Lawletter Vol  48 No. 3

UIM Changes

Amy Gore—Senior Attorney

      New changes in Virginia Underinsured Motorist (“UIM”) insurance laws went into effect July 1, 2023, that make a significant change in the benefits available to injured claimants.

     Previously, all auto policies issued in Virginia calculated the amount of UIM coverage available to an injured claimant by subtracting the amount of available liability coverage from an insured’s stated UIM limits. Assuming there was any difference, the reduced sum would comprise the UIM coverage available to an injured claimant. Only those insureds with UIM limits greater than the tortfeasor’s liability limits would ever recover for the benefits they purchased. The new amendment to Va. Code Ann. § 38.2-2206(C) now will

The Lawletter Vol. 48 No. 2

Matt McDavitt, Senior Attorney

           A common issue to be resolved in any administration of a decedent estate is the determination of the rightful value of the compensation due to the serving personal representative. While the will of the decedent may validly dictate the amount of compensation due to the serving personal representative (though, subject to judicial scrutiny), more commonly, the value of such fiduciary compensation follows statutory strictures. Lacking an appropriate testamentary personal representative compensation provision, states employ an array of calculation methods to determine the proper value of such remuneration based on one of several methods.

            A common methodology employed in personal representative compensation statutes is to examine a suite of elements characterizing the relative complexity of the estate administration, the objectively reasonable effort required to perform the necessary tasks, the diligence of the personal representative, and results attained therefrom:

The Lawletter Vol. 48 No. 2

Suzanne Bailey, Senior Attorney

            In Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388 (1971), the U.S. Supreme Court recognized an implied right of action for damages by a victim of a constitutional violation by a federal agent against that federal agent in federal court. In that case, the plaintiff sought damages for a violation of his Fourth Amendment rights when federal narcotics agent conducted a warrantless search of his apartment, arrested him for alleged narcotics violations, and subjected him to excessive force by conducting a visual strip search. Since Bivens, the Supreme Court has recognized an implied right of action against a federal agent committing a constitutional violation in only two other cases, Davis v. Passman, 442 U.S. 228 (1979) (woman discharged from employment by U.S. Congressman a right of action, arising directly under Fifth Amendment due process clause, to recover damages for Congressman's alleged sex discrimination), and Carlson v. Green, 446 U.S. 14 (1980) (administratrix of deceased federal prisoner's estate had cause of action against federal prison officials for violation of deceased's Eighth Amendment right to be free from cruel and unusual punishment by failing to give him proper medical attention). More recently, in Ziglar v. Abbasi, 582 U.S. 120 (2017), the Court stated that recognizing implied causes of action was now a "disfavored judicial activity," noting its consistent refusal "to extend Bivens to any new context or new category of defendants." Id. at 135 (internal quotation marks omitted). Before implying a cause of action, courts must engage in a two-step inquiry: (1) determine whether the claim presents a new Bivens context not previously recognized by the Supreme Court and, if so, (2) determine whether there are special factors counseling judicial hesitation absent action from Congress. Id. at 136-140.

The Lawletter Vol 48 No 2

Nadine Roddy, Senior Attorney, National Legal Research Group, Inc.

       In a most unusual case recently before the federal district court sitting in Nevada, Barnes v. Kijakazi, No. 3:18-cv-00199-MMD-WGC, 2023 WL 3007904 (D. Nev. Apr. 19, 2023), a pro se plaintiff asserted a claim of disparate-impact discrimination against the Social Security Administration (SSA) under the Age Discrimination in Employment Act (ADEA). It has been less than 20 years since the Supreme Court held in Smith v. City of Jackson, 544 U.S. 228 (2005), that disparate-impact claims are cognizable under the ADEA. The scope of disparate-impact liability is narrower under the ADEA than under Title VII, and the general requirement of statistical evidence to prove the elements of a disparate-impact case still applies. Thus, it is unusual for a pro se plaintiff to bring such a suit under the ADEA—even an attorney plaintiff.

         The plaintiff in Barnes was a lawyer who had applied unsuccessfully for the position of attorney advisor in a soon-to-be-opened SSA hearing office in Reno, Nevada. She sued the agency through its Acting Commissioner and the hiring official who handled her application. She alleged that the official had recruited and hired five attorneys for the new office in a manner that had a disparate impact on older applicants such as herself. As part of his recruitment process, the official advertised the positions externally with an online job board maintained by the University of Nevada’s law school. He also recruited from the alumni branch of the Peace Corps.

The Lawletter Vol 48 No 2

Charlene Hicks, Senior Attorney, National Legal Research Group, Inc.

             Bankruptcy preference litigation involves situations in which the plaintiff (normally the trustee) tries to claw back substantial monetary payments debtors make to creditors within 90 days of filing for bankruptcy. Preference cases are deceptively simple in form. However, complications often arise, particularly in cases involving creditors that regularly do business with the debtor. Such creditors may invoke diverse sections of the Bankruptcy Code in an attempt to negate the trustee’s reimbursement claim against them.

            In Auriga Polymers Inc. v. PMCM2, LLC, 40 F.4th 1273, 1277 (11th Cir. 2022), the Eleventh Circuit Court of Appeals recently analyzed the interplay between two such sections of the Bankruptcy Code. One of the eight preference defenses a creditor may raise is known as the subsequent new value defense and is set forth in 11 U.S.C. § 547(c)(4). Section 503(b)(9), in turn, contains an administrator expense claim that a creditor may obtain for payment in full for the value of goods sold to the debtor in the ordinary course of business within 20 days before the debtor files for bankruptcy. 11 U.S.C. § 503(b)(9). In an issue of first impression in the Eleventh Circuit and one which is unsettled in other circuits, the Auriga Polymers court addressed “whether post-petition transfers made under a 11 U.S.C. § 503(b)(9) request will reduce the creditor’s new value defense” under 11 U.S.C. § 547(c)(4). The trustee claimed that Auriga would effectively receive a “double payment” if it were allowed to obtain payment for its administrator expense claim and also to avoid repayment to the trustee under the preference defense of subsequent new value. Auriga Polymers, 40 F.4th at 1288.

The Lawletter Vol. 48 No. 1

Anne Hemenway, Senior Attorney, National Legal Research Group, Inc.

        It is not uncommon for a debtor who filed a Chapter 11 or 13 bankruptcy case to die or become incapacitated during the life of the bankruptcy proceeding. Under Fed. R. Bankr. P. 1016:

If a reorganization, family farmer's debt adjustment, or individual's debt adjustment case is pending under chapter 11, chapter 12, or chapter 13, the case may be dismissed; or if further administration is possible and in the best interest of the parties, the case may proceed and be concluded in the same manner, so far as possible, as though the death or incompetency had not occurred.

            Interestingly, the rule is different where the debtor filed under Chapter 7. The death or incompetency of the debtor "shall not abate a liquidation case under chapter 7 of the Code." This is because the death of the debtor has no practical effect on the administration of a Chapter 7 which is in the hands of the Chapter 7 Trustee. See Hawkins v. Eads, 135 B.R. 380 (Bankr. E.D. Cal. 1991).

The Lawletter Vol. 48 No. 1

Jason Holder, Senior Attorney, National Legal Research Group, Inc.

          Accused of sexually assaulting a patient while working as a certified nursing assistant, Terence Tekoh was interrogated “at length” by a Los Angeles County Sheriff’s Department Deputy. Vega v. Tekoh, 142 S. Ct. 2095, 2099, 213 L. Ed. 2d 479, 485 (2022). While the Deputy ultimately secured a written statement from Tekoh apologizing for inappropriate touching of a patient, the Deputy had failed to inform Tekoh of his rights under Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966). Vega, 142 S. Ct. at 2099-2100. Following a mistrial, Tekoh was acquitted at the conclusion of his second trial. Id. at 2100. In both criminal trials, judges refused to suppress the un-Mirandized statement. Id.

        Following his acquittal, Tekoh brought suit against the Deputy and other defendants pursuant to 42 U.S.C. § 1983, alleging violation of his Fifth Amendment right against self-incrimination. Id. An improper jury instruction led to a second trial in the civil action at which Tekoh requested the jury be instructed that it was “required to find that Vega violated the Fifth Amendment right against compelled self-incrimination if it determined that he took a statement from Tekoh in violation of Miranda and that the statement was then improperly used against Tekoh at his criminal trial.” Id. The trial court refused the request, holding that Miranda establishes a mere prophylactic rule that could not, standing alone, provide a ground for § 1983 liability. Id. A panel of the Ninth Circuit reversed, holding that “Dickerson [v. United States, 530 U.S. 428, 120 S. Ct. 2326, 147 L. Ed. 2d 405 (2000)] made clear that the right of a criminal defendant against having an un-Mirandized statement introduced in the prosecution's case in chief is indeed a right secured by the Constitution.” Tekoh v. County of Los Angeles, 985 F.3d 713, 720 (9th Cir. 2021).

The Lawletter Vol. 48 No. 1

Paul Ferrer, Senior Attorney, National Legal Research Group, Inc.

            Rule 60(b) of the Federal Rules of Civil Procedure authorizes a court to relieve a party from a final judgment, order, or proceeding for various reasons, including “mistake, inadvertence, surprise, or excusable neglect.” Fed. R. Civ. P. 60(b)(1). The U.S. Circuit Courts of Appeal have had a “longstanding disagreement whether ‘mistake’ in Rule 60(b)(1) includes a judge’s errors of law.” Kemp v. United States, 142 S. Ct. 1856, 1861 & n.1, 213 L. Ed. 2d 90 (2022). Resolving that question in Kemp, the U.S. Supreme Court held, based on the text, structure, and history of Rule 60(b), that “a judge’s errors of law are indeed ‘mistake[s]’ under Rule 60(b)(1).” Id. at 1860. In so holding, the Supreme Court indicated that the term “mistake” in Rule 60(b)(1) should be given its broadest possible interpretation to include any mistake, including “all mistakes of law made by a judge.” Id. at 1862.

            The Supreme Court specifically rejected the Government’s narrower reading of Rule 60(b)(1) in Kemp that the term “mistake” includes “only so-called ‘obvious’ legal errors.” Id. The Supreme Court’s decision sensibly spared the federal district courts from having “to decide not only whether there was a ‘mistake’ but also whether that mistake was sufficiently ‘obvious,’” since the plain language of Rule 60(b)(1) “does not support—let alone require—that judges engage in this sort of complex line-drawing.” Id. at 1863. Thus, the rule going forward could not be any simpler: relief from a final judgment or order may be granted under Rule 60(b)(1) based on a judge’s “mistakes,” including legal errors.

The Lawletter Vol. 48 No. 1

Brett Turner, Senior Attorney, National Legal Research Group, Inc.

          Mother and Father married in 1996 and had two children. Mother filed for divorce in 2019, and the divorce was granted in July of 2021. Father was ordered to pay child support.

            In October 2021, three months after the divorce, Father filed to reduce child support, alleging that he had been terminated from his job. He then failed to make his October and November child support payments and was also not in compliance with the property division terms of the decree.

            Father was in the process of selling a piece of real estate, the Carpentersville property, awarded him in the decree. In mid-November, Mother moved the court to order the proceeds from that sale be placed in escrow, with the proceeds used to satisfy Father's child support and other obligations under the decree. The trial court granted the motion to the extent of holding the sale proceeds in escrow, and Father appealed.

            Father argued that the escrow order was an impermissible prejudgment attachment of funds in which Mother had no interest. The appellate court rejected the premise that the trial court issued a prejudgment attachment at all. "Instead, the trial court was exercising its equitable power to protect the two minor children and their right to support." In re Patel, 2022 IL App (1st) 211650, ¶ 23. "Hence, the trial court may order an injunction of proceeds to prevent the dissipation of assets that may be used to satisfy court-ordered child support and maintenance." Id.

The Lawletter Vol. 48 No. 1

Amy Gore, Senior Attorney, National Legal Research Group Inc.

     Like so many others in today’s society, lawyers are dependent upon electronic forms of communication, including email. The use of electronic communications has raised a plethora of ethical concerns for practitioners. Now, in addition to the previous ethical concerns, the dreaded “Reply All” is added to the list that practitioners must oversee.

     In Formal Opinion 503 (2023), the ABA Standing Committee on Ethics and Professional Responsibility cautions lawyers to not copy their clients on electronic communications to opposing counsel, unless the intended result is a “reply all” response. The Committee cited Model Rule 4.2 which cautions that an attorney, in representing a client, may not “communicate” about the subject of the representation with a represented person absent the consent of that person’s lawyer, unless the law or court order authorizes the communication. When an attorney sends a communication to opposing counsel and includes the client on the email communication, the receiving attorney is likely going to reply all. This would result in opposing counsel communicating with a represented person, and possibly without the consent of the client’s attorney.