Use of Bankruptcy FilingsIn

Your Investigations

JUDICIAL ESTOPPEL

2.For the Claimant....Their Worst Nightmare

3.Is Applicable in State and Federal Courts

4.Valid Defense in Property Losses

5.Valid Defense in Bodily Injury Claims

1. For The Defense....Your Best Friend Ever

The Doctrine of Judicial Estoppel

2. Protects the Integrity of Judicial ProceedingsChicon v. Carter, 258 Ga. App. 164 (2002)

1. Precludes a Party from Assuming a Position in a Subsequent Legal Proceeding Inconsistent With a Position Previously Asserted In Bankruptcy

New Hampshire v. Maine, 532 U.S. 742, 121 Sup. Ct. 1808 (2001)

Key Elements of Judicial Estoppel

1.Affirmative Defense...Must be Raised In Answer Jones v. Littlejohn, 222 Ga. App. 494 (1996)

2. Normally Decided on Summary Judgment Rimes Tractor & Equip. v. AgriCredit Accep. Corp., 216 Ga. App. 249 (1995) .

3. Deprives Creditors of Resources With Which To Satisfy Unpaid Obligations of Claimant/Debtor

4. Prevents a Claimant/Debtor From Misleading the Bankruptcy Court About the Existence of an Actual Or Potential Claim Thereby Giving The Debtor An Unfair Financial Advantage and Windfall If Secreted

How To Locate Bankruptcy Filings

1. Pacer U.S. Party/Case Index

2. http://pacer.uspci.uscourts.gov/

Bobby McAdams Injured During Fender Bender On 11/10/07

Bobby Filed A Lawsuit on 12/24/07 Hoping For Quick Settlement For Christmas Money!

But Did He Tell the Bankruptcy Court About the MVA When He Filed Chapter 13 On 10/28/08?

“A Debtor’s Interest in a Cause of Action…. Including an Unliquidated Tort Claim, is Personal Property That Must Be Included as Part of the Bankruptcy Estate” . Byrd v. JRC Towne Lake, 225 Ga. App. 506 (1997)

In a Chapter 13 Bankruptcy, the Debtor is Under Duty to Amend and Disclose a Potential Asset on the Schedule of Assets No Matter When the Claim/Injury Arose Period Homes, Ltd. v. Wallick, 275 Ga. 486 (2002)

In Chapter 7 or 11 Bankruptcy Filing, Only Claims Arising Before the Filing of the Bankruptcy Petition are Required to be Disclosed. Reagan v. Lynch, 241 Ga. App. 642 (1999)

The Important Law In A Nut ShellThe Important Law In A Nut Shell

Judicial Estoppel is not favored under Tennessee law. Layhew v. Dixon, 527 S.W.2d 739 (Tenn. 1975).

In Tennessee "Judicial estoppel only applies where a statement of fact is willfully false in the sense of knowing, deliberate perjury.“ Prince v. Allstate, (E.D. Tenn. 2002)

In Tennessee there is a good faith exception for "mere mistakes or inadvertent conduct” on Application/Petition. Browning v. Levy, 283 F.3d 761 (6th Cir. 2001)

A Homeowner files Bankruptcy and Attorney Inserts the Amount Exempted by Bankruptcy as the Actual Value of Personal Property on the Bankruptcy Schedule. The Homeowner has a Later Fire Loss and Submits A Personal Property Claim for a Multiplier of the Amount Previously Sworn to in Bankruptcy Petition and The Insurer Screams Foul

HOW WOULD YOU START LOOKING

McAdams, Robert

487-20-8093

Must Reveal Lawsuits Filed One Year Must Reveal Lawsuits Filed One Year Prior Prior To Bankruptcy To Bankruptcy

This is Critical Information This is Critical Information Where Bankruptcy Filed After Where Bankruptcy Filed After

A Lawsuit is Filed A Lawsuit is Filed

Must Obtain Certified Copy of Bankruptcy DocumentsMust Obtain Certified Copy of Bankruptcy DocumentsTo Be Admissible In Federal OR Georgia Courts To Be Admissible In Federal OR Georgia Courts

Whiten v. MurrayWhiten v. Murray, 267 Ga. App. 417 (2004), 267 Ga. App. 417 (2004)

I certify under penalty of perjury that the information provided above is true and correct.

Signature of Debtor: /s/ xxxxxxxDate: October 10, 2008

Insured Reported A Theft of $500,000 Worth of Insured Reported A Theft of $500,000 Worth of Jewelry, Furniture & AccessoriesJewelry, Furniture & Accessories

DATE OF LOSS……10/24/08DATE OF LOSS……10/24/08

Insured Had Previously Insured Same Premises With Another Insurer For Much More

But When Insured Filed For Bankruptcy One But When Insured Filed For Bankruptcy One Year Prior To Theft…..Contents Were Not Year Prior To Theft…..Contents Were Not

Nearly As Much As For The Amount Nearly As Much As For The Amount On Proof On Proof of Lossof Loss

Schedule “C” Is Different From Schedule “B”

SUBSTANTIVE ISSUES

GEORGIA /TENNESSEELAW

HOTTEST DECISION IN GEORGIA --- 2012 *

Couch v Red Roof Inn (July 9th)

1. Couch was abducted, robbed & assaulted while guest at Red Roof2. Lawsuit filed and Red Roof Inn filed Notice under § 51-12-33 3.Jury can Apportion Fault Against Unidentified Non-Party (Criminals)4.Plaintiff argued Red Roof owed duty to provide safe premises to guests5.Jury can Apportion “fault” between Red Roof & Criminals6. Example: Jury finds for Plaintiff --- Awards Plaintiff $1,200,0007. But Jury can find hotel only 5% responsible for Plaintiff’s injuries 8. Jury can Apportion 95% of “fault” to criminal who initiated the attack9. Plaintiff recover s $60,000 against Hotel (.05 x 1,200,000 = $60,000)10. Can Apply to Retailers, Bars, Anyplace People Assemble11. Can Apply fault to Immune Non-Parties (Police, Government)

* (So Far)

*(So Far)

A Variation

1. Plaintiff Sunbathing At Apartment Complex Swimming Pool

2. Sign At Pool Says No Pets Inside Fence At Swimming Pool

3. Tenant Has His Dog At Pool ----- Off Duty Police Arrests Tenant

4. Cops Puts Handcuffs On , Detains & Arrests Tenant

5. Tenant Sues Apartment Complex Owner but not Cop (Immunity)

6. Is There Apportionment Since Cop Not A Party ?

7. Apartment Owner Is Liable For The Actions of The Cop

8. Security Is Non-Delegable Duty (Peachtree-Cain v McBee)

9. Walker v. AMC Theaters (Cop arrested 14 y.o. for loitering)

10. (Employer escapes liability if officer strictly doing police duties)

11. AMC Defined Loitering…..present > 30 mins. Before/After Show

Hottest “Decision“ In Tennessee *1. Enactment of House Bill 1189 …. (Not A Court Decision)

2. Repealed Myint v. Allstate (Tenn. 1998), Which Allowed Recovery Under Tennessee Consumer Protection Act for Unfair or Deceptive Acts or Practices in Handling an Insurance Claim

3. TCPA Allegations Against Insurers Were Based Upon Any Perceived Conduct Including Actions of Independent Adjusters, Insurance Agents and Even Experts Hired by The Insurer. Because of the Expansive Scope of Myint, Courts Rarely Granted Summary Judgment or Partial Summary Judgment Even After Claim Was Paid

4.Settlement Of Insurance Claims Inflated Under TCPA Because It Allowed Recovery of Attorney Fees, Punitive & Trebled Damages

* If 2011 is

Current

Senate Bill 2271 --- April, 2012 Signature On Insurance Application Creates a Rebuttable Presumption That Applicant Has Read, Understands, and Accepts Contents of the Application

Gagne v. State Farm. Prior to This Decision SOL Started The Date of The Denial

Under Gagne SOL commences SOONER of (1) the date of denial; OR (2) the date that payment of claim is due.

So, assuming a fire on Jan. 1, 2012 and a proof of loss is submitted on Feb. 1, 2012, most policies will require payment within 60 days of submission of proof of loss. Limitations triggered, sixty days from submission of the proof of loss (unless there is a denial before that time).

More Recent Tennessee “Decisions”

Georgia Offer Of Judgment Statute

1. Made By Either Party (30) or More Days Before Trial

2. In Writing, Stating Made Under Offer of Settlement - § 9-11-68

3. Identify Which Parties Are Making the Offer

4. Identify The Claims Which the Offeror Desires to Settle

5. State the Total Dollar ($) Amount of the Offer

6. The Amount of Any Punitive Damages Included in The Claim

7. Whether The Amount Includes Attorney’s Fees

8. Delivered Via Certified Mail or Overnight Delivery

9. Remain Open For At Least 30 Days or Until Withdrawn in Writing

10. Plaintiff Must Recover 75% of Offer To Avoid Paying Attorney Fees

11. Defendant Liable For Attorney Fees When Plaintiff Wins 125% +

of Amount Plaintiff Made Offer of Judgment To Defendant

12. Only May Be Collected Against The Party ---Not Party’s Attorney

Tennessee Offer Of Judgment Statute1. Made By Either Party TEN (10) or More Days Before Trial

2. Must Be Made In Writing (Served Upon Opposing Party)

3. State the Dollar ($) Amount of the Offer or Property Offered

4. Costs Accrued Are Added to The Offer

5. No Need To Deliver Offer Via Certified Mail or Overnight Delivery

6. Offer Must Remain Open For At Least 10 Days

7. Offer Must Be Accepted In Writing

8. Must File Offer, Written Acceptance of Offer & Notice of Service With Court

9. Must Obtain Verdict More Favorable Than Offer (Not Equal To)

10. If Verdict Not More Favorable Then Party Responsible For Costs

11. Can Make Subsequent Offers of Judgment

12. Rule 68 Costs Does Not Include Attorney’s Fees, Deposition Costs, Court Reporter Fees, Expert Witness Fees, or Prejudgment Interest

PERSON v. FLETCHER, 582 S.W.2d 765 (Tenn. App. 1979)

Misrep In App. (GA)1. Misrepresentation need not be made intentionally.

2. Misrepresentations made innocently sufficient to void O.C.G.A. § 33-24-7(b)(3); Haugseth v. Cotton States

3. Once Breached, Policy Cannot Be Unbreached Rollins v Gault

4. Misreps Don’t Have to Be Related To Loss Schroeder v. Farm Bureau

5. Can’t Void Auto Policies – Cancel Prospectively OCGA § 33-24-44

6. Open Mortgagee Clauses Permissible On Homeowner Policies and Misreps In Apps Due To Fraud Can Void

7. “ This policy shall be paid as Interest may Appear to You and the Loss Payee Shown in the Declarations.”

In Re Alexander , 329 B.R. 919 (Bankruptcy M.D. Ga. 2005)

4 Couch on Insurance § 65:36 (3d) (2004)

Misrep. In App. (TN)1. Misrepresentation in Application will not Void Policy unless the Misrepresentation

is Made with Actual Intent to Deceive Increase the Risk of loss by Reasonably Affecting Insurer’s Judgment necessary to an Honest Appraisal. TCA §56-7-103

2. Misrepresentation is Material If It Increases the Insurer's Risk of Loss

3. Insured Who Signs But Fails to Read an Application Is Conclusively Presumed to Know its Contents and Must Suffer the Consequences of Their Own Negligence.

4. Insured Is Estopped From Denying Incorrectness Because Did Not Read App.

Beasley v. Met Life

1. (1) Application contained false information

2. (2) False Information Given with Intent to Deceive the Insurer

3. (3) The false information materially increased the risk of loss to the insurer. McPherson v. Fortis Ins. Co.; TCA §56-7-103

4. “The insured has a Duty to Disclose Information which is Material to the Risk Involved. Whether Undisclosed Information is Material is a Question of Law for the Court.” Campbell v. Florida Steel ; Lawhon v. Mountain Life (2011)

Killer Apps For BI Claims

Bad Faith (GA)1. § 33-4-6(a) Insurer’s Refusal to Pay Claim Within 60 days After Demand

Made by Insured/Claimant Without Reasonable Grounds Makes Insurer Liable to Pay Claim + Greater of 50% of Claim/$5,000 + Reasonable Attorney’s Fees

2. Evidence of Bad Faith May Exist If:

A. Refusal of Insurer to Investigate Loss

B. Failure to Make Bona Fide Offer Where Liability is Clear And Special Damages Exceed Limits Where Time Demand Made Supports Cause of Action

C. Arbitrary Decision To Deny The Claim

D. Failure To Timely Pay Legitimate Claim

E. Failure To Treat Interests of Insured With Different Consideration As Own

3. No Bad Faith If Reasonable Or Debatable Ground for Resisting Claim

4. Insurer Afforded Until Trial To Show Good Faith Reasons To Contest Claim

5. 3rd Party May Sue Liability Carrier Through Its Insured If It Seeks To Pay Less Than Amount Reasonably Owed For Property Damage - - - - - § 33-4-7

Separate Judgment And Atty Fees Award Against Insurer By Same Trier Of Fact

Bad Faith (TN)

1. §56-7-105(a) Penalty up to 25% + Interest Upon Showing Bad Faith By Insurer

A. Insured Must Make Formal Demand

B. Insurer Refused to Pay Claim Within 60 Days After Demand

C. Proof That Payment Under Policy Due and Payable

D. Insured Waited 60 Days After Demand Before Filing Suit

E. Insured Must Show Refusal to Pay Was Not in Good Faith

2.Similar Penalty Against Insured Who Sues Insurer in Bad Faith (Reverse Bad Faith)

Tenn. Code Ann. § 56-7-106