primary election in which all candidates and all voters, regardless of party affiliation, participate on an equal footing.  Candidates are permitted to list a party preference.  Under the traditional system of party primaries, still operative in most states, each qualified party, major or minor, is assured that its candidate will appear on the general election ballot under the party’s name. 

For independents like me, top-two is a positive reform because it allows independent voters (who are more often than not barred from party primaries) to fully participate in the electoral process, and it breaks the hold of the parties on the candidate selection process. 

In their efforts to defeat this reform, through the courts and otherwise, Richard and other minor party activists have, in my opinion, allowed themselves to be used by the major parties. The parties, major and minor, have opposed the top-two system.  In California, the Democrats and Republicans decided it was best to allow the minor parties to play the more active role both in the media and in the courts.  And since the adoption of top-two by a substantial majority (53.8 to 46.2 percent) of the voters, the major parties have worked to discover how to use the new system to their advantage, while Richard and the minor parties in California have continued to litigate against it. 

In continuing down this road, they ignored warning signals that they would not only reach a legal dead end, but that there might be adverse financial consequences for lawyer and client alike.  The U.S. Supreme Court has upheld top-two as constitutional, and the U.S. Court of Appeals rejected a further challenge after the Supreme Court ruled.  The efforts of Richard and his attorney to enjoin the implementation of top-two also failed.  

The lawsuit in question tried to parlay two minor issues, neither of which had legal merit, into a wholesale attack on the top-two system.  The issues were whether a candidate could list as a party preference only the name of a qualified party, and whether top-two made write-in votes impossible.  By lack of merit, I mean that the Courts had already ruled that neither of these was a constitutional right that state legislation had to respect.  They are questions of public policy, with arguments on both sides.  Furthermore, these alleged defects in top-two can be easily remedied by the legislature. 

Despite all of this, Richard and his lawyer went ahead in their effort to overturn an important pro-democracy reform that the voters of California had supported.  There are lessons here.  They have to do with what you can and can’t accomplish through the courts, and what warning signals you must heed, as an attorney or a litigant, in the electoral arena. 

Perhaps most important, particularly for independents, we must not allow ourselves to be used by the major parties to prop up a partisan political arrangement from which more and more Americans are disaffected.  Did Richard believe his alliance with the major parties would provide legal and financial cover, despite the weakness of his case?  We all have something to learn from these unfortunate events.

 

The Middle Game

In legal, and other, affairs, too little attention is paid to the middle game. It tends to be all about beginnings and endings. This insight has proved of great help in assisting clients deal with matrimonial and other family related matters. I recently helped a client settle a messy divorce. She graciously gave me permission to speak, in general terms, about it. There were two critical turning points. The first came after efforts to negotiate a fair early settlement failed. The other side made a “final” offer on the low end of what was acceptable. The client and I met, and she said that while she could live with this, she could never feel comfortable with herself unless she rolled the dice and let the Court decide some of the key issues. We then made a motion for interim relief, and got just about everything we were asking for.

The second occurred when we took another look at the husband’s valuation of some assets that were difficult to assess as they were luxury items that he was in the business of purchasing. A formal appraisal would have been expensive and sent out a signal (we are ready to litigate again) that we did not want to do. Instead, my client went online and found a company willing to give an informal valuation of the items in question. It turned out to be almost double what her husband had said.

A phone call to his attorney followed; the settlement negotiations got back on track, and the case was resolved fairly. At both points in the process we resisted the temptation to move too quickly to the end game. My client and I are glad that we played from the middle.

Mortgage Madness

A fall out of the financial meltdown is that routine real estate transactions have become more complex and stressful. It used to be that the buyer did some preliminary work with a bank or a mortgage broker to determine what type of financing was available. Then, once a bid was accepted on the property (a coop or condo, for example), a contract was signed and a deposit, usually 10 percent, put down. The contact allowed 45 days to secure a firm mortgage commitment with the seller agreeing to return the down payment if it was not.

Since the crisis, banks have made it much harder to obtain a mortgage and no longer give firm commitments. Sometimes you don’t know until days before closing whether financing is actually available. For the seller, this means that a deal might fall through at the last minute and other potential buyers lost; for the buyer it can mean forfeiting a substantial down payment. There is no easy solution to this problem. What used to be a straight forward, low risk arrangement is now fraught with uncertainty and even peril. Each situation must be examined carefully to determine the vulnerabilities on each side.

An important part of my job is helping the client weigh the risks and the scenarios that might unfold. Sometimes that leads to a smaller down payment (so less of the buyer’s money is at risk), and sometimes dispensing with the mortgage contingency at all, when financing is reasonably certain, even without a firm commitment. In one case it meant asking the seller to extend the mortgage deadline until the bank made up its mind; in another, in the case of property that was difficult to sell, it meant allowing the buyer to proceed without a mortgage deadline. Welcome to the brave new world of post meltdown real estate deals. In it we also have to learn to play from the middle.