Long Term Disability Success Story-Post 2

Author: Charles F. Fuller

When a client comes to our office with a long term disability issue, we analyze the client’s case and take action that is needed to protect the client’s rights. Our representation is tailored to the client’s specific needs.

Recently, a client I will call John came to our office. He had been on and off long term disability several times over the past half dozen years due to ongoing back problems. He had had multiple back surgeries by the time he came to our office and was unable to do much of anything at all, physically. When John came to us, his disability benefits had been terminated. He had prepared and submitted his own administrative appeal to the disability insurance carrier, and it had been denied. Further, he had asked the disability insurance carrier to reconsider his appeal, and they denied that as well. The long term disability policy had a very short, one-year statute of limitations provision which was quickly approaching. In reviewing John’s case, it was apparent that John did not provide sufficient medical documentation to support his claim for ongoing disability benefits. John knew how terrible he felt and could not physically return to his job because he was unable to do much of anything other than rest throughout the day. The disability carrier took a different view. John contacted our office and we met with John and his wife. He brought in some medical records and claim documents which were reviewed. It was apparent that substantial information and documentation was needed to pursue his case.

It was going to take some time to obtain John’s complete medical records. Since the statute of limitations was nearing, we prepared a complaint prior to the expiration of the statute of limitations and filed it with the United States District Court for the District of Maryland. We continued to seek out John’s medical records. After obtaining all of the records, reviewing and summarizing them, we reached out to John’s doctors and obtained detailed reports as to his specific physical limitations, the reasons why he was physically restricted and their opinions as to why John could not return to his regular occupation or any other occupation. We prepared a supplemental appeal and submitted this to the disability insurance carrier. After many months, the disability insurance carrier wrote to us and advised that it was refusing to consider the supplemental appeal. It was the disability carrier’s position that John had exhausted his administrative appeal rights and they did not have to further consider his appeal. Based upon the disability carrier’s position, we filed an amended complaint to bring all of this information before the court, including the supplemental appeal with the very supportive medical evidence demonstrating John’s disability.

In the early stages of the litigation, we advised the court that we thought it would be appropriate to have the case remanded, or sent back down, to the disability insurance carrier for its consideration of John’s supplemental appeal. The disability carrier refused to voluntarily undertake this review. We filed a motion to remand the claim back to the disability carrier, asking the court to order it to review John’s supplemental appeal. The disability carrier opposed that motion and also filed a motion for summary judgment, contending that as a matter of law, the court must uphold the carrier’s decision. We vigorously opposed this action taken by the disability carrier. Ultimately, the court ordered the disability carrier to review the supplemental appeal and denied its motion for summary judgment. Subsequently, the disability carrier upheld John’s supplemental appeal and restored his benefits.

The above situation is the reason why it is very important to have competent legal counsel representing you should you have a long term disability claim. Although you know how you feel and that you cannot perform your job duties as a result, that is often not enough to successfully obtain benefits. The federal statute governing such claims, the Employee Retirement Income Security Act of 1974, as amended, (ERISA), is a very technical statute, and knowledge of that statute and its procedural roadblocks is important. Having an attorney both knowledgeable and experienced handling ERISA claims is often essential in such cases. We would be happy to speak with you about your claim.

 

 

Qualified Domestic Relations Order Victory

Author: Charles F. Fuller

Although our firm does not practice family law, representing individuals in divorces, adoptions or similar matters, we do practice in one very important area in that field. Due to our substantial experience with employee benefits and the Employee Retirement Income Security Act of 1974, as amended, (ERISA), we are often called upon to assist clients with Qualified Domestic Relations Orders (QDROs).

Our client, who I will call Ann, sought our assistance in protecting her rights to a portion of her ex-husband’s pension retirement benefit. Ann was married to Bill for over two decades. After Bill retired and began receiving pension benefits, they encountered marital difficulties leading to divorce. The parties live in a southwestern state, and through legal maneuverings by Bill’s attorneys, the state court held that Ann had given up her right to a survivor’s benefit of Bill’s pension retirement benefit. Ann did relinquish her right to receive a marital share of her former husband’s pension benefit during his lifetime in the Property Settlement Agreement between them. Bill’s employer subsequently went bankrupt. The bankruptcy employer’s pension plan was taken over by a federal agency, the Pension Benefit Guaranty Corporation (PBGC). The PBGC, in reviewing Bill’s pension file, determined that the state court order divesting Ann of her right to receive a survivor benefit in Bill’s pension and the state court’s entry of a QDRO in favor of Bill’s subsequent wife were invalid. The PBGC determined that Ann was the proper recipient of Bill’s pension benefit upon his death because the QDRO sought to provide a form of benefit not otherwise provided under the Plan; Ann’s survivor benefit irrevocably vested when the pension benefit was first paid to Bill and therefore was not waivable or assignable.

Bill initially brought suit against the PBGC in the United States District Court for the District of Columbia claiming PBGC had violated federal law. Subsequently, Ann was made a party to the litigation on the basis that she was an indispensable party. This allowed Ann to protect her own rights in the lawsuit. After Ann entered the case, Bill amended his complaint to add several state law claims against her.

Both Bill, on the one hand, and the PBGC and Ann on the other hand, moved for summary judgment in the trial court. The District Court agreed with the PBGC and Ann that Ann could not have waived her right to Bill’s survivor pension benefit through the state law QDRO because her benefits irrevocably vested after Bill began receiving benefits and therefore were not waivable or assignable. The trial court also dismissed the state law claims against Ann because ERISA, the federal statute governing pensions, preempted state law. Bill disagreed and appealed to the United States Court of Appeals for the District of Columbia.

In the appellate case, the PBGC was dismissed as a party, leaving Bill and Ann as parties to the appeal. We successfully argued to the Court of Appeals that the federal statute, ERISA, preempted the state law relied upon by Bill and invalidated the QDRO. The Court of Appeals agreed with our position. Further, we argued that contrary to the state court’s determination, Ann could not have waived her right to the survivor pension benefit through a QDRO because her benefits irrevocably vested upon Bill’s receipt of pension benefits and therefore Ann could not legally waive or assign those benefits to either Bill or his new wife. The Court of Appeals agreed with our position and ruled in favor of Ann. Bill did not seek to appeal the case to the United States Supreme Court, and therefore the Court of Appeals’ decision was final in favor of Ann.

The importance of Ann’s case, besides the substantial monetary benefit she may recover after Bill’s death, is that it is extremely important for a spouse to protect his/her rights to a former spouse’s pension benefit at the time of divorce. By obtaining a properly drafted and entered QDRO shortly after a divorce is finalized, a spouse can protect his/her federally protected rights without the resort to litigation. This was not done in Ann’s case. The litigation to prevent Ann from receiving her federally protected right to Bill’s pension benefit after his death was filed a year or two after the divorce. It wasn’t until more than a decade later that her rights were finally protected. Addressing this issue head on, close in time to the entry of the final divorce decree can avoid much heartache and expense. We are often called upon by clients to prepare QDRO’s to protect their rights to a former spouse’s pension. We would be happy to assist you should the need arise.

Do I Need to Update My Will When I Move Out of State?

Author: Denise A. Martin

I am routinely asked whether an estate plan needs to be updated when one moves to a different state. The answer I give is maybe not, but it is always worth having an attorney in the new jurisdiction review your estate plan. An estate plan that was properly drafted and executed in one state will be legally enforceable in another state. The validity of wills and trusts is controlled by the law of the jurisdiction where they were signed, and so those documents are enforceable in any state as long as they were properly drafted and executed under the law of the originating state. For other estate planning documents, such as powers of attorney and medical directives, the full faith and credit clause of the U.S. Constitution requires states to recognize such documents prepared validly in other states. So if you prepare and sign an estate plan in Maryland but later move to Florida, you do not necessarily need to have a completely new estate plan prepared. That being said, a big life change, such as moving to a different state, provides an excellent opportunity to review your estate plan.

Estate plans should be reviewed after major life changes, as well as every five or so years; changes in state or federal law and the birth, death, or marriage, etc., of close family members or friends may result in your estate plan becoming out-of-date. Tax laws, including state “death taxes” like estate tax and inheritance tax, also vary from state to state, such that an estate plan in one state may result in no tax being owed upon the death of the individual but that individual’s passing in another state could have numerous, significant tax consequences. For example, Maryland has both an estate tax (levied on estates of a certain dollar value) and an inheritance tax (levied on bequests made to distant family members or non-family members), while Virginia has neither; so your loved ones may be subject to the imposition of a significantly greater tax burden if you pass away while living in one state compared to another.

Another reason why a move out-of-state provides a good reason to review your estate plan is that while certain estate planning documents may be legally enforceable in a new state, the function of actually using those documents may be difficult enough that it is worth updating them. For example, many states have statutory powers of attorney and medical directives; i.e., the state legislature codified into law a standard form power of attorney and/or medical directive that is legally required to be accepted throughout the state. Where a state has such statutory forms, financial institutions and hospitals are used to seeing the statutory form and will generally be apt to accept such forms without delay. However, if your agent appointed in your power of attorney or medical directive presents a statutory form from another state that may look quite different, there may be delays and headaches while the legal department of the institution reviews the form. So even though that document may ultimately be legally enforceable, it may make sense from an ease-of-use standpoint to just update the document.

In any case, if you think the substantive provisions of your estate plan need to be updated (e.g., the distribution scheme, who your trustee or personal representative is, who the agent in your power of attorney or medical directive is, etc.), then I definitely recommend you meet with an attorney sooner rather than later to have your plan reviewed!

The Importance of Designating a Beneficiary for a Thrift Savings Plan

Author: Charles F. Fuller

Recently, we were asked to assist a personal representative who was appointed to administer the estate of a deceased federal employee. The deceased federal employee was not married and did not have any surviving children. She had a Will that left her estate to her surviving sister. The employee had been advised to review her retirement and bank accounts and to name beneficiaries for those accounts. Unfortunately, the employee did not do this prior to her death. In fact, the deceased employee never designated a beneficiary for her Thrift Savings Plan (TSP) account. The personal representative attempted to have the TSP funds rolled over into an estate Individual Retirement Account (IRA) in order to avoid the immediate assessment of federal and state income taxes on those funds. Some TSP officials agreed that this was allowable. As the request was processed through the system, other TSP officials disagreed, and ultimately the TSP refused to roll the funds over into an estate IRA. The TSP determined that since the employee did not designate a beneficiary, only the employee’s estate was legally entitled to receive the proceeds from her TSP account. The TSP then sent a check to the personal representative made payable to the estate of the deceased employee, withholding a substantial amount of tax. The personal representative deposited the TSP check into the estate checking account. She then sought the advice of counsel.   Under the existing circumstances, it was determined that there was little, if any, likelihood of success if litigation was instituted against the TSP. As a result, the estate paid a significant portion of the TSP proceeds in federal and state income taxes.

What every federal employee should learn from the above situation is that they should review their TSP account periodically to ensure that they have designated a beneficiary to receive the proceeds of that account upon their death and further, to make sure the beneficiary designation is updated if necessary. The employee should designate a primary beneficiary and also designate a contingent beneficiary in the event the primary beneficiary predeceases the employee.

If a Decedent Dies Without a Will in Maryland, Who Receives Assets

Authors: Denise A. Martin and Victoria Chan-Pablo

To view the full flowchart in PDF format, please click the link below.

If a Decedent Dies Without a Will, Who Receives Assets

New Payment System

Author: Shameka Sterling

McChesney & Dale is now providing our clients the convenience of paying with a credit card online. We have recently started using LawPay, which is a secure online credit card processing system that makes it easier for clients to make payments towards retainer(s) and/or invoice(s). We encourage you to use our new system, however, we do still accept payments by telephone if this is your preferred method. Please feel free to give our office a call at (301) 805-6080 if you have any questions.

To make a retainer payment, use the following link:

https://secure.lawpay.com/pages/mcchesneyanddale/trust

To make an invoice payment, use the following link:

https://secure.lawpay.com/pages/mcchesneyanddale/operating

Pet Food Drive

Author: Shameka Sterling

McChesney & Dale Hosts a Pet Food Drive

 McChesney & Dale, P.C., invites you to join us in “paying it forward” by filling our boxes to help a family with a pet in need.

McChesney & Dale will sponsor a pet food drive from June 8 – 19, 2015. All donations will be provided to the Bowie Citizens for Local Animal Welfare (Bowie CLAW), which will package and distribute goods to families with pets in need.

We welcome you to help us in giving someone and their pet a piece of happiness by making a donation. Donations can be made on the first floor of the OMNI Building, located at 4000 Mitchellville Road, Bowie, MD 20716.

The following items are requested:

-Canned and dry dog food

-Dog Treats

-Canned and dry cat food

-Cat Treats

-Kitty Litter

For more information about Bowie CLAW, please visit http://www.bowieclaw.org/pet-assistance-support/.

BowieFest 2015

Author: Shameka Sterling

McChesney & Dale, P.C., will be at Bowiefest!! Come out and visit our attorneys and staff!!

Bowiefest 2015 is here! Join us for good food, music, entertainment and tons of information about local businesses at Allen Pond Park on Saturday, June 6, 2015 from, 11:00 a.m. to 6:00 p.m.

WHAT:           Bowiefest 2015

WHEN:           Saturday, June 6, 2015

11:00 a.m. – 6:00 p. m.

WHERE:         Allen Pond Park

3330 Northview Drive

Bowie, MD 20716

 

We invite you to come out and visit us in the Business Expo area located in the Bowie Ice Arena. We would love to meet you and answer any questions you may have.

*We will also hold a raffle where we will give away three (3) $100 Visa gift cards. Be sure to visit our booth for more information.

Bowiefest is a City tradition, bringing the community together to enjoy the local entertainment, food, community organizations and businesses. More information about Bowiefest can be found at http://www.cityofbowie.org/index.aspx?NID=783.

 

 

 

 

 

 

McChesney & Dale, P.C. Pet Food Drive

Can I Disinherit My Spouse?

Author: Denise A. Martin

For various reasons, clients sometimes ask if they can exclude their spouse from receiving anything under their will or other estate planning documents. For example, their marriage may be a second marriage for one or both or may have occurred late in life, such that they have separate assets and separate beneficiaries they would like to benefit upon their death. The short answer is: you can try to disinherit your spouse, but you may not be successful. Under Maryland law, even if you explicitly exclude your spouse from receiving assets under your will, they are entitled to claim an “elective share” of your net estate (i.e., the remaining probate assets after the payment of funeral expenses, probate expenses, family allowances, and enforceable estate debts). See Md. Est. § Trusts Code Ann. § 3-203. The amount of the elective share depends on whether the predeceased spouse had surviving children. If the predeceased spouse had surviving children, the surviving spouse may elect to receive one-third of the net estate. If the predeceased spouse did not have surviving children, the surviving spouse may elect to receive one-half of the net estate. A surviving spouse is also entitled to receive an allowance of $10,000 from the estate for personal use. Md. Est. § Trusts Code Ann. § 3-201. Now, while a surviving spouse has the right to elect the spousal allowance and the elective share, there is no requirement that they do, and they may choose not to do so.

There are ways to avoid the potential risk of a spouse claiming the elective share, such as through trust planning or establishing a pre-nuptial or post-nuptial agreement. Contact our office if you have questions!