September 1997

Vol.2 – No.2

What’s New in Consumer Law?

Punitive damages against home improvement lender. A home improvement lender must pay $1.5 million in damages in a class action for making home improvement loans with knowledge of the contractor’s fraud. The Court of Appeals for Ohio held that disclosure is compulsory when a lender knows fraud is being perpetrated on one of its unsophisticated customers in a loan transaction and that making the loan would further the fraud. The contractor targeted elderly people with built-up equity in their homes because they would qualify for home improvement loans. He then steered the homeowners to the lender. The lender should have suspended future transactions with the contractor upon receiving adverse information about his performance until an investigation was satisfactorily completed. The jury awarded $15,000 in compensatory damages, $1.5 million in punitive damages and attorneys fees for fraud, civil conspiracy, violation of the Ohio Consumer Sales Practices Act and breach of contract.

What’s New in Debtor/Creditor Law?

Debtor may be disinherited. Bankruptcy estates include all property inherited within 180 days of the filing of the petition. A mother was able to keep her money away from her son’s creditors by executing a codicil shortly before her son filed bankruptcy that disinherited him if she died less than 181 days after his petition was filed. The U.S. Bankruptcy Court determined that it was in her prerogative to execute the codicil and she had no duty to underwrite the creditors of her son’s bankruptcy estate (Mass. Adv. No. 96-1698).

What’s New in Divorce/Family Law?

Ex-husband’s estate must pay for college. The divorce settlement required a couple to pay for their son’s college education commensurate with their income and assets. When the husband died, he left none of his $10 million plus estate to his son. When the son was accepted to a college eight years later, the ex-wife argued that the estate should pay his tuition because the money in the estate far exceeded her income. The estate was ordered to pay the college tuition because the divorce agreement did not specify that this obligation terminated upon death (New Jersey Supreme Court). Courts in Illinois, New Hampshire, Virginia, Utah and West Virginia have similar rulings.

What’s New in Estate Planning Law?

Retirement plan liable for failure to warn. A retired employee can sue a retirement plan for not warning him that he could never change the beneficiary of his joint and survivor annuity. Shortly after naming his wife as beneficiary, he was divorced and wanted to name his new wife instead. Since his marriage was shaky at the time he retired, he claimed that he would not have named his ex-wife as beneficiary if he had known that he could not change the designation (U.S. Court of Appeals, Third Circuit).

What’s New in Health Law?

Involuntary sterilization is a civil rights violation. A retarded woman who was involuntarily sterilized 20 years ago at the age of 16 can sue her parents, the hospital and doctors under the 1871 Ku Klux Klan Act, a statute aimed at those who conspire to violate the civil rights of certain classes. Although the statute was enacted to combat lynchings and other violent acts against recently freed slaves by whites, especially the Klan, the Supreme Court has applied it to otherwise class-based, invidiously discriminatory animus (Third U.S. Circuit Court of Appeals, 112f. 3rd 682).

What’s New in Landlord/Tenant Law?

Landlord liable for discrimination even though unaware of disability. A tenant was evicted for failing to cooperate with pest extermination. He claimed he was depressed and needed a “reasonable period of accommodation” to prepare for the exterminators. Even though the landlord did not know about the tenant’s mental disability at the time the eviction notice was sent, it can be sued under the Fair Housing Act where it learned about the disability before the tenant was actually evicted. The act is violated when housing is “denied” by actual eviction because of a handicap (U.S. Court of Appeals, Eighth Circuit).

What’s New in Personal Injury Law?

$157,000 award for rottweiler attack. A retired truck owner and operator was walking his pet poodle near his home. When a 120 pound rottweiler attacked, he put his arm up to protect himself from the dog and was knocked to his knees. The rottweiler then attacked the poodle. He stabbed at the attacking dog with a six inch knife which barely phased the dog. Another neighbor shot the dog to death with a pistol. The Plaintiff claimed that his lower arm was numb for two years after the attack. The poodle had scars on both sides of his neck (Pierce County, Washington Superior Court). $11.5 million award against gun seller. A store which sold a gun to a drunken man who shot his girlfriend is liable for $11.5 million for negligent entrustment. Selling a gun to an intoxicated person presents a foreseeable risk of harm. The gun buyer had consumed a fifth of whiskey and case of beer during the day. Although the store clerk indicated that the buyer did not appear intoxicated, he had to help him fill out the federal firearms form because his handwriting was illegible (Florida Supreme Court).

What’s New in Real Estate Law?

Rehab center sues under ADA. A drug and alcohol treatment center which was denied a building permit can sue under the Americans With Disabilities Act (ADA). The treatment center applied for a building permit in a “mixed-use” retail and residential district. The building commissioner granted the permit because the center qualified as a business or professional “office” under the city’s zoning ordinance. However, the zoning board revoked the permit after residents and local shop owners protested that the center would lower property values and attract a bad element. The board found that the rehab center was really a “clinic”, not an “office”, even though it did not hold a hearing or issue a written opinion. The treatment center sued on the basis that a zoning decision is a government “service, program or activity” within the meaning of the ADA. The U.S. Court of Appeals, Second Circuit, in affirming a preliminary injunction, held that the ADA clearly encompasses zoning decisions because they are a normal governmental function. Therefore, the zoning board cannot base a decision on “stereotypes and generalized fears about drug- and alcohol-dependent people”. In affirming the injunction, the court felt that the center was likely to succeed on the merits of this claim because: (a) the board’s decision was clearly based on hostility and animus towards drug- and alcohol-dependent people; (b) the board did not defer to the commission who originally approved the permit; and (c) other mental illness professionals were located in the area where the treatment center wanted to move.

What’s New in Small Business Law?

New EEOC rules for job interviews. It is illegal to ask any questions about the applicant’s job-related injuries or worker’s compensation history. It is legal to ask “Can you meet our attendance requirements?” or “How many days were you absent last year?”. But, it is illegal to ask “How many days were you sick last year?”. It is legal to ask questions about “impairments” that do not arise to the level of a disability such as “How did you break your leg?” but, it is illegal to ask “Do you expect the leg to heal normally?” or “Do you break bones easily?”. It is also illegal to ask the general question, “What impairments do you have?”.

Injured Victims’ Rights

The Friedman & Ranzenhofer, P.C. Ten Point Pledge to Accident/Injury Clients is:

• To communicate with you in plain language that is easy to understand.
• To promptly return your telephone calls.
• To quickly and thoroughly investigate and analyze your case. Friedman & Ranzenhofer, P.C. does not accept every accident case.
• To have your case personally handled by an attorney.
• To keep you informed of the progress of your case at all times.
• To show you the personal care, concern and attention which has been the hallmark of our law firm since 1955.
• To not handle your case in an “assembly line” fashion.
• To accommodate the needs of you and your family during the handling of your case.
• To vigorously protect your legal rights.
• To never release your name to the media after your case has been completed, except with your written permission.

Attorney Michael H. Ranzenhofer limits his practice to automobile accident, slip and fall, dog bite and defective product cases. He is a member of the Association of Trial Lawyers of America, the New York Trial Lawyers Association, the New York State Trial Lawyers Association and the Erie County Bar Association Negligence Committee.