Category: Law Firms

MEMORIAL DAY-A LITTLE HISTORY & A LITTLE LAW

Memorial Day was declared a national holiday through an act of Congress in 1971, and its roots date back to the Civil War era, according to the U.S. Department of Veterans’ Affairs. Unlike Veterans Day, Memorial Day honors all military members who have died while serving in the U.S. forces.

Though Memorial Day has evolved over time, it still is a day to honor the nation’s war dead. Veterans Day, however, honors everyone who has served in the U.S. military. It is a solemn occasion that allows the family of the fallen service member, as well as other service members in attendance, to honor their life and service to this country.

Memorial Day is one of eleven federal holidays recognized nationwide by the United States Government. This means all Federal employees are paid even if they receive the day off, and many private-sector businesses give their employees paid time off.

Memorial Day changed from its traditional May 30 date to the last Monday in May. The law took effect at the federal level in 1971.

Veterans Day honors everyone who has served, while Memorial Day is for those who died in military service. Memorial Day is the older of the two holidays and dates to just after the Civil War, 1866, when the town of Waterloo, New York hosted a city-wide “Decoration Day.” Decoration Day only recognized fallen soldiers of the Civil War until World War I. In 1869, the head of an organization of Union veterans, Maj. Gen. John A. Logan, established Decoration Day as a way for the nation to honor the graves of those who died in the Civil War with flowers, according to the U.S. Department of Veterans Affairs. A number of newspaper articles published in 1870 described processions in New York City, among other sites. The stories noted that, aside from Independence Day, there was “no day that calls out the patriotic feelings of our people more than ‘Memorial Day,’” which, the article said, was a national holiday not by any enactment by the legislature but by “the general consent of the people.”

There are debates over which city was the original place of Memorial Day, although the first large observation was held at Arlington National Cemetery for a crowd of about 5,000 in 1868. Some records show that one of the earliest Memorial Day commemorations was organized by a group of formerly enslaved people in Charleston, South Carolina less than a month after the Confederacy surrendered in 1865.

The 1863 cemetery dedication at Gettysburg, Pennsylvania, included a ceremony of commemoration at the graves of dead soldiers. Some have thus claimed that President Abraham Lincoln was the founder of Memorial Day. However, Chicago journalist Lloyd Lewis attempted to make the case that it was Lincoln’s funeral that spurred the soldiers’ graves decorating which followed.

Many cities have claimed to be the first to observe Memorial Day. However, in 2022, the National Cemetery Administration, a division of the Department of Veterans Affairs, credited Mary Ann Williams with originating the “idea of strewing the graves of Civil War soldiers—Union and Confederate” with flowers. 

In 1966, President Lyndon Johnson declared Waterloo, New York as the official “birthplace” of the holiday, according to the VA. However, Memorial Day was not an official holiday until 1968.

Congress, in December 2000, passed and President Bill Clinton signed into law “The National Moment of Remembrance Act,” to ensure those who sacrificed their lives for this country were never forgotten.

Consequently, at 3 p.m. local time, Americans are asked to take part in the National Moment of Remembrance, a time to pause in a moment of silence to honor those who have died serving the United States while in the Armed Forces.

On Memorial Day, the flag of the United States is raised to the top of the staff and then solemnly lowered to the half staff position, where it remains only until noon.   It is then raised to full staff for the rest of the day. The National Memorial Day Concert takes place on the west lawn of the United States Capitol.

Many people visit cemeteries and memorials on Memorial Day to honor and mourn those who died while serving in the U.S. military. Many volunteers place American flags on the graves of military personnel in national cemeteries. Memorial Day is also considered the unofficial beginning of summer in the United States.

It is estimated that over 1.3 million Americans have paid the ultimate sacrifice for their nation.

One can enjoy their weekend, but they should remember what this holiday is about. Residents of Florida and citizens of the U.S. should be thinking about and honoring those who served our nation and made the ultimate sacrifice as well as their surviving family members who certainly will never forget.

The foregoing is just a brief and general legal and historical overview of Memorial Day.                                                                                                                                  

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

EASTER HOLIDAY-A LITTLE HISTORY & A LITTLE LAW

Easter, which falls on the first Sunday following the first full moon after the March equinox, celebrates Jesus Christ’s resurrection from the dead three days after his crucifixion. While primarily a Christian holiday, like Christmas, it has also become a cultural celebration centered around brightly decorated eggs, chocolate, candy, scavenger hunts, baskets, chicks, and rabbits.

While the following day, Easter Monday, which is also known as “Bright Monday” or “Renewal Monday,” is a public holiday throughout most of the world, however, it is not the case in the United States. It was a public holiday in North Carolina from 1935 to 1987.  Many public schools and universities are closed on Easter Monday, and often Good Friday as well, falling under the umbrella of spring break.

Easter Monday is a public holiday in 116 nations throughout the world, including Australia, Austria, Germany, Egypt, Ireland, United Kingdom, Spain, Ghana, Fiji, France, Hong Kong, Italy, Kenya, Poland, Russia, and South Africa. However, not all observations are directly centered around the Christian tradition. In Ireland, it is a day of remembrance for the people who died during the Easter Rising or Rebellion in 1916. In Egypt, the ancient festival of Sham El Nessim, which means “smelling of the breeze,” falls on the same day, marking the beginning of spring.

Some nations even recognize Easter Tuesday, including Cyprus, as a national bank holiday; New Zealand allows a mandatory holiday in the public education sector, and the Australian island state of Tasmania recognizes a legal holiday for some workers.

Easter is a religious holiday derived from two ancient traditions: one Judeo-Christian and the other Pagan. Both Christians and Pagans have celebrated death and resurrection themes following the spring equinox for millennia. Most religious historians believe that many elements of the Christian observance of Easter were derived from earlier Pagan celebrations.

In Christian religion, Good Friday is observed in remembrance of Jesus’s execution by the occupying Roman army, and his burial in a cave-tomb. Easter Sunday is the date when a group of his female followers first noticed the empty tomb and concluded that he had been resurrected.

Other countries around the world, however, do acknowledge the holiday, and even though it is not a federal holiday in the U.S., the White House traditionally hosts its annual Easter egg roll and other celebrations for Easter on the Monday following the holiday.

Easter is not a federal holiday due to the fact that it always falls on a Sunday, which is a non-working day for federal and state employees. Many companies which are normally open on Sunday close for Easter.

Again, Good Friday and Easter Monday are not Federal Holidays. All federal holidays are non-religious other than Christmas Day.

On a local level, the day is informally observed in some areas such as the state of North Dakota, and some cities in New York, Michigan, and Indiana.

Good Friday is a state holiday in 10 states-Connecticut, Delaware, Florida, Hawaii, Indiana, Kentucky (half-day), Louisiana, New Jersey, North Carolina, North Dakota, Tennessee, and Texas. It is an optional holiday in Texas.

Good Friday is an important Christian holiday celebrated two days before Easter Sunday, commemorating the crucifixion of Jesus. However, it is not a federal holiday in the United States. That means post offices and most governmental offices will be open.

In the United States, a federal holiday is one that is recognized by Congress and is designated in Title V of the U.S. Code 6103 – Holidays, which allows Congress the authority to create holidays for federal institutions.

Pursuant to 5 U.S.C. 6103(b), if a holiday falls on a Sunday, for most Federal employees, the following Monday will be treated as a holiday for pay and leave purposes.

Easter Monday is a holiday in many English-speaking countries, including England, Wales, Northern Ireland and Australia, and European counties. The tradition of having a holiday on the day after Easter Sunday was brought to Canada by European immigrants.

The earliest recorded observance of an Easter celebration comes from the 2nd century, though the commemoration of Jesus’s Resurrection probably occurred earlier.

Easter, supposed to be the date that Jesus died and then arose from the dead, but has no fixed date. Easter is religious and is set as the “first Sunday after the first full moon after the spring equinox”.

The most common date for the Western churches’ Easter is April 19th. The earliest Easter can be is March 22nd, and the latest it can fall is April 25th. This year it is April 9th, 2023.

The tradition of setting it by the moon and the spring equinox, instead of a set date in the calendar was a classic religious tradition carried out by the Council of Nicaea in 325 to sort out a problem caused by distinct parts of the Christian world marking Easter on different days.

They set it to be the first Sunday after the first full moon-on or after the vernal or spring equinox.

It was the United Kingdom where this all came to a head, when in the year 664, King Oswiu in the kingdom of Northumbria, brought up on Celtic traditions celebrated Easter on one day, while his wife, who had been brought up in Catholic traditions was celebrating Easter on a different day.

For the King to have an Easter feast while the wife is still marking Lent was somewhat of a problem, and the King decided to sort it out, summoning religious leaders to a Synod, a meeting, to settle the problem.

St. Colman, Bishop of Lindisfarne, put the case for the Celtic tradition, while St. Wilfrid, Bishop  of York, put forward the Catholic argument and won.  The King switched to the Catholic method of working out when the Easter fell.

Consequently, Easter still wobbles around the calendar. Not all Christian countries follow the Gregorian calendar, which was introduced by Pope Gregory in 1528, and countries that use the older Julian calendar celebrate Easter on a different date, although every few years, the two calendars align and celebrate Easter on the same day. The next time that will happen will be April 20th, 2025.

Historically, 400 years after the Gregorian calendar was introduced, the United Kingdom became interested in settling the Easter date, and on August 3rd, 1928, passed “An Act to regulate the date of Easter Day and days or other periods and occasions depending thereon”,  known as the Easter Act.

That did not come out of nowhere since the League of Nations, the precursor to the United Nations, had passed a resolution in 1926 calling for the date of Easter to be sorted out.

Easter would still wobble a bit, but far less than it does today and more usefully would no longer be bound by the vagaries of the moon. The effect of the act would be to establish Easter Sunday as the Sunday following the second Saturday in April, so fixed by the calendar, not the moon, and resulting in Easter Sunday being between April 9th and April 15th. The act of law has Royal Assent but has never been enforced, as it requires both Houses of Parliament to pass resolutions agreeing on when to start enforcing the law.

Eggs represent new life and rebirth, and it is believed that this ancient custom became a part of Easter celebrations. In the medieval period, eating eggs was forbidden during Lent, i.e., the 40 days before Easter, therefore on Easter Sunday, indulging in an egg was a real treat!

According to Discovery News, since ancient times, eggs and rabbits have been a symbol of fertility, while spring has been a symbol of rebirth. Even though rabbits do not lay eggs, the association of these symbols was almost natural.

In Germany in the 1700’s, children would build nests, and leave carrots out for the “Osterhase” or “Oschter Haws”, i.e., the Easter bunny. Legend has it that the Easter Bunny lays, decorates and hides eggs for good children, as they are also a symbol of new life.

According to some sources, the Easter bunny first arrived in America in the 1700’s with German immigrants who settled in Pennsylvania and transported their tradition of an egg-laying hare.  Their children made nests in which this creature could lay its colored eggs.

The foregoing is just a brief and general legal and historical overview of Easter. 

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

Major Changes to Florida Tort & Bad Faith Laws in 2023

Florida Governor DeSantis signed HB 873 into law on March 24, 2023, which resulted in significant changes to Florida’s tort and bad faith laws. These changes were part of a movement by the Republican party in Florida allegedly “to decrease frivolous lawsuits and prevent predatory practices of trial attorneys who prey on hardworking Floridians.” The changes brought forth by this bill took effect once it was signed into law on March 24, 2023.

Several statutes that regulate negligence actions were revised in an effort to reduce large verdicts which have been on the rise across Florida. For instance, the statute of limitations for negligence actions accruing after the effective date of the subject statute was reduced from four (4) years to two (2) years, i.e., Florida Statute § 95.11. The most significant change was to the comparative fault statute, which now states that a claimant who is greater than 50% at fault for his or her own injuries cannot recover any damages pursuant to Florida Statute § 768.81. However, this comparative fault change does not apply to medical malpractice actions.

Florida Statute § 768.0427 was added to provide new guidelines for the admission of evidence related to past and future medical expenses in a negligence action. This statute provides that “Evidence offered to prove the amount of damages for past medical treatment or services that have been satisfied is limited to evidence of the amount actually paid, regardless of the source of payment.” It also states that proof of unpaid medical treatment can be shown by what the party’s healthcare provider was contractually obligated to pay or 120% of the Medicare reimbursement rate if the claimant does not have healthcare coverage or has healthcare coverage through Medicare or Medicaid. If there is no applicable Medicare rate for a service, the claimant can present 170 percent of the applicable state Medicaid rate. If the claimant obtains medical treatment or services under a letter of protection and the healthcare provider subsequently transfers the right to receive payment under the letter of protection to a third party, a defendant can present evidence of the amount the third party paid or agreed to pay the healthcare provider in exchange for the right to receive payment pursuant to the said letter of protection. This process also applies to future medical expenses. There are also new requirements for letters of protection and the information that must be contained within them to be considered valid.

This change is aimed at combatting so-called phantom damages that are regularly seen in bodily injury lawsuits where a claimant presents the amount of medical expenses charged, even though private health insurance, Medicaid, or Medicare pays a lesser amount. Although post-trial the damages were adjusted to account for amounts actually paid, the effect of admitting higher medical bills at trial allegedly, at times, influenced and inflated pain and suffering damages. The earlier system also encouraged claimants to seek treatment under letters of protection to obtain higher payments for medical services. In sum, this new law should reduce damages by limiting medical expenses to amounts actually paid or the amounts that should have been paid. 

In a premises liability case related to allegations of negligent security, Florida Statute § 768.0701 now states that an intentional tortfeasor (initial at fault party or instigator) can be allocated fault on the verdict form. This allocation will have a significant effect on negligent security cases as a jury can now assign a percentage of fault to the criminal actor who caused the harm. The foregoing was previously not allowed under Florida case law.

The subject bill further adds a presumption against liability in residential housing cases for an owner or manager in Florida Statute § 768.0706. This law states that the said presumption comes about when the owner or manager of residential housing implements defined security protocols, including, but not limited to, the use of security cameras, lighted parking, lighted walkways, deadbolts for each unit, locked windows, locked gates, peepholes, a crime prevention design assessment and crime deterrence and safety training. The burden of proof will rest with the owner or manager, but this new law provides a valuable defense by defining the standard of care for residential property owners in negligent security actions.

The bill also modified the award of attorney fees in bad faith actions. Florida Statute § 86.121 adds that a prevailing party is only able to obtain attorney fees where the insurer disclaims coverage and there is a declaratory judgment action. In other words, an award of fees is no longer automatic solely because an insured prevails on an argument. Furthermore, § 86.121 states that a prevailing party’s attorney’s fee claim cannot be assigned. This section also codifies the principle that issuing a reservation of rights letter is not a disclaimer. 

There were also several changes made to Florida Statute § 624.155. First, there is a new safe harbor provision for bad faith claims which states that there is no claim for bad faith if the insurer tenders the policy limits or amount being demanded within 90 days of being provided with sufficient information. The safe harbor protocol cannot be used as evidence in bad faith claims. If any insurer fails to utilize the aforesaid safe harbor period, the statute of limitations can be extended by 90 days.  Further, in a major change to existing law, mere negligence can no longer constitute bad faith. The insurer and the claimant have a reciprocal duty to act in good faith in providing information and setting deadlines. A court can also now consider comparative fault in bad faith suits. Additionally, where there are multiple claimants and insufficient limits, the insurer can file an interpleader action where the court will determine the prorated share. Finally, if the insurer and insured agree to binding arbitration, an arbitrator can decide allocation at the expense of the insurer. Any party that receives an allocation of funds must provide the insurer with a release. 

Florida Statute § 672.727 was also modified to state that prevailing party attorneys’ fees are now allowed against uninsured/underinsured motorists. 

The bill changed Florida Statute §57.104, which sets out the computation of attorney fees. The bill adds a relatively strong presumption that a lodestar fee is sufficient and reasonable in the computation of attorney fees and it can only be overcome in rare and exceptional circumstances with evidence that competent counsel could not otherwise be retained. This new provision will make it more difficult to obtain a multiplier on a claim for attorney fees. 

Finally, in construction matters, the prevailing party can now obtain attorney fees in litigation against a surety insurer. 

While the changes to Florida law are significant, it should be noted that in anticipation of this new law, claimant attorneys recently filed thousands of personal injury suits to potentially avoid the new law’s effects. Several counties were overwhelmed with filings and the online portal systems crashed or were having significant lag times. While not specifically expressed in the bill, the new laws will likely not apply retroactively. Therefore, it is expected that this massive deluge of lawsuits will be subject to the prior law while lawsuits filed after March 24, 2023, may be subject to these new provisions. 

The foregoing is merely a general and brief overview of the NEW Florida law, which causes an even greater need for the assistance of an experienced Personal Injury attorney.

If you have any additional questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

Advance Directives or Living Wills & Related Documents in Florida

An Advance Directive, also sometimes known as a Living Will, is a legal document which details a person’s predetermined wishes about end-of-life care. Advance Directives are highly encouraged to everyone as a means to make difficult decisions regarding one’s care in the event of a catastrophic injury such as severe brain trauma resulting in coma or vegetative state. These decisions should not be left up to family members who are already suffering and might be unsure of that individual’s wishes. Such directives help to avoid disputes as to how to proceed regarding one’s end-of-life medical treatment.

Advance Directives allow these critical decisions to be made in advance by the individual. Under Florida law, a Living Will must be signed by its maker in the presence of two (2) witnesses, at least one of whom is neither the spouse nor a blood relative of the maker. If the maker is physically unable to sign the Living Will, one of the witnesses can sign in the presence and at the direction of the maker.

Unlike the Living Will, however, an Advance Directive is not limited to terminal illness. It may also include medical events such as dementia, stroke, or coma. There are many different types of Advance Directives, including, but not limited to, a Living Will, Health Care Surrogate or medical power of attorney and Do Not Resuscitate (DNR) Order.

Technically, through Advance Directives, one can make legally valid decisions about their future medical care. Florida law recognizes two (2) types of Advance Directives: 1) A Living Will Declaration. 2) A Designation of Health Care Surrogate.

A Living Will is a legally binding document which expresses an individual’s end-of-life preferences, such as whether that person wants to be kept alive through artificial life-support means or equipment.

A Living Will is the written statement that would say that a person may want a Do Not Resuscitate Order. The Do Not Resuscitate Order, on the other hand, is a physician’s order for medical professionals to not provide CPR to the subject person, usually done on a yellow form. A Florida Do Not Resuscitate Order form (DNR or DNRO) is a document or instrument which is used by residents of Florida who suffer from incurable or irreversible medical conditions. This form states that the requester does not wish to be resuscitated in case of respiratory or cardiac arrest. A physician must sign off on a DNR order. A DNR must be honored in any healthcare setting by all medical personnel, including EMTs and paramedics outside of a medical facility. For a Florida DNR to be legally valid or effective, the form must be printed on yellow paper before it is completed by the patient/authorized representative and physician. A blank yellow form can be obtained  for free by writing to the Florida Department of Health.  Once a doctor writes a DNR order at the patient’s request, no one can override it, including family members. If the said patient changes their mind about the DNR, however, they can always speak to their doctor and have it revoked.

Anatomical donation is a document that indicates an individual’s wish to donate, at death, all or part of their body. This can be an organ and tissue donation to persons in need, or donation of their body for training of healthcare workers. One can write down their choice to be an organ donor by designating it on their driver’s license or state identification card, signing a uniform donor form, or expressing one’s wish in a Living Will.

Although some Living Wills may contain directives regarding organ donations or autopsies which remain in effect briefly after one’s death, any authority granted by a Living Will terminates or ends when the person passes away.

Although an Advance Directive may ultimately decide whether an individual continues to live with artificial life support or passes away, there are many other details that make up a Living Will. An Advance Directive should provide instruction for specific scenarios such as the use of specialized equipment including breathing machines, feeding via tube, what to do in the event of ceased breathing or heartbeat, and others. Advance Directives may also serve to name an individual to hold durable power over attorney to make these important decisions. A skilled and knowledgeable attorney can provide guidance about creating Living Wills and Advance Directives.

Proper planning for the future is one of the most responsible things a Florida resident can do. It will lessen the burden on family members and loved ones in the event of a catastrophic injury that leaves the victim unable to make decisions regarding their own health, treatment, and maintenance.

The foregoing is just a general and brief overview of the subject of Advance Directives and/or Living Wills, among others, in the state of Florida.

If you have any additional questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

Trusts in Florida- Revocable and Irrevocable (A Brief Overview)

In Florida, the main difference between a revocable trust and an irrevocable trust is that a revocable trust can be amended or revoked during the settlor’s (i.e., creator of the said Trust and whose assets are used to fund the Trust) lifetime, while an irrevocable trust cannot. In terms of asset protection, a revocable trust is rarely used as part of an asset protection plan, while irrevocable trusts are useful in several asset protection contexts.

A Trust is a contract between a maker of the subject trust (often called a grantor or settlor) and a trustee set up for the benefit of named beneficiaries. A maker of the said trust transfers legal title of their property to a trustee who holds the title and property as a fiduciary for the benefit of named current and future beneficiaries. Again, a settlor is the entity that establishes a trust. The term of settlor is encompassed by several other names such as donor, grantor, trustor, and trustmaker. Regardless of what this entity is called, its role is to legally transfer control of an asset to a trustee who manages it for one or more beneficiaries.

Trusts are essential tools for estate planning. People anticipate conveying their assets to estate planning trusts, but they often do not understand how various types of trusts fit into the estate planning process. Trusts have many purposes, including avoiding probate, reducing estate taxation, or protecting assets from creditor risk. The type of trust and the terms of trust depend on the priority of various planning goals.

Trusts are primarily differentiated by whether they are revocable or irrevocable. A revocable trust conveys assets to a trust expressed by a written trust agreement which expressly reserves the settlor’s right to revoke the trust entirely or amend any part of the trust agreement for any reason during the settlor’s lifetime. Most estate planning trusts that direct the disposition of the settlor’s property upon death are revocable trusts. These estate planning trusts are called “living trusts” because the settlor retains complete control benefits of the trust while he is living.

An irrevocable trust is a trust whose trust agreement prohibits revocation or amendment. Transfers to irrevocable trusts are final conveyances, with some few exceptions. A settlor cannot change his mind about transfers he makes to an irrevocable trust.

Some trusts are designed to be irrevocable from their inception; others start out revocable and later become irrevocable. An example of a trust that starts out irrevocable is a trust set up to make gifts to the settlor’s children during the settlor’s lifetime. Assets transferred to an irrevocable children’s trust are the children’s property. The trustee, as a fiduciary, must use the principal assets and trust income for the children’s benefit and not for the direct benefit of the settlor. Of course, using the trust money for the children’s education, for example, usually indirectly benefits the settlor.

An example of a lifetime irrevocable trust in Florida is an insurance trust. There are tax benefits and asset protection benefits of owning life insurance in the name of an irrevocable trust. The death benefit of life insurance (the amount paid to family members or whatever named beneficiary upon the insured’s death) is part of the insured’s taxable estate, except when the life insurance is owned by an irrevocable trust. For example, death benefits paid to family members are vulnerable to their creditors upon receipt, however, the death benefits are creditor-protected if the money is held inside a properly drafted irrevocable insurance trust.

A revocable trust becomes irrevocable upon the death of all settlors. The trust is locked at death, and the settlor’s heirs (the future trust beneficiaries) cannot change the terms of such inherited trust, with very few exceptions. The said trust becomes irrevocable. No one can change the terms of the trust or add property to it. Also, the trust settlor is no longer the trustee, instead, a successor trustee takes over. The settlor’s written notes, memorandum given to family members, or oral instructions given to family members during his lifetime will not change the revocable trust’s estate plan once it becomes irrevocable.

A revocable living contains written instructions for how the settlor desires to distribute his assets after death. The process of transferring assets, paying debts, and following the settlor’s instructions is referred to as trust administrationTrust administration is directed by the persons the settlor nominated to serve as their successor trustee(s). Trust administration in Florida is the legal procedure whereby a successor trustee of an existing trust carries out the trust document’s instructions after the settlor’s death. Trust administration refers to the tasks associated with managing the assets, distributions, and filings of a trust. Said tasks can often be quite complex and time sensitive.

Trust administration involves several tasks. For example, the family must first confirm their understanding of the settlor’s written instructions expressed in their trust agreement, and any disagreements regarding the trust instructions must be resolved. The successor trustee must find out if the settlor owed money or was subject to any legal claims. The successor trustee must use non-exempt trust assets to satisfy debts and settle claims. The settlor’s income tax liability for the year of death must be determined and paid. The successor trustee also must determine if the settlor’s taxable estate is subject to estate taxation.

Only after the trust administration is substantially completed may the successor trustee distribute trust assets to the settlor’s heirs or beneficiaries according to the settlor’s written instructions. After assets are distributed and the administration is complete, the successor trustee can close the trust. Successor trustees should get a written agreement among all beneficiaries that the subject trust administration has been successfully completed so that the said living trust and all of its trust accounts may be closed.

The foregoing is just a general and brief overview of the subject of revocable and irrevocable trusts in the state of Florida.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

Claims Against the Federal Government & it’s Agencies under the Federal Tort Claims Act

The Federal Tort Claims Act is a 1946 federal statute that permits private parties to sue the United States in a federal court for most torts committed by persons acting on behalf of the United States. Historically, citizens have not been able to sue their government, which is a doctrine referred to as sovereign immunity. It is legal doctrine that ordinarily prohibits private citizens from bringing a sovereign state into court without its consent. Until the mid-20th Century, a tort victim could obtain compensation from the United States only by persuading Congress to pass a private bill compensating him or her for their loss.

Under the Federal Tort Claims Act, the federal government acts as a self-insurer, and recognizes liability for the negligent or wrongful acts or omissions of its employees acting within the scope of their official duties. The United States is liable to the same extent an individual would be in similar circumstances.

The Federal Tort Claims Act (FTCA) sets forth procedures for presenting and resolving administrative monetary claims for personal injury, property damage, or death arising from the alleged negligence of officers and employees.

The FTCA has several exceptions that categorically bar plaintiffs, victims or claimants from recovering tort damages in certain categories of cases. Federal law also restricts the types and amount of damages a victorious plaintiff may recover in an FTCA suit. Additionally, a plaintiff or claimant may not initiate an FTCA lawsuit unless they have timely followed a series of procedural requirements, such as providing the government an initial opportunity to evaluate the subject claim and decide whether to settle it before the case proceeds to federal court. 

When it comes to making a claim and/or suing the Federal government, or any of its agencies, there is no cap like there is in Florida. But there are other limitations. Again, that situation is governed under the Federal Tort Claims Act (28 U.S.C §2671), and the case or claim must also be brought only following proper written notice. In the administrative phase, a specific document must be filed with the government entitled Form 95.

Once the claimant or plaintiff gets past that administrative procedure, a claimant would file suit in federal court. The United States Attorney’s office defends these cases. One does not get a jury trial, i.e., the case is heard by a federal district judge, who alone decides the case called a bench trial.

There are many examples of Federal Tort Claims Act cases, which can include anything from medical malpractice at military hospitals to Federal Aviation Administration errors that cause plane crashes.

Either way, it pays to avoid situations where the circumstance pits the individual against a governmental hazard.

Federal claims are different than state claims in that if a damage or injury is the result of negligence or legal liability of the federal government or federal agency, the claim is governed by the Federal Tort Claims Act (FTCA).  More specifically, an injured party is required in FTCA cases to file a Form 95 with the governmental entity or agency within two (2) years of the date that legal liability accrued.  This two year statute of limitation or deadline is true regardless of whether there is a state statute of limitation for the same cause of action which may be longer.

Further, with FCTA cases, the governmental entity has up to six months to review the subject Form 95 claim and the claimant is not allowed to file suit during that time.  If the entity does not respond to the claim with an offer or denial within the six month period, then claim is presumed denied when the six month period expires.

Please note that said claimant only have six (6) months to file their lawsuit in a FTCA case after a governmental entity has issued a denial of the claim.  Failure to file suit within six months of being denied results in the claim being completely barred EVEN if it has been less than two (2) years since the event causing the injury!

The FTCA case begins when an injured party “presents their claim” to the agency involved.  The foregoing is accomplished by filing the Form 95.

One must also research specific procedures and rules applicable to the applicable governmental entity or agency in which the claim is sought.  These rules include not only how to bring the claim but also where the Notice should be sent and with whom one should communicate regarding the subject claim.  Many federal agencies will post this information in a section on their respective websites.

Unlike the State of Florida where damages against the state are capped, Federal Tort Claims are not capped.  Therefore, one’s Federal Tort Claim case may have significant value. In the Form 95 itself, there is a blank for the amount of damages that claimant has sustained.  The claimant must put a number, however, one should be careful not to underestimate the value of their claim.  Once a Form 95 is filed with a figure for the damages on it, one cannot increase the amount later claimed.  Consequently, one must be generous in their evaluation.

Attorney fees on FTCA cases are capped at 25% if the case is litigated while attorney fees are only 20% if the case is settled. No fee can be charged for appeals of FTCA cases. Again, the purpose is to remove some financial incentive to sue the federal government; however, it does not make it impossible or not feasible to prosecute.

Further, the FTCA imposes significant substantive limitations on the types of tort lawsuits a plaintiff or victim may permissibly pursue against the United States. The Congress that enacted the FTCA, was concerned about “unwarranted judicial intrusion[s] into areas of governmental operations and policymaking,” and opted to explicitly preserve the United States’ sovereign immunity from more than a dozen categories of claims. More specifically, Section 2680 of the FTCA establishes a number of exceptions preventing private litigants from pursuing certain categories of claims against the United States

It has been debated or at least discussed that certain provisions be enacted to modify the FTCA.  Congress, however, still retains the authority to enact private legislation to compensate individual tort victims who would otherwise be barred from obtaining recourse from the United States under the FTCA in its current form. Congress enacted the FTCA, in part, to eliminate the need to pass private bills to compensate persons injured by the federal government. Congress, though, still keeps some authority to pass private bills if it so desires.  Accordingly, rather than amend the FTCA to expand the number of circumstances in which the United States will be held liable to tort claimants, some scholars and legislators have suggested that Congress should pass individual private bills to compensate particular injured persons or groups of persons who might otherwise lack recourse under the FTCA.  To that end, Congress has occasionally provided some type of compensation to victims, plaintiffs or claimants in situations where the courts have found that the FTCA waiver of immunity provides no relief.

The foregoing is just a general overview of the subject of claims against the Federal government under the Federal Tort Claims Act.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

FLORIDA LADY BIRD DEED & ITS BENEFITS

A Lady Bird deed in Florida is a legal document which transfers property upon death inexpensively and without the need for a probate legal court proceeding. A lady bird deed allows the current property owner to use and control the property during the owner’s lifetime, while the property automatically transfers upon death to designated beneficiaries. The lady bird deed is legal in the state of Florida.

In Florida, a Lady Bird deed is also called an enhanced life estate deed. The Lady Bird deed is a version of a life estate deed with enhancedpowers reserved for the original owner(s) of the property.

There are no Florida statutes specifically authorizing lady bird deeds. However, the general legal consensus is that Lady Bird deeds are authorized under common law, particularly by the Florida Supreme Court in Oglesby vs. Lee, 73 So. 840 (Fla. 1917) and Aetna Ins. Co. vs. La Gasse, 223 So.2d 727 (Fla. 1969).

Florida is one of the few states where a lady bird deed is legal. The states which offer Lady Bird deeds include Florida, Michigan, Texas, Vermont, and West Virginia. Some other states may have what is called a transfer on death deed. Otherwise, property in those states must usually be put into a trust to avoid probate upon the owner’s death or else be held with rights of survivorship.

The foregoing document makes the probate process easier or may avoid it entirely. The Enhanced Life Estate deed (also known as the Lady Bird deed) has inherit powers permitting a property owner to retain control over real property during his/her/their lifetime. Equipped with the power to transfer real property located in Florida to others upon the owner’s death (identified as “remaindermen” within the deed), exclusive of a Last Will & Testament and outside of the probate process, the Lady Bird Deed is an attractive and useful tool to customize even the most complicated estate planning regime. There is no doubt, avoiding probate coupled with a grantor’s advantage to maintain control over the real property, where the grantor can sell, lease, gift or encumber the real property during their lifetime, makes the Enhanced Life Estate/Lady Bird Deeds something to seriously consider by Florida homeowners.

A Lady Bird deed must be recorded to be effective. Once the property owner executes the Lady Bird deed, the deed should be recorded to document the conveyance as part of the property’s legal chain of title. Recording the Lady Bird deed should not involve significant documentary stamp taxes, even if the property is mortgaged.

A property owner can change the beneficiaries under a Lady Bird deed even after the original Lady Bird deed is recorded. The owner must execute and record a second Lady Bird deed that names the new person or people (i.e., remaindermen) whom the owner chooses to inherit the property.

Most major title insurance companies fully understand Lady Bird deeds and are not concerned about insuring the title of a property subject to a Lady Bird deed. Title companies should not require the signature or consent of the people listed as remaindermen (similar to designated beneficiaries) when the Enhanced Life Estate or Lady Bird owner sells the property since the beneficiaries or remaindermen have no vested property interest during the owner’s lifetime.

Some smaller or less experienced title insurance companies may not understand a Lady Bird deed, and these companies may require the remaindermen to sign a release. Even worse, the companies may require any judgment holders against the remaindermen to release any claim of lien against the properties. These requirements stem from a lack of understanding about how Lady Bird deeds work.

A Lady Bird deed allows a property owner to transfer property upon death while avoiding probate. The deed is inexpensive, revocable, and simple compared to a Trust. Again, some of the advantages of Lady Bird deed include:

  • Avoids probate. A Lady Bird deed allows a property to transfer on death to named beneficiaries without probate.
  • Low cost. A Lady Bird deed can be obtained for a relatively low cost compared to a more complicated and expensive Living Trust.
  • Simple. A Lady Bird deed does one thing and does it well: it transfers a person’s real property upon the death of the said property owner.
  • Revocable. The property owner is free to change their mind at any point during their lifetime. The property owner can enter into a new deed which gives the remainder interest to someone else or cancels the lady bird deed entirely.
  • Gift Taxes. Transferring property by Lady Bird deed does not trigger a gift tax. The transfer is not a completed gift during the lifetime of the property owner.
  • Capital Gains. In addition, the beneficiary of the Lady Bird deed should still enjoy a step-up basis in the property. A stepped-up basis means that if the property is eventually sold by the beneficiary/remaindermen, the remainderman will pay income tax only on the appreciation in value from the date when the original property owner died and not when the subject property was originally purchased.
  • Medicaid Eligibility. Said deed does not risk the Grantor’s Medicaid eligibility because it is not considered a “transfer” until the Grantor/Owner passes away.
  • Property Taxes. The Owner keeps their homestead real estate tax exemption, and the county will not reassess the property to raise taxes.

Some disadvantages to Lady Bird deeds in Florida include:

  • Lack of Asset Protection. A creditor of the current owner may place a lien on the property, other than a homestead (i.e., primary residence), conveyed by a Lady Bird deed.
  • Constitutional Restrictions. A person cannot use a Lady Bird deed to disinherit a spouse or minor child if homestead real property.
  • Unexpected Deaths. If the holder of the remainder interest dies before the life tenant/owner dies, it may become unclear as to what happens to the property when the original life tenant or owner later dies.
  • Changes to the Estate Plan. It will require extra work for the original owner to change their plan should they later decide not to leave the property to the named remaindermen.

Despite the disadvantages, individuals and families in Florida often use Lady Bird deeds as a simple, inexpensive way to transfer their home upon death without probate.

The following are a few more benefits relating to Florida’s Enhanced Life Estate/Lady Bird Deed:

  1. Individuals will NOT lose their homestead protection. The Enhanced Life Estate Deed or Lady Bird Deed enables a Florida real estate property owner to maintain their homestead and other applicable exemptions (both creditor and tax) if homestead protections apply, even though the grantor holds a type of life estate during their lifetime.
  2. It is automatic. For a proper conveyance to take place, special Florida caselaw language must be contained or written within the Lady Bird Deed. Once a properly executed Enhanced Life Estate Deed is executed and the life estate owner dies, the transfer to the named remaindermen is automatic rendering a stress-free process for the named beneficiaries/remaindermen.
  3. It is relatively easy. The Florida real property will transfer to the individual (i.e., remainderman) named in the deed upon the death of the grantor/last surviving owner without the need to prepare an added deed to complete the transfer. Moreover, it is an easy transfer process. The beneficiary of the property may have to record the death certificate and file a statement of facts with the appropriate county to affirm ownership but there is no need to prepare additional formal legal documents to complete the transfer.
  4. The owner is allowed to change their mind. Equipped with the power to control the subject property, the Lady Bird Deed is so much more than just a life estate. It enables the owner to live in the property for their entire lifetime and also reserves more than just that option. The owner, during their lifetime, reserves the right to sell, lease, gift, and encumber the property without the remaindermen’s consent or notice. If the Florida homeowner is changes their mind, Florida’s Enhanced Life Estate Deed enables the current owner control over the property where the grantor can simply execute another deed to better suit their changes wishes.
  5. It is cost effective. The Lady Bird Deed can be used as an inexpensive estate plan for people whose Florida residence is the primary or only asset which may need to be transferred upon death. Where probate is time consuming and can cost thousands of dollars, the Lady Bird Deed is a desirable alternative.
  6. The deed can serve as a Last Will & Testament substitute. The owner may name more than one remainderman who will take over the property upon his or her death without ever having to prepare a proper Florida Last Will & Testament. A Lady Bird Deed may also have a provision for descendants of a remainderman or alternate of said beneficiary who predeceases the original owner.
  7. Remaindermen also hold creditor protections. The remaindermen receive the property only if the grantor still owns it at the time of death, and since the owner can always change his or her mind prior to death, the remaindermen has no interest in the real property throughout the owner’s life. As such, the remaindermen are protected from creditors during the owner’s lifetime. Since the remaindermen really have no interest in the property until the grantor’s death, the real property is protected during the owner’s lifetime from claims by named remainderman creditors. HOWEVER, Tax liens are different. An IRS lien against a remainderman attaches to the property once the remainderman is named on the lady bird deed.
  8. Consent is not needed. The remaindermen have no rights to the Florida real property whatsoever during the owner’s lifetime, which helps because the owner does not need their consent and the remainder’s creditors cannot claim any rights to the real property. This is one of the major differences between a traditional life estate (where consent is needed) and an Enhanced Life Estate or Lady Bird deed where the grantor or current owner maintains complete ownership control.
  9. Lady Bird Deeds can be executed remotely. In Florida, deeds must be signed before a notary and two witnesses. As of January 1, 2020, Florida Remote Online Notarization laws allow deeds, such as the Lady Bird or Enhanced Life Estate Deed, to be signed remotely before a notary and two witnesses using video and audio online technology.

A Lady Bird deed or Enhanced Life Estate deed is a useful estate planning tool, however, despite its many benefits, it might not be suitable for all people who own Florida real estate. It is best to discuss the matter with an experienced Florida estate planning attorney.

The foregoing is just a general overview of the subject of Lady Bird Deeds in Florida.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

New Year’s Day-A Little History & A Little Law

What is and when is New Year’s Day? The response is a bit more complex than the public might realize. Preliminarily, the definition of a “year” is something to consider. When celebrating the New Year, it is helpful to know exactly which new year you are discussing. Different cultures, countries and ages have measured time in diverse ways, with some basing the year around the sun and others by the moon.

The United States uses the Gregorian calendar based on the solar year. A solar year is the time it takes the Earth to orbit the sun, which is approximately 365 days. Consequently, that means New Year’s Day is celebrated on the first of January of every year. This year it will occur on Sunday, January 1, 2023. According to time and date, the first country to officially enter 2023 was the Republic of Kiribati, an island country in Oceania in the central Pacific Ocean.

The lunar New Year varies and takes some calculating, i.e., one lunar year or 12 full cycles of the moon, is more or less 354 days. Chinese Lunar New Year is the most known and popular season in that genre and starts at sunset on the day of the second new moon following the Winter solstice. Accordingly, the next occurrence of the same is January 22, 2023. Similarly, Islamic New Year, which also observes a lunisolar or lunar calendar is at less fixed points relative to the solar year.

New Year’s Eve, or December 31, is not an officially recognized Federal holiday in the United Sates. Regardless, many people enjoy celebrating the occasion and count it as one of their favorite holidays. It follows that prior to celebrating New Year’s Day, a New Year’s Eve countdown and other festivities throughout the preceding night anticipate the joy and importance of an old year concluding and the promise of a “new” or fresh start. In 2022, New Year’s Eve falls on a Saturday and the First will be on a Sunday. which means if a holiday falls on a Sunday, the following Monday is the legal holiday, i.e., January 2, 2023.

New Year’s Day, January 1, is the first officially recognized Federal holiday on the calendar in the United States. In 1870, the U.S. Congress passed a law that declared New Year’s Day, together with Christmas Day and Independence Day as National holidays.

Celebrating the first day of another year in the world has been an historical tradition for over a millennium. However, New Year’s Day, as most of the world currently celebrates it, on January 1, is a relatively recent invention. In fact, there have been a number of various days selected to mark the beginning of a new year.

The first recorded New Year celebration occurred in Mesopotamia about four thousand years ago. That civilization decided upon the vernal equinox, which is around March 20th, to mark the start of their new year. Thereafter, there are records of other ancient civilizations, including the Egyptians, Persians and Phoenicians, picking the autumnal equinox, i.e., more or less September 20th, to be the start of their new year. The ancient Greeks chose the winter solstice, around December 20th, to commence the new year.

The Roman Emperor, Julius Caesar, who was determined to end all the confusion, established a standardized calendar that would follow the solar year. After consulting with scientific experts, in or about 46 B.C., he introduced the Julian calendar. In that calendar, January 1st was established as the official first day of the New Year. This circumstance coincides with the time of year that the Earth is nearest to the sun. It is also in honor of Janus, pagan god of gateways and beginnings as well as the god of January, known for having two faces, i.e., one face looking forward to the future and one face looking backward to the past.

Finally, in 1582, Pope Gregory XIII slightly corrected the Julian calendar thereby creating the Gregorian calendar, which is the standard most of the world uses today. He reestablished January 1st as New Year’s Day as celebrated in modern times.

The foregoing is just a brief and general overview of New Year’s Day.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

CHRISTMAS DAY-A Little history & A Little Law

Traditionally, the Christmas season celebrates the birth of Jesus Christ, who Christians believe is the son of God. His birth date is unknown since there is little information about his early life. There is disagreement among scholars on when Jesus was born. Christians celebrate Jesus’s birthday on December 25.         

Popular customs include exchanging gifts, decorating Christmas trees, attending church, sharing meals with family and friends and, of course, waiting for Santa Claus to arrive. December 25, i.e., Christmas Day, has been a federal holiday in the United States since 1870.

The first federal holidays were created in 1870 when Congress granted paid time off to federal workers in the District of Columbia for New Year’s Day, Independence Day, Thanksgiving Day, and Christmas Day. President Ulysses S. Grant signed legislation making Christmas a federal holiday in the District of Columbia. That gave federal workers Christmas Day off. The legislation, signed into law on June 28, 1870, also made New Year’s Day and July 4th federal holidays as well as Thanksgiving, although the date for that holiday had yet to be determined.

Christmas had been celebrated in some states, especially those in the South where it was part of the social calendar. Alabama declared Christmas a legal holiday in 1836 and Louisiana and Arkansas followed in 1838.

In Northern states, there was considerable pushback about a Christmas celebration. The Pilgrims who arrived in New England did not celebrate Christmas. They saw the holiday as a decadent man-made invention. They were not alone. Anabaptists, Quakers, and Puritans also believed celebrating Christmas was sinful.

The perception of Christmas began to change in the mid-19th century. Immigrants brought their customs with them, and publications featuring cartoonist Thomas Nast’s illustrations of Santa Claus and holiday recipes and decorations became more popular.

During the Civil War, Christmas Day was considered a day of peace and rest, not war.

The five gift rules say that a person should give five gifts to their loved ones: one for each of the following categories: something they want, something they need, something to wear, something to read, and a special gift.

Since the holiday, this year, falls on a weekend, the rule is if a holiday falls on a Saturday, the Friday immediately preceding is the legal holiday. If a holiday falls on a Sunday, the following Monday is the legal holiday as it is this year of 2022, i.e., the public holiday of Christmas is Monday, Dec. 26, 2022.

Legally speaking, private employers do not have to give their employees time off on days that are designated as holidays by the federal government. Consequently, federal holidays are not an automatic day off. In fact, businesses are generally not even legally required to offer paid vacation.

Although many states recognize most or all federal holidays as state holidays, the federal government cannot enact laws to compel them to do so. Furthermore, states can recognize other days as state holidays which are not federal holidays.

In 567, the Council of Tours “proclaimed the twelve days from Christmas to Epiphany (traditionally January 6th) as a sacred and festive season and established the duty of Advent fasting in preparation for the feast.”

Research done by members of the Church of Jesus Christ of Latter-day Saints generally places the birth of Jesus at some point in early to mid-April, whereas theologian, biblical scholar and author Ian Paul had suggested September or late March.

The origins of Christmas stem from both the pagan and Roman cultures. The Romans celebrated two holidays in the month of December. The first was Saturnalia, which was a two-week festival honoring their god of agriculture, Saturn. On December 25th, they celebrated the birth of Mithra, their sun god.

From ancient times, the season which we now know as Christmas was a midwinter celebration called The Winter Solstice, or Yule. The Winter Solstice, a pagan festival, was a time to celebrate the fact that the worst of winter was over, and the people could look forward to longer days with more sunlight approaching. However, by the 4th A.D., Western Christian churches settled on celebrating Christmas on December 25, which allowed them to incorporate the holiday with Saturnalia and other popular pagan midwinter traditions.

Most religions like Islam, Hinduism, Buddhism, Judaism do not recognize Christmas and Easter as they are ancient Christian festivals so the only religion to celebrate Christmas and Easter is Christianity. Among Christian sects or denominations which do not recognize the holiday include Quakers, Jehovah’s Witnesses, and members of the Churches of Christ. Some of the half-dozen Christian faiths that do no celebrate Dec. 25 contend there is nothing in the Bible that says Christ was born on that day.

The character of Santa Claus is believed to descend from Bishop Nicholas of Myra, who lived in the 3rd or 4th century. St. Nicholas was considered a real man. He is said to be the said bishop, living in what is now modern-day Turkey.

The name Santa Claus evolved from Nick’s Dutch nickname, Sinter Klaas, a shortened form of Sint Nikolaas (Dutch for Saint Nicholas). In 1804, John Pintard, a member of the New York Historical Society, distributed woodcuts of St. Nicholas at the society’s annual meeting. Others posit that the modern Santa Claus is a direct descendent of England’s Father Christmas, who was not originally a gift-giver. However, Father Christmas and his other European variations are modern incarnations of old pagan ideas about spirits who traveled the sky in midwinter. However, Dutch families took the tradition of celebrating the feast day of Saint Nicholas with them to New Amsterdam in the American colonies, beginning as early as the 17th century. They referred to him as Sinterklaas. That name became Santa Claus to the English-speaking majority in the early United States.

For atheists, holiday celebrations can range from nonexistent to the full family affair. Some groups have started celebrating “Newtonmas,” named in honor of English scientist Isaac Newton, who was born December 25 by the Julian calendar in use in England at the time.

The American political cartoonist Thomas Nast fashioned Santa Claus’s image on the pages of the American magazine, Harper’s Weekly. In 1862, Santa was a small elflike figure who supported the Union. Nast continued to draw Santa for 30 years, changing the color of his coat from tan to the red he is known to wear today. St Nicholas, who was the historical figure on whom Santa Claus is based was originally seen as wearing red, since that was the color of the religious robes he would have worn for his role as the Bishop of Myra in Turkey. The red suit was first mentioned in 1881 when Thomas Nast illustrated the poem, “Twas the night before Christmas,” authored by Clement Clarke Moore and brought Santa to life. His drawing included all the features from Mr. Moore’s poetic   description but also showed Santa in a bright red suit and carrying a black sack of toys.

SantaClaus.com states that Santa’s birthday is on March 15. When Santa Claus says, “Ho ho ho,” it is actually an expression of deep joy and happiness. The sound one hears is simply Santa laughing, because he is truly a holly jolly happy fellow.

The foregoing is just a brief and general overview of Christmas Day.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.

MATERIAL MISREPRESENTATION-LYING OR FOREGETTING IMPORTANT INFORMATION WHEN APPLYING FOR INSURANCE IS A BAD IDEA

A misrepresentation would be considered fraud if it is intentional and material. Fraud would be grounds for voiding the contract. If an insurance company receives an application with some information missing or inaccurate for whatever reason and issues the policy anyway, the insurer can later VOID OR RESCIND the said policy, contract and/or agreement.

Any person who willfully makes a false statement or misrepresentation of a material fact for the purpose of obtaining or denying any benefit or payment or assisting another to obtain or deny any benefit or payment can be charged with a felony.

A material misrepresentation may occur when an application contains false information, or it may include the withholding of information. With a liability or property and casualty policy, intent to deceive is not always necessary to void or deny a claim.

Representations are the statements made by the prospective insured on the insurance application. Many of these representations are responses to questions to determine whether the applicant is insurable and how much should be charged.

Under the terms of a homeowners’ insurance policy and applicable Florida law, any misrepresentation, even an innocent one, made by the prospective insured on the policy application may serve as a basis for voiding the policy. The subject insurer or insurance carrier need not prove that the insured made the misrepresentation with an intent to deceive.

Florida Statute § 627.409(1), provides, in pertinent part:

“[A] misrepresentation, omission, concealment of fact, or incorrect statement [made by or on behalf of an insured in an application for an insurance policy] may prevent recovery under the contract to a policy only if any of the following apply:

(a) The misrepresentation, omission, concealment, or statement is fraudulent or is material either to the acceptance of the risk or to the hazard assumed by insurer.

(b) If the true facts had been known to the insurer pursuant to a policy requirement or other requirement, the insurer in good faith would not have issued the policy or contract, would not have issued it at the same premium rate, would not have issued a policy or contract in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss.”

Under Florida law, the general rule is that a misrepresentation or omission in a policy application need not be intentional before recovery may be denied pursuant to Section 627.409, above. 

The issue with many cases is a material misrepresentation may be found where the applicant did not name all of their household members when taking out an insurance policy. Consequently, when a Florida resident does that, it may save them money on the front end, but it can hurt them on the back end when a claim is made, especially in the event that they are involved in an accident or an incident occurs and the insurance company does their investigation and they find out that there are household members living on the applicable property who live with the applicant/insured and said applicant or prospective insured did not name them probably for the purpose of saving money on the premium. Accordingly, the insured is spending money and ultimately getting nothing in return at a time of need.

It is always recommended an insurance applicant be completely honest, thorough, accurate and forthright with the insurance companies, because when an accident or allegedly covered incident arises, insurance coverage may not be present or available. The amount of money that the insurance company would potentially pay out on one’s claim far exceeds whatever a person would be saving on the front end concerning the premium.

If you have any additional Questions regarding the foregoing or have any legal issue or concern, please contact the law firm of CASERTA & SPIRITI in Miami Lakes, Florida.