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Thursday, December 6, 2012

Recent Case Law Has Interesting Implications for the Law of Wills and Estates and Personal Injury

Recently, the United States Supreme Court decided the case of Kurns as the executrix of the estate of Corson who was deceased and others against the Railroad Friction Products Company. The case has interesting implications for the rights of a deceased person to sue. The case concerned a man who worked as a welder and machinist for a railroad carrier. After retirement, he was diagnosed with mesothelioma. He and his wife then sued the company that was responsible for he is exposure to asbestos in the train repair workshops and is the company's train engine parts which were distributed by the company that was sued. The plaintiff alleged that the company designed its trade products defectively and failed to warn of the dangers posed by the asbestos. The basic holding of the court was that the state law in relation to the design defects and the failure to warn claims fell within the field of locomotive equipment regulation and that field was defined by previous case law.

The basic legislation underpinning the decision says that a railroad carrier may use are allowed to be used a locomotive will depend on its railroad line only when the locomotive or tender and its parts are improper condition and safe to operate without necessary danger of personal injury. The court analysed the previous cases which have examined this type of issue and held that to state laws prescribing the use of locomotive equipment pre-empted by the original statements legislation meant that the broad power conferred by the original statements legislation on the Interstate commerce commission which was the agency then vested with authority to carry out the requirements was a general one. the piece of legislation which was seen to be in conflict with the state-based legislation was the Federal Railroad Safety Act of 1970. the parties did not argue that the previous case was wrong. Instead, they argue that their claims the outside the field of the status legislation and that this meant that the federal legislation must override it.

The case reflects in its ultimate reasoning of the decision the fact that the supremacy clause in the federal law related to the US Constitution shall be the supreme law of the land and anything in the Constitution or laws of any state to the contrary notwithstanding shall be subservient to the federal legislation which is stated in United States Constitution in article 4, clause 2. The court then went on to reason that the state requirements of the state legislation were not pre-empted by federal legislation because the court was asked to consider whether there was a manifest intention to occupy the entire field of regulating locomotive equipment. The court answer that question should be determined affirmatively and said that the broad scope of the authority conferred on the Interstate commerce commission by Congress led to that conclusion. The power delegated to the commission, it was explained in previous cases was a general one that extends to the design, construction and the material of every part of locomotive and tender of all equipment associated with this.

The decision left the petitioners without a sufficient remedy in relation to the fatal exposure of asbestos in a repair facility. Because of this, Justice Sotomayor partially concurred but also partially percent majority on the decision and said it is you it would not be a just outcome if the petition is in this case could not hope to recover in relation to the exposure of the plaintiff to asbestos resulting in mesothelioma. The implication of the case is the larger of claims will be wiped out in relation to the railroad industry because of the decision in this matter.

The Top 10 Problems With Judgments

I am not a lawyer, I am a Judgment and Collection Agency Broker. This article is my opinion, based on my experience in California, and laws vary in each state. If you ever need legal advice or a strategy to use, please contact a lawyer.

Judgments are not guaranteed, they are only chances for getting some money in the future. When the economy was good, judgments were sometimes a way to get money. Now they are only a chance of getting some money.

In the ideal situation, your judgment debtor is wealthy and will repay your judgment after getting a single polite reminder. That is not the case 99% of the time. Most of the time, judgments are never enforced. If they are enforced, it is a slow process that often involves compromise, and partial recoveries more often than full recoveries.

Here are the top ten reasons many judgments are never recovered:

1. The debtor can file for bankruptcy protection. Once a debtor files for bankruptcy protection, all creditors must stop all collection activities, at least until they later get written permission from the bankruptcy court. While there are exceptions, most of the time, bankruptcy kills judgments.

2. The debtor can die. While it is possible to show your judgment to the executor of the dead person's estate, when there are no assets left, you will not get paid. Most often, you either get nothing or must settle for a fraction of what is owed.

3. The debtor can go underground, hide assets, or be poor. When you sue a debtor using a fake name, or when the debtor is a professional fraud that keeps most of their assets in names that cannot be traced to them, or is really poor, most of the time, that means a judgment against them cannot be enforced.

4. The debtor can move. It is not cheap or easy to domesticate judgments to another state. Some states make it extra hard for creditors, Florida being one of the worst. Some states impair judgment recovery with laws that specify that small claim cases cannot be assigned, or one must be a lawyer to recover any judgment, even a $100 one.

5. The debtor can become sick or get hurt. Disability (and social security) income cannot be reached by creditors, and disabled debtors often lose their ability to earn income.

6. The debtor can file an exemption claim. Every State has exemptions for a debtor's personal property. If the debtor files an exemption claim, you must show up at the hearing. If you do not show up, the debtor wins.

7. The debtor can vacate the judgment. Especially with default judgments, asking the court to vacate a judgment is cheap and easy. The debtor may not win, however if you do not show up, the debtor wins.

8. The debtor can claim "it's not me". Especially when the debtor has a very common name, or grandpa, dad, and son, all have exactly the same name; it can be difficult to recover a judgment. It can take too much time and money to prove who is the actual debtor.

9. The debtor can hire a lawyer. Some debtors would rather spend $10,000 on lawyers, than pay $5,000 to satisfy the judgment against them.

10. The debtor can have many previous judgments and liens. When a debtor has a bunch of judgments against them already, most judgment enforcers will not even try to recover a judgment against the debtor. This is not always fair, because the first one to recover the judgment wins, even if there are 20 other unsatisfied judgments against the debtor.

How To Minimize Your Credit Card Debt

Unpaid credit card debts are a lawsuit waiting to happen. Save yourself from a lot of headache and learn what you can do to reduce your debt quickly and efficiently.

Check The Statements

Not only should you check your card statement but also your bank statements. The statement shows how much money you owe to your card company while the bank statement shows you where your accounts are. Now, compare these statements with your monthly income, divide a chunk of your salary into portions, in which you need to repay your card company. This is where you will discover if your monthly income is sufficient to cover your debts. In addition, not all records are accurate so always search for errors on your monthly statements as well.

Use Low Interest Cards

If you have multiple cards with varying interest rates, it's best to check which cards have the lowest interest rates and use them instead of credit cards with higher interest rates. The fact is, cutting off credit cards with a long history of credit could do more harm than good. Instead of cutting them off completely, focus on using lower interest cards and use higher interest cards once in a while.

Use Cash/Debit Cards

Generally, using credit cards is more expensive as opposed to paying cash or using debit cards to make purchases. An average credit card's APR is around 5% and most card companies require a monthly or annual membership fee. Save more by using cash instead of your cards. You'd be surprised at how much money you can actually save by using your credit cards during emergencies alone.

Create Expenses Plan

Always manage your expenses. By mapping out a daily or monthly budget, you will not only manage your money, you will also discover where you spend your money the most. Of course, planning your expenses is one thing, executing the plan and sticking to it is a different story. If you create a budget, be sure to stick to your budget. Otherwise, your careless spending could be defeating the purpose of creating a budget for manageable debt.

Better financial situation starts with keeping tabs on your expenses and managing your debt effectively. By keeping track of your expenses and card use, you should have no problems making payments on time, each month. This will help avoid any trouble with your creditor that could possibly lead to a credit card lawsuit.

Should You Give Up Ownership Of Your Judgment? Responding to a Collection Agency's Interrogatories Correctly Receiving a Summons: How to Answer a Summons for Debt Properly Which Judgments Should You Take? 4 Civil Summons Mistakes to Avoid Legal Support Services: What Can a Business Gain From an Experienced Provider?

What a Process Server Really Does

Serving process is a job that is surrounded by many misconceptions. Usually taken up by private investigator firms, process serving is a function that operates privately, independent of the courts, to deliver court materials and legal documents by an impartial third party. Common use is to deliver materials and contracts to unwilling parties, or to directly subpoena defendants with court summons.

Processes are court documents or legal documents that can range from summons to complaints. A process server is used to provide court verification that a document was received by a party involved with the case.

For a quick example, image you are a tenant who is taking your landlord to court for failing to fix some items in your house, as per the lease agreement. The landlord is refusing to answer your calls and you have decided to take that landlord to court for either money back from your rent, or to force the landlord to make the repairs. Your lawyer would hire a process server to track down your landlord and deliver the court summons to them, legally mandating their presence in court on the appointed date. The process server does not work for you and your lawyer though.

The fact that they are a third part is essential to a process server's job. People have the misconception that the process server works in the favor of the plaintiff, but a certified process server must have sworn an affidavit on a case that they are serving to say that they are totally impartial upon serving of the papers. They can have no connection to either the plaintiff or the defendant, insofar as they are hired by the plaintiff's lawyer to serve the papers and ensure a court date.

Each state has their own set of regulations for how a process server can legally consider the documents served. In the state of Virginia, processes can be delivered in person for the most effective serving. However, they have several other tactics that they may use to serve the documents. If another party answers the door of the defendant's residence, they may leave the documents with that individual to then give to the defendant IF that individual is a family member of the defendant, is at least 16 years old, is not a guest in the house but a permanent resident, and is told the circumstances of the documents. If all else fails they can simply attach the process to the front door of the residence, and only the front door. If the defendant has been deemed to have left the state or abandoned the home at which they are legally living, there are other ways to effectively consider the process to be served as well as well.

Hiring a process server is a great way to assure that your court sessions run smoothly and on time. With processes served within the court's time sensitive scheduling, some processes can be served within a couple of days. Rather than getting into a direct situation use a process server to formally and legally announced litigation.

Vehicle Levy Math

I am not a lawyer, I am a Judgment Broker. This article is my opinion, and not legal advice, based on my experience in California, and laws vary in each state. If you ever need any legal advice or a strategy to use, please contact a lawyer.

Levying a judgment debtor's vehicle is expensive and complicated. This article has a vehicle levy example, based on California laws, with example approximate costs.

Laws vary widely in each state, so always check local laws and the court for procedures, and verify costs with your local Sheriff department.

In California, when Sheriff levies are not bank accounts or wages, the judgment debtor's property must be sold at a Sheriff auction. This makes levies of anything except bank accounts and wages very expensive.

The auction process is an imperfect sales mechanism that usually yields relatively low prices, reducing the amount available for the judgment creditor. One day, perhaps Sheriff auctions will be on eBay.

The first expense is the debtor's exemption. That exemption is only for one vehicle owned by the debtor. The exemption starts at $2,725, and if they use the vehicle in their work as a commercial vehicle, the exemption is $5,900. The first $2,725 or $5,900 from an action sale, go back to the judgment debtor.

The cost of buying a writ of execution from the court is $25. The Sheriff charges about $1,000 to start a levy auction procedure.

The good news is the Sheriff often allows you to deposit half the required amount (e.g., $500) to start. The bad news is that is just the beginning of an upward spiral of costs that could sometimes make one regret levying a judgment debtor's vehicle.

After the (so far) $3,725 or $6,900 in expenses, there is the cost of the Sheriff's office charges to store the vehicle. In this article, the example is 30 days at $35 per day for vehicle storage costs, totaling $1,050.

In some situations, for example when the Sheriff is backlogged, or the judgment debtor files for bankruptcy protection, the storage costs you must always pay, go up dramatically.

One more way that bankruptcy is unfair to judgment creditors that levy a judgment debtor's vehicle, is that creditors must pay levy storage fees, even if the judgment debtor's bankruptcy is eventually denied. Four months of storage fees might cost about $4,200.

After all these costs, the auction fees are usually ten percent of what the vehicle sells for.

In this example so far, we are up to at least $4,775 or $7,950. To break even, the vehicle must sell for at least $5,306 or $8,840, to have a chance of paying anything toward satisfying the judgment.

Last but not least, there could also be the cost of paying off any previous loans on the vehicle.

The opening price bid at an auction is usually the costs of the debtor exemption and paying off previous loans on the vehicle.

Always attend Sheriff auctions when your judgment debtor's property is up for sale. While you might be able to credit bid at an auction, you cannot credit bid for the debtor's exemption, or to pay off any previous loans on the vehicle.

When assets are collected using a writ, they are applied first to the cost of obtaining a writ, second to accrued interest, third to the levying officers fees and costs for performing the levy, and fourth to the judgment principal.

If the opening bid price is not met, the $25 writ, at least $500 (often $1,000) of the Sheriff department's fee, and the (at least) $1,050 for vehicle storage, are your costs, even if the vehicle does not sell.

As mentioned earlier, vehicle storage fees could be prohibitive. If there are delays, it could be $4,000 or so, meaning you might be out of pocket more than $5,000. (You might get some of the Sheriff's fees back.)

I am not a lawyer. My opinion is that if the vehicle does not sell, it is often returned to the judgment debtor, and you may not be able to add your massive expenses to what the judgment debtor owes, which seems very unfair.

Here is a hypothetical example of costs for a California vehicle levy. This example assumes a good situation, where it makes sense to levy the judgment debtor's vehicle. As mentioned earlier, in many cases, you can lose a lot of money trying this.

In this example, the judgment debtor's vehicle is a car, with a Kelley Blue Book private-party value of $15,000, and a previous $4,000 loan that must be paid off.

The winning bid at the auction (75 percent of the Kelley Blue Book private-party value) was $11,250.

The fees could go like this: $11,250, minus a 10% auction fee of $1,125, minus $4,000 to pay off the previous loan, minus the judgment debtor exemption for their personal vehicle of $2,725, leaving a gross amount for the judgment creditor of: $6,125.

That $6,125 gross amount has expenses. The storage fee for example, is $1,000. Also, writ and levying officer fees of $525, auction detailing and inspection fees of $400, leaving a net $4,560 for the judgment creditor.

After an auction sale, as with a bank levy, the sheriff returns the writ of execution to the court, showing the amount paid to the creditor. That amount is credited toward paying the judgment, no matter what expenses the judgment creditor incurred.

Should You Give Up Ownership Of Your Judgment? Responding to a Collection Agency's Interrogatories Correctly Receiving a Summons: How to Answer a Summons for Debt Properly Which Judgments Should You Take? Legal Support Services: What Can a Business Gain From an Experienced Provider?

Judgment Debtors And Trusts

A Trust is a document that (at least temporarily) separates the ownership of assets from people. Instead of a person owning an asset, the trust owns it.

There are many kinds of trusts. Trusts are not usually separate legal entities from the people that created them, or are named in them.

Trusts are often an alternate way to own assets. Trusts can be thought of as containers for potential or conditional assets.

Trusts can be used to solve many problems, including avoiding probate, or to try to solve the problem of leaving assets available to satisfy judgment debts.

Trusts usually have four categories of people or entities:

1) The grantor (sometimes called a settlor), that creates and usually funds the trust.

2) Assets, which are transferred in and out of the trust.

3) Beneficiaries (sometimes called settlees), that receive assets or benefits from the trust.

4) The trustee, who manages the trust's assets, and distributes them according to the terms of the trust, or if legal action unravels the trust.

The grantor can also be the beneficiary, and the trustee too, at least while they are still alive.

When the same person is the grantor, trustee, and also the beneficiary, it is called a self-settled trust. Self-settled trusts are not legal in most states, and are a foolish way to try to hide assets from creditors.

Putting assets into a properly formed trust can make those assets less available to creditors. Even when the trust itself is the defendant and judgment debtor in a lawsuit, it can be difficult to recover the judgment. There are many ways a trust may be hidden or depleted, in private ways to stymie judgment creditors.

There are two kinds of trusts: revocable, and irrevocable. Revocable trusts can be changed, undone, or dissolved. Assets in revocable trusts are reachable by judgment creditors. When a trust is irrevocable, it is off-limits to changes by the judgment debtor, and usually not available to judgment creditors either.

To avoid the expenses and disclosures required in the probate process, many people with assets, set up a revocable living trust. Then, they transfer ownership of everything they own into that trust.

A revocable living trust can be changed at any time, prior to the death of one or both of the grantors/settlors - the person(s) who set up the trust.

A judgment creditor, looking at the recorder's office for deeds on a judgment debtor's home, might expect to see "Barney and Pam Jones". In the past, the couple owned their house as husband and wife. However, later they transferred title to "Barney and Pam Jones, Trustees of the Jones Family Trust dated April 1, 2011". This means the house was transferred to a trust, most often a living revocable trust.

A revocable living trust is not a separate legal entity, separate from the trustee. Like a DBA, this means the debtor, who has moved their assets to a revocable living trust still owns the assets in the trust.

Note that whether a trust is a separate entity or not, you cannot have legal papers served on a trust, you must serve an actual person who is a party to, or a representative of the trust.

If one or more of the settlors of a revocable trust is your judgment debtor, that can be important, especially when the settlors are married to each another.

When you are trying to recover a judgment against a debtor with a trust, you can subpoena the debtor, and with a document request, get a copy of the trust.

If you suspect the trust was set up only to prevent your judgment from being recovered, you might be able to persuade a judge to undo the transfer of assets into the trust, especially if the transfer was done without consideration.

Some sneaky judgment debtors create two trusts simultaneously, a revocable and an irrevocable trust. This can be done by simply changing the cover pages on the trusts.

These kinds of shenanigans, and most anything else done that is fraudulent (forming an irrevocable trust simply to keep assets out of reach from a creditor) has a very good chance of being unraveled, so the judgment creditor gets paid.

Should You Give Up Ownership Of Your Judgment? Responding to a Collection Agency's Interrogatories Correctly Receiving a Summons: How to Answer a Summons for Debt Properly Which Judgments Should You Take? Legal Support Services: What Can a Business Gain From an Experienced Provider? 4 Civil Summons Mistakes to Avoid