Interplay and Pitfalls with Family Law
Cases
when there is a PI, Wrongful Death and
Worker’s Comp Case or Claim
Family Law Conference
August 7, 2015
Kent Emison, Phyllis Norman and Tricia Scaglia
Interest
in
Litigation
and
Marital
Property
• Interest in Pending Litigation???
• What date does the pending litigation become marital property? • Time of Suit?
• Time of Injury?
• Time of Payment of Suit?
• No cases support theory that the trial court is required to assign a value to personal
injury claims that have not been adjudicated yet. Laffey v. Laffey, 4 S.W.3d 655 (Mo. App.
W.D. 2002)
What
is
Marital
v.
Non
‐
Marital
in
PI
Cases
• In Personal Injury Claim what proceeds would be marital?
• Loss of future post dissolution wages – Non –marital • Heslop v. Heslop, 967 S.W.2d 249, 254 (Mo. App. W.D. 1998) • Wages during marriage – Marital
• Future Medical – Non‐marital
• Mistler v. Mistler, 816 S.W.2d 241, 251 (Mo. App. S.D. 1991).; see also Schubert v. Schubert, 366 S.W.3d 55 (Mo. App. E.D. 2012).
• Past Paid Medical Expenses ‐Marital
• Compensation for noneconomic damages, such as pain, suffering,
disfigurement, disability is generally – Non‐marital • Mistler, 816 S.W.2d at 251.
PI
Settlements
• “ A settlement for a personal injury claim occurring during the
marriage may be both marital and non‐marital.” Petties v. Petties, 129
S.W.3d 901 (Mo. App. W.D. 2004).
• Courts use the analytical approach, the settlement award is classified
by what it is meant to replace.” Coffman v. Coffman, 215 S.W.3d 309
(Mo. App. W.D. 2007); Brill v. Brill, 65 S.W.3d 583 (Mo. App .S.D.
2002); Blydenburg‐Dixon v. Dixon, 277 S.W.3d 815 (Mo. App. W.D.
Possible
Personal
Injury
Claim
in
Divorce
• Questions for you to ask client:
• Has a lawsuit been filed?
• What claims were made? What is your specific claim? Spouse’s claim?
• What is the injury? Impact on job? Impact on daily life?
• Who is the attorney? Who does attorney represent?
• Has there been a settlement conference?
• Is there a court date?
SIMPLE
CAR
ACCIDENT
CASE???
• Jane Doe Cut Off Approaching
Construction Zone
• Rear Ended by Delivery Vehicle
Driven by Joe Schmoe
• Jane is Paralyzed, $10 Million in
Damages
• Joe Schmoe Has Only State
3
rdPARTY
INSURANCE
CLAIMS
• Finding the Insureds
• Driver of Vehicle • Owner of Vehicle
• Types of Coverage
• BIPD Primary • Excess/Umbrella
• Competing Concerns
• Immediate Money for Client
• Preserving Path to Further Recovery
TOOLBOX
TO
MAXIMIZE
RECOVERY
• R.S.Mo. 537.065
• Settlement Limiting Recovery to Specific Assets (Usually Insurance Policy) • Claim Continues After Agreement
• Provides Path to:
• Preserve Venue in State Court • Equitable Garnishment Action
• Bad Faith Claim
• Refusal to Settle Within Policy Limits
• Bad Faith Claim Assigned to Plaintiff by Tortfeasor
1
stPARTY
INSURANCE
CLAIM
• Types of Coverage
• Med Pay
• Underinsured Motorist Coverage (UIM) • Uninsured Motorist Coverage (UM)
• Maximizing Recovery
• Loss of Consortium Claims • Stacking Policies
• Vexatious Refusal to Pay Claims
VICARIOUS
LIABILITY
CLAIMS
• Establishing Act in Course and Scope of Employment
• Pattern and Practice • Circumstantial Evidence
• Driver’s Appearance and Activities • Use and Markings of Vehicle
• Job Responsibilities
• Identifying Additional Employers
• Calling a Person an Independent Contractor Doesn’t Make it So • Control is the Key
INDEPENDENT
CLAIMS
• Negligent Entrustment
• Possessing a License is Not Determinative • History of Violations/Accident
• Knowledge of Intoxication • Key is Foreseeability
• Negligent Supervision/Training
• Failing to Identify Unfit Driver
• Failing to Train Driver to Overcome Dangerous Habits
ADDITIONAL
DEFENDANT
CLAIMS
• Product Liability Claims
• Dram Shop/Social Host Claims
IDENTIFYING
A
PRODUCTS
CLAIM
• Injuries or Vehicle Damage
Greater Than Expected
• Ejection With Restraint Use
• Post‐Collision Fire
• Failure of Vehicle Component
TYPES
OF
VEHICLE
PRODUCT
CLAIMS
• Post‐Collision Fires
• Airbag/Seatbelt Failures
• Seatback Failures/Reclined Seats
• Roof Crush/Vehicle Instability/Rollovers
PRESERVING
A
PRODUCTS
CASE
• Preserve the Product
• No Product Often Equals No Products Case • Need to Establish Chain of Custody
• Find/Keep an In‐State Defendant
• Who Could It Be? • Driver, Employer, Dealer • Why Is It Important?
• State Court Rules on Experts Often Less Strict Than Federal Court • Requires Patience and Balancing of Interests
• Postpones Recovery from Automobile Insurance to Provide Access to Greater Insurance
and Assets of Manufacturer
DRAM
SHOP/SOCIAL
HOST
CLAIMS
• Differences in Claim
• Business or Individual
• Identifying Defendants
• Business, Bartender, Waitress, Person
Providing Alcohol, Home Owner
• Building Your Case
• Individual Testimonials
• Photos/Video Surveillance/Receipts • Toxicologist
Settlement
Agreements
• Once you know what all is marital property, do you set up the
settlement agreement to outline the amounts of each type of
proceeds?
• Most PI attorneys will NOT do this unless a family law attorney gets
involved because earnings are taxed and may only represent the
injured party.
• What if you represent the spouse of person who is settling his case? • Need to contact PI attorney to work out Loss of Consortium and Marital
Property arrangement for settlement agreement.
Settlements/Marital
Property
• If settlement agreement does not outline the proceeds, do you put on
this evidence at trial and have the Court decide these issues?
• “To determine the intent of the settlement when dividing marital
property, a court may look to what the parties would have received if
the claims had been adjudicated” Blydenburg‐Dixon v. Dixon277
S.W.3d 815 (Mo. App. W.D. 2009).
Structured
Settlement
Payments
• Monthly Annuities in name of both husband and wife?
• Case: Blydenburg‐Dixon v. Dixon, 277 S.W.3d 815 (Mo. App. W.D. 2009). • “Placing separate property into the names of both spouses creates presumption that
the property has been transferred to the marriage”
• Husband argued only reason for both names was because he had disabilities from
being quadriplegic and all funds were his.
• Wife argued it was inferred that settlement included loss of consortium and to
compensate marital estate for loss of income and medical expenses.
• ANSWER: Court found that although it could be inferred that some of the monies
were for loss of consortium and wife helping husband during marriage – sufficient
compensation had already been paid in lump sums and prior monthly payments.
Remainder was for FUTURE!
PI
Lump
Settlement
• In re the Marriage of Tullier, 989 S.W.2d 607 (Mo. App. S.D. 1999).
• Partied deposited money in joint account.
• Court used analytic method:
• Classifying husband's $250,000 lump sum personal injury settlement as
marital property, and not as husband's separate property, was reasonable, • Because husband would have earned $128,000 in eight‐year period from date
of award to date of divorce, (which was the some portion of award
reimbursed husband for medical expenses related to injury and incurred
during the marriage) and
• Some portion may have been attributable to loss of consortium, and
Workers’
Compensation
Benefits
in
Divorce
Missouri Courts seem to treat a Workers’ Compensation Settlement
Similar to a PI Settlement. Analytical approach.
• Wage Treatment.
• Payments received during marriage are marital property.
• Payments received after divorce belong to the injured spouse as separate property
• Treatment as personal injury award.
• Payments that cover lost wages or medical expenses during the marriage are marital.
• Payments for wages and medical costs not during the marriage are the separate
property of the injured spouse.
• Payments for the loss of a limb or bodily function are also viewed as the separate
property of the injured spouse.
• NOTE: When a workers’ compensation award is commingled in with
marital funds, courts are apt to decide that the entire award is marital
property.
Workers’
Compensation
Benefits
in
Divorce
• Questions to ask your client:
In addition to questions to ask in a PI case:
• What was the injury?
• How long off work? Did resume same job?
• What are the long term effects?
Wrongful
Death
Monies
in
Divorce
• Scenario: My husband received a sizable sum of money from a wrongful
death lawsuit he brought against a nursing home that neglected his mother
and I'm interested to know if this is considered a marital asset?
• Is this inheritance? Does spouse need to ascertain damage amount and
husband’s portion of the award?
• NOTE: When a spouse’s wrongful death award is commingled in with
marital funds, courts are likely to decide that the entire award is marital
property.
• What if filed for divorce then husband dies do you still have a wrongful
death claim? Need to advise client to contact an estate planning attorney
and a tax attorney.
Modification
• Can Settlement Monies from PI case affect modification?
• Modifying maintenance after receive settlement:
• The trial court assigned Wife her interest in both claims and Husband his collateral
interest in both claims. It placed no assigned value on the claims, finding that “any
substantial recovery at a future date may be a basis for a modification of
maintenance, but the Court does not find that it should further impact the division
of marital property.” In his appeal, Husband admits, “the value of the personal injury
claim and malpractice lawsuit cannot now be determined with certainty.” Laffey v. Laffey, 72 S.W.3d 143 (Mo. App. W.D. 2002).
• CHILD SUPPORT?? (This could be a case that happens after which changes income).
• If Confidential, how do you find out?
Ethical
Duties
of
Family
Law
Attorney
Related
to
Personal
Injury
Claims
• Duty to Advise Family Law Client on Potential PI or Wrongful Death
Case; including statute of limitations and; if in fact, claim exists.
• Potential Legal Malpractice if no advice
• Potential Legal Malpractice if TOO much advice
• Can you put in your contract you don’t represent on any civil case? Is that
enough??
Language
Protecting
You
on
Attorney
Client
Relationship
• Be specific as to your representation
• Be specific as to what potential claims you are not representing client
on
Attorney
Client
Relationship
• An “attorney‐client relationship” exists when a person seeks and
receives legal advice and assistance from a lawyer who intends to give
legal advice and assistance to the person, but reliance alone upon the
advice or conduct of a lawyer does not create an attorney‐client
relationship. Collins v. Missouri Bar Plan, 157 S.W.3d 726 (Mo. App.
W.D. 2005).
Legal
Malpractice
Elements
• The question of the legal duty owed by an attorney to non‐clients is
determined by weighing six factors:
• (1) the existence of a client's specific intent that the purpose of the
attorney's services be to benefit the non‐client plaintiffs;
• (2) the foreseeability of harm to the plaintiffs as a result of the attorney's
negligence;
• (3) the degree of certainty that the plaintiffs will suffer injury from the
attorney's misconduct;
• (4) the closeness of the connection between the injury and the attorney's
conduct;
• (5) the policy of preventing future harm; and
• (6) the burden on the profession of recognizing liability in those
How
Much
Legal
Advice
Is
Too
Much
• When a lawyer declines to accept a legal matter, he or she should be careful not to give any legal
advice or opinion regarding the prospective client's claim.
• Any such advice can provide the basis for a later malpractice claim against the lawyer if it turns
out that the advice or assessment was wrong and the prospective client relied on that advice to
his or her detriment.
See In Togstad v. Vesely, Otto, Miller & Keefe, 291 N.W.2d 686 (Minn. 1980).
* A lawyer rejected a possible medical malpractice claim after meeting with a prospective client for
45 minutes and told client case was not worth pursuing and would not represent her.
• SOL had not expired at the time of the consultation, but it later expired before the woman
consulted another lawyer.
• Client claimed that she relied on the lawyer's opinion that his case was not worth pursuing in not
seeking the opinion of another attorney until it was too late.
• A jury found the lawyer guilty of malpractice for giving her erroneous advice about the merit of
her case and entered a verdict against him for $649,500.
Non
Engagement
Letters
• "Non‐engagement letters" should clearly inform the prospective client that the law firm
will not represent the prospective client in that matter and that he or she should not rely
on the lawyer for any advice or legal action.
• It is not necessary or even desirable in every case to inform the client on which the
statute of limitations will expire. In fact, sometimes doing so will create a basis for a
claim of malpractice if the information is wrong. You may not be aware of shorter notice requirements that must be met. (i.e. Nursing Home Cases; Cases against City etc).
• Although you should not give advice about when the statute of limitations will expire, it
is important to tell the prospective client that claims may become barred if not filed
within the time provided by law and that the client should immediately seek the advice of other counsel regarding the claim. This can be accomplished without giving an
Duties
of
Family
Law
Attorney
• What basic questions must be asked prior to taking a case ‐‐‐to make
sure your client or their spouse have NO civil cases that could relate
to the property division, maintenance or child support?
• Consider adding to your questionnaire/client intake questions
regarding potential civil cases including time of incident etc.
Duties
of
Family
Law
Attorney
• If civil case at issue, what questions to ask to make sure you protect
Ethics
In
Representing
Multiple
Parties
When Would You Represent Multiple Parties to One Action?
• Driver/Passenger (Husband and Wife)
• Heirs of Decedent
• Employer/Employee
• Parties to Contract
• Insured/Insurer
Rule
4
‐
1.7(a):
Conflict
of
Interest
Except as provided in Rule 4‐1.7(b), a lawyer shall not
represent a client if the representation involves a
concurrent conflict of interest. A concurrent conflict of
interest exists if:
• (1) the representation of one client will be directly
adverse to another client; or
• (2) there is a significant risk that the representation of
one or more clients will be materially limited by the
lawyer's responsibilities to another client,a former
How
to
Resolve
Conflicts
Resolution of a conflict of interest problem under this Rule 4‐1.7
requires the lawyer to:
• (1) clearly identify the client or clients;
• (2) determine whether a conflict of interest exists;
• (3) decide whether the representation may be undertaken
despite the existence of a conflict, i.e., whether the conflict is
consentable; and
• (4) if so, consult with the clients affected under Rule 4‐1.7(a)
and obtain their informed consent, confirmed in writing. The
clients affected under Rule 4‐1.7(a) include both of the clients
referred to in Rule 4‐1.7(a)(1) and the one or more clients
whose representation might be materially limited under Rule
4‐1.7(a)(2).
[Comment 2: Rule 4.17]
Can
All
Conflicts
Be
Resolved?
Can
All
Conflicts
Be
Resolved?
Ordinarily, clients may consent to representation notwithstanding a conflict. However, as indicated in Rule 4‐1.7(b), some conflicts are nonconsentable, meaning that the lawyer involved cannot properly ask for such agreement or provide representation on the
basis of the client's consent. When the lawyer is
representing more than one client, the question of consentability must be resolved as to each client.
[Comment 14: Rule 4‐1.7]
Rule
4
‐
1.7(b)
Prohibited
Representation
Notwithstanding the existence of a concurrent conflict of
interest under Rule 4‐1.7(a), a lawyer may represent a client
if:
• (1) the lawyer reasonably believes that the lawyer will be
able to provide competent and diligent representation to
each affected client;
• (2) the representation is not prohibited by law;
• (3) the representation does not involve the assertion of a
claim by one client against another client represented by
the lawyer in the same litigation or other proceeding
Alignment
of
Parties
in
Litigation
• Rule 4‐1.7(b)(3) prohibits representation of opposing parties in the same litigation, regardless of the clients' consent. On the other hand, simultaneous representation of parties whose interests in litigation may conflict, such as co‐plaintiffs or co‐defendants, is governed by Rule 4‐
1.7(a)(2) . . . common representation of persons having similar interests in civil litigation is proper if the requirements of Rule 4‐1.7(b) are met.
[Comment 23: Rule 4‐1.7]
• Whether clients are aligned directly against each other within the meaning of Rule 4‐1.7(b)(3) requires examination of the context of the proceeding. [Comment 17: Rule 4‐1.7]
Formal
Opinion:
Driver/Passenger
C.
of
Int
‐
118
QUESTION
What ethical problems are presented when the same lawyer represents both driver and passenger of a motorcycle who were killed in a collision with another vehicle that was driving on the wrong side of the road. There is no evidence of negligence on the part of the driver of the motorcycle and both the driver and the passenger of the motorcycle were minors. A full and frank discussion has been had with the parents of both deceased boys. It is agreed by all parties, including counsel, that a separate action should be brought for each and that the driver's action should be brought first to avoid consolidation. The attorney submits the following questions:
1. Is it ethical for the law firm to represent the parents of both the driver and the passenger of the motorcycle with respect to their claims, if the lawsuits are directed solely against the owner and operator of the other vehicle as the sole defendant?
2. If, in the passenger's lawsuit, a third party petition is filed by the other driver against the motorcycle driver's estate, which would be defended by the motorcycle driver's insurer and a guardian ad litem appointed for that defendant, is it still ethically proper for the law firm to represent the survivors of the motorcycle passenger on their death claim?
3. Assuming the law firm in the passenger's death case, for technical reasons, includes as defendant a guardian ad litem for the deceased motorcycle driver, can the law firm ethically pursue the passenger's lawsuit while at the same time representing the mother of the motorcycle
ANSWER
The Committee views the factual situation submitted as one wherein a possible conflict can arise in the representation of the parents of the driver and the parents of the passenger on the motorcycle. This conflict can be waived, however, and if the waiver is obtained, it is permissible for the attorney to take all the actions set out in Questions 1,2, and 3. The Committee suggests that all waivers of conflict be obtained in writing and the parents of the passenger be given an opportunity to consult outside counsel on the question of whether or not the driver of the motorcycle should be named as a party defendant in their lawsuits. Rendered August 29, 1979.
[Rule 4‐1.7]
Informal
Opinion:
Driver/Passenger
Informal Opinion 930163
QUESTION
Attorney represents a client who was a driver in a boating accident with another boat. Passengers in the client's boat want Attorney to represent them also. Attorney knows that the client was drinking at the time of the accident. Is there a conflict of interest and can the conflict be waived?
ANSWER
Yes, there is a conflict of interest under 1.7(a) and under1.7(a)(1) it cannot be waived.
[Rule 4‐1.7]
Informal
Opinion:
Driver/Passenger
Informal Opinion 940085
QUESTION
A case has arisen involving an automobile accident in which the child was a passenger and the mother was one of the drivers. There is no reason to believe that the mother is liable. May the clients waive the potential conflict of interest? May Attorney represent the driver and passengers in the accidents?
ANSWER
Yes, the passengers may waive the potential conflict of
interest. Concerns are raised if the mother acts on the
child's behalf to waive the conflict. The father, or other
independent person, should act on the child's behalf
regarding the waiver. If an actual conflict develops,
Attorney must withdraw from representing all clients.
Attorney should be certain that Attorney has made
sufficient disclosures and has thoroughly documented
the disclosures as well as any consent given. [Rule 4‐1.7]
Informal
Opinion:
Between
Family
Informal Opinion 940173
QUESTION
Attorney has been hired to represent parents and child in a suit involving an accident in which the child was injured. No issue of comparative negligence by the parents has been raised but it is conceivable that it might be. Does Attorney have a conflict of interest? If yes, can it be waived?
ANSWER
This situation creates a conflict of interest under Rule 1.7. Attorney must first determine that joint representation would not reasonably be expected to adversely affect the relationship with either client. If a genuine issue of comparative negligence develops, this step in the analysis would dictate that the conflict could not be waived. Once step one is satisfied, the clients must be willing to consent after full disclosure. The parents may not consent on behalf of the child. Only a next friend appointed by the court may consent for the child. If the next friend will not consent, Attorney may continue to represent the parents unless information has been obtained that could be used to the child's detriment. Attorney has obtained information from the parents such that Attorney could not represent only the child unless the parents consent.
[Rule 4‐1.7]
Conflict
Example
in
Family
Case
Between
Family
FACTS
Attorney represents both Husband and Wife in a Car Accident case where both receive monies. Case is settled.
Then wife comes to attorney to have him represent her in her divorce case against the husband he previously represented??? Found following informal opinion that may apply.
Informal
Opinion:
Co
‐
Plaintiffs
Informal
Opinion
940084
QUESTION
Attorney represents an individual as nominal plaintiff in a lawsuit in which another individual is the real party in interest. On behalf of another client, Attorney wants to sue the nominal plaintiff in the other case. Is this a conflict of interest?
ANSWER
Yes, under Rule 4‐1.7(a), Attorney would have a conflict of interest by filing a lawsuit against the individual who is Attorney's current client even though that individual is only nominally a client.
