Archive for June, 2012

ARE LAWSUIT SETTLEMENTS TAXABLE?

June 22, 2012

By Dennis R. Stout

The simple answer to the question regarding the tax consequences of a settlement claim is it all depends on the nature of the settlement!

 

Generally speaking, settlement money received from cases involving personal physical injury or physical sickness can be excluded from taxation (IRS Code sect. 104(a)(2)). Certain other types of settlement awards, (considering the nature of the item that the settlement replaces), may be taxable, including compensation for lost wages or lost profits; breach of contract damages, employment discrimination, emotional distress (if not related to physical injury or sickness); and punitive damages just to name a few.

 

In conclusion, only settlements from physical injury or sickness are non-taxable; generally all other types of settlements are taxable. Given the complexity of litigation, settlements and tax consequences, it is important and prudent to speak to an attorney, accountant, or tax advisor for clarification on this issue. Attorneys at Heiting & Irwin are always available to assist our clients with all of their legal needs and questions.

IS THE EMPLOYER RESPONSIBLE FOR INJURIES THAT OCCUR ON THE WAY TO OR FROM A MEDICAL APPOINTMENT?

June 20, 2012

By Debbie A. Beals, Paralegal to
Richard H. Irwin, Esq., Certified Workers Compensation Specialist

An employer bears the risk of incurring compensability liability under the California Workers’ Compensation Act for an injury suffered in route to or from a medical appointment related to an existing compensable injury.

If an employee suffers a new injury while traveling a reasonable distance, to or from a medical appointment for an existing compensable claim, the new injury will also be compensable. However, the employer will incur no liability if the employee travels an unreasonable distance to where the medical treatment was to occur and beyond “ the reasonable geographic area of his or her employer’s compensability risk.”

Each incident must be evaluated on a case-by-case basis with consideration being given to:

1) the location of the employee’s residence;
2) the location of employee’s workplace;
3) the location of the medical facility;
4) the location of the employee’s attorney;
5) the location where the new injury occurred;
6) the route the employee takes to deviate from an reasonable direct route to the medical facility;
7) the availability of providers or medical specialists;
8) the distance between the medical provider’s office and the employee’s point of departure; and
9) the employee’s reason why travel was beyond “the reasonable geographic area of his or her employer’s compensability of risk.”

Limited provisions is implied in Labor Code, Section 4600.

Heiting & Irwin has over 100 years combined experience assisting those who have suffered injuries due to the negligence of another, and has an entire department devoted to Workers’ Compensation matters supervised by Richard H. Irwin, a Board Certified Specialist in Worker’s Compensation. If you or someone you know has been injured, it is important to consult with an experienced, knowledgeable attorney in a timely fashion. To schedule a free consultation, please call our office at (951) 682-6400.

NOT IN MY CAR: WHY THE REPAIR SHOP WILL BE LIABLE FOR A JOY RIDE

June 20, 2012

By Sara B. Morgan, Esq.

A coffee-run to my local Starbucks (Brockton and Arlington) prompted my last article about the liability of an automotive repair or service shop for damage to a vehicle left in its care. Since posting my last article, I am happy to report that I have not seen any other mechanics using customer’s cars to pick up coffee.

Garages and other vehicle repairers would be wise to heed the warning, however. As previously discussed, a vehicle repairer is fully liable to the car owner for any damage which occurs when the vehicle is used without the customer’s consent. Civil Code, Sections 1835 and 1836. Presumably, this would include using a customer’s car to take a joy ride to get coffee at Starbucks. In these situations, the vehicle repairer bears the burden of proof to demonstrate it was free from fault or negligence. Downey v. Martin Aircraft Serv. (1950) 96 Cal. App. 2d 94.

Finally, the law prevents a customer from signing away this protection. In Gardner v Downtown Porsche Audi (1986) 180 Cal. App. 3d 713, the court held that an automobile repair garage may not limit its liability for negligent care of the vehicles entrusted to it by having customers sign a written disclaimer. The Gardner court relied on the premise that contractual clauses which purport to exculpate repair garages for liability for negligence violate Civil Code, Section 1668 and are invalid as contrary to public policy.

In most circumstances, the vehicle repairer’s liability for its negligence, or the negligence of its employees, is limited to the value of the vehicle left in its care. Civil Code, Section 1840. However, exceptions exist which may involve fraud or misrepresentation. If you believe you are the victim of wrongful conduct and have suffered damages or injuries, it is important to consult with an experienced, knowledgeable attorney.

The law firm of Heiting & Irwin has over 100 years combined experience representing the interests of people who have been harmed by the actions of others. We offer free consultations, a warm and inviting office, and a friendly staff to anyone interested in speaking about a potential legal matter. If you would like to speak with someone about your circumstances, please call our office at (951) 682-6400 for a free consultation.

NOT IN MY CAR: WHY THE TEST DRIVE SHOULD BE LIMITED TO TESTING

June 13, 2012

By Sara B. Morgan, Esq.

One recent morning while leaving my local Starbucks drive-thru, I waited while two men wearing mechanic uniforms crossed the parking lot to what I assumed was their vehicle. I thought nothing more of this until, several days later, I saw the same men, again clad in uniforms, only this time walking to a different vehicle. This time, I noticed the fluorescent writing on the rear window, and suddenly realized these were auto service or repair men who were using customer vehicles to get their morning coffee!

A vehicle repairer to whom a vehicle is delivered has the usual duty of ordinary care and liability of a bailee for hire. Civil Code, Section 1852. The vehicle may not be used for any purpose without the customer’s consent, and the vehicle repairer is responsible for any damage which occurs when the vehicle is used without the customer’s consent. Civil Code, Sections 1835 and 1836.

Now, being the daughter of a mechanic, I appreciate the importance of the post-service test drive. However, I doubt that those customers anticipated the extra risks these men were taking in exposing their vehicles to the small, busy, bustling shopping center, particularly at the height of the Starbucks morning rush. Nor is it likely they would anticipate the vehicle repairer’s employees consuming food and beverages inside their vehicles. Thus, in addition to liability for any fender-benders, the vehicle repairer would also arguably be liable for any stains or cleaning fees in order to restore the vehicle to the condition it was in at the time the customer left it with the repair shop.

SHOULD SETTLEMENTS BE CONFIDENTIAL?

June 5, 2012

SHOULD SETTLEMENTS BE CONFIDENTIAL?

Heiting & Irwin

By: Dennis R. Stout

You have sustained an injury or some form of damage, filed and prosecuted your Complaint, and have now reached a settlement with the adverse party. Upon receipt of the Settlement Agreement and Release, the defendant requests that the settlement be deemed confidential, that the nature of the settlement, its terms, and the amount be kept secret by the parties to the litigation.

With several exceptions in the state of California, defendants can demand that a settlement be confidential. Cases involving public entities (where taxpayers have a right to know the disposition of public funds), elder abuse cases, and sex offenses are an exception to the rule. Otherwise, a defendant wishing to avoid public disclosure of fault, wishing to avoid similar claims, and concerned that knowledge of the settlement amount would belie a public denial of wrongdoing, may demand and include a confidentiality clause within the Settlement Agreement and Release.

Although there are strong arguments against confidentiality in Settlement Agreement and Release documents relating to injuries, there is no outright prohibition for the inclusion of such terms within a settlement agreement. As an injured party/plaintiff settling a case, one should not only aware of, but understand the provisions contained within the Settlement Agreement and Release that would subject the plaintiff to a penalty in the event of disclosure. The plaintiff should carefully read, review, consider, and understand the language of the Settlement Agreement and Release and any sanction for disclosure contrary to its terms. Reliance upon your counsel to explain the confidentiality clauses, ramifications and potential sanctions is an important conclusion to the litigation process. As with all stages of your injury and damage claim, confidence in and reliance upon your chosen counsel is of the upmost importance. All of the attorneys at Heiting and Irwin have handled litigated cases and are familiar with the importance of the terms and conditions contained within the Settlement Agreement and Release documents. It is our goal to assist you in all stages, and most importantly, that the settlement of your claim should not result in any sanction to you, should the disclosure of its terms be beyond your control.

The attorneys at Heiting and Irwin are available to discuss your case not only from its beginning, but to assist you in the completion of your case, as well, including review and evaluation of settlement documents. Experience in all aspects of litigation is important, and that is what all attorneys at Heiting and Irwin offer to its clients.