The Indiana Law Blog caught an AP story about the American Civil Liberties Union of Indiana suing the state over “In God We Trust” license plates because, unlike other specialty plates, no additional fee is charged.

The plaintiff bringing the case, Mark Studler, said he pays an additional $40 for one of the popular environmental plates depicting an eagle above the word “Environment.” Of the total fee, $25 goes to a state trust to purchase land set aside for conservation or recreational purposes and the remaining $15 is for the administration fee.

The 2006 law establishing the “In God We Trust” plate waives the administrative fee.

“Therefore, those who obtain an ‘In God We Trust’ license plate are afforded the opportunity to make an affirmative statement through display of the plate without any additional cost while Mr. Studler must pay additional fees for his environmental license plate,” the complaint said.

I think this makes some sense. The suit won’t be popular — lawsuits over civil liberties rarely are — but I think challenging the preferential status the “In God We Trust” plate gets over other “message” plates is correct. Why should one message, particularly a religious endorsement, be subsidized by the state when others are not?

(Via the Indiana Law Blog) Digitized versions of historical Indiana documents, including the journals and debate reports for the 1851 Indiana Constitution.

The Indiana Judicial Center’s legislative update blog has a post that says:

On Wednesday, Chief Justice Shepard did a marvelous job delivering his 20th State of the Judiciary address. You may access the webcast or the text of his speech at: http://www.in.gov/judiciary/supreme/state_jud.html.

I didn’t see it, and I assume C.J. Shepard did a good job as usual. But, I just have to ask, if he botched the speech, could we really rely on the Indiana Judicial Center to tell us?

Today I’m spending in Indianapolis at day 2 of a two day Continuing Legal Education seminar that attempts to provide an update in what has been going on in most areas of Indiana law. The seminar is much larger than I anticipated in terms of number of lawyers in attendance. They pretty much fill up Room 501 of the Convention Center. I guess it’s: a) useful; and b) a cost effective way to get most of one’s CLE credits in one shot. Here are some notes from the seminar. If I’ve misstated something, chalk it up to speed, careless note taking, and/or my ignorance of what is being said, not to any fault of the speaker.

Prof. Jegen – Tax law. First segment spent talking about the upcoming election and tax law efforts. Recent efforts have been eroding the middle class. Heritage Foundation is about the only group who doesn’t seem to think the deficit is an issue. Thinks the exemptions will probably go up to something like $5 million per spouse and this will take care of the vast bulk of lawyer’s clients. Another important issue is the effect of the estate tax on the deficit. We won’t know what’s going to happen until after the election. Something will almost certainly happen because if nothing is done, the law is that the estate tax will revert to the way it was 10 years prior.

Great move to deal with the AMT. It’s spreading – was originally supposed to affect the very wealthy but now it’s getting to people it was never designed to affect.

Recommends Roth IRA – money has to be in for at least 5 years and can only be taken out for prescribed reasons, mostly because you’re between 59.5 years old and 70.5 years old. If done properly, money is tax free. Recently has allowed roll over retirement plan into Roth IRA – have to pay income tax on the retirement plan funds, but then it can go into the Roth.

Congress has given Dept. of Treasury the authority to adopt regulations to govern deductions for donations of household goods. These deductions amount to $9 billion per year. Apparently the federal government thinks a lot of these donations are of essentially worthless items.

Can get deductions for FMV of books donated to schools if certified by donor and recipient that the books will actually be used by students.

Charitable remainder trust has to have specific instructions as to exactly how much will be paid out to the individual before the trust qualifies for a deduction.

Charitable deduction for donation of land up to 50% and with a 15 year carryover.

Deficit went down some, not because tax rates were helpful – this is a tax cut finance deficit – but because there was a 2 year window for corporations to bring foreign money back into the country at a very low tax rate.

——–
Elder Law Update – Robert Fechtman.

Medicaid – Assets/Resources; Income; Transfer of Assets.
Resources: Single – $1,500 at first day of first month.
Couples – $2,250 if both are in the community or in a nursing home. For married couple where one spouse is at home, $1,500 for applicant plus add’l allowance for spouse at home. General rule is the community spouse can keep half of assets of couple above $19,908 and below $99,540.

Assets that are excluded from computation are a home (capped at equity value of $500,000) to which applicant intends to return; irrevocable pre-paid burial arrangement; furniture, household goods, and personal effects; one automobile with $4,500 equity value for single applicant or any value for applicant with a community spouse, rental real estate producing a positive cash flow; assets held in certain forms of trusts.

There are spousal allocation rules where, if the spouse at home gets less than $1,650/month (up dot $2,489), the spouse can get an allowance from the income of the Medicaid recipient.

Lookback period has been extended to 5 years. Eligibility for Medicaid doesn’t start now until, essentially, you’re out of money and in a nursing home.

Federal law provides that a transfer penalty does not apply when assets were transferred solely for purposes other than qualifying for medical assistance. Usually this means assets that were exempt in deterimining eligibility. However, Indiana has adopted rules to say that Medicaid applicants would also have to show that they were not, at least in part, attempting to avoid Medicaid estate recovery or a Medicaid lien.

Annuities have been changed for asset calculation. No more annuities from private parties (family members, particularly). No more annuities with balloon payments at the end – the idea being to have the big payment come after the applicant is dead and the heirs receive the money. Another provision requires that the state be named as remainder beneficiary on annuities purchased on or after 2/8/06 or the purchase will be considered to be a transfer of an asset for less than fair market value.

Where a child lives in the parents’ home and provides care to the parent that keeps the parent out of a nursing home for 2 years or more, the parent can transfer the house to the child without a transfer of asset penalty.

Rental property is exempt from asset calculation but only if fair market rent is being charged (no renting out to family members for nominal sums.)

A transfer penalty will be imposed for failure to take action to receive assets which one is entitled to receive by law. Example is where a spouse disinherits the medicaid applicant, most likely to avoid having the estate go to Medicaid. If the spouse then fails to attempt to take against the will, the applicant will get a transfer penalty. However, in the case of a surviving spouse who fails to take a statutory share of a deceased spouse’s estate, no penalty will be imposed if the deceased spouse has made other equivalent arrangements to provide for a spouse’s needs. “Other equivalent arrangements” include but is not limited to a trust established for the benefit of the surviving spouse.

Estate recovery has been increased to include a great deal of non-probate assets. There had been an exemption of $125,000 so that applicants could leave something to their kids. That’s been scaled back and now eliminated. The State has now been going against even very small amounts, such as in bank accounts.

Estate has been expanded to include any interest in real estate that the medicaid recipient held as a joint tenant with rights of survivorship, if the joint tenancy was created after 6/30/02. These kinds of trends that erode spousal protections could have the effect of returning us to the days of spouses getting divorces simply to protect the community spouse from becoming impoverished because of the applicant’s need for Medicaid.

———–

Terry Farmer – Contracts, Business, and Banking Law
Statute of Frauds – Writings where parties were still negotiating did not satisfy the writing requirement where contract could not be performed within a year and promissory estoppel did not remove it from the Statute because reliance injury was not independent from benefit of bargain, resulting instead from incidental expenses and inconveniences; and not so substantial as to consitutte an unjust ans unconscionable injury.

Condition precedent – Where a condition precedent remains in control of one of the parties, that party has a duty to make a reasonable and good faith effort to satisfy the condition. Therefore, where a contract required final approval by a board of directors and the employees never brought the contract before the board, the court held that a breach of the contract had occurred.

Business organization in Indiana has been undergoing a process designed to make changes sufficient to encourage businesses to locate and remain in Indiana rather than moving to more “business friendly” states. A recent Act (HEA-1306) is designed to “modernize and streamline” Indiana business law by broadening the persons who may sign documents which must be filed with the SOS; excluding from the definition of ‘distribution” amounts paid to shareholders for services, retirement benefits, or payment of gauranty fees; expanding the definition of “other entity” to include virtually any other busines entity other than a corporation; providing for business entity type conversions performed by foreign entities to be easily recognized in Indiana; broadening the ability for non-corporations to convert into other non-corporate business forms; and providing for springing member LLCs to allow for possibility of the continuation of the LLC after its last member dies.

Small loan remedies – Payday lender loans money; Check is written and held as security for the loan; when loan is due and unpaid, check gets cashed. If check bounces, then lender uses treble damage aspect of bad check. To take advantage of the treble damages, actual fraud in issuing of check has to be proven. Legislature has since come along and amended IC 24-4.5-7-406 to say that treble damages aren’t available for these kinds of loans and to restrict recovery on these loans in other ways.

Receiverships – a borrower, a joint venture, and a lender met during a foreclosure procedure and agreed to the appointment of a receiver who would take control of real property on behalf of the bank. During a break in the meeting, the borrower called his controller and directed a large transfer of rent proceeds from the borrower’s bank account to the joint venture account. The bank sued but the court disallowed the claims because the bank failed to object to a receiver’s final report which made no mention of rents, did not show any assets that could be considered equivalent to rent proceeds, and failed to list any accounts receivable. So, a creditor must object to a receivers report within 30 days otherwise it could lose big.

BREAK: I have to say, the lack of easily available free WiFi in downtown Indianapolis is seriously annoying. The convention center doesn’t offer any in its seminar rooms and within the convention center itself, they want to charge you $10 per day to access the Internet. Similarly, the Starbucks in the Hyatt offers a Tmobile connection that also costs $10/day. If Indy wants to present a tech friendly face, I’d suggest that visitors ought to be able to open their notebooks anywhere in the downtown area and get a signal. Sure, my opinion here is colored by what would be convenient to me personally, but I think it has some merit objectively as well. At this stage of the game, I regard Internet access as being about as basic as plumbing. I’d steer clear of any two bit town that made me pay to use the toilet.

Now I’ve moved a bit. Kudos to the Ah Barista Café across from the RCA Dome for hooking me up with a bagel and an Internet connection. I’ll go ahead and post this entry now while I have the chance. No idea if I’ll have the time or inclination to update the entry with notes from the second half of the day

The Attorney General published an opinion on a question submitted by the Auditor of State with respect to IC 4-13-2-14.8 which requires a person who has a contract with the state or submits invoices to the state for payment to authorize the state to pay the contract or invoice through direct deposit to a financial institution. The statute provides for a waiver of the requirement for a person with no bank account and who can’t open one without being a charged a fee.

The AG responded to the Auditor’s questions by stating that the State is not responsible for interest or penalties if an invoice goes unpaid because the person failed to authorize direct deposit; a political subdivision is subject to the direct deposit provisions; and an employee requesting reimbursement for travel expenses is subject to the direct deposit provisions.

An opinion of the Attorney General was published on the issue of whether a garnishee (defendant) qualifies as a “defendant” for the purposes of Indiana Code sections 33-37-4-6 and 33-37-5-28 which impose a $10 additional filing fee for each additional defendant. In the opinion of the Attorney General, it was not the intent of the General Assembly to impose an extra $10 fee each time a judgment creditor added a garnishee defendant to the case in an effort to try to collect on the judgment.

Given the garnishee’s neutral role as a third party in proceedings supplemental to the original cause of action between the plaintiff and the defendant, and based on the statutory references to the garnishee as a “person” or “garnishee defendant” under chapter 34-25-3 and in the Indiana Trial Rules, it is the opinion of this office that the legislature did not intend for clerks to collect a ten-dollar service fee from the plaintiff for each named garnishee defendant under Indiana Code section 33-37-4-6 or 33-37-5-28.

I have prepared a draft memorandum on the subject of the new service of process fee the Sheriff is required to collect under IC 33-37-5-15(a) of $13 “from a party requesting service of a writ, an order, a process, a notice, a tax warrant, or any other paper completed by the sheriff.”

When you get a judgment that doesn’t get paid, you can initiate a “proceedings supplemental” where the debtor is supposed to appear to testify as to his or her income or assets. If the debtor fails to appear, generally a court will require a show cause hearing to be set where the debtor is to show cause why he or she shouldn’t be held in contempt. Typically if the person shows up at all for the show cause hearing, the court won’t hold the person in contempt since the person is now available for questioning about his or her income or assets which was the point in the first place.

It varies a little from court to court, but usually the practice is to have the Sheriff serve the person at the Proceeding Supplemental stage and to serve the person at the Rule to Show Cause stage. If the person doesn’t get served at either of those stages, nothing will happen. If the person gets served at both of those stages, a writ will issue for the person’s arrest.

This was a good system before the new Sheriff’s fee in that it provided protection to the judgment debtor – you can presumably take the word of the Sheriff’s deputy that the document at least got to the last known address and the Sheriff would tell you if the person clearly didn’t live there anymore. Because the service fee was all wrapped up into the initial filing fee, it didn’t place any undue burdens on the judgment creditor seeking to enforce a judgment.

Now, however, at $13 per served document, it could get rather expensive for judgment creditors to even attempt to collect on their judgments, particularly in the case of an un(der) employed debtor who likes to ignore court papers.

At this link, I have posted a draft memorandum I am contemplating providing to the judges before whom I practice advising them of the law which I believe supports my contention that service by ordinary mail is, in most cases, all that is required by the law and that the courts should forego the additional protections they have afforded to judgment debtors because of the significant extra cost it will impose on judgment creditors.

By draft, I mean draft. I have not edited any of it yet. Hopefully, I’ll be able to insert some links for the relevant citations. But if any of you folks have interest in the subject and/or have knowledge of the arcana of Rules, Writs, and Citations, I would certainly appreciate any input.

Wow, Martin County Judge Joseph Howell has apparently jailed Martin County Clerk John Hunt for contempt, allegedly because court filings and money was not being handled properly.

The above link is to the Indiana Law Blog which cites WAMW Local News in Washington, Indiana.