Hernsberger QDRO Law September 2019

What Happened in Reed Springs? In 2002, the quaint town of Reed Springs, Missouri, declared bankruptcy. The hard decision came after the town was forced to pay $100,000 to Sally Stewart, a woman who sued Reed Springs after she tripped over a pothole during a shopping trip. News of a greedy woman ruining a small village to make a quick buck sparked outrage across the country. But Stewart wasn’t the real villain of this story. A little digging into this case reveals a much deeper conspiracy. in front of the pothole. However, the Missouri Court of Appeals determined the city of Reed Springs was liable for Stewart’s injuries. The court ordered Reed Springs to pay Stewart $100,000, over half the city’s annual budget. Despite the high price tag, in normal circumstances, this verdict wouldn’t have forced Reed Springs to declare bankruptcy because the town’s insurance would have covered the bill. Unfortunately, at the time of Stewart’s accident, the mayor of Reed Springs was a corrupt man named Joe Dan Dwyer.

How a Small Town Went Bankrupt Over a Pothole

Stewart had been visiting Reed Springs in 1998 when she tripped on a pothole hidden beneath some overgrown grass on the sidewalk. But this was no small stumble. Stewart tore two ligaments in her ankle and had to undergo surgery. To help pay for the medical bills, Stewart, who’d never sued anyone before, initially filed a personal injury lawsuit against the owners of the store

Dwyer left office while being investigated for insurance fraud, child pornography, statutory rape, witness bribery, and perjury, and he was later sentenced to seven years in federal prison. Among his many indiscretions, Dwyer also let the town’s insurance policy lapse. Reed Springs didn’t have insurance when Sally Stewart got hurt, which is why they had to write a check out of their own budget and ultimately declare bankruptcy. In this case, what started as a simple pothole accident quickly unveiled the lasting damage of an unscrupulous politician. Perhaps this case serves as reminder about why it’s important to vote in local elections.

QDRO Case Studies: Plan Administrators Make Mistakes Carol Nordstrom played it by the book. In her 2001 divorce from Charles Gault, the judge awarded Ms. Nordstrom 50% of Mr. Gault’s pension, valued as of the date of divorce. It was a textbook award that complied with Berry v. Berry. Everything went according to plan: Ms. Nordstrom’s attorney prepared a QDRO, the judge signed the QDRO, the attorney sent a certified copy of the QDRO to the plan administrator, and the plan administrator approved the QDRO and notified both parties. Fifteen years later, Carol Nordstrom received word that Mr. Gault had retired. So, Ms. Nordstrom contacted LyondellBasell to find out when she could expect her money. And thus began a three-month ordeal, where all Ms. Nordstrom got were evasion tactics and intentional deception. “That’s not my department.” “Let me transfer you.” Finally, LyondellBasell responded with a formal letter. “We approved your QDRO in 2001. The value of your benefit is a lump sum of $58,137.62. By mistake, we paid your benefit to Charles Gault when he retired. We suggest that you contact Mr. Gault to collect the funds from him.” Instead, Carol Nordstrom contacted us. What could go wrong?

< 2 >


Made with FlippingBook Annual report