Prairie State Legal Services is Hiring

An article in yesterday's Rockford Register Star said that Prairie State plans to add 13 attorneys to defend foreclosure cases.  The funding for the new hires will come from a settlement obtained by the Attorney General's office.  HERE is a link to the article.

Emergency Motions in Bankruptcy Court

The U.S. Bankruptcy Court for the Northern District of Illinois just issued a new General Order regarding procedures for emergency motions.  The procedures must be followed for anyone seeking emergency relief after October 1, 2012.  The Order states that matters may only be treated as an emergency if "it arises from an occurrence that could not reasonably have been foreseen and requires immediate action to avoid serious and irreparable harm."  I wish there was a state court equivalent to that order.  I've often thought that most "emergency" motions filed in state court are not really an emergency at all.  

In any event, I thought you should be aware of this new Order, a copy of which can be found HERE.

My 1L summer internship experience at BP America Inc.

My 1L summer, which ended a few weeks ago, was memorable.  Not only was I thankful that I had emerged alive at the other end of the first year of law school, I was also incredibly fortunate to receive an offer from BP to be one of its two legal interns at its Naperville-Chicago offices.  The internship is supported by the Diversity and Inclusion (D&I) initiative of BP's Legal Department, and applicants are required to demonstrate a commitment to D&I.

Being a BP intern was a privilege with huge benefits.  As everyone who's ever been a law student probably knows, there are very few 1L internships.  Of those available, most are unpaid, or at best, minimally paid.  Not only does BP add some serious weight to one's resume, it also provides a healthy salary and a tremendous learning opportunity.

To begin with, all the legal interns (five across the company) were taken to corporate headquarters in Houston for a week of orientation.  The orientation included such onerous tasks as a steak dinner at one of Houston's finest dining establishments, and a day in Galveston visiting the Offshore Drilling Museum and lunching on fresh seafood by the ocean.

On returning to Illinois, I was immersed in the work-world of BP's attorneys -- all of whom have impeccable credentials (Managing Editor of Stanford Law Review!  Undergraduate degree from Yale!  Taught at MIT!  Formerly of Katten!  Formerly of Sidley!  Formerly of Jenner & Block!  etc.).  I rotated through all the practice areas in the Naperville-Chicago offices, spending one week in each.  Devoting time within many areas and watching attorneys interact so closely with their clients (in some cases, they literally work in the same room) taught me volumes about the practice of the law.  Some lessons were unique to the corporate counsel experience.  For instance, I was invited by one of the attorneys to a day-long Incident Response Seminar at which several business units strategized on how to respond to an incident, and I saw where and how Legal fit into that plan.  It was an experience unique to a major corporation with a large in-house legal department like BP, and it gave me a very specialized perspective.

BP went to great lengths to groom me for my legal career.  I went through a resume review, a session on interviewing tips, and three mock interviews towards the end of my internship, to help prepare me for my future job search.  As an intern, I was partnered with an attorney who was my "buddy" and my main contact.  He would stop by my desk every day to chat, give me pointers, and answer questions.  I went into his office often -- to talk about my interests, ask questions about firms, and discuss the law school experience.  He pulled me into meetings with clients, external counsel, consultants, and other attorneys within the group, and patiently cleared the fog that often clouded my mind.  He provided a wealth of advice and encouragement, and always had time for me.  I was assigned another attorney for my summer project -- a comprehensive presentation on a consent decree.  She made time to explain complex technical matters to me, took me to meetings with the client, reviewed my draft, resolved my confusions, fielded the tough questions at my presentation, and was unfailingly supportive.  Throughout the legal department, no door was shut to me.  People were friendly, cheerful, and always ready to feed me lunch.

Thanks to BP, my interests have broadened.  In particular, I hope very much to be involved in D&I initiatives wherever I work.  Before my internship, I didn't even know that such an area of activity existed within a business organization.  BP not only taught me about its existence and its visibility, it also showed me how much of a priority it can be to an organization.  BP has shown me what D&I can look like within an organization, and I plan to build on that experience.

Without the least bit of exaggeration, I can say that I loved every single day of my summer at BP.  I created friendships, built connections, and was part of the legal team of one of the largest corporations in the world.  It was, without a doubt, the 1L summer of my dreams.

Kane County Eviction Guidelines

I have previously posted the Sheriff's eviction instructions for Will and Kendall Counties. The Will County instructions are HERE and the Kendall County instructions are HERE.  Also, both of these are linked in the Forms Archive of this Blog.

Now I also have a link to the Kane County Eviction Instructions.  The Kane County instructions can be found HERE and they are also located in the Forms Archive.

Kendall County Eviction Guidelines

Several months ago, I posted the Will County eviction instructions published by their Sheriff's Department.  HERE is a link to that post and the instructions are also linked in the Forms Archive portion of this Blog.

Those instructions have gotten a lot of clicks since I put them up, so I am now linking to the Kendall County Eviction Guidelines.  HERE is a link to the Kendall County Guidelines. They also appear in the Forms Archive as well.

Let me know if anybody has any questions.

Law School Tuition in Illinois

As reported in the Chicago Daily Law Bulletin, here are the tuition amounts for in-state students for all law schools in Illinois (in alphabetical order):

• DePaul University College of Law - $43,636
• IIT Chicago-Kent College of Law - $42,900
• John Marshall Law School - $42,724
• Loyal University Chicago School of Law - "around $41,000"
• Northern Illinois University College of Law - $19,811
• Northwestern University School of Law - $53,468
• University of Chicago Law School - $53,560
• University of Illinois College of Law - $37,100
• Southern Illinois University School of Law - $16,995

I wonder what value the Chicago students receive that is worth 2-3 times the NIU tuition?  This chart just confirms my decision nine years ago to go to Northern.

LCD Class Action Lawsuit

If you bought a LCD flat-panel TV between January 1, 1999 and December 31, 2006, you may be entitled to a settlement in a current class action lawsuit.  The case alleges price fixing of the screens.  

Unfortunately, the class action does not apply to purchases made in Illinois.  So, if you reside outside of Illinois, and you picked up this blog on Google, or if you happened to purchase a TV while on vacation out of state, you are in luck.

Claims can be submitted online at www.lcdclass.com. Anticipated payment to claimants is $25.00.

Long Term Care Insurance: The basics that every attorney should know about the changing landscape of long term care

The long term care industry has evolved over the last 30 years with perhaps the most significant changes occurring within the last 5 years.  Many new products are now available, bringing access to long term care to those who previously could not qualify for coverage.  Today, a long term care solution can be tailored to your client’s specific financial as well as medical situation.  The changing landscape within the long term care industry is providing an opportunity for attorneys in tax, estate planning, and elder law to enhance the value that you bring to your clients as a trusted advisor.  By incorporating a discussion about long term care into your estate planning process, you have an opportunity to address a client’s pressing need for long term care as well as provide additional ways to preserve and protect the client’s financial assets.  The discussion that follows will provide an overview of the changing landscape of long term care. 

Traditional long term care insurance has previously been out of reach for many clients due to a client’s pre-existing medical conditions.  Unfortunately, many people tend to wait too long to begin thinking about long term care insurance and by the time they shop for coverage, they cannot obtain the coverage due to either advanced age, cost of coverage, or pre-existing medical conditions.  The conversation with clients can begin as early as age 45 or whenever a client first contacts their attorney to discuss estate planning and asset preservation issues. 

Traditional long term care insurance is underwritten in a manner similar to life insurance.  The underwriting process typically requires a physical examination as well as a five year look-back period whereby the underwriters can request an applicant’s medical records going back five years from any medical provider.  There is a long list of common medical conditions that serve as “knockout” conditions that disqualify an applicant from obtaining long term care.  The list of common knockout conditions can include any diagnoses of a chronic disease or medical condition, even if the condition is not severe or presently manifesting itself, and can include diabetes, multiple sclerosis, Alzheimer’s, dementia, congestive heart failure, heart attack, stroke, and various types of cancer, etc.  The brief list provided is not an exhaustive list and each insurance company provides its own list of disqualifying conditions. 

Traditionally the analysis came down to whether a client had sufficient financial resources to self insure or whether they could afford or had the desire to purchase long term care insurance.  These elements of the analysis remain largely unchanged.  The difference today is the choice in insurance carriers that provide long term insurance policies and the types of policies that are available.  However, the choice still ends up centering around what can the client afford and which solution is the most suitable to the client.  Suitability varies from client to client depending on their financial resources, age, risk tolerance, time horizon, and any tax, estate planning, and asset preservation planning issues unique to the client. 

A client with several million dollars in assets might choose to self insure.  However, there remains the risk that even a person with substantial assets could spend through their entire nest egg and end up being a burden to their family or to society.  The most rational choice for clients with substantial financial resources who wish to pass on a rich legacy to their heirs would be to purchase long term care insurance.  Even for clients with modest means, long term care insurance makes sense if the client can afford it in order to not spend through one’s assets or become a burden to loved ones. 

The cost of care is high today, no matter whether it is private at-home care or care given in a nursing or assisted living facility, and the cost is likely going to continue to increase in the future.  For example, it is commonplace today to spend $1500 per week, out of pocket, for non-qualified at home care that includes cooking, light cleaning, running errands, and occasional personal care.  This non-qualified care will cost $78,000 cash out of pocket this year and the cost would be even greater for qualified caregivers such as private at home nursing care.  Also, consider the cost of assisted living.  It is quite common today to spend $100,000 or more per year to keep a family member in a private room in an assisted living home.  These costs will likely continue to increase with time given inflation and changes in healthcare policy in our country.  Also, the cost goes up if the patient needs to move into a qualified nursing home. 

The need for long term care is great since people are living longer.  Today, if a disease doesn’t wipe-out a person quickly, the chances are great that person will live with the condition for many years.  In general, people are staying active longer and are living healthier, more productive lives.  Yet with all of the advances in medicine through the years, we have yet to come up with ways to ease the financial burden of growing old.  According to a 2008 study conducted by the Department of Health and Human Services, at least 70% of people over the age of 65 will require some long-term care services at some point in their lives.  Attorneys who get out in front of this issue with their clients by incorporating a long term care review into their estate planning process will be doing a great service for their clients. 

The traditional long term care insurance policy is a reimbursement policy that reimburses the insured person for certain caregiver expenses if they cannot do two or more of the Activities of Daily Living (ADLs) which include eating, bathing, dressing, transferring, toileting, and continence.  When shopping for traditional long term care, the client has a choice of the benefit amount, and the number of months of coverage, as well the type of inflation protection they desire.  If approved by the underwriters, the long term care policy goes into effect, and the client must make periodic payments either monthly, quarterly, semi-annually or annually to the insurance company. 

The traditional long term care insurance policy provides the purest form of long term care insurance.  However, the traditional approach has drawbacks which include stringent medical underwriting, the necessity of having to pay the insurance premium continuously out of pocket as long as you own the policy or until you make a claim on the policy, as well as the possibility that the insurance company one day imposes higher premiums. 

As mentioned at the beginning of this article, the long term care insurance industry has been undergoing rapid changes the last several years.  Several insurance companies have exited the long term care industry, while others have expanded their presence with the roll-out of new products.  Among the new products are several “hybrid” or “alternative” long term care solutions.  The two major alternative categories are 1) universal life insurance policies that include a long term care insurance rider and 2) variable annuities that contain long term care features. 

The most significant development in the long term care industry to come about with the introduction of the alternative products is the reduced or relaxed underwriting standard that is available through some of the insurance providers.  This is very significant because due to the relaxed underwriting, and in some cases no underwriting, clients with pre-existing medical conditions who ordinarily would not qualify for long term care, can for the first time purchase long term care coverage. 

The universal life insurance policy with long term care rider provides indemnification if a client cannot do two or more of the activities of daily living.  The underwriting process for the universal life insurance hybrid can be satisfied with a simple 45 minute phone call rather than the lengthy and invasive medical underwriting process that is customary with traditional long term care.  The universal life insurance hybrid provides three types of benefits.  1) If the client passes away suddenly without using the long term care feature, the policy will pay a death benefit to the client’s estate.  2) If a client purchases the policy and then changes their mind or a better product happens to come along and they want to get out of their current policy, some of the universal life insurance products provide a guaranteed return of premium.  3) The third benefit available with the universal life insurance hybrid is the long term care feature which will pay a specific dollar amount for a specified period of time if the client cannot perform two or more of the activities of daily living.  All that is required is a signature by the client’s own doctor to certify that the client is unable to perform two or more of the activities of daily living.  The certification must be renewed annually.  Some of the policies provide total flexibility which gives the client the choice whether to go into a qualified nursing facility, assisted living, or to receive care in their own home. 

The other alternative product is a variable annuity contract.  For those who are not familiar with these investments, a variable annuity is an investment vehicle that comes with an insurance wrapper, ie: there is an investment portion that can grow in value over time, as well as a contractual guarantee from the insurance company to pay some specified benefit to the policyholder or beneficiary at some point in the future.  In a typical variable annuity contract, a portion of the premium is used to pay for the cost of the insurance protection that the insurance company provides, and the remainder of the premium, less fees and expenses, is placed into a separate account at the insurance company and the money in the separate account is invested in a basket of investments such as mutual funds or indexes that follow the stock and bond markets.

The variable annuity featuring long term care requires no underwriting whatsoever.  This is extremely significant because those clients who would not qualify for any other type of long term care insurance due to a pre-existing medical condition can for the first time obtain a form of coverage.  The money the client places into the variable annuity contract is designed to grow if the pool of investments that the money is tied to grows.  If the investments don’t grow, the variable annuity contract provides an underlying step-up in value that the insurance company is contractually obligated to provide. 

As with all variable annuities, the investments in the separate account will continue to grow if the market performs well, or the policyholder will continue to receive the step-up in value from the insurance company either until the client reaches a specific age or until the client annuitizes the contract.  If the client annuitizes the contract, this means the client is turning the cash value of the variable annuity into a stream of income for life, guaranteed for as long as they live.  The long term care benefit comes into play if the client cannot do two or more of the activities of daily living and they obtain a signature from their physician, then the payout from the insurance contract doubles, serving as long term care.  The cash is provided on an indemnity basis and can be used for any purpose.  This gives the client total flexibility in choosing whether to stay in their own home or move into a care facility. 

Both the variable annuity and the universal life insurance solution are designed as single premium solutions.  These products can be purchased with a one time, lump sum, up-front premium rather than periodic payment of premiums.  This provides retired clients who may be living on a fixed income with the peace of mind of not having to worry about making periodic payments of their premium as is common with the traditional form of long term care insurance. 

As with most other types of life and health insurance, long term care tends to cost less if it is purchased when the client is younger and in their best health.  Premiums for traditional long term care and universal life insurance will increase with age.  Most of the resistance that clients have regarding long term care insurance tends to center around affordability.  Some clients may have obtained quotes for long term care products many year ago and dismissed it because it was too expensive.  It turns out that most attorneys as well as prospective clients are not even aware of the alternative/hybrid products that are available today and are not aware of the options available to pay for long term care.  The bottom line is that there is a long term care solution available for just about everyone today and the products are available in a range of price points and include a range of features.  The purchase of one of the available long term care solutions should not be dismissed out of hand simply based on a perceived lack of affordability. 

How to fund the purchase of long term care is a specific concern for many clients, especially for retirees who are living on a fixed income.  There are many ways to tackle the problem.  For those who built a small business and have recently sold a stake in their company, a lump sum from the sale of assets or the business could be set aside for long term care.  For those who retired with a 401(k) or IRA, several long term care solutions can be funded with assets from a qualified retirement plan.  A tax free 1035 exchange of the cash value out of an old life insurance policy or an old annuity is another very common way to leverage existing assets to obtain long term care. 

Each alternative has its own characteristics which can make the product either suitable or not-suitable for a specific client, depending on the facts unique to the client’s case, as well as the client’s time horizon, risk tolerance, and specific objectives.  A comprehensive discovery process is required before specific recommendations can be made to clients.  Doing the discovery and assisting the client with this analytical process should be left to the client’s financial advisor. 

Incorporating the discussion about long term care planning into an attorney’s tax and estate planning review should be adopted as a best practice as part of any holistic estate planning practice.  If handled the right way, a conversation about long term care would help get clients into the right mindset to address long term care with their financial advisor and help provide the client with action items that are consistent with preserving their hard earned assets and achieving a multi-generational transfer of wealth, as well as their other financial goals.  Reviewing these issues with your clients will enhance the value that you bring to your clients and, strengthen your value proposition as an attorney, helping you win more repeat and referral business, and helping to cement your position as one of your client’s trusted advisors.  

Illinois Criminal Policies and Procedures

The Illinois Criminal Justice Information Authority has released a new guide called “Policies and Procedures of the Illinois Criminal Justice System.”   The guide provides an overview of how the state adult criminal justice system typically operates in Illinois. It offers information on the flow of adult criminal cases through the criminal justice system including arrest procedures, the court system, pretrial activities, trial, sentencing, corrections, and the criminal record expungement process.  It offers a step-by-step outline of the criminal justice process, with ample citations to statutory authority.  It was apparently funded by a grant from the U.S Department of Justice.  

HERE is a link to the guide.  This will probably not be too much help to the experienced criminal lawyers who read this blog, but it is a great resource for those of us who are not so familiar with the process.