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meahtelícor and efnetan ealdum þyrse (-re, MS.) (cf. mando dapes mordax lurcorum more cyclopum, Prehn 217), Rä. 41, 63. Emnyttende equiparando, Angl. xiii. 421, 803. v. emnettan in Dict.
efolsian. v. eofulsian: efstan. v. efestan.
eft. Add. I. of repetition, again:--Eft gelíce identidem, Wrt. Voc. ii. 47, 50. Eft ræ-acute;dende lectitando, 50, 23. Wé nú gehýrdon þis godspel ræ-acute;dan, and þéh wé hit sceolan eft ofercweþan, Bl. H. 15, 31. Wæs culufre eft (a second time) of cofan sended, Gen. 1464: B. 1377. Eft . . . níwan stefne, Gen. 1885: An. 1304. Eft . . . óðre síðe, 706: 1677: Sat. 75. Eft swá æ-acute;r, An. 1276: 1343. Eft swá æ-acute;r . . . niówan stefne, B. 1787. I a. of replacement, restoration, renewal:--Geðwegenum fótum eft sceógian hí lotis pedibus recalcient se, Angl. xiii. 413, 687. Sceal beón se ingang eft geopenod, Bl. H. 9, 8. Hú hé eft gesette seld sélran werode, Gen. 94: Dan. 641. Þá wæs eft swá æ-acute;r þeód on sæ-acute;lum, B. 642: An. 1478. II. of return, reversal, back, again (a) to a place:--Hí eóden and eft cómon, Hml. Th. i. 64, 7: Gen. 1478. Hám eft becuman, El. 143. Se heofonlica æ-acute;rendwreca eft hám cerde, Bl. H. 9, 24. Wæ-acute;ron Egypte eft oncyrde, Exod. 451. Nú wille ic eft þám líge neár, Gen. 760. Hig æðelinges eft ne wéndon they did not expect the prince back, B. 1596. (b) to a condition:--Þú tó eorþan scealt eft geweorþan, Cri. 624. Willflód ongan lytligan eft, Gen. 1413. (c) of giving:--Hé háteþ þá eorþan eft ágifan þ-bar; heó æ-acute;r onféng, Bl. H. 21, 30. (d) reversal of order:--Agof is mín noma eft onhwyrfed, Rä. 24, 1. III. afterwards, (a) in reference to the past:--Sió æ-acute; wæs æ-acute;rest on Ebrisc geðióde funden, and eft Creácas wendon hié on hiora ágen geðióde, and eft Lædenware swæ-acute; same, Past. 7, 1-3. Swá hié eft dydon, Cri. 455: Exod. 389: Sat. 374. Ic sóna eft mé sylfum andwyrde, Past. 5, 21. Gesceóp God Adam and Evah eft siððan . . . Beswác se ðeófol siððan eft ðá men, Ælfc. T. Grn. 3, 4-8. Hé spræc tó Abrahame . . . Cwæð þá eft raðe tó Sarran, Gen. 2726: Sat. 229. Hé eft æfter fæce geþrowade, Bl. H. 23, 30. Eft ufaran dógrum, B. 2200. (b) in reference to the future, hereafter:--Þæt þú ne secge eft, 'Ic gewelegode Abram,' Gen. 14, 23: Gen. 2145. Æ-acute;r seó mengeo eft tófaran sceolde, 1663: 2702. Wá eów þe nú hlihaþ, for þon gé eft wépað on écnesse, Bl. H. 25, 23, 20: 55, 24: B. 1753. Wé wæ-acute;ron on wræcsíþ sende, and nú eft sceolon óþerne éþel sécan, Bl. H. 23, 6: Sat. 212: Gú. 1159. III a. afterwards, in a later part of a book:--Eft rehþ infra subdit, An. Ox. 5167. IV. where there is a sequence of propositions, statements, again:--Wæs gecueden ðætte ðá sácerdas ne scoldon nó hiera heáfdu scieran . . ., ne eft hí ne scoldon hira loccas læ-acute;tan weaxan, Past. 139, 13. Sé ðe ágiémeleásað ðá giémene . . ., oððe eft folgað ðæ-acute;re giémenne, 87, 11: 321, 16. Gehiéren hwæt áwriten is . . . and eft gehiérað ðone cwide, 323, 10: Met. 7, 27: 11, 26. Hwílum . . . hwílum eft, 20, 215: Cri. 648: B. 2111. Næ-acute;nig eft . . . again no one . . ., Crä. 18. Swá hit eft be eów Esaias mæ-acute;lde so, again, Isaiah said it of you, El. 350. ¶ In the Northern glosses the prefix re- in many Latin verbs is rendered by eft, but the English word is separable; cf. eft tó cerranne reuerti, Lk. R. L. 19, 12.
eft-ácenned re-born, born again:--Eftácenned renatus, Jn. p. 3, 14. Eftácennedum renatis, Rtl. 32, 3. Eftácenndum, 33, 22.
eftácennedness, -cennes regeneration:--Eftácennednisses regenerationis, Rtl. 35, 15. Æftákennisse regeneratione, Mt. R. 19, 28.
eft-æ-acute;rist resurrection:--Eftérest resurrectionem, Mt. L. 22, 23.
eft-bétung, e; f. Restoration to health:--Eftboeteng restitutio (manus aridae), Mk. p. 2, 17.
eft-boren re-born, born again; renatus, Jn. L. R. 3, 5.
eft-bót, e; f. Restoration to health:--Eftboete restitutio, Mk. p. 2, 17. Eftbóte reparationis, Rtl. 33, 17.
eft-cennes regeneration:--Eftcynnes, edníwung regeneratione, Mt. L. 19, 28. v. eft-ácennedness.
eft-cneoreso regeneration, Rtl. 108, 29.
efter-sóna; adv. Again:--Eftersóna iterum, Mk. L. 8, 25. Eft'sóna (æfter-, R.), 2, 1. Eft'sóna (efter-, R.), 7, 31. Eft'sóna (æfter-, R.), rursus, 2, 13. [Frequent in Northern Gospels, in L. generally with the symbol for er, in R. written in full.] v. eft-sóna.
eft-flówende glosses redundans:--Eftflówende wætera redundantia flumina, An. Ox. 506.
eft-flówung, e; f. Redundance:--Eftflówu[nga] redundantia, i. flumina, Hpt. Gl. 418, 45.
eft-for(e)gifnes glosses remissio, Mk. p. 2, 14: L. 3, 29: Lk. L. R. 24, 47: Rtl. 119, 38: reconciliatio, Mt. p. 14, 13.
eft-geearnung remuneration:--Eftgearnunge remuneratione, Rtl. 59, 1.
eft-gemyndig; adj. Remembering:--Eftgemyndig wæs Petrus recordatus est Petrus, Mk. L. 14, 72: Lk. L. 22, 61. Eftgemyn(d)ig, Mt. L. 26, 75. Eftgimyndig, Mk. R. 11, 21: Rtl. 55, 30. Eftgemyndig reminiscens, Jn. p. 7, 16. Eftgemyndig wé aron, Mt. L. 27, 63. Eftgemyndigo (-myndge, R.), Lk. L. 24, 8: Jn. L. (R.) 2, 17. Eftgemyndgo (-e, R.), 22. Wosað gié eftgemyndgo reminiscamini, 16, 4.
eft-gemynd(i)gian to remember:--Ic nó eftgimyndga ego non recordabor, Rtl. 19, 5. Eftgimyndga milsa ðínra reminiscere misericordiarum tuarum, 167, 27. v. eft-myndig.
eft-gewæxen; adj. (ptcpl.) Grown again:--Eftgewæxen barc, Lch. i. 378, 15.
eftgian; p. ode To repeat, iterate:--Hit is áwriten: 'Ne eftga ðú ðín word on ðínum gebede.' Ðæt is ðæt mon eftgige his word scriptum est: 'Ne iteres verbum in oratione tua.' Verbum iterare est, Past. 421, 11, 12. v. ge-eftgian.
eft-hweorfan. Add:--Þí hálgan lenctenfæstene efthwyrfende when Lent returns, Hml. S. 23 b, 613.
eft-leániend, es; m. A remunerator, recompenser:--Eftleániend remunerator, Rtl. 89, 30.
eft-lésing, -lísing. Add: Lk. L. R. 24, 21: Rtl. 123, 35.
eft-lócung glosses respectus, Rtl. 86, 30.
eft-myndig; adj. Remembering:--Eftmyindig recordatus, Mk. L. 11, 21. Eftmyndigo recordati, Jn. L. 12, 16. v. eft-gemyndig.
eft-níwung, e; f. Renewal, restoration:--Eftnívuwunges reparationis, Rtl. 7, 27. Eftníwawnges, 31, 1.
eft-onfónd (?) a receiver:--Eftondfóende receptorem, Mt. L. p. 16, 8.
eft-ryne, es; m. A running back, return:--Útgong his and eftyrn his egressio ejus et occursus ejus, Ps. Srt. 18, 7.
eft-sel(e)ness, e; f. Requital, retribution, recompense:--Dæge eftselenise (efttóselenisse, R.) diem retributionis, Lk. L. 4, 19. Ðá ilcu dóe ðé eftselnisse (-selenise, L.) fiat tibi retributio, Lk. R. 14, 12. Alle eftselnisses omnes retributiones, Rtl. 169, 27.
eft-sóna. Add:--Eftsóna ibidem, An. Ox. 7, 289: 8, 213: iterum, Mt. L. 5, 33: 13, 45: 20, 5. Ne þincð mé næ-acute;fre þ-bar; hit sóð sý þ-bar; þis sý Efesa byrig . . . ac ic nát eftsóna, ne ic næ-acute;fre git nyste þ-bar; æ-acute;nig óþer byrig ús wæ-acute;re gehende búton Ephese ánre methinks it cannot be true that this is Ephesus, but again I do not know, nor ever yet did I know, that any other town were near us but Ephesus only, Hml. S. 23, 542. v. eft, efter-sóna.
eft-spellung. For Cot. 271 l. Wrt. Voc. ii. 77, 36.
eft-þingung, e; f. Reconciliation:--Eftðingung reconciliatio, Rtl. 88, 10. Cf. ed-þingung.
eft-wyrd. Add: A becoming again (v. weorþan, I), a renewal of existence, resurrection at doom's day (?):--Swá nú regnþeófas ríce dæ-acute;lað, yldo oððe æ-acute;rdeáð; eftwyrd cymð, mægenþrymma mæ-acute;st now mighty robbers hold sway, eld or early death; renewal of life shall come, greatest of God's glorious powers, Exod. 539.
ege. Add:--Nis þæ-acute;r (in heaven) ege, ne geflit, ne yrre, Bl. H. 23, 31. Orsorg æ-acute;lces eorþlices eges, Bt. 10; F. 28, 18. For ðæ-acute;m ege ánum ðæs innecundan déman, Past. 79, 7. For ríces mannes ege, Bl. H. 43, 10. Þysne ege þrowian æt þyssum englum, 93, 34. Ofergytende þisse sæ-acute;we ege, 235, 1. Hú mycelne ege wé sceolon witan (hú micel ege sí tó hæbbenne, v. l.) tó þám hálgum werum quantus sit viris sanctis timor exhibendus, Gr. D. 63, 5. Wíf ic læ-acute;rde þ-bar; hié heora weras lufedan and him ege tó wiston, Bl. H. 185, 23: Wlfst. 220, 27. v. weorold-ege.
hí eádmódne forhygedon, Hml. Th. i. 300, 19. (2) of things, terrible, tremendous:--Beó him swíðe egefull ðæt éce wíte aeterna supplicia perhorrescant, Past. 263, 16. Seó sæ-acute; is hwílon swíðe hreóh and egeful on tó beónne, Hml. Th. i. 182, 33. Tó þám egefullan Godes dóme tremendo judicio Dei, R. Ben. 31, 10. Þone egefullan cwide terribilem sententiam, 49, 19. II. fearful, timorous. (1) feeling fear, cf. ege-leás:--Egefulle tremebundos, Hpt. Gl. 475, 4. (2) expressing fear:--Mid eargum, egefullum gebæ-acute;rum formidilosis, i. stupefactis gestibus, Hpt. Gl. 518, 58.
egefullíce; adv. Fearfully, awfully, in a way that inspires awe:--Se Hæ-acute;lend egefullíce and hálwendlíce clypað on his godspelle, Hml. Th. i. 94, 9.
ege-healdan. l. ege healdan: ege-láf. Dele, and see éce, I.
ege-leás; adj. Without fear, without awe. Cf. ege-full, II, and see two following words.

matches: v. v. v. v. v. v. v. v. v. v. v.


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Last week, the Georgia Supreme Court confirmed that an insurance carrier’s duty to settle a claim against its policyholder arises only after an injured claimant presents a “valid offer” to settle within policy limits. In First Acceptance Insurance Company of Georgia v. Hughes, the Court found that, because the letter presented to First Acceptance by the injured parties’ counsel was not a time-limited settlement demand, First Acceptance’s failure to respond before the injured parties withdrew their offer did not constitute negligence or a bad faith failure to settle the claim within policy limits.
In 2008, First Acceptance’s policyholder caused a multi-car crash killing the policyholder and injuring five others, including Julie An and her 2-year-old daughter. The policy had the minimum liability limits of $25,000 per person and $50,000 per accident. In January of 2009, First Acceptance’s counsel circulated correspondence to the attorneys for the multiple claimants indicating it was interested in a joint settlement conference to resolve the injured parties’ claims. On June 2, 2009, counsel for An and her daughter sent First Acceptance two letters – the first responding to First Acceptance’s suggestion of a joint settlement conference and expressing his clients’ interests in settling their claims within policy limits, and another requesting information about the policy within 30 days of the date of the letter. First Acceptance’s counsel did not view the letters as including a time-limited demand.
As a result of a clerical error, both letters were inadvertently filed away with medical records. When First Acceptance did not respond to either letter within 30 days, claimants’ counsel sent a letter advising First Acceptance that its offer to settle was rescinded. First Acceptance continued settlement efforts by inviting claimants to a joint settlement conference with the other claimants, and offering to settle their claims for policy limits. Claimants rejected the offers.
After a 2012 trial, a jury found in favor of the claimants and against the policyholder awarding over $5.3 million dollars in damages. The policyholders’ estate then sued First Acceptance claiming that First Acceptance’s failure to settle the claims within the policy limits led to the excess judgment. The trial court granted summary judgment to First Acceptance only to have the Georgia Court of Appeals reverse the grant of summary judgment on the failure-to-settle claim.
The Georgia Supreme Court agreed with First Acceptance in its unanimous decision, stating that an insurer’s duty to settle is not triggered until an injured claimant has made a valid settlement offer. It found that, when considering the two letters sent to First Acceptance on June 2, 2009 as a whole, they did not include a 30-day deadline for acceptance. Instead, the Court viewed the offer to settle for policy limits as an alternative to claimants’ participation in the proposed global settlement conference. Without a clear deadline, First Acceptance could not have reasonably known it needed to respond within a certain time or risk that its insured would be subject to a judgment in excess of the policy limits. Thus, the Court held First Acceptance did not act negligently or in bad faith when it failed to settle the claims within policy limits.
Georgia’s high court also addressed the estate’s argument that First Acceptance knew or should have known that the minor daughter’s injuries were the most severe, and therefore, it should have settled her claim first. The Georgia Supreme Court disagreed with this position, finding that there was no precedent requiring that an insurer settle part of multiple claims. Instead, it found that a settlement of multiple claims including the minor’s claim was in the insured’s best interest as such a settlement would reduce the overall risk of excess exposure.
Ultimately, First Acceptance dodged a $5.3 million dollar bullet with Georgia’s highest court concluding that First Acceptance was entitled to summary judgment and reinstating the trial court’s ruling. This case serves as an important reminder to be cognizant of language in correspondence from injured parties that could be considered to be a valid settlement offer and to diligently calendar response dates and timely respond to such offers.
 First Acceptance Insurance Co. of Georgia Inc. v. Hughes, Case No. S18G0517, in the Georgia Supreme Court.
Litigation usually involves complex issues related to technology, products, or business processes. In many cases, clients are the best subject-matter experts of their craft. Nevertheless, attorneys are sometimes hesitant to designate a client or a client’s employee as an expert witness for fear of waiving attorney-client privilege. In a recent decision, the Supreme Court of Texas addressed this very issue and held that the attorney-client privilege remains unscathed when a party (or its corporate representative) is designated as a testifying expert witness. See In re City of Dickinson, — S.W.3d —, No. 7-0020, 2019 WL 638555 (Tex. Feb. 15, 2019).
City of Dickinson concerned whether a property insurer underpaid insurance benefits related to a Hurricane Ike claim made by the City of Dickinson. In responding to the City’s motion for summary judgment, the property insurer filed the affidavit of its corporate representative who was also a senior claims examiner. Unsurprisingly, the affidavit offered factual and expert testimony in opposition to the dispositive motion. The City later learned the corporate representative exchanged emails and drafts of the affidavit with defense counsel. The City then moved to compel the production of the emails and all other information “provided to, reviewed by, or prepared by or for” the corporate representative in anticipation of his expert testimony. Naturally, the property insurer claimed the documents were protected by the attorney-client privilege. The trial court, however, disagreed and granted the motion to compel. The intermediate appellate court reversed, finding the information sought was privileged.
On appeal, the Court addressed whether Texas Rules of Civil Procedure 192.3 and 194.2 barred the property insurer from asserting attorney-client privilege. Rule 192.3 concerns the scope of discovery and provides that, with respect to a testifying expert, “[a] party may discover . . . all documents, tangible things, reports, models, or data compilations that have been provided to, reviewed by, or prepared by or for the expert in anticipation of a testifying expert’s testimony[.]” In construing Rule 192.3, the Court noted that the use of the word “may” merely meant that an opposing party could discover the information—not that it had an absolute right to discover it when a privilege applied. The Court also noted that another subpart of Rule 192.3 expressly precluded the discovery of privileged information.
The Court also rejected the City’s argument that the Texas Rules of Civil Procedure should be interpreted the same as the pre-2010 Federal Rules of Civil Procedures because they were modeled after them. The Court summarily rejected the argument because the comments to the rules where substantively different.
City of Dickinson provides clarity in a previously unsettled area of Texas law. Further, it reinforces the importance of the attorney-client privilege and clarifies that a client does not have to choose between testifying as an expert at trial and invoking attorney-client privilege. Going forward, we expect the primary party-expert dispute to center on whether materials provided to the party-expert constitute discoverable work product under Christus Spohn or protected attorney-client privilege under City of Dickinson. Indeed, as the Court noted in its opinion, the two privileges are often conflated.
In a surprising decision on rehearing, on February 4, 2019, a panel of the Louisiana Third Circuit Court of Appeal reversed itself and held that bad faith claims arising out of an insurance contract are subject to a ten-year prescriptive period rather than a one-year prescriptive period. Fils v. Starr Indemnity & Liability Company, — so. 3d — (La. App. 3rd Cir. 5/9/2018)(on r’hrg), centered on the timeliness of the plaintiff’s bad faith claims against his uninsured motorist carrier. Dissatisfied with the $45,000 that his UM carrier had tendered following a motor vehicle accident on August 28, 2013, the policyholder filed suit against the insurer for additional benefits the day before the expiration of the two-year prescriptive period applicable to claims for UM benefits. Sixteen months later, the insured amended his petition, alleging bad faith on the part of the UM carrier and seeking penalties and attorneys’ fees pursuant to Louisiana’s two “bad faith” statutes, La. R.S. 22:1973 and La. R.S. 22:1892. The trial court sustained the insurer’s exception of prescription and dismissed the bad faith claims with prejudice.
Progressive recently settled a bad faith lawsuit with the guardians of a child injured in a car accident driven by a Progressive policyholder, Earl Lloyd. Progressive faced liability for an underlying judgment in excess of $22 million against Lloyd, who had purchased a $10,000 auto policy from Progressive. The bad faith lawsuit alleged that Progressive failed to advise its insured regarding the significance of executing a financial affidavit. Had the insured executed the financial affidavit, the claimant allegedly would have accepted the insured’s $10,000 policy limits in exchange for a release of Lloyd. The case, Wallace Mosley v. Progressive American Insurance Company, was set for trial beginning December 10, 2018 in the U.S. District Court for the Southern District of Florida before Judge Beth Bloom.
On November 25, 2018, Judge Bloom denied Progressive’s motion for summary judgment, finding there were questions of fact as to whether Progressive breached its duty of good faith to Lloyd by failing to advise him of the consequences of not signing the financial affidavit. Mosley by & Through Weaver v. Progressive Am. Ins. Co., No. 14-CV-62850, 2018 WL 6171417 (S.D. Fla. Nov. 25, 2018). The court explained that because the focus is on the conduct of the insurer, the reasons why Lloyd refused to sign the affidavit were irrelevant. Other alleged failures on the part of Progressive also led to the court’s decision.
The $22.7 million underlying trial court judgment arose out of an auto accident that occurred in November 2008, when Lloyd struck an 11-year-old boy, Wallace Mosley, who was riding a scooter into the roadway. Lloyd failed to report the accident to Progressive. Progressive learned about the accident nearly 10 days later from Rosa Lopez, an attorney representing a relative of Mosley. Lopez provided a copy of the police report to Progressive which indicated Mosley was struck by Lloyd who was “traveling at a high rate of speed.” Mosley was thrown approximately 100 hundred feet.
Progressive assigned the matter to its claims professional, who made several attempts to contact Lloyd. Progressive subsequently issued a reservation of rights letter to Lloyd based on his failure to notify Progressive of the accident. Progressive did not, however, deny coverage. On December 4, 2008, without the benefit of any communications with Lloyd, any medical records, or even a settlement demand, Progressive tendered Lloyd’s $10,000 policy limits to Mosley’s counsel. Four days later, on December 8, 2008, Lloyd finally contacted Progressive.
On December 9, 2008, Lopez sent Progressive a 12-page financial affidavit as a condition of settlement. The cover letter advised that if the affidavit revealed no visible assets, Mosely would execute a release and settle the claim; absent execution within two weeks, suit would be filed. Progressive contacted Lloyd and forwarded the affidavit on the same day it was received. Despite the contemporaneous call notes in Progressive’s claim file reflecting communications about the affidavit, Lloyd contended that, other than the transmittal, Progressive did not advise Lloyd of the consequences of not signing the affidavit; nor did Progressive send him an “excess letter” explaining that he could be exposed to liability in excess of the policy limits. Lloyd, who believed he was a “Sovereign Citizen of Moorish Descent,” refused to sign the affidavit based on his moral and religious beliefs.
On May 5, 2009, Mosley filed suit against Lloyd. Lloyd again failed to notify Progressive that he had he had been served with a complaint. Progressive learned of the suit from claimant’s counsel and immediately retained defense counsel to represent Lloyd. Defense counsel made several efforts to meet with Lloyd to discuss the affidavit. Despite ultimately meeting with defense counsel, Lloyd still refused to execute the affidavit. During his deposition in the underlying case, Lloyd testified that he was an Apostle of God who had previously raised people from the dead, that he had sovereignty because of his Moorish beliefs, and that he was immune from suit brought by the claimant.
The matter proceeded to trial in October 2014, and a $22.7 million judgment was entered against Lloyd. Lloyd subsequently entered into an agreement with Mosley assigning his bad faith claim against Progressive in exchange for an agreement not to execute the $22.7 million judgment.
On May 5, 2009, Mosley filed suit against Progressive for third party bad faith. Progressive moved for summary judgment, claiming it properly advised Lloyd and asserting Lloyds’ stated religious beliefs as the reason why the affidavit was not executed. The court denied Progressive’s motion, explaining that under Florida law, Progressive has a “fiduciary relationship” with its insureds, which requires it to refrain from acting solely on the basis of the its own interests. Importantly, the court noted that “Progressive did not send Lloyd any written communications explaining the significance of the Affidavit or the potential of an excess judgment being placed against him personally during the critical 14-day deadline,” nor did Progressive advise Lloyd of the steps he might take to avoid an excess judgment, as required by Boston Old Colony Ins. Co. v. Gutierrez, 386 So. 2d 783 (Fla. 1980).
While the court acknowledged that Lloyd’s assertion of sovereignty “may be a factor to consider,” the court determined Progressive was not entitled to summary judgment in light of Lloyd’s arguably self-serving testimony that had Progressive properly advised him, he would have signed the affidavit. The court explained: the “focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured.” Berges v. Infinity Ins. Co., 896 So. 2d at 677 (Fla. 2004).
Less than two weeks after the court issued its summary judgment ruling, Progressive settled the matter.
This case is yet another example, in the wake of the Florida Supreme Court’s ruling in Harvey v. GEICO Gen. Ins. Co., No. SC17-85, 2018 WL 4496566 (Fla. Sept. 20, 2018), of a $10,000 policy ballooning to one with significantly higher limits, for which the insured did not pay a premium.
The case further emphasizes the heightened duties some states, including Florida, impose on insurers to adequately advise policyholders of the consequences of litigation, particularly in matters with potentially great exposure and low policy limits, and confirming that advice in writing.
The Florida Supreme Court recently decided Harvey v. GEICO Gen. Ins. Co., No. SC17-85, 2018 WL 4496566, at *1 (Fla. Sept. 20, 2018), an important case setting forth what many will try to argue has lessened the standard for bad faith law in Florida to one of negligence plus.
The case has a detailed but uncomplicated factual history. However, the factual summary contained in the majority’s opinion must be read along with that of Justice Canady’s dissent in order to understand the full picture factually.
On August 8, 2006, GEICO’s insured, James Harvey (“Insured” or “Mr. Harvey”), was in a motor vehicle accident. The accident resulted in the fatality of the other driver, and Mr. Harvey was at fault.
Mr. Harvey was insured by a GEICO auto policy with $100,000 liability limits. The claim was assigned to GEICO adjuster Fran Korkus, who promptly interviewed Mr. Harvey. On this same date, Mr. Harvey contacted a local attorney whom he did not actually hire (and, in fact, as noted in a footnote in Justice Canady’s dissent, worked for the same law firm who ultimately represented the estate).
On August 11, 2006, GEICO sent its Insured a letter explaining that the estate’s claim could exceed his policy limits and that he had the right to hire his own attorney, which he did. A paralegal employed by the estate’s attorney called Ms. Korkus on August 14, 2006, requesting a statement to determine the extent of Mr. Harvey’s assets. The paralegal did not give Ms. Korkus a deadline to provide the statement. It is disputed whether the request was communicated to Mr. Harvey. Ms. Korkus’s contemporaneous file notes indicate that she “updated [Mr. Harvey] on claim status” and advised him of the firm retained by the estate. Despite Ms. Korkus’s notes, Mr. Harvey testified that “to the best of his recollection,” Ms. Korkus did not mention that the paralegal had asked about other insurance coverage and Mr. Harvey’s assets.
On August 17, 2006, nine days after the accident, GEICO tendered the full amount of Harvey’s $100,000 policy limits to the estate’s attorney, along with a release. Multiple log entries indicate that GEICO had to first contact the estate’s law firm because it had not yet provided a letter of representation. On this same date, Mr. Harvey gathered all of his asset information and set up a meeting with his personal attorney to take place on August 23, 2006. Indeed, Mr. Harvey later testified that he gathered this information and set up the meeting because of GEICO’s August 11, 2006 letter.
On August 23, 2006, Mr. Harvey met with his personal attorney. Testimony revealed that Mr. Harvey owned certain liquid assets exceeding $900,000, plus four motor vehicles and two houses. The estate’s attorney testified that in his view, the only “collectible” asset was $85,000 in the operating account of Mr. Harvey’s business. The estate’s attorney testified that, had he been able to take a statement of Mr. Harvey, he would have recommended to his client that she accept the $100,000 tender of policy limits.
The attorney wrote back to Ms. Korkus in response to GEICO’s tender, acknowledging receipt of the check and Ms. Korkus’ apparent refusal to make Mr. Harvey available for a statement. Ms. Korkus received the letter on August 31, 2006 and faxed it to Mr. Harvey that same day. Further, on this same day, Ms. Korkus contacted the estate’s attorney, who faxed Ms. Korkus a letter memorializing their conversation, confirming that he wanted a statement to determine the extent of Mr. Harvey’s assets and that Ms. Korkus was “unable to confirm that [Mr. Harvey] would be available for a statement.” Ms. Korkus’s contemporaneous file notes, however, indicated that she advised the estate’s attorney that she would contact Mr. Harvey and pass the information along so he could decide whether to provide the statement.
The next day, on September 1, 2006, Mr. Harvey called Ms. Korkus to discuss the letter from the attorney. A log entry from Ms. Korkus reflected that the insured advised her that his attorney would not be available until after the holiday weekend on September 5, 2006 and requested that she contact the estate’s attorney to notify him of this. Despite Mr. Harvey’s request, and instructions from her supervisor to do so, Ms. Korkus did not relay this message to the estate’s attorney. At Mr. Harvey’s request, Ms. Korkus also faxed a copy of the letter to Mr. Harvey’s personal attorney.
On September 11, 2006, the estate’s attorney met with his client, explained bad faith law, and recommended that the estate file suit. On September 13, 2006, the estate returned the check to GEICO and filed a wrongful death suit against Mr. Harvey. A jury found Mr. Harvey 100% at fault and awarded the estate $8.47 million in damages.
Mr. Harvey filed a bad faith suit against GEICO, which proceeded to trial. GEICO moved for directed verdict, which the court denied, and the jury found GEICO in bad faith. Judgment was entered against GEICO in the amount of $9.2 million. GEICO moved for judgment notwithstanding the verdict, which was also denied.
With respect to the first, the 4th DCA acknowledged that while Ms. Korkus did not immediately notify Mr. Harvey of the estate’s request for a statement, she did so on August 31, 2006. Moreover, the estate never conveyed to Ms. Korkus that settlement was contingent on his providing a statement.
With respect to the second, third, and fourth factors, the 4th DCA found that GEICO’s August 11, 2006 letter, which notified Mr. Harvey of a possible excess judgment and advised him of his right to hire an attorney, satisfied each of these.
With respect to the fifth factor, the 4th DCA found that there was no evidence that GEICO was deficient in its investigation of the facts.
With respect to the sixth factor, the estate never provided GEICO with a settlement demand prior to filing suit, so GEICO could not have given consideration to an offer.
With respect to the seventh factor, the 4th DCA noted that GEICO tendered its policy limits nine days after the accident, without any demand from the estate.
The 4th DCA also relied on Novoa v. GEICO Indem. Co., 542 F. App’x 794 (11th Cir. 2013), analogizing the 11th Circuit’s findings in that case, namely, that although the evidence reflected that the insurer could have handled the claim better, this amounted to negligence, not bad faith. The 4th DCA further explained that while evidence of carelessness is relevant to proving bad faith, the standard for determining liability in an excess judgment case is bad faith rather than negligence.
Next, the 4th DCA, relying on Perera v. U.S. Fidelity & Guar. Co., 35 So.3d 893, 903–04 (Fla. 2010), noted that not only must there be actions demonstrating bad faith on the part of the insurer, but the insurer’s bad faith must also have caused the excess judgment. The 4th DCA explained that GEICO did not fail to meet any deadlines or other requirements established by the estate, as a requirement for settling the claim and avoiding the filing of a lawsuit against its insured.
Lastly, the 4th DCA noted that as the Eleventh Circuit explained in Novoa and Barnard v. Geico Gen. Ins. Co., 448 F. App’x 940 (11th Cir. 2011), where the insured’s own actions or inactions result, at least in part, in an excess judgment, the insurer cannot be liable for bad faith. However, the 4th DCA did not actually make any findings or comparisons on this final point.
In a 4-3 decision, the Florida Supreme Court quashed the 4th DCA’s opinion and directed that the jury verdict and final judgment be reinstated. The majority opinion was written by Justice Quince. Justices Canady and Polston each wrote lengthy dissents.
In essence, the Florida Supreme Court held that the Boston Old Colony factors are not the only factors involved in the bad faith inquiry. Instead, it found that because GEICO “completely dropped the ball” by failing to coordinate Mr. Harvey’s statement (a demand GEICO received before even receiving a letter of representation from the estate’s attorney), it was in bad faith. Harvey, 2018 WL 4496566 at *6.
The majority dedicated a significant portion of its analysis to discussion of the 4th DCA’s reliance on Novoa and Barnard for the idea that the insured’s conduct is relevant to the inquiry of bad faith. Indeed, as discussed above, the 4th DCA based its decision on the Boston Old Colony factors, not Mr. Harvey’s conduct, and simply made mention of Novoa and Barnard. Indeed, as Justice Polston explained in his dissent, “[t]he Fourth District’s comment in Harvey regarding the insured’s actions or inactions was dicta and only mentioned after Fourth District reached its holding that GEICO fulfilled its obligations of good faith to the insured.” Harvey, 2018 WL 4496566 at *18 (Polston, J., dissenting).
The majority acknowledged that “it is true that negligence is not the standard.” Id. at *7. At the same time, the majority found that the Florida Supreme Court “made clear in Boston Old Colony that because the duty of good faith involves diligence and care in the investigation and evaluation of the claim against the insured, negligence is relevant to the question of good faith.” Id. It continued on to explain that by relying on [the Eleventh Circuit’s opinion in Novoa] in lieu of this Court’s binding precedent in Boston Old Colony, the Fourth District minimized the seriousness of the insurer’s duty to act in good faith with due regard for the interests of its insured.” Id.
Rather than take issue with the Fourth District’s analysis of the specific Boston Old Colony obligations, the majority points to the Fourth District’s purported failure to focus on the more general language in Boston Old Colony regarding an insurer’s duty to use “the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” E.g., majority op. at –––– (quoting Boston Old Colony, 386 So.2d at 785). In doing so, the majority completely divorces that general language from the specifically enumerated obligations and effectively adopts a negligence standard for bad faith actions, even though negligent claims handling does not amount to bad faith failure to settle. See Campbell, 306 So.2d at 530 (noting that the “standard[ ] for determining liability in an excess judgment case is bad faith rather than negligence”); see also Auto Mut. Indem. Co. v. Shaw, 134 Fla. 815, 184 So. 852, 858 (Fla. 1938) (noting that bad faith involves “a heavier burden upon the insured” than does negligence).
Notably absent from the majority’s opinion is any mention of the fact that on August 23, 2006, three weeks before suit was filed, Mr. Harvey had gathered all of his financial documents and met with his attorney to discuss his assets. There was also no mention of the fact that Mr. Harvey in fact had $1 million in assets, independent of his insurance, that at no point since August 2006 did Mr. Harvey ever offer to provide a statement, and that at no point since August 2006 did the estate ever attempt to collect from Mr. Harvey. Further, the majority failed to acknowledge that the estate never provided a settlement demand, advise GEICO of any deadline for providing the statement, or even provide GEICO with a letter of representation until August 17, 2006, the day GEICO tendered its policy limits to the estate.
The effect of the majority’s opinion is that, in Florida, the standard for proving bad faith is essentially whether the insurer “dropped the ball,” which while the court acknowledged bad faith takes more than negligence, still sounds a lot like negligence.
Moreover, the majority’s opinion brings into question whether the insured’s actions—or the claimant’s actions—are a part of the inquiry. This is indisputably in conflict with the fourth Boston Old Colony factor, in which the Florida Supreme Court explained that one of the bad faith factors requires the insurer to advise the insured of any steps he might take to avoid an excess judgment. This, arguably, means that while an insurer has a duty to advise, the insured’s failure to act on that advise will not be held against the insured. As Justice Canady explained in dissent, it is also in conflict with the Florida Supreme Court’s ruling in Berges v. Infinity Ins. Co., 896 So. 2d 665 (Fla. 2004), where the court conducted significant analysis of the insured’s conduct in that case, in that the insured at all times contested liability, requested the insurer not to settle, and executed a hold harmless agreement assuming responsibility for any excess judgment. In other words, Florida Supreme Court precedent clearly requires analysis of the insured’s actions as well as the insurer’s.
The result of the majority’s decision is that an insured who caused damages that exceeded his policy limits by over 8,000 percent, who had assets that greatly exceeded his policy limits, and who at no time ever offered to provide his financial information to the third-party claimant despite knowing that the information was being requested even after the policy limits were tendered, has his $100,000 policy converted into an $8.47 million policy, while other insurance customers eventually foot the bill.
Harvey, 2018 WL 4496566 at *12 (Canady, J., dissenting).
Insurers must be aware of what this decision inevitably encourages: “a rush to the courthouse steps by third-party claimants whenever they see what they think is an opportunity to convert an insured’s inadequate policy limits into a limitless policy.” Id. at *16 (Canady, J., dissenting). In light of the current climate in Florida, it is especially important for insurers to communicate and act promptly and ensure that claim files are specifically documented, especially in cases of high value with low policy limits.
From the high market cap Bitcoin, Ether, Ripple, and Litecoin, to the quirky Fonziecoin, Selfiecoin, Pizzacoin, and (thank you, Dennis Rodman) Pot Coin, we have all been blasted by news of crypto and blockchain, and tales of kids in their parents’ basements getting rich off this new wonder that many of us struggle to understand. But what we might not have heard of, or thought about, is potential insurance coverage under a homeowner’s insurance policy in the event of theft of this “alt” currency.
On September 25, 2018, a Columbus, Ohio trial court judge denied an insurer’s motion for judgment on the pleadings on the grounds that its assessment of Bitcoin as “money” subject to a $200.00 sublimit under a homeowner’s insurance policy was proper and, therefore, the insured had no claims for breach of contract or bad faith. In doing so, Judge Charles A. Schneider relied on Internal Revenue Service Notice 2014-21, which provides that, “[f]or federal tax purposes, virtual currency is treated as property.” While termed “virtual currency,” the IRS recognized Bitcoin as property “and [Bitcoin] shall be recognized as such by this Court.” Kimmelman v. Wayne Ins. Grp., Case No. 18-cv-001041, Doc. 0E337-P71 (Ohio Ct. Comm. Pl., Civ. Div. Sept. 25, 2018).
In August 2017, the insured, James Kimmelman, submitted an insurance claim to his insurer, Wayne Insurance Group (“Insurer”), reporting roughly $16,000.00 of Bitcoin stolen from Kimmelman’s digital wallet. The Insurer investigated the claim and made a payment of $200.00 to Kimmelman, determining the Bitcoin was “money” and governed by a sublimit within the policy. Aggrieved, Kimmelman filed suit against the Insurer in February 2018, asserting claims for breach of contract and bad faith. The Insurer moved for judgment on the pleadings, which the court addressed in its September 25, 2018 order.
The court began by setting forth the applicable standard of review under Ohio state court procedural rules which, for judgment on the pleadings, is similar to that under Federal Rule of Civil Procedure 12(c). The court was limited to the allegations set forth in the complaint, accepted as true, with all inferences drawn in favor of the non-moving party. Only if it appeared beyond doubt that Kimmelman could prove no set of facts entitling him to relief would the court grant the Insurer’s motion. See Id. p. 2 (citing State ex rel. Midwest Pride IV, Inc. v. Pontious, 75 Ohio St.3d 565, 570 (1996)).
The Insurer argued Bitcoin is generally recognized as “money,” citing articles from CNN, CNET, and the New York Times. The Insurer also cited IRS Notice 2014-21, which subscribed the term “virtual currency” to Bitcoin. The court quickly disposed of Kimmelman’s responsive arguments, finding the authorities neither governing nor persuasive. Accordingly, the court held that the only authority it could “rely on in determining the status of Bit[c]oin is” IRS Notice 2014-21. Under the notice, “‘[f]or federal tax purposes, virtual currency is treated as property.’” Id. p. 3 (quoting IRS Notice 2014-21). Even though the IRS used the term “virtual currency,” the court found the IRS recognizes Bitcoin as property and, therefore, the court also recognized Bitcoin as property for purposes of the policy’s available limits of coverage.
In summary, the court held Kimmelman had properly plead his breach of contract and bad faith claims, denied the Insurer’s motion for judgment on the pleadings, and lifted the discovery stay. While the coverage result might be different in this case on a subsequent motion for summary judgment, the court broadly held that it was recognizing Bitcoin as property under the policy. Thus, it is also possible that, in subsequent dispositive motion rulings in this case, the trial judge will reiterate that position.
However, given that this appears to be an issue of first impression in Ohio and much (if not the entire) country, and in light of the IRS’s own use of the term “virtual currency,” on summary judgment review, the insurer should have valid arguments that it committed no bad faith. Tokles & Son, Inc. v. Midwestern Indem. Co., 65 Ohio St. 3d 621, 630, 605 N.E.2d 936 (Ohio 1992) (denial reasonably justified where “the claim was fairly debatable and the refusal is premised on either the status of the law at the time of the denial or the facts that gave rise to the claim”).
Cryptocurrencies and blockchain technologies present both emerging risks, and opportunities, for insurers in the global marketplace. As these technologies become more ubiquitous in our economy and everyday lives, the impact of rulings such as Kimmelman will likewise become more significant. Because Kimmelman serves as an early ruling on first-party property and bad faith issues associated with coverage for theft of cryptocurrencies, insurers can expect a great deal of citation to the opinion by policyholders. Insurers wishing to eliminate the risk of coverage for loss of cryptocurrencies may consider modifying policy language to expressly exclude coverage for virtual currencies.
 While the policy also included sublimits of $500.00 for “electronic funds” and $1,500.00 for “securities,” which the Insurer raised in its motion, the court’s opinion offered no analysis of whether those sublimits would apply to Bitcoin or other forms of cryptocurrency.

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Robert F. Young, Dayton, Ohio, and Morton Honeyman, Roanoke, Va. (Harshman, Young, Colvin & Alexander, by Robert F. Young, Dayton, Ohio, on the brief), for appellant.
James E. Corkey, Washington, D.C. (Philip C. Ebeling, Pickrel, Schaeffer & Ebeling, Dayton, Ohio, Gravelle, Whitlock, Markey & Tait, Washington, D.C., on the brief after remand by the Supreme Court; Pickrel, Schaeffer & Ebeling, by William G. Pickrel and Gordon H. Savage, Dayton, Ohio, on the brief), for appellee.
Before MARTIN, WEICK and O'SULLIVAN, Circuit Judges.
This case was remanded by the Supreme Court for consideration in the light of Commissioner of Internal Revenue v. Duberstein, 363 U.S. 278, 80 S.Ct. 1190, 4 L.Ed.2d 1218. Duberstein had not been decided at the time our original opinion in this case1 was announced. We have complied with the mandate of the Supreme Court. Additional briefs were filed by counsel after the remand and the case was again heard on oral arguments.
As we understand Duberstein, not only are findings of fact made by the District Court binding on an appellate court unless clearly erroneous,2 but the rule itself applies to factual inferences drawn from undisputed basic facts. United States v. United States Gypsum Co., 333 U.S. 364, 394, 395, 68 S.Ct. 525, 92 L.Ed. 746. But see: United States v. E.I. Du Pont DeNemours & Co., 353 U.S. 586, 598 footnote 28, 77 S.Ct. 872, 1 L.Ed.2d 1057. Even though an appellate court may draw different factual inferences from those of the District Court, it is not free to do so.
When it comes to conclusions of law and inferences to be drawn therefrom, the appellate court is free to act independently and draw its own legal conclusions and inferences. United States v. Mississippi Valley Generating Company, 364 U.S. 520, 526, 81 S.Ct. 294, 5 L.Ed.2d 268. If this were not so, the appellate court would be stripped of its power of review. Moreover, not all findings labeled as findings of fact are binding on an appellate court. Where a finding designated as a finding of fact is not in reality a finding of fact, but is a conclusion of law or a mixed finding of fact and conclusion of law, it is not binding on the appellate court. Bogardus v. Commissioner, 302 U.S. 34, 58 S.Ct. 61, 82 L.Ed. 32; Weible v. United States, 9 Cir., 1957, 244 F.2d 158; Chandler v. United States, 7 Cir., 1955, 226 F.2d 403. Where a finding is of an ultimate fact in the making of which is involved the application of legal principles, it is subject to review. Baumgartner v. United States, 322 U.S. 665, 64 S.Ct. 1240, 88 L.Ed. 1525.
See also: Republic Pictures Corp. v. Rogers, 9 Cir., 1954, 213 F.2d 662, 665; United States v. John McShain, Inc., 1958, 103 U.S.App.D.C. 328, 258 F.2d 422, 425, certiorari denied 358 U.S. 832, 79 S.Ct. 52, 3 L.Ed.2d 70.
The contract, which was the subject of this action for declaratory judgment, was in writing. There was no dispute as to its terms and provisions. The only controversy between the parties was as to the proper interpretation of the provision for prices to be paid for the tires, the contract providing that they were to be 'prices prevailing on date of shipment.' An identical provision was contained in the contract with White Stores, Inc., the other customer in Dayton's chain store division. Dayton figured the prices on what it termed the cost justification plan.
The question to be determined is whether Cordovan was being charged 'prevailing prices' under its contract when the only other customer in Dayton's chain store division received prices ten percent lower than the prices charged to Cordovan.
The course of dealing between the parties and the practical construction of the contract by them supports our views. The Trial Judge found that for many years the only two customers in Dayton's' chain store division were billed the same prices before and after the contracts with identical price provisions.
Cordovan's contract with Dayton did not specify how or in what manner the prevailing prices were to be computed, i.e., whether by cost justification, cost price or any other method. It seems to us that it is immaterial how Dayton established its prevailing prices so long as Cordovan was not charged more than White for tires of the same type.
Appellee insists that we are precluded from disturbing the judgment of the District Court because of Finding No. 28 which is as follows.
This finding cannot be considered separate and apart from the other findings, but must be considered with them.
Although Finding No. 28 was included by the learned District Judge in his findings of fact, we think that it might more properly have been included in his conclusions of law which were mixed with and not separated from his conclusions of fact. In our judgment, Finding No. 28 is either a conclusion of law or a mixed finding of fact and law. It might even be an ultimate finding which he made from all the evidence in the case after applying the law. Baumgartner v. United States, supra. In any event, we do not think it bars us from reviewing this case and correcting a judgment which we believe is wrong.
The written contract does not state that Cordovan's prices are to be tied to White's prices under all circumstances or any circumstances. In fact, in Cordovan's contract no mention is made of White. Cordovan could not complain if Dayton charged White a higher price or even ceased selling to White. As to this only White could complain.
The District Court ruled that the contract was valid. If interpreted as appellee claims, it would be invalid and unenforceable. Where a contract is susceptible to different interpretations, the court will adopt the one which will give it validity, if it is reasonable, rather than one which renders it illusory. J. C. Millett Co. v. Distillers Distributing Corp., 9 Cir., 1958, 258 F.2d 139. We cannot presume that the parties intended to enter into a void contract. In our judgment, the contract in the present case is not reasonably subject to the interpretation which appellee would have us make. We can hardly believe that a chain store buyer would enter into a contract to buy its entire requirements of tires for two years which would permit the seller to charge the buyer any price the seller in its uncontrolled discretion might fix and which price had not relationship to prices charged other customers.
The fact that Cordovan, after it learned of White's new contract, unsuccessfully attempted to negotiate a similar new contract with Dayton does not militate against its right to enforce its existing contract which remained in full force and effect. Dayton was unwilling to enter into a similar new contract with Cordovan without imposing conditions which Cordovan would not accept.
Our interpretation of the contract is that under the circumstances of this case the term 'prevailing prices' means the lowest prices for which the tires are sold. We are of the view that the District Court, in ruling otherwise, committed a mistake. United States v. United States Gypsum Co., supra. We adhere to our original judgment.
The judgment of the District Court is reversed and the cause remanded with instructions to determine the correct prices chargeable by Dayton to Cordovan Associates and approved distributors under the terms of the contract from June 1, 1958 to October 31, 1958 in accordance with the views herein expressed and enter judgment accordingly.

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1.This Act supplements the contents of Title 24 Chapter One Navy Hospitals, Naval Home, Army and other Naval Hospital, and Hospital Relief for Seamen and Others �1-40. The United States has the best-trained, most effective military in the world. The military is an all-volunteer force of dedicated, patriotic men and women who reflect the best values and spirit of our Nation. The Army, Navy, and Marine Corps were established in 1775, in concurrence with the American Revolution. On June 30, 1775, the Second Continental Congress established 69 Articles of War to govern the conduct of the Continental Army. The War Department was established in 1789, and was the precursor to what is now the Department of Defense. On April 10, 1806, the first United States Congress enacted 101 Articles of War, which were not significantly revised until over a century later. The Department of Defense (DoD) was named in the Secretary of Defense Transfer Order No. 40 of July 22, 1949. Since the creation of America�s first army in 1775, the Department has evolved into one of the largest organizations in the world. It executes a budget more than twice that of the world�s largest corporation, has more personnel than the populations of a third of the world�s countries, provides medical care for as many patients as the largest health management organization and maintains 24 million acres of land. The �pre-decisional� defense budget request increased from $582 billion to $606 billion FY 17 and then to $639 billion FY 18 and to $686 billion FY 19. CR 18 limited total defense increase to 1% to $611.8 billion FY 18 including a $4.7 billion Emergency Supplemental for a new Missile Defense system. CR 18 exhausted all legitimate claims for defense department spending growth potential in excess of 3% annually. The President's hyper-inflationary 12% FY 19 total war fund growth request is certain to be rejected. Departmental outlay growth must slow to 3% annually FY 20 � 2% pay-raise, 1% net new employment � afforded by continuing resolutions projected to pay no more or less than 3% annual growth from $611.8 billion CR 18.
2. The Office of Management and Budget (OMB) issued guidance on a �Comprehensive Plan for Reforming the Federal Government and Reducing the Federal Civilian Workforce.� Reform efforts should focus on improving organizational effectiveness; eliminating, restructuring, or merging activities; and workforce management. Congressional support is required to eliminate barriers associated with the account availability for certain annual appropriations, modify reprogramming thresholds, initiate new starts, and improve contracting processes through continuing resolutions. The Department is overzealously responding to the defense drawdown, which began with the FY 2010 budget, was the fifth major defense drawdown since the end of World War II (WWII), following those after WWII and the Korean War, the Vietnam War, and the Cold War. While this decline largely reflects a significant drawdown of U.S. presence in Iraq and Afghanistan, it occurred in a period of considerable instability and was driven to a substantial extent by the restrictions of the Budget Control Act (BCA) of 2011 rather than by strategic considerations. Since the NPT goals of 2012 there has been little to justify further spending reductions or increases in excess of 3% annually. Beginning with the Fiscal Year (FY) 2013 budget, the Defense Department began implementing $487 billion, 10-year cut in spending consistent with $500 billion annual federal spending caps instituted by the Budget Control Act of 2011. After saving a considerable sum of money complying with Nuclear Non-Proliferation (NPT) warhead decommissioning goals in 2012 the FY 2015 DoD budget request was able to reduce military spending. The FY 2015 DoD budget request could not accept sequestration levels and the Bipartisan Budget Act of 2015 funded the Department at about $116 billion more than projected sequestration levels over the 5-year period. The Fiscal Year (FY) 2017 Defense Department budget submission complies with the Bipartisan Budget Act of 2015 and sustains the alignment of program priorities and resources with the 2014 Quadrennial Defense Review (QDR) and supports military operations in Afghanistan and other areas of the world to counter threats from terrorists. The President must agree that $611,800 million from CR 18 exhausted all legitimate claims for total Defense spending growth in excess of 3% annually therefrom. Although FY 19 military department budgets exhibit unsustainably high rates of catch-up growth by FY 20 department spending growth must be limited to 3% annually to sustain a profit margin of undistributed offsetting receipts, moderating demand for the production of unexploded ordinance.
Source: FY 17 DoD Budget Request End-Strength Table crunched. Pre-decisional Department of Defense FY 18 Budget (PB) Request May 2017; Maj. General Pletcher; Wilson, Heather A. Secretary of Air Force. United States Air Force FY 19 Budget Overview. 12 February 2018.
3. Total US Military end-strength increases from 2.8 million FY 16 to 2.9 million FY 17- FY 19 to nearly 3 million FY 20. Reserve and Civilian workforces support active duty soldiers. The FY 19 Air Force request is for end strength to 506k, 3% more than 492k requested FY 17 and 1.2% more than 500k FY 18. 539k FY 06 is the war time high, down to 490k FY 09 before excessive growth FY 10 resulted in cuts to 483k FY 15. 1% annual net employment growth is the norm. The military pay raise is 2.4% FY 18 and 2.6% FY 19 while the civilian pay raise was 1.9% FY 18 and 0% FY 19. While military employment is growing normally, at 1% annually, civilian employment is declining by 1,000, -0.7% FY 18 � FY 19. The FY 19 Army budget compensates 1,030,500 end strength, including adjustments for pay, subsistence, housing allowances; continues to address retirement compensation. The budget increases funding for Reserve Component Soldiers on active duty supporting missions under 10USC�12304b. Navy FY 19 active duty manning at 335,400, up from 322,900 FY 17 with more than 100 ships deployed overseas on any given day. The budgeted end strength in FY 2019 is 7,500 higher than the estimated end strength for FY 2018. Total Navy and Marine Corp employment increases from 812k FY 17 to 831k FY 18. Navy FY 19 active duty manning at 335,400, was up from 322,900 FY 17 with more than 100 ships deployed overseas on any given day. The budgeted Navy end strength in FY 19 is 7,500 higher than the estimated end strength for FY 2018. In peacetime the US military usually has a work-related fatality rate of 2.2 per 100,000. Less than the 3 per 100,000 average. President Obama won the Nobel Peace Prize and in peacetime under his administration there were years when there was not a single work-related fatality in the 2.8 million end strength of the US military reported by Occupational Health and Safety Administration (OSHA). Of the 1.5 million who served in the Global War on Terrorism, 0.2% - 1% of combat soldiers died at the estimated average age of 24 rather than the national age of 78. That constitutes a work-related fatality rate of 200 per 100,000, double the risk of logging, the most dangerous civilian career with fatalities exceeding 100 per 100,000. It can be estimated that the life expectancy of people fighting in these wars can be estimated at 70 due to sudden death although soldiers who survive the war theatre tend to live full and healthy lives. Global War on Terror returnees are using medical services and applying for disability at higher rates than in previous conflicts. For every service member killed in action as of October 21, 2013 (7,092) there are seven wounded in action (51,670). When including �noncombat� injuries (56,874), the ratio of injured to killed jumps to 16 to 1. One out of four veterans of the current conflicts has filed a disability claim at the VHA, and the VA has treated 30% of veterans of the two wars as of October 2011. A war is defined as a conflict in which more than 1,000 people died.
4. The mission of the Air Force is to provide combat-credible forces needed to deter war and protect the national security. The FY 19 Air Force budget increases total end strength by 4,700 and supports a 2.6% pay raise to maintain competitive compensation profile to revitalize squadrons. FY 16 � FY 17 total spending increased 3.6% from $163 billion FY 16 to $169 billion FY 17, 8.7% to $183.6 billion FY 18 and 5.8% to $194.2 billion FY 19. The FY 19 request is for end strength to 506k, 3% more than 492k requested FY 17 and 1.2% more than 500k FY 18. 539k FY 06 is the war time high, down to 490k FY 09 before excessive growth FY 10 resulted in cuts to 483k FY 15. 1% annual net employment growth is the norm. The military pay raise is 2.4% FY 18 and 2.6% FY 19 while the civilian pay raise was 1.9% FY 18 and 0% FY 19. While military employment is growing normally, at 1% annually, civilian employment is declining by 1,000, -0.7% FY 18 � FY 19. Overseas Contingency Operations support deployed personnel. There is -8.3% decline in outlays for military construction, BRAC and military family housing from $2.4 billion FY 18 to $2.2 billion FY 19, yet the agenda seems vigorous and next BRAC round is in FY 20. The FY 18 and FY 19 Air Force budget has ceased to express major spending categories of blue and non-blue TOA, and reserves as civilian employees, and now even reports pass-through funds. To sustain 3% annual armed service spending growth the Department must moderate 8.7% growth FY 18 and 5.8% FY 19 to 3% FY 20 exactly $200 billion for the Air Force, and 3% every year thereafter. Major procurement quantities for the Air Force account for aircraft (119 FY16, 102 FY17, 84 FY 18 and 100 FY 19), space (5 FY16, 3 FY17, 3 FY 18 and 5 FY 19) and weapons (31,600 FY16, 37,610 FY17, 39,136 FY 18 and 48,512 FY 19). The Procurement portfolio delivers both immediate and future capabilities through investment across five specific appropriations: Aircraft, Missile, Space, Ammunition, and Other Procurement. The Air Force balanced modernization with recapitalization efforts to invest in future capabilities needed for a high-end fight. The FY 19 budget request increases procurement ramps and production quantities of 48 F-35A, 15 KC-46A, 1 HC-130J, 6 C-130J, 10 Combat Rescue Helicopters (CRH). FY 19, the Air Force will procure 256 AIM-9X Sidewinder Air-to-Air missiles, 220 (2 OCO) AIM-120D Advanced Medium-Range Air-to-Air Missiles (AMRAAM), 312 (48 OCO) Joint Air-to-Surface Standoff Missile- Extended Range (JASSM-ER) missiles, 7,899 JDAM (28,101 OCO), 1,338 (3,000 OCO) Hellfire missiles, and 3,427 (3,909 OCO) Small Diameter Bomb (SDB) II to sustain the Air Force�s air dominance and global precision attack capabilities.
5. The FY 19 budget supports a total Army end strength of 1,030,500 soldiers. The Army�s top-line base funding grew by 7% from the total FY18 budget request, Military Personnel 4.5%, Operations & Maintenance 6.1%, Procurement/RDTE (RDA) 14.3% military construction declines -13% after a 44% increase FY 18 while other base spending remained zero after 33% growth FY 18. $14.5 billion, 28%, of $52.5 billion FY 19 outlays for operations and maintenance go to civilian pay. The plan to reduce regular army employment to 450k FY 18 has been overruled. Now the budget provides for between 5.8% growth to 476 k FY 18 and 7.4% growth to 483.5k FY 18 authorized by the FY 2018 National Defense Authorization Act, Public Law No: 115-91. The FY 19 request is for 487.5k regular army, 8.3% growth in end-strength in two years since FY 17, 4.2% average annual growth. FY 20 and thereafter, all Army units Regular, Guard and Reserve are expected to sustain 1% average annual growth. The basic pay raise is 2.6%, the Basic Allowance for Housing 2.9% and Basic Allowance for Subsistence 3.4%. The combined FY 19 Procurement and RDTE budget is $26.5 billion FY 17, 5.2% growth to $27.9 billion FY 18 and 15% to $32.1 billion FY 19. Excessive growth must moderate at 3% to $33 billion Procurement and RDTE FY 20 or cuts will be warranted. The FY 19 Research Development, Test and Evaluation (RDTE) request is for $8.6 billion FY 17, 9% growth to $9.4 billion FY 18 and 8.5% growth to $10.2 billion FY 19. The FY 19 Procurement request is for $17.9 billion FY 17, 1% more than FY 16, 4% growth to $18.6 billion FY 18 and unacceptably high 17.7% growth to $21.9 billion. The Army requested $15.1 billion for procurement FY 17, a reduction of -8% from FY 2016, yet 2.4% annual growth from $14.1 billion FY 2014. The FY 19 budget sustains procurement of Apache, Blackhawk and Chinook aircraft remanufacture and new builds. Accelerates Multiple Launch Rocket Systems (MLRS) launcher modernization and maximizes procurement of key munitions Patriot Missile Segment Enhancement (MSE) missiles, Guided MLRS rockets, and Army Tactical Missile Systems (ATACMS). Accelerates modernization of Abrams, Bradley and Stryker fleets with mobility and lethality upgrades. Sustains procurement of Paladin Integrated Management (PIM) and Joint Light Tactical Vehicle for Low Rate Initial Production (LRIP). Increases procurement of Joint Battle Command � Platform (JBC-P), baselining the force of the mounted mission command.
6. For more than two centuries, the Navy and Marine Corps have operated throughout the world to protect American citizens and defend U.S. interests by responding to crises and, when necessary, fighting and winning wars. Naval forces use the global maritime commons as a medium of maneuver, assuring access to overseas regions, defending key interests in those areas, protecting U.S. citizens abroad, and preventing adversaries from leveraging the world�s oceans against the United States. Total Obligation Authority (TOA) for the FY 2019 DON baseline budget is $179.1 billion. The need for stable and predictable funding remains. To meet the objectives in the National Security Strategy, as part of the Joint Forces, the Navy and Marine Corps primary force contributors are two Carrier Strike Groups (CSG) and two Amphibious Ready Groups (ARG) forward at all times, and keeping three additional CSGs and ARGs in a ready use or surge status (2+3) to deploy within 30 days. The average ship count FY 18 is 280 ships with 100 deployed, FY 19 299 ships with 100 deployed and FY 23 with 326 ships with 131 deployed. The Navy employs 117 ships in the North Atlantic, 1 ship in the South Atlantic, 6 ships in the South Pacific, 52 ships in the North Pacific, 24 ships in the Indian Ocean and 17 ships in Western Europe. In FY 2019, deployable battle force is 299 ships. The FY 2019 budget request procures ten battle force ships and 120 manned and unmanned aircraft. The active Navy has increased 2.3% from 327,900 in FY 2018 to 335,400 in FY 2019. The active Marine Corps is growing 0.6% from 185,000 in FY 2018 to a level of 186,100 in FY 2019. Civilian personnel levels grow to accommodate. The FY 19 Navy budget request $194.1 billion, an increase of $12.6 billion (7% from the FY 2018 budget request (Base and OCO). Marine Corps Force 2025 initiatives are without increased end strength and OCO growth is anemic.
7. The Coast Guard budget is not financed by the military, it is the responsibility of the Department of Homeland Security. The Coast Guard is a military service and branch of the U.S. Armed Forces, a federal law enforcement agency, a regulatory body, a first responder, and a member of the U.S. Intelligence Community, the Coast Guard serves on the front line for a Nation whose economic prosperity and national security are inextricably linked to vast maritime interests. Semper Paratus � Always Ready. The Coast Guard is the lead Federal maritime law enforcement agency for securing and managing the Nation�s maritime borders, and enforcing national and international law on the high seas, outer continental shelf, and inward from the U.S. Exclusive Economic Zone (EEZ) to inland navigable waters, including the Great Lakes. Research and development funding doubled from $18 million FY 16 to $36 million FY 17 that reverted to $18 million FY 18 and is growing normally at a rate of 3% thereafter. Proposed FY 19 termination of funding for Reserve Training, Environmental Compliance and Restoration and Medicare Eligible Retiree Health Care Fund Contribution (MERHCFC) may be overruled by Congress on its merits. There is some concern that the 2.6% military pay raise may result in reduced Coast Guard employment whereas manpower was not reported by the Coast Guard. Homeland Security reported, there are 41,700 active-duty military; 7,800 reserve military part-time employees; 8,300 civilian full-time employees; and 31,000 civilian auxiliary volunteers employed by the United States Coast Guard (USCG) in 2017. The FY 2019 Budget 'increases the workforce by 109 positions to support Coast Guard activities across six mission programs' is a deceptive statement. In 2019 DHS estimates decrease to 40,863 active duty military; 7,000 part-time military Reserve, 7,780 civilian and 32,000 auxiliary. The Coast Guard procures countless Cutters and some aircraft. Opportunistic state actors like Russia and China are building military and technological capabilities to exploit emerging regions and erode our military advantage. Escalating competition is evident in the Arctic, where Russia�s militarization and China�s economic investments have accelerated, effectively challenging U.S. sovereignty and threatening regional stability. Coast Guard polar icebreakers can ensure year-round access to both Polar Regions.
8. The FY 19 budget was formulated around the National Security Strategy (NSS) and National Defense Strategy (NDS) goals to: Protect the American people, the Homeland, and the American way of life, Promote American prosperity, Preserve peace through strength, and Advance American influence. The National Defense Strategy directs a more lethal, resilient and agile Joint Force that can compete and win in the complex, global security environment. China is undergoing rapid military modernization and is pursuing near-term regional hegemony, owes compensation for wrongful death and detention of CIA informants and jointly declares trade war with tariffs in excess of 6%. Global warmers, Russia seeks to restore its national prestige and is willing to use force and coercion, while North Korea intends to guarantee regime survival through its ballistic missile tests. Iran asserts an arc of regional influence and instability, of radioactive soil. Violence extremist organizations expand coercion to new fronts beyond reinstitution of the Iron Curtain to the Iron Law of Wages. The 2.6% military pay-raise requires attention because it exceeds normal 2.5% labor budget growth = % raise + % net new employment, and overspending is going to cause a deficit or relapse to sanctions, but it might be perceived as a crime to deprive the armed service members of their reserve and promotion distorting bribe. The solution is to increase the growth rate for the armed services budget to 3% annually. This is however still not enough to afford a 2.6% raise + 1% net new employment = 3.6% payroll spending growth, without underhanded cuts to promotion, reserves and other programs, due to a shortage of volunteers, no amount of propaganda can entirely ameliorate. It is therefore promoted, without duress due to the comfortable profit margin of undistributed offsetting receipts, that the Department of Defense lower their military pay-raise to 2% to afford 1% net new employment, with 3% inflation in armed services spending. Civilians may not be compelled to serve in armed or auxiliary forces. No pressure or propaganda which aims at securing voluntary enlistment is permitted under Art. 51. Expectant and nursing mothers, teenagers 13-20 years of age, soldiers, laborers and children shall be given additional food, in proportion to their physiological needs under Art. 89 of the Fourth Geneva Convention for the Protection of Civilians of 1949.
9. The President�s hyperinflationary budget requests for the Department of Defense must be convicted of armed robbery under the Eighth, Ninth and Tenth Commandments that prohibit stealing, false testimony and coveting that of the neighbor, respectively. The Department of Defense is due 3% annual spending growth from CR 18. The military departments must reduce hyperinflation from as high as 5% FY 18 and FY 19 to 3% by FY 20. It is imperative that actual and threatened Presidential budget cuts of civilian agencies must be redressed, so that it would be as if the President had paid in full his first term. Agencies are due annual 2.5% government, 3% services, including armed services, internal revenue services, and international assistance, 4% disability and 5% retiree growth for a growing population of poor people to compete with 2.7% average annual inflation. Proposed budget cuts to civilian agencies and FY 18 cuts to international assistance programs, constitute a grave breach of Art. 147 of the Fourth Geneva Convention for the Protection of Civilians, (1949), whereas civilian budget cuts threaten to cause extensive destruction and appropriation of property, not justified by military necessity and carried out unlawfully and wantonly. The Occupying Power may not alter the status of public officials or judges in the occupied territories, or in any way apply sanctions to or take any measures of coercion or discrimination against them. This prohibition does not affect the right of the Occupying Power to remove public officials from their posts under Art. 54. The Occupying Power shall, with the co-operation of the national and local authorities, facilitate the proper working of all institutions devoted to the care and education of children under Art. 50. Budget cuts constitute deprivation of relief benefits under 18USC�246 and deprivation of subsistence under Common Article 1 of the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights. $27 billion arrears are due FY 18, $11.4 billion international assistance, $550 million UNESCO arrears and $85.7 million dues increasing 3% annually under Art. 19 of the UN Charter. By reason of attitude not in accordance with the Geneva Conventions the government is under obligation to make good to consequence of injury. Thus, every wrong creates a right for the court to rectify in the Case Concerning the Factory of Chorzow A. No. 9 (1927) the Permanent Court of Justice. Military budget cuts and zero growth, were found to be Outrages upon personal dignity, in particular humiliating and degrading treatment under Common Article 3(c) of the Geneva Conventions and must not be afflicted upon the civilian government and population.
10. The Interior Department must sustain 3% growth in federal outlays for Indian Affairs and 2.5% for other Interior departments, to maintain relationships with 573 federally recognized Tribes in the lower 48 States and Alaska, with a protected population of nearly two million people on 55 million acres, whose land and mineral resources we manage in Trust. The proposed budget cuts are overruled due to the tidy $2.5 billion profit of Interior Department undistributed offsetting. Budget cuts constitute deprivation of relief benefit under 18USC�246 and bribery of witnesses 18USC�201. $100 million DoD transfer for Palau has not been approved by Congress. Standing Rock Reservation is due $100 million compensation for having the most decreased life expectancy in the nation in 2017 after water-torture in freezing temperatures by out-of-state private pipeline security contractors during the Presidential elections of 2016. Furthermore, the Interior Department does not possess $6 billion in undistributed offsetting receipts it would cost to purchase the Forest Service outright from the Department of Agriculture. While the occupying Secretary is right that $11.7 billion federal outlays annually is enough for the time being, the Secretary is not declaring undistributed offsetting receipts to express a budget surplus and his actual and threatened budget cuts are unjustified. In his individual capacity as lost-hunter he must see to either repeal of the right to bear arms as codified under 16USC�1a-7b or transfer of the section to obstruction of lawful hunt under 16USC�5201 et seq., to prevent obstruction of justice under 18USC�1513 and cease his unnecessary and abusive advocacy of the overthrow of tribal government under 18USC�2385, and negligence regarding the arson of the National Forests under 18USC�81. He is to be tried for Conspiracy Art. 81 Uniform Code of Military Justice under 10USC�881 and Obstruction of Justice under Rule 96 (Art. 134) of the Manual for Courts-Martial. In his defense, Yellowstone history expresses a preference for details of troops specifically ordered to prevent trespassers or intruders from entering the park for the purpose of destroying the game or objects of curiosity therein under 16USC�23 to law enforcement that is indiscriminately authorized to make arrests and carry a firearm under 16USC�1a�6 (2013) and 54USC�102701 (2014) for the dismissal of the magistrate with offices in the Yellowstone jail under 16USC�30 or National Forest under 16USC�551. There is no defense for sanctions against civilian programs from the Eighth, Ninth and Tenth Commandments that prohibit stealing, false testimony and coveting that of the neighbor under Art. 54 of the Fourth Geneva Convention relating to the Protection of Civilians (1949). Title 54, National Park Service and Related Programs was made law by Pub. L. 113�287, �6(e) on Dec. 19, 2014, 128 Stat. 3272. Congress must restore 2013 Chapter 1 National Park Service rules to Title 16 Conservation to create a body of common law with Title 54 of the United States Code.