Investors who contributed $1 million to a Timaru law firm's contributory mortgage scheme face potentially significant losses after a Dunedin student complex with a bizarre sales history went into liquidation.
Pureikeriki Investments, the owner of an 11-studio student accommodation complex known as Hazelwood House, collapsed in April over unpaid taxes. The company's principal, Alistair McGaw, was bankrupted last February over other debts and is working as a real estate agent in Queensland.
Liquidators PricewaterhouseCoopers (PWC) said in its first report into Pureikeriki that a first-ranked Raymond Sullivan McGlashan Law contributory mortgage had swollen to $1.48m following missed interest payments and this amount exceeded the property's current rating valuation of $830,000. The property has been on the market for the past three years for $1.2m.
RSM Law practice manager Greg O'Brien declined to respond directly to questions on whether investors would be short-changed, but said in a statement: "Investors have been kept fully informed of all aspects."
Hazelwood House has had a tortured past and now has four mortgages from fringe financiers.
In the year before McGraw's Pureikeriki's acquiring the property, it had changed hands twice with the sale price nearly doubling.
According to property records Hazelwood House was bought on August 17, 2005, by Gladstone Road, a vehicle for Dunedin-based investors for $980,000. A week later, on August 23, it was sold for $1.2 million to FIIC, a company owned by Tapanui man Christopher Brenssell.
On August 17, 2006, FIIC sold the property to Pureikeriki for $1.6m. Gladstone Road directors and Mr McGaw could not be contacted. Mr Brenssell said when he sold the property, $100,000 of the proceeds was kept in the property as a fourth mortgage, an amount he had now written off.
PWC liquidator Malcolm Hollis said the escalation of the property's price raised questions but was outside the remit of his administration.
Century 21 Real Estate agent Bawden Curson, who facilitated the sale between Gladstone and FIIC, said that sale was underpinned by a registered valuation of $1.4m.
He said the multiple sales and dramatically rising price were merely a function of the recent property boom. "A substantial property moving two or three times within a 12 month period, at the time, was not unusual," Mr Curson said.
Mr O'Brien said he was unable to comment on the sale history of the property. "I don't think I can responsibly or factually comment on historic fluctuating market forces," he said.
Mr McGaw received funding for his 2006 purchase from a variety of sources.
Four mortgages underpinned the Pureikeriki purchase. In order of ranking, $999,000 came from RSM contributory mortgages, an unknown amount from now-collapsed Dunedin lender Hurricane House, $466,000 from the RSM-linked Cheyne Finance and $100,000 from FIIC.
Cheyne Finance, an entity whose directors are all partners at RSM law, borrowed money from South Canterbury Finance (SCF) and lent it to developers.
Cheyne was declared a related-party loan by SCF in its December 2008 prospectus because of RSM partner Ed Sullivan's position on the finance company's board.
The prospectus records Cheyne as being the recipient of an $18.6m loan attracting 11.9 per cent interest.
According to property records, the Cheyne loan over Hazelwood attracted interest of up to 17 per cent.
Mr O'Brien said any loss from Cheyne's Hazelwood loan would be borne by shareholders – whose identity is kept hidden behind the firm's trust company – and he has said Cheyne had no outstanding loans with the collapsed SCF.
In February 2009, after defaults, RSM Law as mortgagor took possession of Hazelwood House. A year later the firm bankrupted Mr McGaw, who had by then moved to Australia.
- © Fairfax NZ News
Source: www.stuff.co.nz
For new law school grads, the job outlook is still bleak - Philadelphia Daily News
Tony Chiaramonte, a Drexel University law school graduate, is one of the fortunate ones.
He landed a coveted clerkship with the Texas Court of Criminal Appeals in Austin at the start of his third year in school. To get the job, which he will start in September, Chiaramonte sent out 200 to 300 applications.
Total yield? Two return calls.
"I think I hit every state," said Chiaramonte, 29, who graduated May 17. "I was not discriminating against any state."
Even as a robust employment market has emerged for lawyers with several years’ experience, a sobering new reality awaits this year’s crop of law school graduates: The market for those fresh out of school has rebounded only slightly from its recessionary lows and remains very weak.
Big law firms in Philadelphia and across the nation report that hiring of graduates is well down from its peak of just a few years ago, when legal work was plentiful and firms competed for first-year lawyers. This year, firms are showing a little more flexibility in hiring summer interns and first-year lawyers, but the change is incremental. Most important, law-firm leaders who once hoped that the hiring of young lawyers would return to its past peak now say it will likely stay down for years.
The struggling economy, continuing downward pressure on rates, and insistence by clients that their matters be staffed with experienced lawyers all are playing roles.
"I have a stack of resumes on my desk and a number of phone calls that I have put off making," said Stephen A. Madva, managing partner of the Center City firm Montgomery McCracken Walker & Rhoads L.L.P.
In years past, the firm brought in eight or nine new graduates each fall and hosted a class of about a dozen summer interns. This year, Madva doesn’t anticipate hiring any first years, and the firm has only two summer interns. Instead, it has been recruiting lawyers with several years’ experience and established client relationships.
"Our clients are not willing to pay us to train [young lawyers], and the numbers in the firm now are a pretty good match to the amount of work we have," he said.
Most law schools still are collecting employment data on this year’s graduates, so the best information available is for the job search of last year’s class. Figures compiled through February showed that, except for graduates of the very top schools, a great number of law school graduates hadn’t found jobs as lawyers.
Law schools say they expect this year’s results to be about the same. The hiring plans of law firms back up that assessment.
"It is not so terribly different from the way it has been for the past few years," said Drexel law school dean Roger Dennis. "We are about even in absolute numbers with last year, and our sense is that the quality of the jobs is somewhat up."
Yet it is an extremely tough market. Through Feb. 15, Drexel reported that 57 of its 131 graduates had full-time permanent work as lawyers, with nine more employed in full-time jobs in which a law school education was deemed to be an advantage. Others had found work in non-law jobs, while 17 still were looking for jobs.
At Villanova University, 132 graduates out of 252 were employed full time as lawyers, with 19 more in full-time jobs for which a law degree was an advantage. Fifty-nine graduates still were seeking employment at the time of the survey’s conclusion.
At Temple, 177 graduates were employed full time as lawyers out of total of 319 graduates, while 32 had full-time jobs in which a law degree was considered an advantage although not required. About 18 were without jobs.
Even for graduates of the University of Pennsylvania law school, who typically enjoy a high rate of success, the battered economy has exacted a price. The overwhelming majority of last year’s class found employment, 95 percent of the 274 graduates. Yet there was a slight downward trend in the number of graduates employed in sought-after jobs with big firms, those with 500 or more lawyers. That number went down from 152 in 2008 to 125 last year, even though the class size had gone up.
The city’s major law firms report hiring plans that track closely with the law-school statistics. Drinker Biddle & Reath L.L.P. will take on 23 first-year lawyers in the fall, up from 19 in 2010, when the legal world was still adjusting to the financial collapse, but still down from 37 in 2009. Schnader Harrison Segal & Lewis L.L.P. plans to hire three first-year lawyers in the fall, down from nine in 2009.
Cozen O’Connor has increased its hiring of first years slightly, from 13 in 2009 to 19 this year, but for a 575-lawyer firm, its program is relatively small.
Though big firms remain highly profitable, it has come in part through severe cost-cutting and layoffs. At the same time, competition among firms for work has sharpened, placing even greater pressure on hourly billing rates. The unraveling of New York-based Dewey & LeBoeuf, which filed for bankruptcy Tuesday, reinforced the idea that the business remains fragile. Dewey once was a global powerhouse.
"The Dewey collapse put a chill in the air and fear in people’s hearts," said James Leipold, executive director of the National Association for Law Placement, which tracks the legal-employment market.
This deep anxiety appears not to be a momentary blip. In a survey of managing partners and chairmen at 238 U.S.-based law firms conducted in March and April, Altman Weil, a Newtown Square-based legal-consulting firm, reported that those firm leaders overwhelmingly said the profession faced long-term financial pressures, and that firms would adjust, in part, by outsourcing work and hiring fewer inexperienced lawyers.
About 55 percent of respondents said they expected that smaller classes of first-year lawyers had become a permanent trend; in 2009, just over 10 percent said they anticipated hiring fewer new law school graduates. There were similarly large increases in respondents who said they expected that outsourcing of legal work, hiring of more contract lawyers, and lower law-firm profits all were part of the new normal.
"The prerecession associate-hiring binge is over, replaced by much more cautious and conservative hiring policies," Altman Weil said.
With such a grim employment market, it likely helped that Chiaramonte, who plans a career in public-interest law, kept a positive outlook. When he started his job search, he didn’t focus on the odds, and he was willing to go anywhere.
"I felt I would go wherever the job was," he said. "I was pretty lucky, and this job came around."
Source: www.philly.com
Libya lawyers appeal law banning glorifying Gaddafi - Reuters India
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Source: in.reuters.com
Law Day cases for May 21 - Sedalia Democrat
Judge Robert L. Koffman heard the following cases during the May 21 Law Day docket, according to Pettis County Prosecuting Attorney Jeff Mittelhauser:
• Dennis Bice, 33, of Sedalia, pleaded guilty to driving while revoked. Sedalia Police Sgt. Kelley Casto arrested the defendant March 26 near 6th and Moniteau. The offense was a felony because the defendant has four prior convictions for various offenses. The judge ordered a sentencing assessment report and scheduled sentencing for July 11.
• Charity Bowman, 33, of Sedalia, pleaded guilty to three counts of driving while revoked, offenses which occurred Aug. 31, Nov. 10 and Feb. 11. The offenses were felonies because she has three prior convictions for driving while revoked. Execution of a four-year sentence was suspended and the defendant was placed on probation for five years with requirements that she serve 120 days of shock detention and perform 120 hours of community service work.
• Bert Ellison, 33, of Sedalia, pleaded guilty to stealing and burglary in connection with two separate thefts earlier this year. On Jan. 16, he stole copper ground wire from KCP&L utility poles. On March 5, he helped another person steal property from a home on Boonville Street. He was sentenced to serve three years in prison.
• William Foster Jr., 51, of Sedalia, pleaded guilty to burglary and stealing, admitting he took part in the March 13 break-in at a business on South Limit. He was sentenced to serve four years in prison.
• Tiffany Howe, 25, of Sedalia, was sentenced to serve concurrent seven- and four-year sentences when her probation was revoked on charges of forgery and leaving the scene of an accident. She pleaded guilty to the offenses in November. Her probation was revoked because she used marijuana, failed to attend substance abuse treatment, failed to report to her probation officer and associated with a convicted felon.
• Christopher Hoyle, 33, of Sedalia, was ordered to serve a two-year sentence when his probation was revoked on a charge of possession of a controlled substance. He was placed on probation in 2005 and absconded from probation supervision in 2007.
• Anna James, 32, of Sedalia, pleaded guilty to possession of a controlled substance and stealing. Sedalia Police Officer Sean Hiatt arrested the defendant July 31, 2009, for shoplifting at Walmart and found a small quantity of methamphetamine in her possession. Execution of a five-year sentence was suspended and the defendant was placed on probation for five years. She was sentenced to serve 10 days in jail for the stealing charge.
• Desiree Knott, 23, of Kansas City, was placed on probation for five years after pleading guilty to the felony of stealing. The offense occurred July 28 when she and two others stole more than $500 worth of merchandise from Walmart. Conditions of probation include 10 days of shock detention and restitution.
• Darrell Parish Jr., 29, of Sedalia, pleaded guilty to stealing by deceit, admitting that in 2009 he obtained unemployment benefits by failing to report that he was working. The defendant was placed on probation for five years with a requirement that he pay restitution in the amount of $3,179 to the state of Missouri.
• Brandon Paxton, 19, of Smithton, was placed on probation for five years after pleading guilty to forgery and possession of a controlled substance. The forgery occurred Dec. 5 and involved a check written on the account of a family member. Sedalia Police officers arrested the defendant Jan. 5 and found hydromorphone pills in his possession. Conditions of probation include 10 days of shock detention, restitution, 120 hours of community service work and no contact with others involved in forging the check.
• Joseph Petree, 49, of Sedalia, was placed on probation for five years on a charge of driving while revoked. He was arrested Dec. 6. The offense was a felony because the defendant has four prior convictions for various offenses. Conditions of probation include 60 days of shock detention and 120 hours of community service work.
Source: www.sedaliademocrat.com
Sussex celebrates Queen's Diamond Jubilee - BBC News
People across the South East have been celebrating the Queen's Diamond Jubilee
Thousands of people have taken part in events across Sussex to mark the Queen's Diamond Jubilee.
More than 80 street parties were held in East Sussex, at least 70 in Brighton and scores of celebrations were enjoyed in West Sussex.
Eastbourne's newest lifeboat, named Diamond Jubilee, was among the vessels taking part in London's Thames Pageant.
In West Hoathly and Sharpthorne up to 100 scarecrows lined the streets.
Residents in villages in this part of West Sussex regularly create novelty scarecrows for big national occasions.
'Jubilee parade'Among them are effigies depicting the Queen and Irish Guards.
“Start Quote
End Quote Julie WaltersI am standing in for the Queen”
Scarecrow creator Sean Patrick O'Callaghan said: "There are probably about 100 scarecrows in the area, many made by children."
Actress Julie Walters has taken part in a Diamond Jubilee party in the village of Plaistow, West Sussex.
The star of Educating Rita, Mamma Mia and the Harry Potter series joked: "I am standing in for the Queen. She couldn't be bothered."
In East Grinstead hundreds of people lined High Street to watch a special Jubilee parade.
Young and old cheered as marching bands, charity floats and old military vehicles made their way past the crowds in the town centre.
Eastbourne was set to host a musical special Diamond Jubilee firework display.
Councillor Neil Stanley, of Eastbourne Borough Council, said "This is our treat for music fans with free entry while the temporary works continue at the bandstand.
"This is the perfect opportunity to enjoy a free concert on the beach and get a taste of what a great programme we have on offer when the bandstand reopens in July."
Residents in Brighton and Hove were also treated to music from the city's seafront bandstand earlier.
Trees are also being planted throughout the city in 2012 to mark the Queen's Diamond Jubilee year.
See all the latest Diamond Jubilee news and features at bbc.co.uk/diamondjubilee
Source: www.bbc.co.uk
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