New Law Seeks to Raise Minimum Injury Insurance Limits

The State of Illinois is currently debating a bill which would effectively increase the minimum insurance coverage for bodily injury required of drivers in Illinois.  Currently, the minimum coverage necessary to keep a driver “legal” is $20,000 per person, $40,000 per occurrence.  Senate Bill 1898 would raise the minimum limits to $50,000 per person, $100,000 per occurrence.  The bill would also raise the minimum coverage for the destruction of property from $15,000 to $40,000.

Where does Illinois currently stand amongst the 50 states you ask?  Essentially in the middle.  However, passage of this law would put Illinois at #1 with Alaska, Maine, and Wisconsin, each having minimums of $50,000/$100,000.  Piece of advice,   be careful driving in Florida or Ohio.  The minimum to keep drivers in those states legal is $10,000 and $12,500 respectively.  The most common minimum policy limits (shared by 26 of the 50 states) is $25,000 per person, $50,000 per occurrence.

The best advice is to never rely upon other drivers carrying enough (or any) insurance.  Always make sure that you carry uninsured and underinsured motorist coverage.  Make sure to purchase a policy with the highest bodily injury limits you can afford.  The most common policy in Illinois is typically $100,000 per person, $300,000 per occurrence.  While the cost of uninsured and underinsured coverage is relatively minimal, the amount of money it could save you down the line could be substantial.  

Sometimes you want the public defender.

March 18, 2013 was the 50th anniversary of Gideon v. Wainwright, in which the U.S. Supreme Court unanimously ruled that states are required under the 14th Amendment to provide counsel to criminal defendants who cannot afford a private attorney.  I don't practice criminal law and I never really gave that case much thought after law school, but several news items over the past couple of weeks have made me think about it more.

I read an article last week that praised the Gideon ruling, but at the same time lamented the sad state of most public defenders' offices.  The lawyers are overworked, underpaid, and sometimes incompetent, the article alleged.  While they may be overworked and underpaid, it is completely unfair to categorize public defenders as incompetent.  

Tom McCullough is a public defender.  He is the public defender of DeKalb County.  He was formerly the Kane County public defender.  He has handled some of the highest profile murder cases in the Fox Valley area over the past several decades.  

Tom McCullough is a heck of a lawyer.  Recently, he represented William Curl, who was arrested for the murder of NIU student Toni Keller.  That case was all over the news last week when Mr. Curl entered a guilty plea in exchange for a 37 year sentence.  Since he has already served nearly three years, he will be released in approximately 34 years.  

Following the entry of the plea, several lawyers involved in the case gave interviews on the courthouse steps out in Sycamore.  I have placed a link below to Tom McCullough's interview.  It's only about three minutes long and it's worth it.

Here is the link to the interview:  "Public Defender Tom McCullough Talks Curl Plea Deal"

When I saw that interview, I immediately thought about that article that I mentioned earlier.  I also thought about a lot of other interviews I saw last summer by private lawyers.  Anybody who wouldn't want Tom McCullough as their lawyer just because he's a public defender must be crazy.  Just watch the interview.  He's as cool as they come. 

Just think what could happen if you hired a private lawyer.  You might get this guy:

Is Lassie Family or Property?

Everyone knows that feeling of a long day that sometimes brings you home in a funk.  You come home expecting to sit on the couch, do a little mindless TV watching, and then retire to bed.  However, something changes your plan and at the same time, your entire outlook on the evening.  The look of an excited and happy dog wagging his or her tail and waiting and ready to greet you and make all of your troubles go away.

Pets have become intertwined in the fabric of our lives.  For most people, they are family members.  They depend on us for food and shelter and in return, give us unconditional love.  When we lose a pet to illness or accident, it is only natural that most people go through a grieving process similar to the loss of a family member or friend.  In the case of an accident caused by another’s negligence, what rights does a pet owner have to recover damages for not only the value of the pet, but the medical bills and loss of companionship that the owner suffers?  For many years, the answer was the actual true market value of the pet.  However, many jurisdictions, including Illinois, have moved toward a more progressive understanding and approach to measuring the damages associated with injury or loss of a pet. 

The most recent Illinois case to examine the treatment of damages associated with injury or loss of a pet was Leith v. Frost, 387 Ill.App.3d 430 (4th Dist. 2008).  In Leith, a couple filed suit for serious injuries sustained by their dachshund, Molly.  The dachshund was attacked by a neighbor’s Siberian husky, Cosmo.  While the couple sought payment of $4,784 in veterinary expenses for Molly, Cosmo’s owner argued that the couple was only entitled to the fair market value of Molly, $200.  The trial court agreed and limited damages to $200 holding that under the law, a dog is property and not person. 

The Fourth District Appellate Court disagreed, finding that it was reasonable to expect pet owners to spend any amount necessary to cure a family member.  Said the court:

It is common knowledge that people are prepared to make great sacrifices for the well-being and continued existence of their household pets, to which they have become deeply attached.  They feel a moral obligation toward these animals.  Emotionally, they have no choice but to lay out great expenditures when these animals suffer a serious physical injury. 

While agreeing that pets are considered personal property, the court equated the value of a pet as akin to that of a family heirloom, photograph, or trophy (i.e. priceless).  In doing so, the court held that damages should not be limited to something as nominal as fair market value, but that the owner should be able to provide evidence of what the pet’s value was to him or her. 

In Leith, the pet owner only sought payment of the veterinary expense as Molly ultimately survived.  Thus, the court did not address whether a pet owner should be entitled to damages for the loss of a pet.  More specifically, should a pet owner whose pet dies as a result of the negligence of another be entitled to damages commonly associated with the wrongful death of a person, i.e. loss of companionship, loss of society?  This is an area of law that will continue to develop and perhaps one day will more closely resemble how pets have become true family members.       

Are pets family members?  Should a pet owner be entitled to damages for the loss of their pet and the emotional suffering such a loss inevitably engenders?  Any and all comments or questions regarding this topic are greatly welcome.    

U.S. Trustee Suspends Debtor Audits

According to a report on DowJones.com, the U.S Trustee ("UST"), the division of the Justice Department that monitors all bankruptcy cases, has indefinitely suspended its auditing program due to budgetary constraints.  The BAPCPA amendments of 2005 authorized the UST to audit 1 out of every 250 consumer bankruptcy cases filed in this country.

This means several different things.  For debtors, it means less oversight, intrusion, and hassles from the UST.  It will reduce work and expenses for debtors' attorneys, most of whom work for a flat fee whether they are audited or not.  It will also let debtors sleep easier at night knowing that it is more likely that they will get their discharge without having to jump through the hoops of an audit.

For creditors, it might mean that debtors will become more brazen with their petitions.  If a debtor knows that there is no risk of an audit, he or she might take chances in filing a case that may not have been filed in the past.  Creditors should begin to review debtors' petitions for accuracy more so than ever.  There are several different ways that creditors can object to debtors' cases, so sharp-eyed creditors' lawyers should analyze all bankruptcy petitions for truthfulness and accuracy.  

Please give me a call if you have any questions about the bankruptcy process, whether you are considering bankruptcy for yourself or if someone who owes you money has recently filed bankruptcy.  

Can Macy's be forced to honor this advertisement?

Macy's mailed an advertisement this month that listed a $1,500 sterling silver necklace for $47.  The list price was supposed to be $479, but the advertisement contained a typo that listed the necklace for $47.  

Apparently, several customers did get this "super buy" because when Robert Bernard arrived at a Macy's location in Plano, Texas, he was told that they were sold out of the necklace.  The teller did offer to have the necklace shipped to Mr. Bernard's house though.  He paid for the necklace at the register and was told that it would be shipped shortly.  Before the necklace arrived, however, Mr. Bernard received a voice mail from Macy's telling him that the advertisement had been a mistake and that his order had been cancelled.

Let's analyze this situation from the perspective of a breach of contract case (in Illinois).  In order to form a contract, there must be an offer and an acceptance.  Ordinarily, a newspaper advertisement, whether it contains an erroneous purchase price or not, is not an offer that can be accepted to form a contract.  The advertisement is construed by the courts of Illinois as an invitation to the general public to come in and make an offer.  It would then be up to the store to accept the offer.  At that point, you'd have a contract.  See, for instance, O'Keefe v. Lee Calan Imports, Inc., 128 Ill.App.2d 410 (1st Dist. 1970).  

So, not everyone who received this advertising circular from Macy's can sue them for a $47 necklace.  Mr. Bernard, however, might actually have a case.  Mr. Bernard did make an offer in response to the advertisement.  Macy's, through its agent (the store clerk), accepted his offer.  He fully performed by paying $47 on his credit card.  He is entitled to full performance of the contract by Macy's.  In my opinion, Macy's breached the contract by calling and telling him that his "order had been cancelled."

I'm sure some of the brilliant Blog followers will be able to argue the other side of this case.  Who wants to defend Macy's?  Who wants to tell me why this was not a valid contract?  Who wants to make Professors Gaebler and Reynolds proud????????  Any and all comments would be appreciated.  

LLC Charging Orders

Charging orders are one of the more confusing areas of judgment enforcement law.  Ordinarily, a judgment creditor would serve a citation to discover assets and then look to the citation statute for enforcement procedures.  Under Section 1402, when non-exempt assets are discovered, the court can compel the judgment debtor to deliver those assets either to the sheriff or a private selling agent for sale.  The proceeds of the sale are then applied to the judgment.  This is commonly called a turnover order.  

However, you can't obtain a turnover order on a judgment debtor's interest in an LLC.  In order to do that, you'll need a charging order.  Section 30-20(a) of the Illinois Limited Liability Act provides that "on application by a judgment creditor of a member of a limited liability company or of a member's transferee, a court having jurisdiction may charge the distributional interest of the judgment debtor to satisfy the judgment."

I just read a case that further clarifies the procedures behind a charging order.  The case is Bank of America v. Freed, 2012 IL App (1st) 110749.  Here is the relevant paragraph:  

Under the Illinois Limited Liability Company Act (Act), a charging order only gives the judgment creditor the right to receive distributions to which the member would otherwise be entitled, and if the charging order is foreclosed, the purchaser would have only the rights of a transferee of distributional interests. Under section 30-1(a) of the Act, a member of an LLC “is not a co-owner of, and has no transferable interest in, property of a limited liability company.” 805 ILCS 180/30-1(a) (West 2008). Further, section 30-5 of the Act provides that a transfer of a distributional interest in an LLC does not give the transferee any rights as a member but only the right to receive distributions by the LLC, while section 30-10 provides that transferee may become a member only if all other members consent (805 ILCS 180/30-10(a) (West 2008)). A “transferee who does not become a member is not entitled to participate in the management or conduct of the limited liability company’s business, require access to information concerning the company’s transactions, or inspect or copy any of the company’s records.” 805 ILCS 180/30-10(d) (West 2008). Therefore, an Illinois LLC has no interest that is affected when a charging order is entered on a judgment debtor’s distributional interest because the party in whose favor the charging order is entered is not an owner of the LLC and has no authority over the LLC’s affairs and can only receive distributions. Hence, the LLC has no interest to be protected and need not be made a party.

“We are all vessels: human bags carrying sea water.”

How’s that for an argument for federal admiralty jurisdiction? 

Debtor bought a used pick-up truck for $28,000 at 23.9% interest and the note was assigned to AmeriCredit Financial Services, Inc.  He made one payment and then sent AmeriCredit the note stamped with the words “Accepted for value and returned for value for settlement and closure” and directed AmeriCredit to bill the balance to the U.S. Treasury. 

AmeriCredit repossessed the truck, sold it, and billed debtor for the deficiency of over $11,000.  Debtor then sued AmeriCredit in federal court for $34 million plus $2.2 Billion in punitive damages.  Here Judge Posner notes that “(N)eedless to say, he was proceeding pro se.”  Debtor, now plaintiff, claimed jurisdiction on both diversity and admiralty grounds.

Although plaintiff had “perfect diversity” among the parties he failed to satisfy the second prong of diversity jurisdiction which requires an amount in controversy of $75,000 because although he alleged over $2 billion in damages, Posner found it to be “a legal certainty that the plaintiff is entitled to recover nothing.”  

His claim of admiralty jurisdiction also failed.  Although the debtor didn’t explain this claim Judge Posner recognizes the debtor’s claims as arising from the Sovereign Citizens' movement and cites to one of its publications that explains that because “(W)e are all vessels; human bags carrying ‘sea water’” there is admiralty jurisdiction.  The Judge disagrees with this analysis, deciding instead that because there is no claim involving maritime activities there is no admiralty jurisdiction.

Baba-Dainja El Vs AmeriCredit Financial Services, Inc. United States Court of Appeals for the Seventh Circuit,  No. 12-3310

Illinois Appellate Court Maximizes Recovery to Injury Victims

In Stanton v. Rea, 2012 IL App (5th) 110187, the Fifth District Appellate Court scored a huge victory for personal injury plaintiffs by maximizing the amount a personal injury victim is entitled to receive out of a settlement or judgment.  Under the Health Care Services Lien Act, 770 ILCS 23/1, medical providers asserting a lien on a personal injury claim are entitled to up to 40% of a verdict or settlement on behalf of a personal injury plaintiff.  If the liens total 40% or more of a settlement or judgment, the law limits attorney’s fees to 30%.  Prior interpretation of the law left a personal injury plaintiff with a maximum of 30% of their personal injury recovery.  In essence, the medical providers received the greatest benefit from the plaintiff’s recovery while also retaining the right to collect any remaining balance on their bill after reimbursement from the settlement or judgment.

In Stanton, the Fifth District determined that calculation of the 40% due to medical providers should only begin after reducing the recovery by the total attorney’s fees and costs.  The example below demonstrates exactly how important this is to an injured victim’s recovery:

            Prior interpretation of the Act:

              $100,000 settlement/judgment
            - $  30,000 attorney’s fees (30%)

            - $  10,000 costs

            - $  40,000 medical liens (40%)

            =$  20,000 net recovery to injury victim

            Interpretation of the Act after Stanton v. Rea:

           

              $100,000 settlement/judgment

            - $  30,000 attorney’s fees

            - $  10,000 costs

            =$  60,000 amount subject to Act computation

           

            *40% of $60,000=$24,000 (amount lienholder entitled to under the Act)

              $100,000 settlement/judgment

            - $  30,000 attorney’s fees

            - $  10,000 costs

            - $  24,000 lienholders share

            =$  36,000 net recovery to injury victim

Based upon the Appellate Court’s interpretation of the Act, the injury victim’s net recovery in the above example increased by $16,000, a substantial amount.  Medical providers, however, are still entitled to bill and collect the outstanding balance left after reimbursement of their lien. 

The Illinois Supreme Court denied certiorari in Stanton v. Rea, so this case is currently the law of Illinois.  

Mortgage Lenders Kill People - Part II

I wrote about a wrongful death case several years ago in which a widowed plaintiff alleged that her husband was killed by a mortgage lender's harassing telephone calls. HERE is a link to that story. I never heard how that case was resolved.

Today, I saw the following article about a guy who DIED IN COURT at a hearing in his lawsuit against Wells Fargo. He was suing them for screwing up his real estate tax escrow and causing him to default on his mortgage. These murderous mortgage lenders are out of control!!

According to the now-deceased plaintiff, a Wells Fargo typo ultimately resulted in foreclosure on his home. When Larry Delassus’ received a demand from Wells Fargo that he pay two years of late property taxes on his property in order to avoid foreclosure, he was understandably surprised. Delassus had paid his property taxes every year and did not owe a penny. In fact, Wells Fargo had paid property taxes on another neighboring property, but due to a two-digit typo, sent the bills to Delassus. Delassus, who spent a fair amount of time in and out of hospitals did not question the demand for back taxes or the increase in his mortgage (from $1,237.69 a month to $2,429.13 a month), but simply stopped paying his mortgage and moved into an assisted-living home in Carson, California. It was not until nearly two years later than his attorney discovered the typo and attempted to fight the foreclosure. The bank’s attorney acknowledged the error but refused to let Delassus resume paying his mortgage without catching up via a reinstatement payment first. Initially, Delassus was unable to find out how much he owed in reinstatement and would likely have been unable to pay it anyway on his fixed income. When he finally received an amount in January 2011, it was the sum of $337,250.40, owed in the next 24 hours or the foreclosure would move forward. The condo was sold in May 2011[1]. The story took a truly tragic turn, however, when Delassus died in court last December while pursuing a negligence and discrimination case against Wells Fargo. At the time of his foreclosure, Delassus was actually six months ahead on his property taxes[2]. Nevertheless, the judge had already indicated that she planned to rule for Wells Fargo, which led a bank spokeswoman to say that “there was no reason for Mr. Delassus to attend” after expressing sympathy over his death.