July 1996 - Vermont Bar Examination Essay Questions

[Question I]
[Question II]
[Question III]
[Question IV]
[Question V]
[Question VI]

QUESTION I - JULY 1996 The Vermont Health Care Authority is a three-member Board responsible for overseeing health care planning in Vermont. Among its responsibilities is administering the Certificate of Need (CON) review program The CON law requires any "new institutional health service" offered in Vermont to be licensed by the Health Care Authority. The term "new institutional health service" is defined as the construction of any health care-related building costing more than $500,000 or the purchase of health care equipment costing more than $250,000. However, the purchase or lease of an existing health care facility is specifically exempted from CON review. The Authority is assisted in administering the CON program by a 26-member advisory body known as the Health Policy Council. The relevant law provides that a majority of the Council's members constitutes a quorum. Fifteen Council members attended the regular monthly meeting of the Council on the first Monday in May. The first agenda item was a ten-minute public comment period. Very few members of the public were present so early in the meeting, and no one asked to comment, so the Council's chairperson proceeded onto their next agenda item, a discussion of a longstanding CON controversy: Should Vermont allow the establishment of for-profit hospitals in the state? All of the existing hospitals were not-for-profit, community-led institutions. Recently, however, a number of for-profit health care corporations based outside the state had indicated an interest in buying or building new community hospitals in several locations through Vermont. This triggered fears by Vermont non-profits that they could no longer continue to offer their services in the same manner. Because ofthe importance of this issue, the Authority had asked the Council to look into it in detail and to make some policy recommendations for the Authority's use. To assist the Council in its task, the Authority hired an expert in health care economics - Dr. Christine Cardinal - who came to the meeting to present her report and recommendations. Dr. Cardinal's report concluded that the addition of new for-profit hospitals into the Vermont health care system would definitely have a negative impact on Vermont's not-for-profit hospital system. She therefore recommended that the Authority require that any for-profit corporation seeking to build a new hospital, or to purchase an existing hospital, be subject to CON review. After the Council members had an opportunity to question Dr. Cardinal, several members of the public - some of whom had arrived after the meeting had begun - raised their hands and requested permission to comment on the report and her recommendation. Because the scheduled public comment time had passed, however, the Chair decided not to allow their comments. The Chair also noted that the Council had held several public meetings on the same topic in the past month, at which time members of the public had had ample opportunity to comment on the controversy. It was then moved that, given the sensitive political nature of the issue before them, the Council go into executive session to consider Dr. Cardinal's report and recommendations. Seven Council members voted in the affirmative on the motion and five voted no; the remaining three had left the room. The Council members moved into an adjacent room for their executive session, where the three missing members joined them. Another half-hour of discussion and argument ensued, after which they decided to take a "straw poll" to see what their recommendation to the Authority would be. Nine members, including one who was a hospital administrator and one who was on the board of directors of another hospital, voted to recommend that the Authority adopt Dr. Cardinal's proposed new policy. Four members voted against the proposal, and two abstained. Immediately after the straw poll, the Council adjourned from the executive session and resumed to the main meeting room. It was then moved, seconded, and voted to recommend approval by the Authority of Dr. Cardinal's proposed new policy. Each Council member voted as he or she had voted during the straw poll. The Chair of the Council sent a copy of the minutes of the meeting to the Health Care Authority Board with a cover letter stating that the Council was recommending that the Authority adopt the proposal by Dr. Cardinal that any proposed building or purchase of a hospital in Vermont by a for-profit corporation be subject to CON review. After receiving the letter, the Chair of the Health Care Authority Board called up several of the Council members and invited them to her office to meet with Dr. Cardinal to further discuss the Council's recommendation and Dr. Cardinal's report. When Roberta Woodward, the director of a citizens' health advocacy group, heard from a friend on the Council about the meeting, she called the Authority and asked when and where it was going to be held so that she could attend. She was told, however, that the meeting was not open to the public. One week after that meeting, at its next regularly-scheduled public meeting, the full Authority Board decided to adopt the proposed new policy without any modification. In addition to beginning the formal Administrative Procedure Act rulemaking process by filing the new policy with the Secretary of State's off'ce, on May 23 the Authority issued a press release announcing that it was adopting the policy as an emergency rule because the public's welfare was implicated by the possibility that for-profit hospitals would enter Vermont's health care system and disturb its fragile balance. On October 1, before the new policy had been finalized through the normal rulemaking process under the APA, New England Healthcare, Inc. (NEHI), a for-profit corporation based in Orange, Massachusetts - just over the border from Vermont - announced plans to purchase the Bennington Regional Hospital for $5.75 million. It was anticipated that the transaction would take place by November 1. Shortly after getting wind of the proposed purchase from reading the local paper, representatives of Manchester Community Hospital (MCH), which is located only 25 miles from Bennington, wrote to the Authority to request that it require the proposed purchase to undergo CON review by virtue of the emergency rule. On October 15, the Authority Board reviewed MCH's request for CON review of the proposed purchase. On the advice of its counsel, it reluctantly concluded that there was no jurisdiction over the proposal under the CON program. Instead, the Board issued a Certificate of Exemption to NEHI, allowing the purchase to co ahead as nlanned. On October 2O, MCH appealed to the Vermont Supreme Court invoking V.R.C.P. 75 and the Vemmont Administrative Procedure Act, asking it to overturn the Authority's determination that no CON jurisdiction existed. In an attempt to prevent the sale of Bennington Regional Hospital on November 1, MCH also filed a motion with the Court requesting a stay of the Authority's Certificate of Exemption pending resolution of the appeal. Questions: Roberta Woodward comes to you for advice. Discuss and analyze the legality of the actions of the Council and the Authority Board. Discuss and analyze MCH's appeal and motion to the Supreme Court.
Model Answers
QUESTION II - JULY 1996 Yesterday, John Defen came to your office with two documents. One was entitled "Complaint" and the other "Notice of Deposition." He indicated to you that he found them taped to the door of his home in Montpelier the preceding day. The Complaint relates to an auto accident that he was involved in exactly two and a half years earlier. John told you that while he was driving his car on Route 2 in Montpelier in Washington County, a car came abruptly out of a driveway; he couldn't stop, and he collided with it. Unfortunately, the collision instantly killed David Plain, a child who was in the other car. David's brother, Ian Plain, sustained a number of serious injuries. Mary Plain, the children's mother and the driver of the vehicle coming out of the driveway, sustained a broken leg as a result of the collision At the time of the collision, Frank Plain, Mary's husband and the children's father, was in the basement of the house which was located about 100 feet from the road. Frank did not realize what had occurred until he came out of the basement about five minutes after the incident. In addition to the personal injuries that were received, the Plain's car and a computer in the back seat were destroyed. The computer was owned by Frank's employer, Plain Corporation, a corporation wholly owned by him. John injured his neck in the accident. It still hurts. The Complaint follows: Frank Plain and Mary Plain, ) Chittenden Superior Court individually and as Administrators ) Docket No. Of the Estate of David Plain, ) and Ira Plain, by and through his ) next friends, Frank and Mary Plain ) ) v. ) ) John Defen ) COMPLAINT NOW COME the Plaintiffs, by and through their attorneys, and hereby complain against Defendant as follows: 1. On or about January 1, 1994, Defendant John Defen was operating his vehicle on public highway No. 2. 2. Defendant negligently permitted his vehicle to collide with a vehicle operated by Mary Plain in which David and Ian Plain were passengers. COUNT I As a result of the collision, Frank Plain sustained the loss of a computer valued at $3.000 and his vehicle with a value of $5,000. COUNT II As a result of the collision, Mary Plain suffered personal injuries including, but not limited to, a broken leg. She lost wages, incurred medical bills, and experienced pain and suffering. COUNT III As a result of the collision, Ian Plain sustained numerous fractures, incurred medical bills and underwent pain and suffering. COUNT IV As a result of the collision, David Plain was killed. COUNT V As a result of the collision, Frank, Mary and lan Plain sustained mental distress. WHEREFORE, the Plaintiffs demand judgment in an amount determined to be fair, just and equitable by the trier of fact and, further, request costs. Date: June 30. 1996 Signed: XYZ Law Firm On behalf of the Plaintiffs The Notice of Deposition which John gave you calls for his deposition to take place at the law firm of plaintiffs' attorneys in 25 days. John told you that he does not want to be deposed on that date. John then told you that he had no insurance at the time of the collision. You will be working on this matter with the senior partner in the firm. She has asked you for a draft of the substance of the pleading or pleadings that you think should be filed and a memo identifying each defense that you see and the basis therefor. Please do what she has requested.
Model Answers
QUESTION III - JULY 1996 In March of 1991, Bob Bigh and his girlfriend Wanda bought a parcel of land from Sally Sellano for $15,000. They paid $3,000 cash, and Sally took back a mortgage for the $12,000 balance. Sally filed the mortgage in the town land records on the day of the sale. Sally's father previously had a mobile home on the land that Bob and Wanda bought. Sally and her brother each have a mobile home on adjacent pieces of property. All of the land used to be Sally's family's farm. In April of 1991, Bob and Wanda bought a new mobile home from Green Mountain Mobile Home Co. for $30,000. They paid $7,000 cash. Green Mountain Mobile Home Co. financed the $23,000 balance and filed a UCC financing statement on the day of the sale. The mobile home was moved onto the land on June 1, 1991. Bob and Wanda got married in 1993. Also in 1993, Bob and Wanda improved the septic system, drilled a new well, and put a concrete block foundation under the mobile home. They also constructed a deck out back and a mudroom and steps in the front of their mobile home. Until the fall of 1995, Bob and Wanda kept current on their payments to Sally and to Green Mountain. Whenever they were late with a payment, they caught up within three months. By the fall of 1995, Bob and Wanda had $10,000 in equity m the mobile home, and $4,000 in equity in the land. In the fall of 1995, Bob lost his job, and he and Wanda were late with almost every payment to Sally and Green Mountain Mobile Home Co. Wanda left Bob in January of 1996. He has not made any payment at all on the mobile home or the land in 1996. The local fuel dealer obtained a small claims judgment against Bob for fuel he bought in February and March of 1996, and filed the ]udgment in the local land records. Green Mountain and Sally see separate attorneys for legal advice on how to get paid for the mobile home and land. What alternatives for legal action does each have? What should each attorney recommend? What obstacles to success is each likely to encounter and how should their attorneys handle them?
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QUESTION IV - JULY 1996 I. Nancy and Joe Fisher have been married for 10 years, and have two children. They live in Benmngton, Vermont. Nancy comes to seek advice from you, and she gives you the following information. They have had a tumultuous marriage, and there have been a handful of times over the years that Joe has pushed her and shoved her during arguments. In the past, there have also been times when he has thrown dishes and pulled the telephone off the wall. On one occasion, about a year ago, he knocked her down and she hit her head against a door. More recently, about 2 days ago, he had a few too many drinks after a softball game with his friends, and, when he came home, he was angry because she did not have supper ready. He started an argument with her, and grabbed her wrist, leaving black and blue marks and causmg a spram. She did not go to see a doctor, but she complains that the wrist is tender, and you notice that she has difficulty moving it. Although Nancy has tolerated his temper in the past, this time the children witnessed the incident, and she has become more afraid of Joe. She tells you that his drinking has increased, and that they argue more and more often. She also informs you that Joe is a self-employed autobody repairman, and that he rents a shop approximately one mile from the marital home. She has not worked since the children were born; they are ages 5 and 3. She worked as a hairdresser prior to the first child's birth. They live solely off Joe's income; he reports to the IRS a net profit of approximately $35,000 per year. He grosses between $250.000 and $300,000. They own a home on land that was given to them by Joe's family shortly after they were marred. Nancy tells you that she cannot afford to find another place to live, but that she is thinking of taking the children and moving in with her parents for a trial separation from Joe. She is very worried that he will hurt her or the children during another argument. What legal remedies would you recommend to Nancy regarding the home, the children and her financial situation? II. Assume that a divorce action was filed and six months have passed, that the parties have separated, and that Nancy has had sole parental rights and responsibilities for the minor children during this time. Joe's attorney has contacted you to convey a property settlement offer from his client. Nancy asks for your advice. The marital home has been appraised at $125,000. Of that value, $80,000 is for the building residence, and $45,000 is the value of the land alone. There is a mortgage with a payoff balance of $40,000.00. The home, which is a modular home, was purchased jointly by the parties for $50,000.00 shortly after their marriage and after Joe's parents conveyed the land to them. Joe and Nancy have made additions and improvements to the modular home since they purchased it; Nancy has done extensive landscaping and interior renovations. The total cost of these improvements was $20,000.00. When the parties were first married, Joe worked for his father as an autobody repairman. About 3 years into their marriage, he decided to start his own business. At first, Nancy helped him with the billing and bookkeeping; after the first child was born, she became less and less involved with the business. After the second child was born, Joe hired a bookkeeper to manage the business finances. There is an IRS lien against Joe's business in the amount of $15,000.00, stemming from an audit of his business conducted in 1993. He has business inventory of approximately $10,000.00, tools and equipment worth approximately $50,000.00, and a business loan secured by his equipment with a payoff of $20,000.00. Assume that Nancy and the children have been living in the home and have had sole temporary possession of the premises since the separation from Joe, and that Nancy has been receiving child support from Joe. Joe has also made an additional contribution of $250.00 per month towards the mortgage, which was treated as a maintenance supplement by the parties.

Joe's attorney conveys the following offer: Joe will convey his interest
in the property to Nancy, and on condition that the property be sold by Nancy
within a year. Upon sale, Joe wishes to receive 1/2 of the net equity in the
modular home, and 1005,0 of the value of the land (based on the fact that his
family gave him the land as a gift).

Joe is also willing to pay Nancy $250.00 per month, over and above the
child support, but he wants it to be deemed as spousal support to her. He
will pay this to her for a year from the date of the final divorce.

Joe wishes to have sole title to his business, and offers nothing for
the net value of that enterprise. His attorney reminds you of the pending IRS
lien and the business loan, which reduce the value of the business, and
indicates that Joe will assume sole responsibility for those debts.

Would you recommend that Nancy accept Joe's offer? Explain your analysis
and reasons.

Sara Roe comes in to see you. Her mother, Janet, died two months
previously and she has questions about the estate.

Janet was widowed five years ago. She had three children from her
marriage: Sara, 27, Steve, 25 and Dave, 19. Steve died six months ago,
leaving a wife and a one year old son, Sam. Dave will start his sophomore
year at college in the fall. Janet had been paying for his tuition. room and

In addition to the three children of her marriage, Janet had a daughter,
Katherine, who is now two. Katherine lives with her father, John Horn, in the
home that he and Janet shared in Plainfield, Vermont. Janet and John were
never married.

Two wills have just been offered for probate. The first will was
executed ten years ago, in Shelburne, Vermont. The lawyer who drafted the
will and her secretary and paralegal acted as witnesses. It states, in
pertinent part:

I, Janet Roe, of Shelburne, Vermont, being of sound mind and memory do
make, publish and declare this to be my Last Will and Testament, hereby
revoking all wills and codicils heretofore made by me.

I give and bequeath all my tangible personal property, to my husband,
Alfred. If he predeceases me I bequeath all my tangible personal property to
my children Sara, Steve and Dave share and share alike.

I give and bequeath $5000 to the Society for the Protection oi:Children,
in Burlington, Vermont.

I give, devise and bequeath all of the rest, residue and remainder of my
estate to my husband, Alfred. If he predeceases me, then the remainder of my
estate shall be given to my children, Sara, Steve and Dave, per stirues.
However, if anyone taking under this will is under the age of twenty one, his
or her share shall be placed in trust, with the income and principal to be
used for his or her care, support and education. When such child has reached
the age of twenty one, the trust shall terminate and all assets remaining m
the trust shall be distributed to that child without restriction.

The second will offered for probate was executed in Plainfield, Vermont,
a year before Janet's death and was handwritten by Janet. It was witnessed by
John, Steve and a neighbor. This will provides, in pertinent part:

I hereby declare this to be my last will and testament, revoking all
other wills I have made in the past.

I leave my house and all of its furnishings to my children, now living,
in equal shares. Because children are not adequately protected from abuse in
our society, I give $2000 to the Society for the Protection of Cfiildren, in
Burlington, Vermont. All the rest of my estate I leave to my beloved, John
Horn. I appoint Sara Roe to be the executor of my estate.

When Janet died, she owned the house in Plainfield valued at $90,000,
with an outstanding mortgage of $65,000. Janet owned most of the house's
furnishings, and an automobile in her own name which is valued at $18,000,
but upon which there is owed $12,000. She and John also owned a truck which
is valued at $6000. In addition, she had a joint bank account with John that
held $4000, a savings account and mutual funds in her own name valued at
$55,000, and an insurance policy valued at $60,000, with John the named
beneficiary. There is outstanding credit card debt of $3000.

After Janet's death, John quit work to take care of Katherine, and, in
his free time, he begins to do significant renovations on the house. John has
no carpentry experience, and Sara's afraid that he is destroying the house.
John had been paying half of the mortgage on the house over the past year.
Since Janet's death, the mortgage on the house has not been paid, and the car
loan and credit card debts are also in default. John continues to use both
the car and the truck, and has recently had an accident in the truck, doing
major damage to the front end.

Sara wishes to know the following:

1. What items are part of Janet's probate estate? Explain.

2. a) Which will is valid, and why?

b) In the event that the first will is found to be valid, how would Janet's
assets be distributed? Explain.

c) In the event that the second will is held to be valid, how would Janet's
assets be distributed? Explain.

d) The Society for the Protection of Children is no longer in existence.
What will be done with the money which was bequeathed to this charity?

3. a) While the estate is pending, is there something that can be done to
ensure that the bills continue to be paid?

b) Can Dave get the money he needs now to pay for his college tuition,
room and board? Explain.

c) What happens to Janet's assets while the estate is going through probate?

Model Answers
QUESTION VI - July 1996 Two prospective clients, Arjay Reynolds and Mauris Philips, enter your newly opened Vermont law office and detail their ambitious entrepreneurial plan. They have purchased a hundred acres of farmland near Marlboro, Vermont, and they want to construct a domed greenhouse over the land to grow tobacco. The tobacco is then to be harvested, cured, and made into "smokeless" cigarettes with the brand name of Beau Vyne ("Beau Vyne is dee-vine!" will be their advertising slogan). "It'll be a locally grown and produced, more healthy product that will complement Vermont brewed beer," says Reynolds. "We've got about 40 other people excited about investing in this business, and we all want to have some say in the business's decisions, even though none of us wants to be seen as speaking for the business. Actually, some of the people want to get involved as corporations rather than flesh-and-blood individuals, and some of the richest and most enthusiastic people live outside the country." "Yeah," adds Philips, "but all of us are scared ashen of the tobacco litigation going on, and we want to make solid sure that we're not opening ourselves up for any personal liability with this business. We also want to avoid paying taxes to the Feds as much as possible, and we don't want to be kept from making side deals while involved with this business. No need to be faithful to a business, you know what I mean?" Philips has and wants to keep a business interest in a potentially competing tobacco company named Pynex, which is currently involved in litigation in Mississippi. "One more thing," Reynolds says, "we want to set things up so that if any of us kicks the bucket at some point, that person's legal representative can take over the dead person's business interest right away." QUESTIONS: 1. Assuming that Reynolds and Philips speak for everyone, what business form would you recommend in this situation? 2. Discuss how the form you recommend would deal with: a. the number and kinds of persons who want to become involved in the business; b. the nature of business involvement these persons seek; c. the liability protection sought; d. the Federal taxes that would be paid. In your discussion, tell how other business forms, which you have not recommended, would deal (or would not deal) with these factors. 3. Assuming that Philips has expressed everyone's desire not to be "faithful to a business," how could the business form you recommend best address this position. 4. How could the business form you recommend deal with the death of a person involved in the business? What rights would the decedent's legal representative have in the business? 5. What would you do if you learned that Reynolds and Philips do not speak for everyone?
Model Answers
--------------------------------------------------------------------------- Board of Bar Examiners Mailing address: 109 State St. Montpelier VT 05609-0702 Office Locaation: 111 State St. Montpelier, VT Telephone: (802)828-3281