WHAT HAPPENED IN REED SPRINGS? How a Small Town Went Bankrupt Over a Pothole
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. 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 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. 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.
THINK MEDICAID IS YOUR ONLY OPTION?
Think Again!
The average life span formodernAmericans has increased dramatically, primarily due to great medical advances, and, while this is certainly a positive development, there are challenges associated with aging. The older you get, the more you have to worry about living on a fixed income while paying for things like medical care, prescription medication, and assistive devices. Plus, many seniors eventually need long-term care and will have to consider whether an assisted living facility, live- in caretaker, or nursing home is right for their situation. At Hegwood Law Group, we understand these decisions are daunting, but that’s why firms like us exist: to help you put your foot forward. While a great number of aging Americans believe Medicaid is the option best suited for their golden-years needs, it’s only designed to provide medical assistance to low-income individuals and those 65 or older, which may not apply to you or your spouse. Fortunately, for those who have income and assets that exceed the eligibility
threshold for Medicaid, one way to obtain such benefits is by taking advantage of irrevocable trusts.
Depending on the type of trust established, it can serve many purposes: to decrease tax liabilities, to protect accumulated funds from creditors, and to protect privacy, since trusts, unlike wills, are not public documents. A trust is legally defined as a relationship in which property is held by one party for the benefit of another. For all these reasons and more, a trust might be the best way for you to protect your assets should you need long-term care at a nursing home. At Hegwood Law Group, we believe every life has value, and the most vulnerable members of society deserve to be treated with dignity and respect. Our elder law attorneys will work to protect your legal rights, so you will be comfortable in your golden years. Call us today to find out how we can help you plan for your future!
2 HEGWOOD LAW GROUP
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