Law FAQ: What is negligence? What is a legal duty? (Part 2)

In yesterday’s blog post, I listed the 5 basic elements for a negligence claim: duty, breach, injury, causation, and proximate/legal cause.

Today’s post will focus on the first 2 elements which, for the most part, comprise the most interesting and difficult issues that arise in connection with negligence claims:  duty and breach.

As noted yesterday, negligence is commonly referred to as the “reasonable man” standard.  Stated differently, you would be considered negligent if you took an action that most average people would deem unreasonable under the circumstances.  Moreover, negligence can be predicated both on acts of commission (e.g. running a red light) and also acts of omission (e.g. a chiropractor failing to follow correct protocols).

Basically, the rules of negligence boil down to requiring people to follow society’s basic “rules of the road” for reasonable conduct.  For the most part, it’s commonsense-type stuff.  The law of negligence is about reasonableness and balance.  It does recognize, for example, that some injuries are simply unforeseeable and/or sometimes unavoidable.

Stated in legal terms, a court considers the issue of legal duty in the context of what is known as “reasonable foreseeability.”  This means that if your conduct would create a “reasonably foreseeable risk of injury” then you would have a societal duty either to avoid the conduct, or to take reasonable precautions to protect innocent bystanders from the risk.  The rule is really nothing different than The Golden Rule that churches, mothers and fathers teach their children every day.

For example, will you be held liable for negligence if the brakes on your truck suddenly and without warning fail, and you wind up in a wreck?  No, because the risk wasn’t foreseeable and you didn’t act unreasonably.  However, what if your brakes had been acting up previously, and you’d almost been a wreck just a few days prior, and yet kept on driving the truck instead of taking it to the shop for repairs?  In that case, you would be negligent because you failed to take reasonable steps to protect others against a known risk of harm.  In other words, you would be deemed to have breached your societal duty to those around you, and therefore you should rightfully be expected to make good on the injuries and damages you unilaterally imposed on an innocent person.

Note that the law of negligence is a far cry from the daily dose of nonsense you get from both ends of the spectrum.  Indeed, it is NOT the type of automatic, jackpot money grab that the ambulance-chasing TV lawyers seem to imply, and that the so-called tort reformers would likewise have you believe as part of selling their grossly exaggerated claim that “the sky is falling with lawsuits.”  To the contrary, the law does not provide for automatic liability whenever an injury occurs.  Likewise, it does NOT impose a duty to eliminate each and every one of life’s many risks.

The law of negligence is simply about the common sense “reasonable man” standard which is very much akin the Golden Rule — “Do unto others as you would have them do unto you.”

Stay tuned for more about the question of how the law determines the winner of a lawsuit when — as is often the case in real life situations — both parties are somewhat negligent.   This is referred to as the issue of comparative fault.  Stay tuned.

Law FAQ: What is negligence?

Negligence is the legal term for failing to exercise reasonable care and caution under a given set of circumstances.  It is commonly referred to as “the ordinary, reasonable man” standard.  Legal liability is assessed when a person fails to follow society’s most basic “rules of the road” so to speak.

Some examples of negligence might include:

  • Running a red light and causing a wreck.
  • A hurried doctor who fails to follow correct protocol and thus fails to diagnose a curable disease.
  • A nurse who fails to check the medical chart and who then dispenses the wrong medication.
  • A store owner who fails to mop up a known puddle on the floor.
  • A pharmacist who dispenses the wrong dosage of medication.
  • A contractor who fails to adhere to building plans or skirts building codes.
  • A child care center that fails to conduct background checks before hiring employees to care for children unsupervised.
  • A lawyer who fails to file his client’s lawsuit before the statute of limitations expires.

In a negligence case, a plaintiff is required to prove five elements:

  1. that a duty of care was owed by the defendant;
  2. that the defendant failed to live up to that duty (i.e. referred to as a “breach of duty”);
  3. that an injury or loss occurred;
  4. that the breach of duty actually caused the injury or loss; and,
  5. proximate or legal cause.

More on these five elements tomorrow….

Who are my Beneficiaries? A critical question in planning for the future.

beneficiary designations estate planning lawyerDo you know who your beneficiaries are? When we ask clients this question, their first response is often quick and affirmative. However, we frequently discover through the estate planning process that the beneficiaries listed on our clients’ life insurance policies and retirement accounts are not who they think they are, nor are they the intended recipients of the property.

How does Property Pass to Beneficiaries?

One of the most common misconceptions we see is how property passes at someone’s death.  Accounts that have beneficiary designations  pass to the beneficiary or beneficiaries named on the beneficiary designation form for that account regardless of what your will or trust says.  So, for example, if my Will says that everything passes to my spouse at my death, but my beneficiary form on my life insurance names my children as beneficiaries, my life insurance proceeds  pass to my children and not to my spouse. Here are some examples of accounts that typically designate beneficiaries:

  • life insurance
  • retirement accounts
  • transfer on death accounts (TOD)
  • payable on death accounts (POD)

Periodically Review Your Beneficiary Designations

The  Supreme Court case of Kennedy v. Plan Administrator of DuPont highlights the unintended results that may occur if your beneficiary designations are not reviewed periodically.  In this case, William Kennedy named his wife, Liv, as the sole beneficiary of his pension and retirement savings plans at DuPont.  When the couple later divorced, the Qualified Domestic Relations Order (QDRO) provided that Liv gave up her rights to receive any benefits from William’s pension and retirement plan.  Unfortunately, however, the court order was never submitted to DuPont and the beneficiary was never changed.  When William later died, DuPont paid out the plan benefits to his ex-wife, Liv.  Their daughter, Keri, was appointed as Executor of William’s Estate and filed suit claiming that the Estate should receive his retirement benefits because the QDRO clearly provided that Liv had waived any interest she might have in those benefits.  The Supreme Court upheld the ruling of the Circuit Court in saying that DuPont properly paid the benefits to Liv and that Liv was entitled to the pension and retirement funds even though the parties were not married at the time of William’s death and the QDRO clearly provided otherwise.

Moral of the Story

The moral to the story is that the beneficiary designation governs. Thus, it is very important that you know who is named on your various beneficiary forms so that your property goes to the beneficiary or beneficiaries that you intend for it to go to.  It is clear that William did not intend for his benefits to go to his ex-wife instead of his daughter, but the Supreme Court held that the beneficiary designation governed and that DuPont properly paid the benefits to Liv.

Tips for Beneficiary Designation Forms

Here are some tips and common problems to watch out for with your beneficiary designation forms:

1. Do you know where the form is? Generally, employers maintain records of the form, but if they cannot find their form when the time comes, the burden may be on you to produce a copy of the form.

2. Is the form up to date? Changes in your life may require you to review the forms periodically. If you have had a recent marriage, divorce, birth or death in your family, it is important to review your beneficiary designations. And remember, your Will does not change who the beneficiary is on an account or insurance policy.

3. Do you have a contingent beneficiary named? If the beneficiary you have named dies before you or is involved in a common accident with you, you may not know who the benefits will go to if you do not name a contingent or secondary beneficiary.

4. Have you named a minor as a beneficiary? Minors cannot legally hold title to property, including these benefits. If you have named a minor, a guardianship may have to be established and administered through the Probate Court concerning applicable funds.

Want to talk it over with an Estate Planning and Probate Lawyer?

If you have questions regarding your beneficiary designations and how they factor into your Estate Plan, please call us at 901-372-5003 or email us here. We’re ready to help you plan for the future.

To read about other Estate Planning topics on our Blog, click here.

To meet the lawyers and staff at Wiseman Bray PLLC, click here.

 

Blog Post By:  Larry Bray

Estate Planning Lawyer in Memphis

Is Tennessee a Community Property State for Estate Planning?

community property, estate planning lawyer tennessee memphisCommunity property states such as California and Texas, permit assets to receive a step-up in basis to the current fair market value (FMV) at the death of the first spouse to die regardless of which spouse owns the assets.

Tennessee is NOT a Community Property State

Tennessee is a separate property state. This means that only the separate assets of the deceased spouse (titled in his or her name), or 1/2  of any jointly-owned property,  are entitled to a step-up in basis to the current FMV at the death of the first spouse to die.

Tennessee Community Property Act of 2010

But wait—this Act allows for ownership of assets in a Tennessee Community Property Trust.  Although this type of ownership of assets between a husband and wife is not always beneficial, it can provide a significant advantage in the right circumstances, especially for property with a very low tax basis.Provided the Trust meets certain requirements, the property owned by the Trust will be treated as community property.

Advantage

The most significant advantage of this type of ownership is that both spouses’ interests receive a step-up in basis up to the FMV of the property upon the death of the first spouse.  In contrast, if the property was owned jointly or as tenants by the entireties, only 1/2 of the property would receive a step-up in basis at the first death. Thus, community property ownership can significantly reduce or even eliminate capital gains upon the death of a spouse.

We can advise you further.

Call us today at 901-372-5003 or email us here. We can talk with you about your assets and the best way to structure an Estate Plan that fits your family’s particular circumstances.

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