Rosemary Macedonio

Monday, 22 July 2002 09:38

Resisting the saming of America

I am an unabashed proponent of small business.

I believe that small business is good for America and good for Americans. At home and among friends, I'll get on my soap box and espouse the benefits of supporting locally owned businesses.

Having observed a growing debate over the issue of small vs. large, chain vs. mom and pop, I must now go public with my case.

In terms of the decision to buy from the little guy or go with the giant retailer, catalog or Internet super site, buying one thing is pretty much the same as buying another. A primary motivator, most often, is cost. Or, as one woman put it, "In the real world, people buy by price."

Maybe so, but not always. Besides, what is price? Does it include an aggravation factor? Does it take service into consideration?

I am willing to pay a little more for good service and, even more important, someone to take care of me if my purchase doesn't turn out as expected. I'm particularly willing to pay more to talk to an owner or to someone who reports directly to the owner instead of having to interrupt a clerk's personal phone call and/or being told, "This isn't my regular department. You'll have to ... " For the most part, you don't get that nonsense with locally owned stores.

Sometimes we only think that the big chains are cheaper, and therefore, we don't even give the little guy a chance. I just bought a digital camera. The national chain was out of the one I wanted. (Yes, I too can backslide from time to time.)

The locally owned store not only had plenty in stock, but its price wasn't a penny higher than the chain's. Moreover, I walked out with a coupon book that, among other things, entitles me and a guest to attend a free photography class.

Of course, there are many instances in which the national chain's prices are lower, at least while there is still local competition. But just wait until the local mom and pop store is out of the picture. While shopping at a drugstore chain at a location that I don't usually patronize, I noticed prices were significantly higher than those at the location I usually frequent.

When I asked the cashier if there was a mistake, she said, no, the other location's prices are lower because there is a Marc's down the street and the chain has to be competitive.

Let's talk about variety and appeal. Have you taken a long car trip lately? Does it seem that, no matter what where you are, you keep passing the same place? The same restaurants and fast food joints, the same gas stations, the same retail stores, even the same outlets. What do you get when you go in? The same thing you can get back home. Predictable, unexciting. Yeah, Applebee's or Friday's will give you a decent meal, but does it compare to the soup of the day and homemade pie at the little café they tore down to build it?

Competition is good for America, not only in terms of price, but also in terms of employment, diversity and selection. One by one, local retailers are disappearing because Mr. and Mrs. Consumer are going to the giants. Look at bookstores. I know of only three locally owned bookstores on the entire east side of Greater Cleveland. I go out of my way to patronize one in particular.

Do I pay more when I go there? Sometimes. Do I kick my husband in the shins when he orders from You bet. Why? Because many of us own or work for small businesses.

It might not affect my livelihood today if the local car dealer sells out to a national megachain, or if the few remaining independent bookstores knuckle under. But what's next? As a lawyer and small business owner, my clients are small businesses. As each industry succumbs to the giant mania, my target client gets smaller and smaller.

If we don't put our money where our own businesses come from, all that will be left are the big boys. And guess what? The big boys don't want to do businesses with the little guys -- at least not when it means supporting them instead of selling to them. So I might eventually be out of work. And I'll be dipped if I'm going to work for one of the big boy firms. Until then, I'll keep thinking small. Rosemary Macedonio is a partner in the law firm of Macedonio, Toerek & Box PLL. Her practice is geared toward the needs of privately owned companies, advertising agencies and health care providers. Her areas of practice include corporate, regulatory, trademark and copyright and employment law. She can be reached at (216) 360-9919.

Monday, 22 July 2002 10:02

Legal Briefs

According to the Ohio Supreme Court, when a business increases in value as the result of the company owner's own labor, the appreciation in value is a marital asset. Therefore, upon divorce, the spouse of the company owner is entitled to half of the appreciated value.

This is true even when an individual has owned the company before the marriage; in that case, however, it may be only the appreciation, not the company value just prior to the marriage, to which the spouse can make a claim.

Middendorf v. Middendorf, decided this summer, overturned prior cases which required the nonowning spouse to contribute substantial efforts to the business in order to lay claim to any appreciation in value. In making its ruling, the Supreme Court cited a change in the statutory definition of marital property, which now includes appreciation on separate property due to the labor, monetary contribution, or in-kind contribution of either or both of the spouses during the marriage.

Passive appreciation, such as increased value due to market fluctuations or other outside influences, remains a separate, nonmarital asset.

Property owners beware

For years, under Ohio law, property owners were generally not liable for injuries occurring on their property to the employees of independent contractors.

The general rule was modified in 1983, when the Ohio Supreme Court ruled that a property owner or occupant who hires an independent contractor, and who actively participates in the job performed by the contractor, can be held responsible for the injury or death of the contractor's employee, if the hiring party fails to eliminate a hazard which could have been eliminated using ordinary care.

Some members of the defense bar feel that the ruling in Sopkovich v. Ohio Edison Co. may have nearly eliminated the requirement for active participation by defining that term very broadly.

In Sopkovich, a painter was electrocuted while working adjacent to a live power line, which the defendant had failed to turn off. The defendant did not participate in the painting work, nor did it supervise or control the painting work or the workers. The court justified this expansion of liability by stating that "active participation giving rise to a duty of care may be found to exist where a property owner ... retains control over a critical variable in the workplace."

Has the Court, therefore, declared open season on property owners? Not necessarily. Sopkovich involved electrical power, something that is inherently dangerous, and which could be controlled only by the property owner. Moreover, whether the power was turned on or off could not be easily ascertained by the contractor or its employees. Nevertheless, defense lawyers are concerned that Sopkovich can be used to find that property owners are in control of any critical variables merely by owning the property.

Rosemary A. Macedonio, Macedo-nio & Toerek P.L.L., a Cleveland business law firm.