Ohio recently joined 34 other states by adopting statutory provisions (in this case, RC §5804.08) authorizing the creation of a Trust for the care of an animal. While preparing a trust for the care of a pet has always been possible, such trusts were discretionary with little basis for enforcement Since pets are considered personal property, not beneficiaries with rights to be protected, under prior law, there was no one with standing to enforce the trustee’s performance of his/her/its obligations.

Now, Ohio pet owners can be assured that if they set up a pet trust properly, there will be persons with standing to enforce the trustee’s performance of his/her/its obligations. This person may be someone named in the trust or designated by the court. The person appointed by the court must first show that he/she has an interest in the pet’s welfare.

A statutory trust of this sort may provide for the care of one designated pet or several pets.

The value of the trust estate of a trust for the care of a pet must be reasonable in light of what amount will be needed to care for the animal or animals involved. The calculation of that amount may take into consideration such factors as the estimated veterinary bills, food expenses, recreational costs (e.g., toys, dog parks, etc.), occasional boarding, life span, and burial or cremation expenses of the particular species or breed of animal(s).

If a court determines that the trust’s funds are excessive and unreasonable, the court will distribute the excess to the creator of the trust or, if he/she is deceased, to his/her other beneficiaries or heirs.

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In In re Estate of Holycross, 2007-Ohio-1.Champaign App. No. 2005 CA 1, 2005-Ohio-5582. Judgment affirmed. (Jan. 3, 2007), the Supreme Court of Ohio held that, regardless of the date on which a married couple was divorced, 1990 legislation that ‘automatically' terminates all life insurance beneficiary designations in favor of a former spouse at the time of a divorce does not apply to insurance contracts that were in effect prior to the effective date of that legislation.

Section 1339.63 of the Ohio Revised Code, which took effect on May 31, 1990, provides that upon the termination of a marriage by divorce, dissolution, or annulment, all life insurance beneficiary designations in favor of a former spouse are automatically terminated unless the divorce decree specifically provides otherwise. In today's decision, Justice Evelyn Lundberg Stratton affirmed lower court rulings that R.C. 1339.63 does not affect insurance contracts that were in effect prior to May 31, 1990, because retroactive application of the statute to pre-existing policies would violate the Contracts Clause of the Ohio Constitution.

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The Ohio Supreme Court recently resolved a long debated question facing Ohio employers. In the case of Lake Land Employment Group of Akron v. Columber, the Ohio Supreme Court decided that employers do not have to give a special payment or bonus in exchange for the employee’s agreement to a non-compete agreement.

For years, employees’ attorneys argued that an agreement restricting the employee’s ability to work in direct competition with their previous employer was not enforceable if the employee did not receive anything more than continued employment in exchange for signing the agreement. Earlier this month, the Ohio Supreme Court seemed to answer the issue by deciding that continuation of at-will employment between the employee and the employer was enough to constitute “legal consideration” for the agreement.

The Ohio Supreme Court has left room for a new argument by employee’s attorneys. While the Court said that continuation of the employment at-will arrangement was sufficient consideration for a non-competition agreement, the fact that no bonus or other payment was made to the employee could still be considered by courts in determining whether the agreement as a whole was “reasonable” and therefore enforceable consideration.

It affirmed existing caselaw which defined the rule that a person who owns an insurance policy in existence before May 31, 1990, and who wishes to remove his or her ex-spouse as beneficiary of that policy must undertake an affirmative act in order to remove his or her ex-spouse as beneficiary despite the language of R.C. 1339.63. The corollary to this rule is that by failing to act, the person owning the policy will be presumed to have made a conscious decision to retain the ex-spouse as beneficiary.

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Ohio's new smoking ban, Ohio Rev. Code § 3794.01 et seq., took effect on December 7, 2006. Among other things, this new law prohibits smoking in public places and places of employment. The Ohio Department of Health must establish rules and regulations for implementing this new law on or before June 7, 2007. In response to litigation, the State of Ohio has agreed not to enforce the smoking ban until the rules and regulations are established. Rules have been posted for comment so that they may be implemented well before June 7, 2007.

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A 2006 report by the Ohio Psychiatric Association (OPA) noted that more than 2 million Ohio children, adolescents, and adults experience a mental disorder each year, and more than half a million of those stricken are affected by serious and potentially disabling mental illnesses. Furthermore, a 1999 U.S. Surgeon General's report estimated that the cost of untreated mental illness in Ohio (due to lost productivity at work or school, incarceration, or the inability of mentally ill parents to care for their children) was more than $3.5 billion annually.

On December 29, 2006, Ohio Governor Bob Taft signed Senate Bill 116, a "mental health parity" bill, which generally requires that health-insuring corporations in the State of Ohio offer and provide the same coverage for certain mental illnesses that they provide for physical illnesses. Under this law, insurers are prohibited from offering coverage for covered mental illnesses at lower levels than that offered for physical illnesses. It is estimated that the new law, which will become effective on March 30, 2007, will impact the insurance plans of many workers in Ohio. A summary of the some of the statute's key requirements are as follows:

The law generally prohibits discrimination in group health-care policies with respect to coverage provided for the diagnosis, care, and treatment of "biologically based mental illnesses." These illnesses include schizophrenia, bipolar disorder, panic disorder, obsessive-compulsive disorder, paranoia and other psychotic disorders, schizoaffective disorder, and major depressive disorder, as defined by the American Psychiatric Association. Diagnostic and treatment services for such illnesses are now considered "basic health care services," a term that was previously limited to traditional medical treatments for physical illnesses.

The OPA estimated that approximately 110,000 Ohioans will be directly benefitted by enactment of the new parity law. While these new requirements do not apply to currently existing policies, the law will be cover health-insurance policies delivered, issued, renewed, or modified after September 29, 2007.

The statute contains an exemption that appears to be aimed at preventing escalating health-care costs. Under this provision, employers can obtain an exemption from the law's coverage if they are able to demonstrate that, over a period of at least six months, incurred claims for the required mental-illness coverage caused an increase (or are expected to cause an increase) of more than one percent per year in the cost of coverage. To obtain such an exemption, the employer must provide documentation which is endorsed by an actuary. The Ohio Superintendent of Insurance will then decide whether to approve the exemption.

The new statute will impact all employers that purchase insurance from third-party providers. The law also states that it applies to multi-employer insurance plans, such as those provided by unions to their members. However, the application of state health-insurance law is superseded, or preempted, by the federal Employee Retirement Income Security Act of 1974 (ERISA). Thus, although the law purports to cover self-insured employers, the ERISA exemption will generally remove private self-insured employers from this mandate.

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In a long-awaited decision, the Ohio Supreme Court ruled that evidence of medical bill “write-offs” are not barred by the collateral source rule. Robinson v. Bates (2006), 112 Ohio St.3d 17, 2006-Ohio-6362. As a result, in a personal injury case, both the medical bill showing the amount originally charged, as well as evidence showing that the provider accepted a lesser amount as payment in full for those charges, are admissible in court. Thus, a jury may consider both the amount that the provider billed, as well as the lesser amount that the provider actually accepted as payment in full, in its calculation of the reasonable medical costs that constitute part of a prevailing plaintiff’s damages.

At issue in the case was the application of Ohio’s common law doctrine known as the “collateral source rule” to the circumstances described above. The collateral source rule, recognized by Ohio courts since 1970, prevents a jury from learning about a plaintiff’s receipt of payment for plaintiff’s injury from a source other than the defendant. The rule was adopted to prevent a tortfeasor from benefiting from the plaintiff’s own efforts to cover his/her damages from other sources, such as plaintiff’s own insurance carrier.

In Robinson v. Bates, the Supreme Court reasoned that the collateral source rule is not applicable to write-offs because they are not payments made by a third-party to the plaintiff. Instead, write-offs are just a reduction in the amount that the provider accepts for medical services provided to the plaintiff. Rather than identifying either the amount billed or the discounted amount paid as the appropriate evidence to be submitted to a jury as the “reasonable value” of medical expenses, the Court ruled that all information could be submitted to the jury.

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