Source: https://huddleston.law/news/page/2/
Timestamp: 2019-04-19 12:18:55+00:00

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If Medical Marijuana Businesses Are Legalized In Oklahoma What Clauses Should Your Lease Include?
As Oklahoma citizens consider State Question 788, landlords and property managers need to know how to address medical marijuana use in their buildings.
The supremacy clause in the U.S. Constitution says that states must not (and cannot) enact laws that conflict with Federal law—but states have been doing just that when it comes to legalizing marijuana. Until now, the Federal government’s marijuana policy has been to essentially turn a blind eye to the changing marijuana laws. And now Oklahoma will consider SQ 788 and possibly another ballot measure in 2018 to legalize medical marijuana. Half of the states, including Arkansas, and the District of Columbia have already legalized medical marijuana so it is a safe bet that marijuana will be legalized in some form in Oklahoma. Although cannabis remains illegal under Federal law, the U.S. Drug Enforcement Agency — which made marijuana a primary target in its “war on drugs” — is considering reclassifying it as a Schedule II drug, which could open the door to decriminalizing pot on a Federal level.
As a result, Oklahoma landlords and property managers could face new considerations when it comes to how marijuana laws affect their lease agreements. There are a number of scenarios related to marijuana legalization you could find yourself in, but if you stay informed, you can take steps to address any changes in the legal landscape.
Landlords and property managers are not required to accommodate recreational pot use under state law, but they may choose to make some exceptions for tenants who use marijuana for medical purposes. Still, that doesn’t mean you have no control over how it’s used inside your building. And unless federal law is changed, you may still prohibit marijuana use in any form.
One of the first things you need to decide is whether you want to allow smoking of any kind in the building (e.g., rent houses). Tobacco, for example, is a legal substance nationwide, but most property and business owners — restaurants, bars, apartment buildings — have the right to ban smoking cigarettes inside. The case for marijuana is no different.
It is extremely important for landlords to recognize that they may be dealing with a medical marijuana tenant who may have a disability as defined under the Fair Housing Act. So, for example, it would not be a good policy to reject a rental applicant because the person uses medical marijuana to treat a disability. It may be better to simply inform the applicant that smoking marijuana or growing plants is not allowed on the property, and give the disabled applicant the opportunity to decide whether to pursue the vacancy (or use other forms of medical marijuana such as edibles). Past drug addiction also is protected under anti-discrimination statutes, and is not a topic that should be explored during tenant screening. Because the use of marijuana remains a Federal offense, there is an argument that you may deny a reasonable accommodation claim for the use of medical marijuana under the Federal Fair Housing Act. However, the Federal Courts are not in agreement on this issue and the law is changing. In the employment area, courts have denied medical marijuana as a reasonable accommodation. Given the Federal government’s express intention to not allow US Department of Justice enforcement of the law prohibiting the use, sale and cultivation of medical marijuana (Specifically, see page 230: Section 537 of the Consolidated Appropriations Act of 2017), this may lead Oklahoma state courts to be more lenient when it comes to requiring reasonable accommodations.
What Can Landlords Do to Regulate Marijuana Use?
There are a number of strategies that landlords may employ to prohibit marijuana use. It is helpful to remember the reasons why landlords may want to regulate marijuana — for instance, to minimize tenant complaints, to minimize property damage, to reduce crime, and so on. The most encompassing strategy is to prohibit marijuana possession and use because it is illegal under Federal law.
If Oklahoma does legalize medical marijuana, it will very likely apply only to tenants over the age of 21. Those landlords who manage student rentals and typically deal with younger tenants, would want to ban marijuana use entirely. Marijuana use or cultivation may be viewed as a disturbance which violates other tenants’ quiet enjoyment.
Can You Evict a Tenant for Using Medical Marijuana?
Currently in Oklahoma all marijuana is banned, so issuing an eviction notice to a tenant who violates your anti-drug policy or anti-marijuana clause is fairly straightforward. But even if medical marijuana is legalized, you have the right to evict tenants who violate the terms of your lease, which would be an eviction for engaging in federally illegal activity. If you ban smoking marijuana — but not other forms of consumption of the drug — and a tenant continually violates that term, you can evict. This is why it is so important for a landlord to clearly state the rules concerning marijuana use in their lease agreements.
Can You Ban Growing Marijuana on Your Property?
When it comes to cultivation, you would want to require tenants to receive written consent from the landlord before growing cannabis on the premises. The language of the written consent should allow the landlord or property manager to inspect the unit from time to time to ensure that tenants are not growing more cannabis than is legally allowed.
Something to keep in mind: Cultivation often requires higher electricity and water usage—and plants require a lot of moisture, which can be harmful to the building. So you have very legitimate reasons to prohibit all cultivation on the premises.
Hopefully, landlord-tenant disputes about marijuana use will be covered by a well drafted lease agreement. Complaints typically come from other tenants who are concerned about marijuana smoke or odors. If you find yourself in this situation, act quickly in devising a solution that works for all parties—for example, perhaps the marijuana user would happily switch to edibles.
Over the last 20 years, the number of states allowing use of marijuana has been increasing, and with a recent poll showing over 60% of Americans support legalization, we can expect that trend to continue. The implications for real estate are numerous. The conflict between Oklahoma and Federal law creates extra considerations. Owners/managers should take care to be up-to-date on the laws, and ensure their lease provisions specifically address their policies related to these laws along with any other special considerations.
Oklahoma voters will get the chance to legalize medical marijuana in 2018.
While supporters had gathered enough signatures to place the measure before voters in 2016, advocates had filed a lawsuit against then-Attorney General E. Scott Pruit after he rewrote the initiative’s ballot title, delaying the vote. Advocates were successful in their lawsuit earlier this year, when the Supreme Court of Oklahoma ruled 7-1 in their favor. The measure will appear on the ballot as State Question 788. The finalized ballot title, which is the original title submitted by opponents, was formally approved by Oklahoma Secretary of State. The measure will most likely appear on the November 2018 ballot, unless Oklahoma Governor Mary Fallin calls a special election for the measure. If approved by voters, medical marijuana would be subject to a 7 percent sales tax.
Posted in Legislation & Case Notes | Comments Off on Oklahoma voters will get the chance to legalize medical marijuana in 2018.
Oklahoma has expanded its limited protection for patients who use low-THC, high-CBD cannabis oil for certain medical conditions, which was initially passed in 2015. HB 2835 allows adults to use low-THC cannabis oil (minors were already covered by existing law) and added “spasticity due to multiple sclerosis or due to paraplegia, intractable nausea and vomiting, and appetite stimulation with chronic wasting diseases” to the list of qualifying conditions, in addition to severe epilepsy. Click here for a summary of the law.
Unfortunately, it is still hard for patients to gain access to cannabis oil in Oklahoma. And, as with all current laws providing access to high-CBD products, the law is very limited and leaves behind most patients who could benefit from whole-plant medical marijuana in various forms, such as people with cancer, intractable pain, and other serious illnesses. For a broader look at CBD laws and where they fall short, take a look at an analysis available here.
Oklahoma State Question 780 made all marijuana possession offenses misdemeanors.
On November 8 2016, 58% of Oklahoma voters supported State Question 780, which makes all marijuana possession offenses misdemeanors effective July 1, 2017.
Oklahoma still has further to go, as the penalty for first-time marijuana possession will remain up to one year of incarceration and a fine of up to $1,000. Removing possible jail time for marijuana possession altogether, as 21 states have already done, will allow police to focus on solving violent and property crime. In addition, enforcement of these laws is racially biased. According to this report by the ACLU, African Americans in Oklahoma are 2.9 times more likely than whites to be arrested for possession of marijuana, even though blacks and whites consume marijuana at similar rates.
Posted in Legislation & Case Notes | Comments Off on Oklahoma State Question 780 made all marijuana possession offenses misdemeanors.
Street Law School: I passed a School Bus and they want to suspend my driver’s license for a year! Now what?
If you do not stop when those red lights are activated for a school bus, or a church bus, and you drive past that bus, in addition to a fine and other penalties such as points on your license and record, you’re going to lose your driver’s license for a year. The law is found at 47 O.S. § 6-205.A.11 (OSCN 2017). The purpose of this article is help people from being shocked by finding out after they have paid a fairly small ticket that they are losing their driver’s license. When you get a ticket that is for anything more than a minimal speeding ticket, you should contest the charge. Failing to do so can be devastating for a family, for wage earners or for moms who drive to and from school and work.
Oklahoma DPS will suspend your Oklahoma driver’s license if you’re convicted of illegally passing a school bus or a church bus. You must act quickly if you have received a notice of driver’s license suspension for this offense. You may have received a ticket in the mail for meeting or overtaking a school bus. The police don’t even have to be present at the time of the alleged violation for you to receive the citation. The school bus driver who observed the alleged violation merely needs to fill out a simple report and submit it to the police within 24 hours of the violation. 47 O.S. § 11-705.D (OSCN 2017).
While paying the $100.00 ticket may be the easiest and quickest thing to do, it also is the equivalent of pleading guilty to the offense. You should instead request a hearing for the ticket. Often the school bus driver is unable to identify the person who allegedly passed the bus. If convicted of passing a school bus or church bus, Oklahoma DPS will suspend your Oklahoma driver’s license for one year and add 4 points to your driving record according to the Oklahoma license points schedule.
If you received a passing a school bus ticket in the mail or notice of license suspension, you should talk to an attorney about having the conviction overturned and appealing the suspension.
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In the unfortunate event you have to move forward with an eviction, you will likely want to evict your non-paying or nuisance tenant(s) just as quickly as the law allows. When you have tenants in your properties that aren’t paying or are in violation of their Rental/Lease Contract, acting quickly will minimize the amount of lost rent, vacancy loss, property damage and make ready expenses.
I am pleased to announce that I have another recent appellate court victory. This time in an unreported case where, as is often the case, the trial court granted the bank’s motion for summary judgment for foreclosure against the homeowner, but the Oklahoma Court of Appeals reversed and remanded the case, finding that there exists a material issue of disputed fact as to whether HSBC was the holder of the promissory note at the time that it filed its amended petition. The opinion makes it clear that a motion for summary judgment in a foreclosure case must present undisputed facts supported by acceptable evidentiary materials showing that the bank is a person entitled to enforce the note at the time that the petition is filed. The bank’s evidentiary materials were deficient because it had made inherently contradictory allegations in its pleadings and affidavit in support of its motion for summary judgment. Here is a link to the slip opinion: HSBC vs Williamson.
When property is leased for exploration, the lessee has the right to go out and drill on that property. However, this exercise often causes damage to the surface of the land — damage to crops and land, pollution, damage caused by pipelines, access roads, etc. The issue of surface damages is addressed in the Oklahoma Surface Damages Act. While one individual may own the surface of property, another may own the land below the surface. This can rapidly become a complicated legal situation when surface damages occur.
Surface owners may become involved in a surface damages claim and require legal representation. Although the lessee can drill on the property they are leasing, they are ultimately responsible for compensating the surface owner for any damage done to the surface property. If you are a surface owner we can explain the legalities of the Oklahoma Surface Damages Act and how this law affects you.
2. “Surface owner” means the owner or owners of record of the surface of the property on which the drilling operation is to occur.
§52-318.3. Notice of intent to drill – Negotiating surface damages.
Before entering upon a site for oil or gas drilling, except in instances where there are non-state resident surface owners, non-state resident surface tenants, unknown heirs, imperfect titles, surface owners, or surface tenants whose whereabouts cannot be ascertained with reasonable diligence, the operator shall give to the surface owner a written notice of his intent to drill containing a designation of the proposed location and the approximate date that the operator proposes to commence drilling.
Such notice shall be given to the surface owner in any manner as provided for in paragraph 1 and paragraph 2 of subsection C of Section 2004 of Title 12 of the Oklahoma Statutes for the service by personal delivery or by mail of a summons in a civil action. If the operator makes an affidavit that he has conducted a search with reasonable diligence and the whereabouts of the surface owner cannot be ascertained or such notice cannot be delivered, then constructive notice of the intent to drill may be given in the same manner as provided for the notice of proceedings to appoint appraisers.
Within five (5) days of the date of delivery or service of the notice of intent to drill, it shall be the duty of the operator and the surface owner to enter into good faith negotiations to determine the surface damages.
§52-318.4. Undertakings which may be posted as damage deposit.
A. Every operator doing business in this state shall file a corporate surety bond, letter of credit from a banking institution, cash, or a certificate of deposit with the Secretary of State in the sum of Twenty-five Thousand Dollars ($25,000.00) conditioned upon compliance with Sections 318.2 through 318.9 of this title for payment of any location damages due which the operator cannot otherwise pay. The Secretary of State shall hold such corporate surety bond, letter of credit from a banking institution, cash or certificate of deposit for the benefit of the surface owners of this state and shall ensure that such security is in a form readily payable to a surface owner awarded damages in an action brought pursuant to this act. Each corporate surety bond, letter of credit, cash, or certificate of deposit filed with the Secretary of State shall be accompanied by a filing fee of Ten Dollars ($10.00).
B. The bonding company or banking institution shall file, for such fee as is provided for by law, a certificate that said bond or letter of credit is in effect or has been canceled, or that a claim has been made against it in the office of the court clerk in each county in which the operator is drilling or planning to drill. Said bond or letter of credit must remain in full force and effect as long as the operator continues drilling operations in this state. Each such filing shall be accompanied by a filing fee of Ten Dollars ($10.00).
C. Upon deposit of the bond, letter of credit, cash, or certificate of deposit, the operator shall be permitted entry upon the property and shall be permitted to commence drilling of a well in accordance with the terms and conditions of any lease or other existing contractual or lawful right.
D. If the damages agreed to by the parties or awarded by the court are greater than the bond, letter of credit, cash, or certificate of deposit posted, the operator shall pay the damages immediately or post an additional bond, letter of credit, cash, or certificate of deposit sufficient to cover the damages. Said increase in bond, letter of credit, cash, or certificate of deposit shall comply with the requirements of this section.
§52-318.5. Negotiating surface damages – Appraisers – Report and exceptions thereto – Jury trial.
A. Prior to entering the site with heavy equipment, the operator shall negotiate with the surface owner for the payment of any damages which may be caused by the drilling operation. If the parties agree, and a written contract is signed, the operator may enter the site to drill. If agreement is not reached, or if the operator is not able to contact all parties, the operator shall petition the district court in the county in which the drilling site is located for appointment of appraisers to make recommendations to the parties and to the court concerning the amount of damages, if any. Once the operator has petitioned for appointment of appraisers, the operator may enter the site to drill.
B. Ten (10) days’ notice of the petition to appoint appraisers shall be given to the opposite party, either by personal service or by leaving a copy thereof at the party’s usual place of residence with some family member over fifteen (15) years of age, or, in the case of nonresidents, unknown heirs or other persons whose whereabouts cannot be ascertained, by publication in one issue of a newspaper qualified to publish legal notices in said county, as provided in Section 106 of Title 25 of the Oklahoma Statutes, said ten-day period to begin with the first publication.
C. The operator shall select one appraiser, the surface owner shall select one appraiser, and the two selected appraisers shall select a third appraiser for appointment by the court, which such third appraiser shall be a state-certified general real estate appraiser and be in good standing with the Oklahoma Real Estate Appraisal Board. Unless for good cause shown, additional time is allowed by the district court, the three (3) appraisers shall be selected within twenty (20) days of service of the notice of the petition to appoint appraisers or within twenty (20) days of the first date of publication of the notice as specified in subsection B of this section. If either of the parties fails to appoint an appraiser or if the two appraisers cannot agree on the selection of the third appraiser within the required time period, the remaining required appraisers shall be selected by the district court upon application of either party of which at least one shall be a state-certified general real estate appraiser and be in good standing with the Oklahoma Real Estate Appraisal Board. Before entering upon their duties, such appraisers shall take and subscribe an oath, before a notary public or some other person authorized to administer oaths, that they will perform their duties faithfully and impartially to the best of their ability. They shall inspect the real property and consider the surface damages which the owner has sustained or will sustain by reason of entry upon the subject land and by reason of drilling or maintenance of oil or gas production on the subject tract of land. The appraisers shall then file a written report within thirty (30) days of the date of their appointment with the clerk of the court. The report shall set forth the quantity, boundaries and value of the property entered on or to be utilized in said oil or gas drilling, and the amount of surface damages done or to be done to the property. The appraisers shall make a valuation and determine the amount of compensation to be paid by the operator to the surface owner and the manner in which the amount shall be paid. Said appraisers shall then make a report of their proceedings to the court. The compensation of the appraisers shall be fixed and determined by the court. The operator and the surface owner shall share equally in the payment of the appraisers’ fees and court costs.
D. Within ten (10) days after the report of the appraisers is filed, the clerk of the court shall forward to each attorney of record, each party, and interested party of record, a copy of the report of the appraisers and a notice stating the time limits for filing an exception or a demand for jury trial as provided for in this section. The operator shall provide the clerk of the court with the names and last-known addresses of the parties to whom the notice and report shall be mailed, sufficient copies of the notice and report to be mailed, and pre-addressed, postage-paid envelopes.
1. This notice shall be on a form prepared by the Administrative Director of the Courts, approved by the Oklahoma Supreme Court, and supplied to all district court clerks.
2. If a party has been served by publication, the clerk shall forward a copy of the report of the appraisers and the notice of time limits for filing either an exception or a demand for jury trial to the last-known mailing address of each party, if any, and shall cause a copy of the notice of time limits to be published in one issue of a newspaper qualified to publish legal notices as provided in Section 106 of Title 25 of the Oklahoma Statutes.
3. After issuing the notice provided herein, the clerk shall endorse on the notice form filed in the case the date that a copy of the report and the notice form was forwarded to each attorney of record, each party, and each interested party of record, or the date the notice was published.
E. The time for filing an exception to the report or a demand for jury trial shall be calculated as commencing from the date the report of the appraisers is filed with the court. Upon failure of the clerk to give notice within the time prescribed, the court, upon application by any interested party, may extend the time for filing an exception to the report or filing a demand for trial by jury for a reasonable period of time not less than twenty (20) days from the date the application is heard by the court. Appraisers’ fees and court costs may be the subject of an exception, may be included in an action by the petitioner, and may be set and allowed by the court.
F. The report of the appraisers may be reviewed by the court, upon written exceptions filed with the court by either party within thirty (30) days after the filing of the report. After the hearing the court shall enter the appropriate order either by confirmation, rejection, modification, or order of a new appraisal for good cause shown. Provided, that in the event a new appraisal is ordered, the operator shall have continuing right of entry subject to the continuance of the bond required herein. Either party may, within sixty (60) days after the filing of such report, file with the clerk a written demand for a trial by jury, in which case the amount of damages shall be assessed by a jury. The trial shall be conducted and judgment entered in the same manner as railroad condemnation actions tried in the court. A copy of the final judgment shall be forwarded to the county assessor in the county or counties in which the property is located. If the party demanding the jury trial does not recover a more favorable verdict than the assessment award of the appraisers, all court costs including reasonable attorney fees shall be assessed against the party.
§52-318.6. Appeal of decision on exceptions to report of appraiser or verdict upon jury trial – Execution of instruments of conveyance.
Any aggrieved party may appeal from the decision of the court on exceptions to the report of the appraisers or the verdict rendered upon jury trial. Such appeal shall not serve to delay the prosecution of the work on the premises in question if the award of the appraisers or jury has been deposited with the clerk for the use and benefit of the surface owner. In case of review or appeal, a certified copy of the final order or judgment shall be transmitted by the clerk to the appropriate county clerk to be filed and recorded.
When an estate is being probated, or when a minor or incompetent person has a legal guardian or conservator, the administrator or executor of the estate, or guardian of the minor or of the incompetent person or the conservator, shall have the authority to execute all instruments of conveyance provided for in this act on behalf of the estate, or minor or incompetent person with no other proceedings than approval by the judge of the court of jurisdiction being endorsed on the instrument of conveyance.
§52-318.7. Effect of act on existing contractual rights and contracts to establish correlative rights – Indian lands.
Nothing herein contained shall be construed to impair existing contractual rights nor shall it prohibit parties from contracting to establish correlative rights on the subject matter contained in this act.
This act shall not be applicable to nor affect in any way property held by an Indian whose interest is restricted against voluntary or involuntary alienation under the laws of the United States or property held by an Indian tribe or by the United States for any Indian tribe.
§52-318.8. Effect of act on jurisdiction, authority and power of Corporation Commission.
Nothing in this act shall be construed as repealing or limiting the jurisdiction, authority and power of the Oklahoma Corporation Commission.
§52-318.9. Violation of act – Damages.
Upon presentation of clear, cogent and convincing evidence that the operator willfully and knowingly entered upon the premises for the purpose of commencing the drilling of a well before giving notice of such entry or without the agreement of the surface owner, the court may, in a separate action, award treble damages. The issue of noncompliance shall be a fact question, determinable without jury, and a de novo issue in the event of appeal.
Any operator who willfully and knowingly fails to keep posted the required bond or who fails to notify the surface owner, prior to entering, or fails to come to an agreement and does not ask the court for appraisers, shall pay, at the direction of the court, treble damages to the surface owner.
Damages collected pursuant to this act shall not preclude the surface owner from collecting any additional damages caused by the operator at a subsequent date.
STREET LAW SCHOOL: My mortgage company is out of business and it never released its lien, now what?
Title Insurance and Closing Company settlement agents bear the bulk of responsibility when it comes down to closing a real estate transaction. After all, they are the ones who need to verify a clear title and facilitate resolution of any outstanding issues.
Unfortunately, this process is typically opaque, and can take a lot of time and resources, particularly when it comes to locating appropriate documentation to resolve outstanding mortgage liens. Even more difficult is knowing what to do when an original lender has disappeared or is now defunct. Luckily, there is a resource that can help smooth the difficult process of finding lenders who no longer exist.
Posted in Real Estate Law | Comments Off on STREET LAW SCHOOL: My mortgage company is out of business and it never released its lien, now what?
I am pleased to announce that I have another appellate court victory. This time in an unreported case where I was hired only after the homeowner had already had judgment granted against him by the trial court in 2007. That’s right. In 2017, 10 years after the default judgment, the Oklahoma Court of Appeals reversed and remanded the case, giving no credence to US Bank’s statute of limitations argument under 12 O.S. § 1038.
The pro se defendants had a default judgment entered against them for their failure to file an Answer. The homeowners hired me in 2015 after they were served with a Notice of Sheriff’s Sale. I filed a petition to vacate the 2007 default judgment, which the trial court denied, but we won a reversal on appeal. The opinion contains a good discussion of § 1038, the statute of limitations to challenge judgments, and when the refusal to vacate a default judgment is an abuse of discretion.
Here is a link to the slip opinion: U.S. Bank vs. Smith.

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