Trick or Treaters Can Be Expected

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            It seems like most people have a good idea as to who is likely to show up at their door on any given day.  Family, friends, neighbors, kids’ friends, the occasional girl scout selling cookies, or maybe an elementary school kid promoting a school fundraiser.  Occasional visitors might include persons sharing religious messages, repairmen, contractors, and even the occasional door to door salesman selling vacuum cleaners or Fuller Brush products.  For most people, that’s about it.

But on one night each year, most people in North America can expect to see a handful of little strangers appear on their door step with nothing to sell, and only asking for something small such as a treat.  That night would, of course, be Halloween.

According to Wikipedia, Halloween is a variant of “All-Hallows-Even” and is the name give to the evening before “All Hallows Day”, or “Hallowmas,” which is also known as “All Saints Day.”  This Day is a religious Holiday that has been around for a long time.  Apparently Shakespeare even refers to the day by the name of “Hallowmas” in his comedy “The Two Gentlemen of Verona.”

According to Wikipedia, the development of “Trick-or-Treating” is a relatively recent development in the observance of Halloween.  Trick-or-Treating is now apparently done  in many different countries, and generally consists of children visiting homes (often of strangers), often accompanied by an adult, where the children say “Trick-or-Treat” after knocking on the front door.  The practice apparently originated as a request by the children for a small treat in exchange for the children not performing some prank or trick on property or the homeowner.  In common practice, there doesn’t seem to be any significant consideration of any “prank” or “trick” in connection with Trick-or-Treating, and most people who participate seem to have a generally positive experience with the practice.  Those who aren’t interested in participating usually seem to keep their lights off or go out for the evening.

From a legal perspective, Halloween creates an interesting situation with respect to homeowners and occupants of property.  Many homeowners don’t specifically invite children to their home on Halloween.  But most people who have lived in this country for any length of time are familiar with the practice of Trick-or-Treating, and many people can reasonably expect children to arrive at their door on Halloween unannounced and uninvited.  It’s usually dark when most of these children show up.  All of these factors can combine to create an unusual set of circumstances – expected visitors who may be excited and may not be paying close attention to their surroundings coming up to properties after dark.  It’s always a good idea for homeowners and property occupants to keep their properties in reasonably clean, orderly, and safe condition for persons who may be coming on to the property.  But it may be especially so when young visitors can be expected after dark – such as on Halloween.  Nobody wants to have a Trick-or-Treat excursion end in an accident or tragedy.  Halloween is a great time for homeowners to take a look around their front yard to make sure that the path to their door is clear, unobstructed, and free of clutter or debris that could present any kind of a risk, danger, or hazard.

Traveling up to a front door doesn’t pose the only potential risk to young children.   Their teeth can also experience the effects of lots of candy.  At least one dentist has been known to sponsor a candy trade-in  where incentives, prizes or rewards are offered to young trick-or-treaters in exchange for the candy they have received on Halloween.  Homeowners or others who are concerned about the effects of lots of candy sometimes offer alternative treats, such as small gifts or favors, or even coins.  That’s one way to recycle of all of that excess change that’s been building up in a jar over the past few years.

Home is a Castle

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            As noted by the California Supreme Court, “A Man’s Home is his Castle.”  People v. Thompson (2006) 38 Cal. 4th 811, 829.

The concept of the “home” as a “castle” has a long, long history in both English and American law. As noted in the People v. Thompson case, American law has for many years provided that a person has an extremely high right of privacy in their own home.  The California Supreme Court wrote that this principle is not “just some forgotten vestige of 15th century English law that allowed English peasants to assert their rights against a powerful monarchy.” Instead, this principle is dearly held, honored and cherished in American law.  The Framers of the U.S. Constitution specifically provided for a very strong right of privacy in the language of the Fourth Amendment: “The right of the people to be secure in their persons, houses, papers and effects, against unreasonable searches and seizures, shall not be violated.”  The United States Supreme Court has held that “At the very core [of the Fourth Amendment] stands the right of a man to retreat into his own home and there be free from unreasonable governmental intrusion.”   Silverman v. United States (1961) 365 U.S. 505, 511.   In the Silverman case, law enforcement officers had placed an electronic device on a heating duct, which essentially turned the duct into a “gigantic microphone” running throughout an entire house.  Because this microphone was placed without a warrant, it constituted a violation of the Fourth Amendment and the conversations heard by police officers were inadmissible evidence.  Likewise, in one case the use of a “thermal imaging device” to explore the details inside a home were held improper when a search warrant wasn’t first obtained.   Kyllo v. United States (2001) 533 U.S. 27, 28.

Whether or not a search warrant must first be obtained before a proper search or investigation can be made is a subject that fills many, many pages of reported legal cases.  But an interesting question arises when the “home” is actually not a “home” at all – but is instead a public sidewalk.

Webster’s II New College Dictionary contains a definition for “Skid Row,” which generally designates a place where people live who are “down on their luck” (so to speak).  Los Angeles apparently has an area actually known as “Skid Row.” (See the report at Los Angeles Homeless Services Authority, 2011 Greater Los Angeles Homeless County Report. The report notes that nearly 34% of the homeless in this area are ages 55 and older. The report also states that 18% of the homeless are veterans).  The report further states that according to HUD, an “unsheltered homeless person” is a person who resides in “A place not meant for human habitation, such as cars, parks, sidewalks, abandoned buildings, or on

the street.”

Apparently several individuals were living in the Skid Row district of Los Angeles in 2011, and on several occasions they “stepped away” from their personal property, leaving it on the sidewalks, to perform tasks including eating, showering, or attending court.  These persons had not abandoned their property, but City employees nevertheless seized and destroyed the property under the Los Angeles Municipal Code, which states that “no person shall leave or permit to remain any merchandise, baggage or any article of personal property upon any parkway or sidewalk.”

Nine of these individuals filed suit against the City of Los Angeles by claiming that these practices violated the Fourth, Fifth and Fourteenth Amendments of the United States Constitution.  The trial court granted an injunction that, among other things, barred the City from “Seizing property in Skid Row absent an objectively reasonable belief that it is abandoned and presents an immediate threat to public health or safety, or is evidence of a crime.”  The court also ordered that unless the material posed an immediate threat to public health or safety, the City was obligated to store the property in a secure location for at least 90 days.”  The case was appealed, and in September of 2012 the trial court’s ruling was affirmed.

For details of the ruling, see Lavan v. City of Los Angeles (2012) DJDAR 12545.

Constitutional rights of property and privacy are very complex, and a substantial amount of legal authority exists on these issues. The foregoing discussion only provides the most limited discussion of some of the key issues involved.  Persons with questions about rights of property or privacy should consult competent legal counsel.

Honesty Is Still the Best Policy

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Some years ago, a Northern California newspaper recently ran a story about a police officer who had been charged with felony mortgage fraud.  According to the article, the officer took out two loans on two different residential homes at approximately the same time.  That’s certainly not a crime.  But the officer has been charged with applying for each loan as an “owner-occupied” loan. What’s more, the officer was apparently charged with substantially overstating his income on his loan applications.  The police officer denied any wrongdoing.

If true, these charges would amount to lender fraud.  Lenders want to know the economic status of the borrowers they deal with.  That’s the reason lenders require Borrowers to fill out loan applications.  A good credit score isn’t enough.  The lender wants a true snapshot of the borrower’s financial condition.  The lender wants assurance that the Borrower has the financial resources to repay the loan – with interest.  And the lender wants further assurance that the Borrower will be motivated to repay the loan.

Borrowers who use a loan to buy their principal residence may be more motivated to repay a loan than borrowers who are purchasing investment property.  If a borrower runs into financial trouble, that borrower may be more likely to default on an investment loan than on a loan on the home where they live.  Thus, an “owner-occupied” loan may have less risk than a loan on an investment property.  The simple reality is that a borrower’s home is often the last, and possibly most important, asset that most borrowers will ever have.  Lenders can gain some assurance from knowing that a borrower is accepting a loan for a home where they plan to live.

Borrowers receiving an “owner-occupied” loan can often can get a loan on better terms than they could on a loan for purchasing investment property.  There can be a substantial economic incentive for borrowers to claim that they intend to live in the property when they actually don’t intend to.  If borrowers falsely represent they intend to live in the home they are buying, then the borrowers commit a fraud on the lender when they make such a representation.

The officer in the story referred to above apparently overstated his income by a significant amount.  This can be a problem because a lender relies on income information in determining whether or not a borrower can repay the loan.  Without sufficient income, the borrower may not qualify for the loan  There can be a significant incentive for borrowers to overstate their income in order to qualify for a loan.  Again, such a practice constitutes lender fraud.

In the story above, the officer reportedly refinanced both loans within a few months of receiving initial loans.  He reportedly pulled cash out of the properties through refinance loans, and he then allegedly defaulted on the loans.  The defaults probably spurred the investigation that resulted in his being charged with felony lender fraud. If loans are fully paid as agreed, then lenders may not have any incentive to confirm whether or not any misrepresentations were made on the loan application.  But once loans go into default, and especially if a lender will suffer a loss, then a lender has an economic incentive to carefully review the borrower’s application to determine whether or not all of the representations were truthful.

What a terrible risk to take.  When borrowers take out loans on investment property in a hot real estate market, misrepresentations on a loan application can seem to be a minor thing.  But when the lender loans hundreds of thousands of dollars on those representations, and if the market turns downward so that there’s a foreclosure, then a borrower who is less than honest can end up facing criminal charges.  Nobody expects this when they fill out a loan application – but it’s a real possibility.  The end result?  Honesty truly is the best policy – even when it’s more expensive.