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This is part one of a three-part series outlining the topics of discussion from our presentation to the Southern Lancaster County Chamber of Commerce.

This morning, Brandon Harter and I had the pleasure of presenting to a full house of Southern Lancaster County Chamber of Commerce members at the Quarryville Library. Thank you to all who attended and we enjoyed a friendly competition and lively discussion of various ways that technology law impacts every small business in 2019.

If you were unable to attend or if you’d like a brief summary of what was discussed, here’s additional information on two of the discussion topics from this morning’s event:…
Continue Reading Expecting the Unexpected: Technology Law Issues for Every Small Business – Part 1

Advertising and other commercial activities happen in an instant on social media. Are you covering your bases legally when posting photos of individuals or groups on your company social media accounts?

State law governs when you can use a person’s name or likeness for commercial or advertising purposes – this is commonly referred to right of publicity or right of privacy depending on the context and legal status in the jurisdiction.

In Pennsylvania, there is a somewhat complicated legal framework comprised of both statutes and case law that governs right of privacy and right of publicity.…
Continue Reading When Can You Use Photos of Customers or Employees for Business Purposes?

Thank you to Chad Umble at LNP for another informative article regarding Pennsylvania liquor laws.  This one is concerning legislation pending in the PA House of Representatives that would impact the way that grocery stores and convenience stores could operate.

More specifically, the article highlights a bill currently being considered in the House’s Liquor Control Committee that would create a “customer convenience permit” which would enable those holding the permit to deny patrons the ability to consume alcohol on their premises, and also allow them more flexibility in terms of where they have to physically locate the beer and wine within their store.  It also proposes to remove some of the restrictions on how many ounces of alcohol can be purchased in any given transaction. As you might imagine, despite this being called a “customer convenience permit”, it is really a permit that was crafted solely by and for the grocery stores and convenience stores. As correctly pointed out in the article, Walmart is a major proponent of this bill and likely provided much, if not all, of the input on the bill as it was drafted.…
Continue Reading More about the Proposal for New Liquor Permits

Are you thinking about investing in Pennsylvania real estate? If so, forming a Pennsylvania limited liability company (LLC) has numerous benefits that will save you time and money in the future.

Here are the top five reasons why the LLC has become the entity of choice for investment real estate ownership in Pennsylvania:

  1. Realty transfer tax implications and timing

If you plan on owning real estate in an LLC, timing is critical to avoid paying Pennsylvania’s realty transfer tax more than once. Realty transfer tax in Pennsylvania is 2% of the value of the real estate.

You should form the LLC prior to signing the agreement of sale, and the party entering into the agreement of sale should be the LLC, not one or more of the individuals’ names. The reason for this is that Pennsylvania’s realty transfer tax law provides that a taxable event includes an assignment of an agreement of sale, which would trigger transfer tax twice.

Further, if you buy the real estate in your individual name and later wish to transfer the property into an LLC that is owned by you, you would also be required to pay realty transfer tax on that transfer.

Creating an LLC from the outset would avoid paying more tax than you are legally required to pay under the above two common scenarios.

  1. Limited liability protection for owners of the LLC

The owners (known as members) of an LLC enjoy limited liability for the debts and obligations of the LLC and the negligent acts of other members. A member’s liability is limited to the amount of his or her investment in the LLC, and their personal assets would be protected in the event causing liability.…
Continue Reading Why (and When) You Should Consider an LLC for Real Estate Investments

One of the questions I am asked most frequently from condominium and homeowner Association boards (and managers) is whether the Association is liable for injuries that occur on the common elements? The answer that I always give is that an Association is only liable for an accident on the common areas if they knew of the problem and failed to take reasonable care to make the common area safe. The recent case of Hackett v. Indian King Residents Association reinforced this answer.

In this case, a resident of the Association slipped and fell on some branches on a common area sidewalk. The branches fell only hours before she slipped on them. It was dark when the resident fell, so she could not see the branches that caused the accident. …
Continue Reading Association Not Responsible for Resident’s Slip and Fall Accident on Common Areas

Thank you to Chad Umble for another informative article about the changing landscape for PA liquor licenses.  I’m sure there are many who read the article and wonder why the PLCB doesn’t just increase the number of available licenses or create a different kind of license for grocery stores and convenience stores to alleviate the pressure on the restaurants.  The answer to that question is neither simple nor clear, but I can give you some thoughts on why those options are unlikely to occur.

First, simply issuing more licenses would involve a change to the liquor code in Pennsylvania, which would have to pass through the legislature.  It is not as simple as the PLCB simply saying that the quota should be updated or more licenses should be issued.  Any time a bill is introduced regarding changes to the liquor code, it usually generates a lot of attention from many industry groups.  The Brewer’s Association, Restaurant and Lodging Association, Tavern Owners Association, the Malt Beverage Distributors Association, and more recently the Convenience Store Council and the Food Merchants Association, all are trade groups that are impacted by even small changes to the liquor code.  Each of these organizations represents members in various aspects of alcohol sales in the state and any change to the liquor code often impacts each of these groups very differently.  As a result, when liquor bills are advanced in the house or the senate, enormous pressure is placed on our legislators to recognize the interests of these various groups and not change the landscape to hurt any particular industry.  What often happens as a result of this is little or no change. …
Continue Reading More about the Cost of Lancaster County Liquor Licenses

Last week, a new law was passed that allows municipalities to prohibit Video Gaming Terminals (VGT) in truck stops. If a municipality wants to opt out of allowing VGTs, it must pass a Resolution that prohibits VGTs before September 1, 2019. This new law reverses the 2017 gaming law that forced many municipalities to permit VGTs, provided certain conditions were met. This bill was sponsored by two Pennsylvania Senators from Lancaster County, Scott Martin and Ryan Aument.

In 2017, Pennsylvania amended its gaming laws to permit “mini casinos” and VGT arcades. The law gave different rights to counties depending on whether a casino was located in the county. If the county had a casino, the municipalities in that county could prohibit VGTs. If the county did not have a casino already, the municipalities could opt out of mini casinos, but were not allowed to prohibit VGT arcades in “truck stops.” A truck stop was given a very broad definition in this new gaming law. Practically, many convenience stores could be built or converted to meet this definition.…
Continue Reading Lancaster County Municipalities May Opt Out of Video Gaming Terminals

If you have been paying attention to what is happening in the brewing industry in Pennsylvania, you’ve noticed that there has been much discussion about the imposition of sales tax on beer manufactured in Pennsylvania and how that might affect consumer prices.  There was a lot of uncertainty about how new regulations from the Department of Revenue will be instituted and how sales tax will be charged on beer produced within the state. You may have read my post Sales Tax on Breweries back in the fall when we knew that it was coming but nobody was certain how it would ultimately be implemented. Now we have some guidance. As part of the 2019-2020 budget for Pennsylvania, the General Assembly was able to include some language that clarifies from a legislative standpoint (as opposed to internal regulations that the Department of Revenue was applying) how sales tax will be charged.

The issue that made this particularly difficult was the potential for inconsistencies in the amount of tax imposed, based on how the beer was sold.  For instance, in my previous post, I used the example of a $40 keg of beer that is sold at wholesale.  For a restaurant or other brewery buying that keg at wholesale, sales tax is paid and remitted to the Department of Revenue based on the $40 wholesale price, so $2.40 would be remitted for sales taxes.  Contrast that with the same keg of beer that is sold on site by the brewery that produced it.  If that brewery does not wholesale beer, under the guidelines issued by the Department of Revenue, the brewery would have to impose sales tax on each pint of beer sold from that keg.  Assuming approximately 120 pints of beer are sold from that keg and each pint is sold for $5.00, the brewery would have to charge and remit a total of $36.00 in sales tax.   With this new legislation, there should now be some consistency in terms of how sales tax is charged, regardless of whether a brewery wholesales its beer or whether they sell it entirely at their own property.…
Continue Reading Sales Tax on Beer

Just because your terms of service say you’re not liable, doesn’t mean you aren’t. Like the fine print at the bottom of a contract, website terms of use are a place for businesses to protect themselves. But they are not a substitute for thinking carefully about how you interact with your customers – particularly if…

Up until April 26, 2019, short-term vacation rentals (like Airbnb, VRBO, HomeAway, etc.) were probably allowed in zoning districts where single family homes are permitted. In April, the Pennsylvania Supreme Court decided that a short-term vacation rentals are not permitted as a single family use.

What do municipalities do now?

First, we should review how the Courts got to this point. It is an interesting development. The first case (Marchenko) dealt with a homeowner who rented her home for less than 25% of the year. The second case (Shvekh) had homeowners who rented their home for about half the year. The third case (Slice of Life) has an owner who bought the property solely as an investment, and never lived there at all. The Commonwealth Court said the first was OK, and then the next two cases built on that decision. …
Continue Reading New Ruling Says that Short-Term Vacation Rentals are NOT Permitted in Single Family Zoning