court-awarded attorneys’ fees, [the insurance company] mounts a collateral attack on the award of attorneys’ fees as violating the “American Rule.” As the trial court held, this attack is without foundation. Perhaps the most well-known public policy-based argument regarding coverage of plaintiff’s attorney fees is found in XL Specialty v.
Jul 31, 2013 · A potential award of attorney fees is seen as a risk by the insurance company that encourages them to offer more money in settlement. Generally, no matter what the award of attorney fees in a bad faith case, you owe your attorney the percentage you agreed on. Most fee agreements are 40% once a petition is filed.
May 26, 2019 · Omega Insurance Company, 4 the Florida Supreme Court held that the narrow application of the fee statute as argued by Omega was inconsistent with the court’s prior ruling in Ivey v. Allstate, 5 which established that an award of attorneys’ fees under FL Stat. § 627.428 requires merely that an insurer incorrectly denied policy benefits ...
Health Insurance Federal employees can enroll in health insurance coverage for themselves and their families at reasonable rates. They enjoy one of the widest selections of plans in the country. Well over 200 plans participate in the health insurance program. Employees can choose among: • Fee-for-Service (FFS) plans with a Preferred Provider
The employing agency is the proper source for employment and pay information about a current employee's service with that agency. OPM does not receive records until after an employee leaves an agency's employment. With regard to requests for an individual's employment and pay records, agency personnel must comply with Privacy Act rules and applicable regulations before disclosing the information.
In preparing a court order, attorneys should keep in mind that we consider each of the three types of awards as separate and independent of the other two, and should exercise great care in each type of benefit they intend to affect.
The United States Office of Personnel Management (OPM) administers both of these retirement systems. CSRS covers most employees first hired before 1984. FERS generally covers employees first hired by the Federal Government after 1983, plus other Federal employees who elected to transfer from CSRS to FERS.
Using the following paragraph will award the former spouse a prorata share of the employee annuity. Prorata share is defined in ' 838.621. To award a prorata share the court order must state the date of the marriage. Unless the court order specifies a different ending date, the marriage ends for computation purposes on the date that the court order is filed with the court clerk. Unless the court order expressly directs that OPM not add COLA's to the former spouse's share of the employee annuity, OPM will add COLA's to keep the former spouse's share at the stated percentage. Paragraph 232 of this appendix provides language for excluding COLA's. " [Employee] is (or will be) eligible for retirement benefits under the Civil Service Retirement System based on employment with the United States Government. [Former spouse] is entitled to a prorata share of [employee]'s [insert "gross," "net," or self‑only] monthly annuity under the Civil Service Retirement System. The marriage began on [insert date]. The United States Office of Personnel Management is directed to pay [former spouse]'s share directly to [former spouse]."
(a) Unless the court order acceptable for processing expressly provides otherwise, the former spouse's share of an employee annuity terminates on the last day of the month before the death of the former spouse, and the former spouse's share of employee annuity reverts to the retiree.
Appendices to the regulations contain model paragraphs that attorneys can use to ensure that , in drafting orders, the language they select will both produce the intended result and meet OPM's processing requirements.
Federal agency personnel do not advise an employee, an employee's spouse, or an attorney about how to draft a court order to award CSRS or FERS benefits. This is the task of the attorneys involved. The requirements that must be satisfied for OPM to honor a court order are set out in the law and regulations provided in this publication. The regulations contain two appendices that provides model language recommended for use in court orders. An agency's efforts to advise individuals in legal matters involving domestic disputes can, despite good intentions, harm more than help.
The familiar American rule holds that each party bears its own attorney fees in litigation. The only exceptions are a statute or contract authorizing the shifting of legal fees from the prevailing party to the losing party. Any number of federal and state statutes have fee-shifting provisions in them. These generally relate to civil rights, consumer protection, employment, and environmental suits. In addition, many contracts have prevailing party provisions that likewise shift attorney fees. [1] In many contexts (class actions, for example), the attorney-fee award can be substantial, often representing a large percentage of the overall recovery.
The typical comprehensive general liability ( CGL) policy provides that the insurer will pay damages because of bodily injury, property damage, and personal and advertising injury. For example, the current Insurance Services Office (ISO) CGL insuring agreement for bodily injury and property damage liability (Coverage A) provides as follows:
Other courts have concluded that attorney fees are not damages. These cases generally fall into two narrow categories. The first relates to statutory or common-law treatment of certain types of attorney-fee awards as costs. The second relates to whether a boilerplate demand for attorney fees triggers the defense obligation where the underlying claim is not otherwise covered by the policy.
Because of the historically broad interpretation given to coverage under a CGL policy, a number of courts have held that fee-shifting awards are covered damages. For example, in American Family Mutual Insurance Co. v. Spectre West Builders Corp., [3] the underlying arbitration involved a construction defect claim by a homeowners’ association against the contractor relating to a condominium complex in Arizona. As part of the award, the arbitrator found that the association was entitled to $300,000 in attorney fees pursuant to contract and Arizona fee-shifting statutes. [4] In the coverage litigation, the insurer sought a declaration that there was no coverage under the CGL policy for the construction defect claims and that the policy did not provide coverage for the attorney-fee award and non-taxable costs. The court rejected both contentions:
Section 642 of Public Law 106-58 requires Federal agencies to reimburse law enforcement officers, supervisors, and managers for up to one-half of the cost of professional liability insurance, protecting them from potential liability and attorney’s fees for actions arising out of the conduct of official duties.
The Federal Employees Retirement System (FERS) is an outstanding three-tiered plan to provide secure retirement, disability, and survivor benefits for employees and their dependents. In addition to Social Security benefits as a base, FERS offers both an annuity that grows with length of service and a tax deferred savings plan. Employees pay less than 1 percent of salary to qualify for the annuity and are fully vested after 5 years of service and, for disability benefits, after just 18 months. (5 CFR 843)
The Thrift Savings Plan (TSP) allows employees to save on a tax-deferred basis for retirement. The amount participants may contribute changes annually, and eventually only the Internal Revenue Code dollar limit will apply. Participants, age 50 or over, are allowed to make catch-up contributions if they meet the criteria required. The Government contributes 1 percent of salary to FERS employees who do not contribute and will match up to another 4 percent of savings for FERS employees who do contribute. Because the savings plan is tax deferred, no income tax is due on the employee’s contributions, the Government matching funds, or the earnings on either of those amounts until retirement.
An employee will receive a lump-sum payment for any unused annual leave when he or she separates from Federal service or enters on active duty in the armed forces and elects to receive a lump-sum payment. Generally, a lump-sum payment will equal the pay the employee would have received had he or she remained employed until expiration of the period covered by the annual leave. (5 U.S.C. 5551; 5 CFR part 550, subpart L)
With the Long-Term Care Security Act, long-term care insurance became a reality for Federal employees, members of the military, retirees, and their families. The insurance program provides coverage for long-term care health care needs, such as nursing home care, home health care, assisted living facilities, adult day care, and personal care/homemaker care. It is the only Congressionally authorized long-term care insurance program in existence.
Survivors of Federal employees, annuitants, and compensationers (those receiving compensation based on an on-the-job injury or employment-related disease) may be entitled to survivor benefits based on the individual’s retirement coverage. Survivors may also be eligible for life insurance proceeds and other lump-sum payments, depending on factors related to the deceased individual’s status.
Under Kansas law, a policyholder is entitled to its reasonable attorney fees when it is forced to sue an insurance company for refusing "without just cause or excuse" to defend or indemnify the policyholder. Specifically, K.S.A., section 40-256, provides:
These rationales generally are founded on (1) the nature of the insurance promise; for example, the nature of an insurance company's duty to defend its policyholder; (2) the theory of consequential damages; (3) the language of particular insurance policy provisions; (4) public policy considerations; and (5) specific statutory provisions.
Maryland courts have stated unwaveringly that " [t]he rule in this State is firmly established that when an insured must resort to litigation to enforce its liability insurer's contractual duty to provide coverage for its potential liability to injured third persons, the insured is entitled to a recovery of the attorneys' fees and expenses incurred in that litigation." 31
Anderson Kill practices law in the areas of Insurance Recovery, Anti-Counterfeiting, Antitrust, Bankruptcy, Commercial Litigation, Corporate & Securities, Employment & Labor Law, Health Reform, Intellectual Property, International Arbitration, Real Estate & Construction, Tax, and Trusts & Estates. Best-known for its work in insurance recovery, the firm represents policyholders only in insurance coverage disputes, with no ties to insurance companies and no conflicts of interest. Clients include Fortune 1000 companies, small and medium-sized businesses, governmental entities, and nonprofits as well as personal estates. Based in New York City, the firm also has offices in Newark, NJ, Philadelphia, PA, Stamford, CT, Ventura, CA and Washington, DC. For companies seeking to do business internationally, Anderson Kill, through its membership in Interleges, a consortium of similar law firms in some 20 countries, assures the same high quality of service throughout the world that it provides itself here in the United States.
An insurance company's refusal to pay a claim can be devastating. Now you have a two-front war: You must contend with the cost and consequence of your loss and deal with your insurance company's refusal to pay. Some jurisdictions will force the insurance company to pay your legal fees regarding the coverage dispute.
Policyholders may also be permitted to recover fees for in-house counsel as costs of pursuing insurance coverage . The cost of using the policyholder's in-house legal staff should be recoverable just as outside counsel fees may be recovered in a successful insurance coverage case.
In Washington, it is well established that courts may award attorney fees to a prevailing policyholder. According to the Washington Supreme Court in Olympic Steamship Co. v. Centennial Insurance Co .:
The leading case on the classification of expenditures as business or personal (as well as deductible versus capitalizable 3) is the Supreme Court decision in Gilmore. 4 This case examined the tax treatment of legal fees to defend a divorce action and protect the husband’s business assets against claims by the wife. The husband argued that the fees were deductible because they were incurred to conserve property (stock) held for the production of income, a position the lower court had agreed with.
When legal fees originate from different claims, an allocation is needed to determine the tax treatment. 27 For example, if an individual incurs legal fees to obtain fair value in a condemnation of property, the legal fees originate from the condemnation and are part of the property transaction (capitalizable). If the award also includes prejudgment interest, the related legal fees are deductible. The legal fees need to be allocated between the two awards so the proper tax rules can be applied.
Several Code provisions are relevant in determining the tax treatment of legal fees incurred by an individual. Sec. 162 allows ordinary and necessary expenses incurred in carrying on a trade or business. Sec. 212 provides a similar rule, but for the ordinary and necessary expenses incurred for income production or collection or for the management, conservation, or maintenance of property held for income production. In contrast, Sec. 262 denies deductions for personal, living, or family expenses.
The origin-of-the-claim test is the approach individuals must use to determine the nature of their legal fees and thereby decide how they are treated for tax purposes. It is important to examine the facts of the claim and ask why the individual hired an attorney. Answering these questions should then enable practitioners to determine if the fees are nondeductible personal expenses, business or income related, or capitalizable as related to a property interest. The potential consequences of not obtaining legal assistance are not relevant to classify the fees. There are many rulings to provide assistance in applying the origin-of-the-claim test.
As noted earlier, the tax treatment of legal fees is a well-litigated area, and there are many court cases to consider in resolving borderline situations. This section provides guidance on identifying the origin of legal fees as capitalizable, business, employment, investment, or personal.
67’s 2%-of-AGI rule), taxpayers have sometimes argued that legal fees are business expenses rather than employment-related expenses.
When legal fees are incurred and produce a damage award that is excluded from income (such as due to the application of Sec. 104), the fees are not deductible. Sec. 265 denies deductions for items allocable to tax-exempt income.
Employers have the right to terminate coverage for employees who are over thirty days late in payment of their contribution. The employer is only required send the employee a written notice of stating the health care coverage will be terminated and wait fifteen days after the notice was sent to terminate health coverage.
As our employment law lawyers have previously discussed (see here and here ), the Family Medical Leave Act (“FMLA”) provides a qualified employee twelve weeks or 1,250 hours of unpaid leave to care for a serious health condition of a spouse, child, or their own serious health condition.
Martin v. Louisiana Farm Bureau Casualty Insurance Company, 94-0069 (La. 7/5/94), 638 So. 2d 1067. Theoretically, the insurer’s right can be one of subrogation or one of reimbursement only, depending on policy provisions. Barreca v. Cobb, 95-1651 (La. 2/28/96), 668 So. 2d 1129. Under subrogation, the insurer stands in its insured’s (the plaintiff’s) shoes and has a right of action against the third party tortfeasor; under reimbursement, the insurer only has a right of action against its insured. Id. In practice, insurers are careful to word their contracts so as to provide for both subrogation and reimbursement. Under both subrogation and reimbursement, the insurer must bear a proportionate share of the costs and attorney’s fees associated with recovery from the tortfeasor, in accordance with Moody v. Arabie, 498 So. 2d 1081 (La. 1986) and Barreca v. Cobb, 95-1651 (La. 2/28/96), 668 So. 2d 1129. But, according to case law, the insurer is assessed attorney’s fees only if it received timely notice of the insured’s suit against the tortfeasor and relied on the efforts of the insured’s counsel. Barreca, 668 So. 2d at 1132. If the insurer intervenes, and its own counsel is an active participant in the suit against the tortfeasor, it may not be responsible for its share of the insured’s attorney’s fees. Id; Doucet v. Gayden, 07-183 (La.App. 5 Cir. 10/16/07), 971 So.2d 382.
Rule 1.1(a) of the Louisiana Rules of Professional Conduct requires us to be competent: A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.
Medicaid is a program established under federal law in which the federal and state governments share in the cost of paying for health care for poor citizens. The federal government pays for most of the costs each state incurs; in return, each state pays its share and complies with certain statutory requirements for making eligibility determinations, collecting and maintaining information, and administering the program. Under the Affordable Care Act, eligibility for Medicaid is determined by income level only without regard to assets (except for the elderly going into a nursing home). Medicaid in Louisiana is administered by the Dept. of Health and Hospitals (DHH) and its private contractors.
State employees are covered under different plans offered under the auspices of the Office of Group Benefits (OGB). OGB has promulgated a regulation, LAC 32:513, in which it asserts full subrogation and reimbursement rights over any and all proceeds. La. R.S. 22:971.1(A) exempts OGB from the authority of the Department of Insurance to regulate “the coordination of medical, surgical, and hospital benefits of a self-insurance plan with such benefits of any other insurance plan”, but that doesn’t exempt OGB from the substantive provisions of the Insurance Code (Title 22). See Capitol Anesthesia Group, P.A. v. Watson, 2008-1159 (La.App. 3 Cir. 3/4/09), 7 So.3d 51, writ denied, 2009-1088 (La. 9/18/09), 17 So.3d 974, in which OGB was tagged for penalties and attorney’s fees under La.R.S. 22:657 (now 22:1821). And La. R.S. 42:858 provides relative to OGB that “[a]ll group insurance contracts effected pursuant hereto shall conform and be subject to all the provisions of any existing or future laws concerning group insurance.”
Medicare is a purely federal program funded by participating taxpayers. Almost everyone who turns 65 is eligible for Medicare. Individuals who qualify for Social Security Disability are also eligible for Medicare when they have been disabled for 24 months. Entitlement to Social Security and Medicare benefits is not affected by income or assets. Medicare is administered by the Center for Medicare and Medicaid Services (CMS).