With Halloween upon us, it is “spooky season”.
“Spooky season” doesn’t necessarily have to involve ghosts and goblins and zombies. “Spooky season” can be caused by poor decisions and not knowing your legal rights.
BDBF attorneys offer the issues that terrify us to confront and how you can avoid making these costly mistakes, which can cause you a “spooky season” (or worse):
Tim Canney (Chair of Business and Tax Practice)
Not having good form business contracts
When well-drafted written contracts are not put into place, or vary wildly from one party to another, or have not been updated over time to reflect the parties’ evolved relationship, business owners can be in for a real fright. Consider your ghoulish customer who stiffs a $15,000 invoice on a dreary October day. You look through your files to locate the written agreement with this customer… only to discover that it is a two-paragraph sheet from 2015 that does not mention attorneys’ fees or enforcement costs. Horrified, you realize that it would cost you at least $15,000 to file and prevail on a lawsuit – meaning that your net recovery might be zero or even a loss! Desperate to escape this nightmare, you turn around the corner of your office and run into your long-term key employee, who tells you they are quitting to go work for your largest competitor! You race back to your files, only to discover that you have no written agreement with that employee preventing either their disclosure of your pricing and business plans or their poaching of your customers and your other employees! [Enough specter! Spare me these twisted visions!]
Phil Kuljurgis (Of Counsel to Personal Injury Practice)
A wonderful client who does not understand our legal system is adversarial and assumes the insurance company will “do the right thing”.
Insurance companies have funny commercials and often have wonderful customer service. Having worked directly or indirectly for many insurance companies, I can tell you that they are mostly staffed with wonderful, hard-working people who are indeed trying to do the right thing. However, “doing the right thing” in our adversarial system of justice means advancing the interests of their insured, or, in the case of a claim directly against the insurance company, advancing the interests of the company itself. Assume a client is struck by an uninsured drunk driver and that client makes a claim against their own insurance company for uninsured motorist coverage. Many clients are shocked to learn that their own insurance will hire an attorney to seemingly represent the drunk driver who hit them, and that every aspect of both liability and damages will be contested. The best way to remedy this is to understand that the claimant has the burden of proof and that our system of justice is adversarial. With this in mind, one is more likely to: stop and ask a witness to an accident for their name and phone number before the witness leaves the scene; not say they are “ok” at the scene of the accident simply to spare a crying at-fault driver’s feelings; be sure to give a full and detailed medical history and list of complaints upon the first visit to a medical provider; keep track of all the life events, business opportunities, or other activities of daily living that were negatively affected by an accidental injury. In our adversarial system, insurance companies will “do the right thing,” but sometimes only if you make them.
Jeremy Rachlin (Chair of Estate and Trust Practice)
Beware of the unfunded trust.
Ask any estate attorney, and they’ll tell you one of the saddest (not necessarily terrifying) things we’ll come across is an unfunded trust created by somebody who has passed away. We know that the decedent expended resources (both effort and money) on creating a living trust as part of their estate plan, almost certainly with the goal of simplifying and streamlining the post-death administration of their assets and affairs But by never funding the trust, it can create an even bigger probate mess than if the person never had established a trust to begin with. We try to keep our clients out of this problem by ensuring that all real estate is retitled into a living trust at the time of signing and giving detailed post-signing instructions on how to implement and fund their trust. But ultimately, it is on the client to do the legwork, loop in their financial planner, and make sure that investment accounts, business interests, and other assets are retitled appropriately and beneficiary designations updated.
Meg Rosan (Chair of Family Law Practice)
Insisting on having the “most aggressive” representation.
Occasionally, a prospective family law client will ask in a consultation: “How aggressive can you be?” Parties to a family law case might think they want the “most aggressive” attorney for good reason: they’ve felt bullied by the opposing party or the opposing party’s attorney, and they’re afraid they won’t stand a chance securing a fair outcome without someone in their corner who can play the same game. Other times, parties want aggressive counsel for the wrong reason: to inflict the most pain. And this is particularly problematic when custody of children is involved. In truth, the “most aggressive” attorney is not always the smartest choice. There’s a difference between aggression and zealous advocacy. Parties in family law cases are often highly emotional and would be best served by seeking counsel who will focus on securing the best outcome for them by providing full and complete legal advice, strategy, and de-escalating conflict.
Dan Shaivitz (Chair of Personal Injury Practice)
Revenge of the underinsured motorist (and the call may be coming from within the house).
I live in fear that a client becomes dreadfully injured and suffers permanent impairment at the hands of a negligent driver who did not buy enough liability insurance coverage. Then, and here is the scary part, we come to learn that the client themself had uninsured/underinsured motorist coverage limits that are inadequate to compensate them for their injuries. As an example, let’s say a reckless driver hits you while you are lawfully crossing the street in a crosswalk. You suffer broken bones, have to get surgery, and it takes months to heal, and even then, you do not heal fully. In the process of making the claim against the driver who hit you, we find out that their liability insurance limits are the Maryland State mandatory minimum limits of $30,000. We then ask the client for a copy of their own policy, which reveals they too carried uninsured/underinsured motorist coverage of $30,000, and they did not purchase the “enhanced” coverage. As a result, there is only a total of $30,000 to compensate the client for their medical bills, lost wages, pain, and suffering. Here is how to avoid the terror I just described – call your insurance agent and increase your uninsured/underinsured motorist coverage limits! Yes, your premiums will increase, too. But the only way to make sure there is enough insurance coverage is to protect yourself through your own policy.
