This year I will be repeating the process of utilizing the December 25 to December 31st period as a "working vacation".  I have done this for the past six years and it has proven to be productive.  Although I will be in and out during that period, the phones will not be formally answered by I or my secretary.  Calls will be deferred to my answering service.  This does not mean there will be  no response to your call.  All messages will appear on my alphanumeric pager within 45 seconds of completion of your call.  I will return all calls generally following receipt, unless I am out of the area.  I have no absences from the office presently planned. 

"Justice is what we get when the decision is in our favor." John W. Raper 

Newsletter Change 

I have finally gotten around to changing the photo.  I am now using my current advertising photo. 

Internet@ 

My New Home Page: 
http:/home.att.net/~gaspalaw 
Stop by! 

Proposition 213 

Under the recently passed Prop 213, uninsured and drunken drivers cannot collect damages for pain and suffering in accidents if their civil trial starts after Jan. 1 1997.  This portion of the proposition was actually secondary to prohibition of convicted felons suing for damages, which everyone seemed to support.  The law is presently in effect and applies to all cases regardless of the date of the accident or date of filing of a lawsuit. 

The practical effect of such a law is to simply "cut out" access to the legal profession.  That is because the contingency fee arrangement depends upon the realization of such damages in order to function.  Attorneys are not going to take these cases (an uninsured injured party).  In light of the proposition, and irrespective of potential litigation challenging this part of the proposition, even seriously injured cases are going to have difficulty in locating counsel.  Tort lawyers are not going to be in a position to finance large cases upon the dual contingency of success in the case and success in statutory litigation (something they have no control over). 
On December 7, 1996, in the Press Enterprise, journalist, Joe Arballo, wrote an excellent update piece detailing how the proposition is affecting the landscape of auto accident tort cases in the local courts.  Cases pending in the court now have prompted motions to accelerate trial dates.  Fact situations involving children or passengers have created many questions and highly inequitable situations.  There is no doubt that this law will have far reaching impact.  Unlike many attorneys, I am predicting the law is here to stay.  Many of the same things being said about this proposition were said and argued as to MICRA (medical malpractice) and Proposition 51 (joint and several liability).  With those laws, on a case by case basis, the higher courts painstakingly struck out its support, explanation and implementation "of the will of the people".  I expect the same thing to occur here. 

Nearly 40% of all drivers in Los Angeles county are uninsured.  Almost 1/3 of all drivers in the Inland Empire and Orange Couny are uninsured.  The other driver’s uninsured status does not affect or invoke the prohibition of Proposition 213.  It is your own uninsured status.  More interesting would be past statistics concerning the insured status of claimants in auto accidents.  Although nothing formal has been generated for public review, internal insurance industry studies have suggested that uninsured drivers have a tendency to make claims with greater frequency than do insured drivers.  This is probably what generated the movement towards Proposition 213. 

The point to be made now is that one should be vigilant about maintaining their insured status.  The new law, theoretically, should bring financial discounts in insurance pricing.  I am certain there will be another voter revolt if the insurance industry does not deliver.  So, over the next year and on, you should be demanding and obtaining significant premium competition, discounting and revised pricing.  You should be vigilant in the most frequent areas of lapsed coverage:  children and vehicles, transferred or acquired vehicles, and recreational vehicles. 

The proposition basically amounts to regulation of an industry.  The point I am interested in seeing is whether other aspects of the industry, such as medical expenses, mechanical and body repair, and car rental will still continue to affect the longterm price of insurance coverage---components of the equation the insurance industry has never mentioned in the continuing crusade against tort lawyers. 

New Partnership Laws 

January 1, 1997, the new California Revised Uniform Partnership Act goes into effect.  All partnerships formed after January 1, 1997 will be under the new law. 

Partnership law "on the books" has not undergone extensive revision since 1949.  Therefore, for small business people some of the following may seem or "sound" familiar, but really amount to things lawyers have been waiting to be codified for some time: 

-  A partnership is now treated formally as a separate legal entity-separate and apart of the partners.  So, for instance, partnership ownership of property need not require title transfers when the partners change; 
- Fiduciary duties are now codified.  A partner owes a duty of loyalty and care to the partnership and partners, but a partnership agreement can be used to excluded separate categories. 
- The new law segregates the events of partner dissociation from dissolution of partnership.  Dissociation will not cause an automatic dissolution except where the partnership is defined to exist for a particular period of time, or for a particular purpose. 
- A new section sets forth what are defined partnership dissolution triggering events, default buyout provisions for dissociating partners, and a complete treatment of formal dissolution. 
- Partners are declared to be jointly and severally liable for all obligations of the partnership. 
- Judgments related to partnership obligations must first exhaust partnership owned property.  There are a few exceptions here. 
- Partnerships may file with the Secretary of State a "statement of partnership".  This form will put the world on notice of the limits on a partner’s authority. 

Finally, there are provisions in the new law which will allow for partnerships to freely convert to or from limited partnerships, limited liability companies or other entities.  Corporations still have to be formed separately, however, and there is no conversion option. 

Better than TV:  Part 2 

Recent verdicts and settlements: 

Police dog bites shooting suspect            Award: Defense 

A 24-year-old unemployed man claimed that police use of a dog in a drive-by shooting investi-gation was excessive force (Rivera v. City of Santa Monica, Los Angeles County Superior Court). 
Insurer denies benefits 
Award $4,700,000 

A chiropractor claimed that the  defendant insurer breached its contract by denying him total disability benefits after he injured his back (Shohet v. The Paul Revere Lire Insurance Co., San Diego County Superior Court). 

Fencing foreman disabled in 16-foot fall in L.A.Award: $22,650,000 

A fencing company foreman working without a safety harness at the L.A. Coliseum fell and landed on his neck. This may be the largest verdict for a quadriplegic in California (Francois v. Tutor--Saliba Corporation, Los Angeles County Superior Court). 

Interesting case: A 61 year old retired saleswoman and part-time wedding coordinator claims delayed breast cancer diagnosis 
Award:  $260,000, amount demanded. 
(Orange County Superior Court) 

Comment:  Failure to diagnose, especially in the venue of cancer, present difficult medical malpractice cases.  Here, the case was subject to "binding arbitration" before an experienced panel. The facts indicated the claimant had regular  mammograms.  The hospital sent notice of normal results in 1992 and 1993.  Claimant noticed a lump in 1994.  Mammogram and biopsy revealed a cancerous tumor and a modified radical mastectomy was performed in August 1994,. Despite admitting the tumor was visible on the 1993 mammogram, defendant argued the failure to diagnose was not medical negligence, nor the cause of her injuries because the radical mastectomy and chemotherapy would have still been required. 

We wish you the very best of holidays, and my further updates will follow! 

Sincerely, 

Gerald Spala 
December 15, 1996