I presented a January 31, 2012 seminar on this topic to assist Baltimore County estates and trusts attorneys in their practices. The written material I handed out is copied below. This seminar was held before the February 21, 2012 decision in the case entitled the University of Maryland Medical Systems Corp v. Muti, which provides important guidance for wrongful death litigants.
The link to that opinion can be found at the following:
I. Wrongful Death Act: CTS. & JUD. PROC. §§ 3-901 – 3-904
A. Qualified Beneficiaries
1. Primary – Wrongful death actions are for the benefit of the spouse, the parent, and the child of the deceased person. CTS. & JUD. PROC § 3-904(a)(1)
2. Secondary – If there are no primary beneficiaries, an action shall be for the benefit of any person related to the deceased person by blood or marriage who was “substantially dependent” upon the deceased. CTS. & JUD. PROC § 3-904(b)
B. Wrongful Death Action
1. One Action Rule – Only one action under this subtitle lies in respect to the death of a person. CTS. & JUD. PROC. §3-904(f)
a. Plaintiff – All persons who are or may be entitled by law to damages by reason of the wrongful death shall be named as plaintiffs whether or not they join in the action. The words “to the use of” shall precede the name of any person named as a plaintiff who does not join in the action. Md. Rule 15-1001(b). Walker v. Essex, 318 Md. 516, 569 A. 2d 645 (1990); Williams v. Work, 192 Md. App. 438, 995 A.2d 744 (2010), aff’d, Ace Am. Ins. Co. v. Williams, 15 A.3d 761, 418 Md. 400 (2011).
b. Complaint – The complaint shall state the relationship of each plaintiff to the decedent whose death is alleged to have been caused by the wrongful act. Md. Rule 15-1001(d).
C. Statute of Limitations and Notices
1. General Rule - In most cases a wrongful death action must be commenced within three (3) years after the death of the injured person. CTS. & JUD. PROC. §3-904(g)(1)
2. Condition Precedent – The statute of limitations in a wrongful death action is a condition precedent to filing suit and must be affirmatively alleged in the complaint.
3. Minority – A minor shall file an action within the lesser of three years or the applicable period of limitations after the date the disability is removed. CTS. & JUD. PROC. § 5-201(a)
4. Notice to Certain Defendants - Various statutes require that notices be given to governmental defendants “soon” after the incident.
1. Noneconomic Damages – In an action for wrongful death, noneconomic damages include damages for each beneficiary’s mental anguish, emotional pain and suffering, loss of society, companionship, comfort, protection, care, marital care, parental care, filial care, attention, advice, counsel, training, guidance, or education. CTS. & JUD. PROC. § 11-108(a)(2)(i)(2); CTS. & JUD. PROC. § 3-904(d)
2. Economic Damages (“Pecuniary Loss” or “Pecuniary Benefit”) – Economic damages are based on the evidence and the relationship of each plaintiff to the deceased person.
a. Spouse of Deceased – The economic losses to be considered include the financial support as well as the replacement value of the services that the deceased furnished or probably could have been expected to furnish. The jury may consider the deceased’s earnings and future earning capacity for the probable time both had been expected to live to determine the amount that the surviving spouse could reasonably have expected to receive. Maryland Pattern Jury Instructions (“MPJI”) 10:22
. b. Parent of Deceased Child – The economic losses to be considered are any financial benefits a parent would have been expected to have received from the deceased child. MPJI 10:23
c. Minor Child of Deceased Parent – The economic losses to be considered include the financial support as well as the replacement value of the services that the deceased furnished or probably would have been expected to furnish. MPJI 10:24
3. Damages Awarded In Proportion To Injury
a. Proportionate among Beneficiaries - Damages may be awarded to the beneficiaries proportioned to their injury resulting from the wrongful death. CTS. & JUD. PROC. § 3-904(c)(1)
b. Determination by Jury - The amount recovered shall be divided among the beneficiaries in shares directed by the verdict. CTS. & JUD. PROC. § 3-904(c)(2)
4. Noneconomic Damages Cap
a. If One Beneficiary – The limitation on noneconomic damages increases by $15,000 on October 1 of each year. CTS. & JUD. PROC. § 11-108 (b)(2)(ii). The cap on noneconomic damages if there is only one claimant for actions arising between October 1, 2011 and September 30, 2012 is $755,000.00.
b. If Two or More Beneficiaries – In a wrongful death action in which there are two or more claimants or beneficiaries, an award for noneconomic damages may not exceed 150% of the limitation for one beneficiary, regardless of the number of claimants or beneficiaries who share in the award. CTS. & JUD. PROC. § 11-108 (b)(3)(ii). Accordingly, the noneconomic damages cap in wrongful death actions arising between October 1, 2011 and September 30, 2012 with two or more claimants is $1,132,500.00.
II. Survival Action
A. Damages – In an action instituted by the personal representative against a tort- feasor for a wrong which resulted in the death of the decedent, the personal representative may recover the funeral expenses of the decedent up to the amount allowed under § 8-106(b) of the Estates and Trusts Article in addition
to other damages recoverable in the action. EST. & TRUSTS § 7-401(y)(2)
1. Noneconomic Damages
a. Conscious pain and suffering (between the time of injury and the time of death)
b. Mental anguish, including pre-impact fright
2. Economic Damages
a. Funeral Expenses. EST. & TRUSTS § 7-401(y)(2)
b. Expenses, including medical expenses (between the time of injury and the time of death)
c. Loss of wages (between the time of injury and the time of death)
B. Counsel Fee
1. Petition - An attorney is entitled to reasonable compensation for legal services rendered to the estate and/or the personal representative. Upon the filing of a petition in reasonable detail by the personal representative or the attorney, the court may allow a counsel fee to an attorney employed by the personal representative for legal services. The compensation shall be fair and reasonable in the light of all the circumstances to be considered in fixing the fee of an attorney. EST. & TRUSTS § 7-602(a)-(b)
2. Exceptions to Petition Requirement - Attorney’s fees may be paid without court approval if:
(a)(i) Each creditor, who has filed a claim that is still open, and all interested persons consent to the payment in writing;
(ii) The combined sum of commissions payments and attorney’s fees do not exceed amounts provided in § 7-601; and
(iii) The signed written consent form states the amounts of the payments and is filed with the register of wills; or
(b)(i) The fee is paid to an attorney representing the estate in litigation under a contingency fee agreement signed by the decedent or current personal representative;
(ii) The fee does not exceed the terms of the contingency fee agreement;
(iii) A copy of the contingency fee agreement is on file with the register of wills; and
(iv) The attorney files a statement with each account stating that the scope of the representation by the attorney does not extend to the administration of the estate. EST. & TRUSTS § 7-604(a)
III Wrongful Death Considerations for Estate Planner
A. Minimum Required Liability Limits –Automobile Insurance – Maryland presently requires liability insurance of no less than $30,000.00 per person and $60,000.00 per occurrence.
B. Uninsured Motorist Coverage – It pays the insured if the “at fault” driver has no insurance or does not have enough insurance to pay the compensatory damages for bodily injury and property damage that the insured is legally entitled to recover on the claim. The amount of such coverage generally cannot be higher than the limits of liability insurance provided by the policy.
C. Umbrella Policy – It provides liability insurance above the amount provided by the underlying policy(ies). For most homeowners, it provides additional coverage if someone gets injured on their property or by or in their insured vehicle(s). Some insurers will for little or no additional premium provide uninsured motorist coverage under the umbrella.
D. Household Exclusion
1. Pre-2004 - Insurers through the “household exclusion” were able to limit insurance coverage on liability claims made by injured members of the insured’s family to the minimum required liability limits, which at the time were $20,000.00/$40,000.00. This resulted in the insured’s family members having less coverage riding with the insured than with a neighbor.
2. Section 19-504.1 of the Insurance Article – Beginning in 2004, insurers can choose how to handle the “household exclusion” by:
a. Providing household members the same coverage as it provides others on liability claims, i.e. remove “household exclusion”; or
b. Giving customers notice of the additional premium needed to be paid so that family members are treated the same as other claimants on liability claims.
IV Victim’s Family Comes to Estate Lawyer With Possible Wrongful Death Claim(s)
A. Accept Sole Responsibility for Claims and Keep Entire Fee?
1. Conflicts of Interest – Besides possible conflict with tortfeasor and/or tortfeasor’s insurer, there are conflicts of interest (i) between the wrongful death claimants on the allocation of the wrongful death recovery among them and (ii) between the wrongful death claimants as a group and the decedent’s estate on how much, if any, of a recovery is allocated to the estate’s survival action.
2. Meeting Limitations and Notice Deadlines for the Claims
3. Liens of Medical Providers – The attorney in many cases will have to deal with Medicare, Medicaid, hospital, Blue Cross/Blue Shield and/or workers compensation liens. Certain statutes, including Medicare, make the attorney personally responsible for his or her failure to properly protect the lien.
4. Rules 1.5(c) of the Maryland Rules of Professional Conduct – A contingent fee agreement shall be in a writing signed by the client and shall state the method by which the fee is to be determined, including the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal; litigation and other expenses to be deducted from the recovery; and whether such expenses are to be deducted before or after the contingent fee is calculated. The agreement must clearly notify the client of any expenses for which the client will be responsible whether or not the client is the prevailing party.
B. Associate with Experienced Lawyer Having Joint Responsibility and Shared Fee?
1. Rules 1.5(e) of the Maryland Rules of Professional Conduct –A division of a fee between lawyers who are not in the same firm may be made only if:
(1) the division is in proportion to the services performed by each lawyer or each lawyer assumes joint responsibility for the representation;
(2) the client agrees to the joint representation and the agreement is confirmed in writing; and
(3) the total fee is reasonable.
2. Confirm Agreement between Associated Lawyers on Division in Writing
C. No Responsibility and No Fee for the Claims?
V. Acting as Personal Counsel for Defendant in Wrongful Death Case
A. Review Insurance Policies and Make Sure of Timely Notice
B. Find competent counsel for traffic/criminal case
C. Monitor insurance carrier’s defense of case – If necessary insurance counsel may need to be reminded about potential bad faith claim.
D. Determine whether excess judgment is dischargeable in Bankruptcy—11 U.S.C.A. § 523(a)(9) provides that a discharge in bankruptcy does not discharge a debt for “death or personal injury caused by the debtor’s operation of a motor vehicle, vessel or aircraft if such operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance.”
E. Prepare to Discuss Maryland’s Uniform Fraudulent Conveyance Act –It is found in Sections 15-201 to 15-214 of the Commercial Law Article
F. Review beneficiary designations, life estates, trusts, wills, etc. of spouse, parents, et. al.
VI. Services provided with Respect to Survival Action.
A. Factors Relevant to Allocation – If giving advice on the amount, if any, to be allocated to estate consider all relevant factors, including: facts of the underlying claim (decedent’s pain, evidence that decedent likely aware of impending death, etc.), claims against and creditors of estate, the distribution of any residuary estate, the time and expense of “running part of recovery through the estate”, etc.
B. Advise Client of Time and Expense Associated with Disposition of Survival Action Recovery – Depending upon what has been filed, the Estate’s recovery may require the giving of notice, the conversion of the small estate, the filing of a fee petition and/or an administration account, etc.