Vol. 71, No. 7,
July 1998
News Briefs
U.S. Supreme Court decision raises
questions about Wisconsin IOLTA program
By Thomas Heine
On June 15, 1998, the U.S. Supreme Court announced a 5 to 4 decision
in Phillips v.
Washington Legal Foundation, a case which may ultimately impact
the Wisconsin Interest on Lawyers Trust Accounts (IOLTA) program and similar
programs nationwide.
Other News:
Legislature rewrites Operating While Suspended and Operating After
Revocation laws
1997 Wis. Act 84 fundamentally changes
OWS and OAR laws in Wisconsin. Some provisions become effective as early
as August 1.
1997 Wisconsin Act 140 defines unincorporated nonprofit associations,
limits liability
The Uniform Unincorporated Nonprofit Association Act (UUNAA)
provides clear definitions of what is considered a nonprofit organization
under Wisconsin law and limits the liability of a nonprofit organization's
members.
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In Phillips, the Court ruled that the clients have a property interest
in the money earned on pooled, short-term lawyers' trust accounts held under
the TexasIOLTA program. The Court did not eliminate the program
in Texas and made no judgment about other IOLTA programs throughout the
country. The case has been sent back to the lower courts to decide whether
the State of Texas has "taken" property in violation of the Fifth
Amendment and what, if any, compensation must be made. It may take several
years to resolved this issue by the courts.
The Wisconsin IOLTA program was created by the Wisconsin Supreme Court
in 1986 to permit attorneys to place client trust funds in pooled NOW accounts
that earn tax-free interest. The income derived from these accounts is used
by the Wisconsin Trust Account Foundation (WisTAF), which manages Wisconsin's
IOLTA program, to fund organizations providing civil legal services to the
poor.
The WisTAF Board believes that the property
laws of Texas and Wisconsin are different and that the U.S. Supreme Court
has postponed consideration of the most salient premise of the IOLTA program:
that clients do not sustain any economic loss as a result of IOLTA. No court,
including the U.S. Supreme Court, has found IOLTA programs unconstitutional.
While the WisTAF Board is studying the decision to determine if it should
adjust Wisconsin's program, the program functions as usual.
Pending future court decisions and WisTAF's research into this issue,
lawyers should maintain their IOLTA accounts and banks should continue transmitting
interest to the program. There are numerous alternatives to explore that
should ensure the continuation of the IOLTA program well into the future.
The State Bar, the Wisconsin Supreme Court, and WisTAF will work together
to review the underpinnings of IOLTA, propose requisite changes, and keep
the Bar and state financial institutions informed.
The IOLTA program has become a solid source of support for the delivery
of civil legal services nationwide. These programs granted approximately
$100 million for civil legal services to poor people in 1997. In 1998, WisTAF
granted $1.4 million for the delivery of legal services to the poor in Wisconsin.
Thomas Heine is executive director of the Wisconsin
Trust Account Foundation, which manages Wisconsin's IOLTA program.
Most family law timelines
not affected by 1997 Wis. Act 187
1997
Wis. Act 187 is one of the myriad of bills Gov. Thompson recently signed
into law. The act, which applies to civil actions commenced on or after
May 12, 1998, extends both the time to serve a summons from 60 to 90 days
and the time to answer the complaint from 20 to 45 days.
"The act extends the time to serve a summons in a family law action
from 60 to 90 days," says Gregg Herman, past chair of the State Bar
Family Law Section. "However, family law practitioners should note
that 1997 Wis. Act 187 does not change the time limits for responding to
a petition in a family law action." In particular, the act does not
modify section 767.085(3), Wis. Stats., which requires serving a response
or counterclaim within 20 days after the service of the petition.
The new act also does not modify section 767.145(2), Wis. Stats., which
permits the court to order a 60-day extension for service of initial papers,
upon a demonstration of good cause by the petitioner, according to Herman.
The corollary provision for paternity cases in section 767.456(1), also
is not modified by the new law.
Melli award honors
contributions to women in the law
The Legal Association for Women seeks nominations for the 1998 Marygold
Melli Achievement Award.
This annual award recognizes an outstanding Wisconsin individual who
has made significant contributions to women in the law by: advancing the
interests of women members in the legal profession; promoting improvements
in the administration of justice; promoting equality and social justice
for all people; promoting the rights of women in society; and/or improving
relations between the legal profession and the public. The award was established
in 1994 in honor of Melli, who successfully managed a distinguished career
at the U.W. Law School, a prolific legal writing career, and extensive community
and professional service while raising four children.
Ruth B. Doyle, Mary Lou Munts, Chief Justice Shirley Abrahamson, and
Judge Barbara Crabb are previous award recipients.
Nomination forms and additional information are available from Janice
M. Baldwin, 125 Nautilus Dr., Madison, WI 53705, (608) 233-8445. Nomination
materials are due by Aug. 15.
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