By Michael Fisch
Photograph by Michael J. Clarke
When you think of the term “transactional law,” perhaps your mind turns to corporate law—someone in a suit drafting contracts, maybe working on a corporate merger.
What you might not think of is a worker-owned cooperative of immigrant women in East Boston producing face masks and other personal protective equipment (PPE).
“People don’t necessarily connect transactional law with social justice,” says Clinical Professor Carlos Teuscher, who launched and directs Suffolk’s new Transactional Clinic. “But transactional law can be a transformative tool for our community-based clients. We can help create new economic structures that prioritize community and equity.”
Toward that end, his students work on legal formation, debt and equity financing, general contract drafting and negotiation, and commercial leases, among other work.
After working at two Big Law firms, Linklaters and Dechert, Teuscher brings experience in international finance deals and mergers and acquisitions to a whole new set of clients—one of those being Puntada, the East Boston mask-making cooperative.
Teuscher previously directed Harvard Law School’s Community Enterprise Project. We caught up with him to find out more about Suffolk’s new clinic.
Puntada’s worker-owners came together during the COVID-19 pandemic to support themselves and their communities. They decided to form a worker-owned cooperative, meaning that the workers, and not third-party owners, fully own and control the business. The workers produce and sell—or donate, in many cases—face masks and other PPE to support low-income immigrant communities in the Greater Boston area. Their masks have made their way to families in East Boston, Chelsea, Chinatown, Lynn, and Dorchester, as well as to other cities across the U.S.
Working with the cooperative incubator Center for Cooperative Development and Solidarity in East Boston, students in the Clinic recently conducted a bilingual workshop with the worker-owners to better understand their legal needs. In addition to learning presentation and other client-based skills, the Clinic students are developing Puntada’s internal legal documents, including a tailored limited liability corporation operating agreement that will set out Puntada’s governance and financial structure.
A CLT is often a nonprofit corporation that is controlled by members of the community. In many CLTs, the CLT owns land with the intent to hold the land in perpetuity for affordable housing, among other uses.
In the case of affordable housing, the CLT will often build a home on its land and sell the building only—not the land—to someone of low or moderate income. The land is leased to the building owner, often for 99 years.
This “ground lease” approach is designed to ensure that the nonprofit can hold onto the land—it won’t be sold to developers. But homeowners still gain equity through appreciation of the part they do own—the building.
There’s another big benefit here. As the land value goes up, the buyers in a low-income community aren’t saddled with that high land cost, just the building cost, so homes are more affordable.
There’s less displacement of low-income people, a lot less foreclosure, and affordable housing for generations. Also, because they have the ability to vote for the CLT’s board of directors, long-term residents have more of a say on how the land in their community is used.
One of our CLT clients this semester is the Boston Neighborhood Community Land Trust. BNCLT provides affordable housing to many families in Boston’s communities of color that have been disproportionately impacted by COVID-19.
One of our student projects for BNCLT this semester is to develop a form of ground lease so that the CLT can move forward with donations of land from two separate homeowners in Dorchester. The lease contains affordability and other restrictions so that the land is controlled by the community, while still allowing the homeowner to build equity.
