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December 2009 Archives

Criminal Restitution as an Alternate Remedy

thumb_elinor.jpgSome of our cases are against people who have committed crimes, like car crashes where the driver was under the influence of alcohol. In these cases, we have learned that the restitution rules of Penal Code § 1202.4 et. seq. can be powerful tools to recover economic losses, as well as investigation costs, storage fees, and attorney's fees. In some cases, the rules allow plaintiffs to attach a defendant's assets even before conviction. In other cases, the rules permit plaintiffs to request an order of examination to determine a defendant's assets. Criminal restitution proceedings have some advantages over civil proceedings. Restitution hearings are more informal than civil trials and are not subject to to the same stringent pre-trial proceedings. Also, once a victim has shown a loss, the defendant has the burden of proving inaccuracies in the victim's proof. Finally, a restitution is not dischargeable in bankruptcy. For more information or briefing on this issue, please contact us. By Elinor Leary

Ten Ways to Help Your Client Through Trying Times

1. Get out of the office.

Effective advocacy requires an in-depth understanding of your client and your clients’ story. Visiting your clients in their own home can give you insights into their lives and losses that an interview in the office or over the telephone will never provide. Visiting the scene of the incident allows you to absorb the environment with all five senses—looking at photographs is not enough.

2. Solve problems creatively.

Ask your clients about problems their injury or the litigation process is causing or exacerbating, and seek creative solutions. One example: a client may be having problems making rent payments. The client’s attorney can talk to the landlord and offer to allow a lien against the case and help the client keep a roof over the client’s head during the lawsuit.

3. Get their benefits.

Most catastrophically injured clients should be getting social security disability payments. Many of them do not know to ask or are denied despite their injuries. They may need assistance with applying for social security disability. Whether you refer the matter out to a social security attorney or help them yourselves, they need the medical records that you likely have obtained in their case. The deadlines in social security disability cases can be complicated for someone untrained in the law or administrative procedure. Clients frequently need help in order to obtain the benefits they are due.

4. Talk about money.

Chat with your client about his/her financial needs and long-term goals well before there is a settlement or verdict. For most catastrophically injured people, the settlement or verdict they receive will be the largest sum of money they have ever seen. But it also needs to take care of them for the rest of their life. Prepare them in advance for the opportunities and pitfalls. People who have not had large amounts of money before often are not prepared to manage it. They need to think about it in advance of receiving the reward.

5. Address their workers’ compensation and medical liens.

There are ways to resolve liens in various situations, whether they be workers’ compensation liens or medical liens. Workers’ compensation liens require an analysis of employer fault and have to be handled very delicately. The resolution of workers’ compensation liens or subrogation actions in civil cases is an article in itself. Given that our firm handles a large number of multiparty construction-site injury cases, we have a great deal of experience in this area. Medical liens may be subject to the made-whole doctrine. This is an equitable insurance principle under which the insurer may not subrogate the insured’s recovery unless the insured recovers 100% of his or her damages. Similarly, California Civil Code § 3040 subjects certain liens to a pro-rata reduction for costs and attorney’s fees under the common-fund doctrine. The common-fund doctrine is an equitable doctrine that permits a litigant or attorney, who recovers a common-fund for the benefit of persons other than himself or his client, to recover fees from the fund. For briefing on these issues, please contact our office.

6. Help repair their credit.

Before settlement or trial, talk to them about their debts and see if you can help negotiate down interest, penalties, and other excess charges on credit cards. Card companies and collection agencies are often amenable to such arrangements, but not if the collections agency learns that the client has just received a substantial amount of money.

7. Protect their result.

Clients who get a large recovery frequently find that they start hearing from long-lost friends and family once news of the resolution gets around. Everyone seems to have a business idea, real-estate venture, or reasons to use their services once the funds are in. Matching your client with a trust or estate attorney to protect their recovery, evaluate their needs, and establish trusts if appropriate and a very good way to help make sure the client’s funds last.8. Use financial professionals and structured settlements.Whether you have your client consult a trust attorney, you should help match the client with a certified financial planner and plaintiff-side structured settlement broker to help evaluate the future needs for the client against the available funds. It is helpful for the trust attorney, CFP, and structure broker to have access to the life-care plan pre- pared in your case. If the client needs more time to evaluate options, consider a Qualified Settlement Fund (QSF). A QSF is a formal process, set up through the courts, that allows the settlement proceeds to be held for later distribution. The QSF preserves all of the plaintiff’s tax benefits. Most structure companies will do the paperwork free of charge to the client. Make sure you afford your clients the opportunity of working with a plaintiff-only structure broker. Plaintiff-side structure brokers are looking for the best deal for your client, not for the insurance company.

9. Think about taxes.

Make sure clients understand the potential benefits of structures, as well as potential risks. Guaranteed payments are excellent for some clients but the lack of flexibility can be a problem. If the client needs more time to make a determination, offer a Qualified Settlement Fund.

10. Protect government benefits.

Some clients are eligible for governmental programs that they will be disqualified from if they receive a large settlement in cash. A particular vehicle known as a Special Needs Trust may be appropriate for these clients. A Special Needs Trust enables a person under a physical or mental disability to have, held in Trust for his or her benefit, an unlimited amount of assets. Those assets are not considered countable assets for purposes of qualification for certain governmental benefits. Once you determine whether such a trust might benefit the client, the client should be referred to an experienced Special Needs Trust attorney to make sure it is established properly.

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