A LITTLE LEARNING IS A DANGEROUS THING

by David McCarthy

There is a saying in Texas: You can’t fix stupid. Is it true? We’ll report. You decide.

At the request of an on-again, off-again client we recently made contact with a distant relative of hers who had been named a respondent to a petition for an order of protection.

Orders of protection are available under the Illinois Domestic Violence Act of 1986, and they can be used to obtain all sorts of relief, from a “stay-away” order to exclusive possession of a house or apartment to custody of a child to an order on the respondent to undergo counseling. In the case at hand a long-time adversary was asking the court for a “stay-away” order on grounds that the respondent was guilty of stalking.

The conversation took place at three o’clock on a Wednesday afternoon. The case was going to be up in court the next morning. The respondent had been served with the court papers a month before and had, in fact, gone to court some weeks earlier to get the matter continued to the date in question.

Why, then, did she wait until late on the afternoon prior to the hearing to think about hiring an attorney? She inferred from the fact that she had spent some time in the employ of a law office that she was fully capable of defending herself, and she continued to think so until there arrived, in that day’s mail, notice that the petitioner had a dozen witnesses under subpoena.

At that point the respondent prevailed upon a family member to front the legal expense, but just as she had overestimated her abilities to defend herself, so, too, she grossly underestimated the expense associated with a hearing at which the opposition proposed to submit testimony from 12 witnesses.

Next, the respondent drew upon her law office experience to conclude that she could defend the case on the grounds that some of the witnesses under subpoena had not received the per diem and mileage fees required by statute. That objection was available only to a witness under subpoena, not to the respondent, and it did not provide her with a defense of any sort.

Finally, for all the importance the respondent placed upon having once worked in a law office, the experience had not enabled her to identify her best defense. The petitioner was not within the class of persons eligible to seek an order of protection against the respondent.

A little learning is a dangerous thing, said Alexander Pope.

The law office experience of the respondent in the foregoing case worked against her, not for her. She overestimated her abilities, underestimated the expense, and mis-identifed her defense.

YOU OWE IT TO YOURSELF TO BUY UM/UIM INSURANCE

by David McCarthy

If you value yourself as much as you value others (and why wouldn’t you?), the car insurance you buy will include UM/UIM coverage, and at limits equal to the limits of your liability coverage.

UM stands for “uninsured motorist” and UIM for “underinsured motorist.” In case you are in an accident, you will want as much insurance for your own injuries as for the injuries of people you hit. So buy UM/UIM coverage, and buy it at limits equal to the limits of your liability coverage.


Picture this:

You are rear-ended at a red light by an “at-fault” driver whose limits of liability insurance (say, $100,000.00) are not nearly enough to compensate you for your medical expense, your lost income, your pain and suffering, and all the rest of it. Can you go against your own insurance company for the UIM coverage under your own policy? Yes, but only if the limits of your liability insurance exceed the limits of his liability insurance. If his liability limits equal or exceed yours, he is not “underinsured” in relation to you.

You would fare no better if you had greater limits of liability coverage (say, $250,000.00 per person/ $500,000.00 per occurrence) but only $100,000.00/ $300,000.00 of UM/UIM coverage (which is to say, that you provided more insurance for the people you hit than you provided for yourself). You not only want to buy UM/UIM coverage, you want to buy it at limits equal to the limits of your liability coverage.

UM/UIM insurance protects you in case you are hit by a driver who has no insurance, or by a hit-and-run driver, or by a driver whose liability limits are less than your liability limits. UM/UIM insurance helps fill the gap between the value of your injury and the amount of insurance available to pay for it.

Your relationship with your own insurance company will be adversarial because you will be looking to it to pay you for that part of your claim which exceeds the limits of liability insurance of the at-fault driver but does not exceed the limits of your UM/UIM coverage. (No matter what the value of your claim, your insurer will not pay out in excess of the limits of your coverage.)

It is easy to foul up a UM/UIM claim.

A mis-timed “okay” is all it takes. We recently got a call from a man who believed he had an open-and-shut UIM case and who was annoyed that his insurer had not already cut him a check. To us it was at least as likely that he had outsmarted himself, but he did not stay on the telephone long enough to tell for sure. He had already received a “policy limits” offer from the insurer of the “at-fault” driver and he had already told the adjuster for his own insurer to “open a file” for his UIM claim. He acknowledged he had reached a point at which some professional advice would be of help to him. Alas, he may have taken one step too many, but there is no way to tell, for at that point, something that meant more to him than his UIM claim came up, he ended the call, and nothing further has been heard from him.

We assumed that he had already prejudiced the right of his own insurer to pursue the at-fault driver, and so his UIM claim was DOA.

But beyond that, he was indulging some rosy assumptions that his insurer was likely to challenge. For one thing, he took his best-case outcome for granted, and he carped that he did not have a check in hand already. His best-case was a payment of $145,000.00 under the UIM clause of his auto policy, that is, the limits of his UIM coverage ($250,000.00) reduced by payments from the insurer of the “at-fault” driver ($100,000.00) and from the “med pay” clause of his own policy ($5,000.00). His actual medical expense to that point was rather modest. The evaluation of the case was predicated on “wage loss” and on “future medical expense.”

As for “wage loss” we would love to know how he planned to reconcile the fact that he was working full, eight-hour shifts with his assertion that he was receiving only half pay. His insurer is apt to want a plausible explanation for that.

Additionally, there was a conflict between his complaints that his insurer had not yet offered him the full $145,000.00 and his assertion that surgery was inevitable (and lots of physical therapy thereafter) but that he would not have this surgery for at least four months. (It is not the practice of liability insurance companies to throw gobs of money at you while you are still being treated for your injuries and before you have reached the point of “maximum medical improvement.”)

Then there is the question of comparative fault, that is, the extent to which the caller’s own negligence caused his injuries.

It does not follow from the fact that the other insurer made a “policy limits” offer that the caller’s own insurer will proceed as if the caller were free of fault. On the contrary, and because they are spending their own money, they will investigate whether, and to what extent, their insured was responsible for his own injuries. And even were they to conclude that he was utterly blameless, they might formulate a settlement offer that factors in some comparative fault.

Our caller professed dismay that his insurance company had not yet written him a check for the full $145,000.00. We allow for the possibility that he will not receive a dime on his UIM claim because he blundered at a critical moment in dealing with the representatives of both insurers.

IT IS BECOMING EVER EASIER TO ENFORCE NON-COMPETE AGREEMENTS.

by David McCarthy

It has long been my position that an attorney preoccupied with his/ her win-loss record would rather oppose a non-competition agreement than attempt to enforce it. They have been difficult to enforce in Illinois, and for good reason: They are a restraint on trade.

But the worm is turning. First, the "blue pencil rule" has gained some traction in Illinois. There was a time when our courts would withhold enforcement of a non-competition agreement if they determined that it was unduly broad in time or area, even if the agreement included a "blue pencil" clause.

The "blue pencil" clause, a staple of non-competition agreements, authorizes a court-ordered narrowing of time and area limitations if those which the agreement recites are deemed too broad. Illinois was slow to accept the "blue pencil rule" on the theory that it amounted to re-making the agreement of the parties. And this spared employers from a sordid temptation to overreach on the front end. After all, why not shoot for the moon -- write in outrageous time and area restrictions -- if, worst case, the court can be counted on to apply the "blue pencil rule" and pare back the time and area restrictions? Nonetheless, over time, the "blue pencil rule" has gained some favor in Illinois.

In September of 2009 one of our Illinois Appellate Courts took an even more dramatic step in favor of the enforceability of non-competition agreements. The Fourth District Appellate Court (central Illinois, including Springfield) held that the "legitimate business interest" prong of the analysis was irrelevant. For ages, the proponent of a non-competition agreement was obliged to establish (i) the reasonableness of the time and area restrictions and (ii) that enforcement (an injunction) was necessary to protect a "legitimate business interest" of the employer (e.g., an interest in preserving confidential information or a "near-permanent" relationship with customers). In today's Fourth District, the proponent need only show that the time and area restrictions are reasonable (and the "blue pencil rule" is often available in aid of that showing).

Does this matter in the real world? You bet it does. Some time ago, we successfully opposed an action to enforce a non-competition agreement on the grounds that the former employer did not have the "legitimate business interest" that was necessary to obtain an injunction. Our client spent all his time at the office of the customer, and the only "confidential information" accessible to him was the customer's information, not the employer's information. Additionally, the customer relied on its own personnel and a number of other outside organizations for the same sorts of services which the employer provided. Finally, despite allegations that "vast sums" had been expended to cultivate the customer, the evidence was to the contrary: All advertising was generic. No advertising was customer-specific. And beyond that the "vast sums" spent to woo the customer consisted of $130.00 doled out to buy lunch on a number of occasions.

All that would be irrelevant in today's Fourth District. Whether the law of the Fourth District will become the law elsewhere in Illinois remains to be seen. There is now a conflict among the districts, and one of the chief functions of the Illinois Supreme Court is to resolve conflicts among the Appellate Courts. Stay tuned.

PAY ME NOW OR PAY ME LATER

By David McCarthy

You don't need a well-written contract when everyone is performing as agreed. You need it when things change for the worse. Everything is always changing, of course, and all too often changing for the worse.

A number of matters that have come into the office lately have driven those points home. In one case, a client dealing with a known rascal preferred to sign off on an agreement that was virtually drawn on a cocktail napkin than to pay an attorney a few bucks to "rascal-proof" the agreement. It was only a matter of time before the rascal did what rascals do. The client has paid far more to keep the rascal in check and the effectiveness of those efforts is much harder to measure than would be so had a well-written contract been drawn at the start of the relationship between rascal and client.


In another case a group of would-be partners had the good sense to commission a well-drawn contract on the front end. Their objective was to share gains and losses equally.

That seems simple enough, doesn't it?

Imagine several boys with paper routes who meet in their tree house and deposit their collections in a coffee can. At the end of the month, they count out the money in the can and divide it equally.

What could go wrong with that?

Not much if they are all delivering the same newspaper to the same number of customers, achieving the same rate of collection, depositing every dime they agreed to deposit; and if no third parties have any claim on the money in the coffee can (e. g., the Internal Revenue Service, the Illinois Department of Revenue, the Illinois Department of Employment Security, spouses, children, dependents, and all the rest of it).

Since the would-be partners are grown men with lives and obligations that are a bit more complicated than those of boys with paper routes in a tree house, putting down on paper an agreement that meets the needs of all is of utmost importance and demands care and attention.

SENIORITY OR DISABILITY: WHO GETS THE JOB?

by David McCarthy

Query: When an employee with seniority and an employee with a disability vie for the same job, who gets it?

Usually the employee with seniority, according to the U.S. Supreme Court.

In 1990 a man named Barnett injured his back while employed as a cargo handler by U. S. Airways Inc.. He invoked his own seniority rights to gain a less demanding position in the mail room. Two years later his position, among others, was opened to seniority-based employee bidding, and Mr. Barnett learned that two co-workers who were senior to him intended to bid for his positions.

Mr. Barnett proposed to U. S. Airways that it accommodate his disability by exempting his position from the seniority system. Ultimately the employer refused, Mr. Barnett lost his job, and he sued U. S. Airways on the grounds that it had discriminated against him in violation of the Americans With Disabilities Act ("ADA").

Summary judgment for the defendant-employer was reversed on appeal. Then the U. S. Supreme Court, in another 5-4 decision, reversed the Court of Appeals and remanded the case to the trial court.

The Court held that the accommodation requirements of the ADA do not oblige an employer to disregard its own seniority system unless the plaintiff-employee shows "special circumstances" warranting from the seniority system in that particular case.

What does a "special circumstance" look like?

The Court offered only one example, to wit, that of an employer who has so often exercised a unilateral right to make exceptions to its seniority system that one more exception will not matter. It is too soon to tell whether the seniority-is-trump rule will be swallowed up tby the "special circumstances" exception, but it is predictable

HOW DO YOU GET TENURE WHEN YOU HAVE NOT PUBLISHED? YOU SUE, OF COURSE.

by David McCarthy

There was a time when it was widely understood and accepted that tenure was conditioned on being published.

Interestingly, officials of the University of Wisconsin were sued for refusing (by a vote of 7 to 1) to grant tenure to an assistant professor of physical education who had published nothing. The contract of employment did not guarantee tenure, but only that plaintiff would be considered for tenure. The case was dismissed on dispositive pre-trial motions and the Seventh Circuit Court of Appeals affirmed the dismissal.

Plaintiff brought a claim under Title VII of the Civil Rights Act that alleged sexual discrimination in the form of "associational discrimination."

It contended, in gist, that tenure had been denied to plaintiff because of her association with a male employee of the university who had earlier filed a sex discrimination claim (and who also cast the only vote in favor of granting tenure to plaintiff). The Title VI claim was found to be time barred.

A claim predicated on denial of equal protection failed for want of evidence that plaintiff had been treated differently from similarly situated candiates for tenure and for want of evidence that the individual defendants were motivated by an intent to discriminate against persons such as plaintiff.

Plaintiff asserted that she was a class of one, a heterosexual female professor who befriended a heterosexual male professor who filed a sex discrimination complaint. However, she did not carry her burden of establishing that the defendant's justification for discriminating against her was irrational and arbitrary.

Finally, the Court rejected a claim that denial of tenure carried a stigma so great that at two different performance reviews prior to the time when plaintiff came up for tenure, the Dean had told her that publishing would be a "critical factor" in the tenure decision.

After the litigation commenced and after the defendants filed their motion for summary judgment, the response of plaintiff flagrantly disregarded local rules pertaining to statements of fact and citations of law. The trial judge therefore disregarded a large part of plaintiff's opposition. Plaintiff charged the trial judge with abuse of discretion. The Court of Appeals rejected that contention.