Photo courtesy of flickr/Brian Turner

The U.S. Virgin Islands Supreme Court and Superior Court remain locked in a debate over the authority the Supreme Court would be allotted if the two systems merged, the courts’ heads said during budget testimonies in July before the 30th Legislature’s Committee on Finance.

Although both courts are in favor of merging into one entity, the question of authority has always been a contentious one. Over the last few years, the idea of merging the courts has become popular, as several years of budget cuts in combination with the Supreme Court’s recent assumption of the mantle of the court of final appeal has made the merger a convenient financial solution. During last year’s budget hearings, Virgin Islands Supreme Court Chief Justice Rhys Hodge publicly supported the merger, citing data from a study by the National Center for State Courts that suggested the Territory could save upwards of $2 million annually.

While the legislation for the merger was introduced at that point, it was held for amendment this February after conflicting testimonies from Chief Justice Hodge and the Superior Court Presiding Justice Michael Dunston showed just how much the courts were in disagreement about allotments of both budget and power.

Both Hodge and Dunston testified that their courts desperately needed millions of dollars more than the budgets the legislation recommended by Governor John P. deJongh would give them, insisting that the courts could not function adequately on the current amounts. The Fiscal Year 2015 recommended budget from the Governor allotted the Superior Court $26.9 million from the General Fund, while the Superior Court requested $31.28 million for salaries, court appointed services, taxes, operating expenses, utility services and youth programs. For its part, the Supreme Court had requested $2.43 million more than the Governor’s recommended budget of $5.48 million, which would cover salaries, benefits, taxes, equipment, operating expenses, the Commission on Judicial Conduct and more.

Additionally, the courts were not in agreement about how much administrative authority each one would maintain after the merger. Hodge and Dunston have met several times to establish areas of agreement, but remain in conflict over what they called the basic philosophical issues about how each court should be managed and where the heads would report. The Superior Court has proposed that its personnel should report to the Superior Court’s presiding judge, while the Supreme Court and the judiciary overall should report directly to the Supreme Court. The Supreme Court, however, stands firm on its proposal that it should supervise the entire court system, unifying both courts and essentially rendering the presiding judge’s position obsolete or merely symbolic.

No votes were taken during the budget hearing, but all involved are hopeful that the courts will reach a middle ground soon.

BoltNagi is an established and well-respected government relations law firm serving individuals, businesses and organizations throughout the U.S. Virgin Islands.

medical marijuanaIt appears that citizens of the U.S. Virgin Islands will finally get their chance to vote on whether or not the Territory should legalize medical marijuana this November.

Senator Terrence Nelson has sponsored a measure that, if it appears on the November general election ballot, would allow voters to give a simple yes or no answer to the question of whether the Legislature should allow for the licensing and regulation of medical marijuana cultivators, distribution centers, caregivers and patients.

For the Legislature to move forward with enacting this legislation, however, not only do the majority of voters on the issue have to vote yes, but the general majority of voters casting ballots in November also have to choose to vote on that specific referendum measure. Many senators expressed strong support of the bill and of the use of medical marijuana in general, and intend to increase efforts to educate the voting public on the medicinal value of marijuana.

Promoting economic development

The approval of this measure is the first time the Legislature of the Virgin Islands has supported a motion to reform marijuana laws by lessening restrictions. Last year, Senator Nelson proposed a bill to reduce penalties for marijuana violations, as well as a referendum on legalizing marijuana. This referendum actually focused on marijuana as an industry booster for the territory rather than as a recreational drug, and garnered support from both local medical practitioners and individuals with serious illnesses who use marijuana for relief from symptoms. These individuals cited studies with data proving the usefulness of marijuana in relieving nausea, pain and other chronic symptoms.

The Bureau of Economic Research was not ready to support the suggestion that the legalization of medical marijuana would boost the U.S. Virgin Islands’ economy, testifying that an economic analysis would be necessary. However, there was a possibility that marijuana legalization could interfere with rum production, one of the Territory’s main industries, although not with local revenues from rum sales.

Proponents have pointed out that legalizing medical marijuana in the U.S. Virgin Islands would dramatically increase the amount of visitors seeking its medicinal properties, boosting hotel rental rates, local cuisine consumption and other tourism dollars.

By adding the measure to the November ballot, the U.S. Virgin Islands is joining the 35 states and the District of Columbia that currently have bills under consideration related to the reformation of marijuana laws to approve and regulate medical marijuana use.

BoltNagi is a widely respected and well-established government relations law firm serving clients throughout the U.S. Virgin Islands.

pool drinkingAlong with all states, the U.S. Virgin Islands has a “dram shop law,” which is designed to enforce the public liability of establishments that sell and serve alcoholic beverages. In recent years, the potential for liability has had local hotels, restaurants and bars concerned about the likelihood of being targeted with a lawsuit if a patron is in an accident while under the influence of alcohol, so the Territory has now added its name to the list of jurisdictions that have imposed a limit to the liquor liability enforceable throughout its dram shop law.

The U.S. Virgin Islands had never seen many of these dram shop cases in previous decades, but in the last few years, local law practices have begun noticing a growing such litigation. These cases typically stem from visitors to the Territory who have sustained or caused injuries after being served too much alcohol at an establishment.

To combat the rise of dram shop lawsuits in the Territory, many of which seemed to be unreasonable or even fraudulent in nature, Senate President Shawn-Michael Malone proposed legislation to curb dram shop liability. Governor John P. deJongh signed the bill, drafted to protect these establishments from frivolous lawsuits, into law last year.

The legislation prevents the individuals who sell and serve alcoholic beverages to patrons from being held liable for any accidents, damage or injuries they cause or sustain, except in cases in which the individuals served persons under the legal drinking age or those who appear to be addicted to alcohol. The new law is based on the language from Florida’s dram shop law.

Even if dram shop lawsuits are fraudulent and don’t produce legitimate evidence of damage, the expense of defense in such a case is very high, up to hundreds of thousands of dollars. This poses a significant threat to the Territory’s many small bars and restaurants. And without the new law, very few establishments would be safe from fraudulent liquor liability cases, as places like gas stations, convenience stores, merchants and even private homeowners could be held accountable for the actions of their patrons or guests who were drinking.

In the year since the law has gone into effect, local establishments have been able to breathe easier regarding selling and serving alcoholic beverages to their patrons. This appears to be a positive development for the tourism industry in the U.S. Virgin Islands.

BoltNagi is a widely respected and established civil litigation law firm serving clients throughout the U.S. Virgin Islands.

same sex wedding ceremonyBoltNagi Attorney Tom Bolt informed the U.S. Virgin Islands’ Finance Committee last month that the territory will most likely be seeing same-sex marriages soon, whether or not residents vote for it.

While presenting next year’s budget request for the V.I. Uniform Laws Commission, a branch dedicated to researching and promoting productive uniform state laws, Bolt said that he anticipates federal courts will order the territory to adopt same-sex marriages soon, even if it does not pass any legislation making these marriages legal.

USVI Senator Judi Buckley has already taken steps to ensure that the territory does vote on the issue, however. Her bill, drafted in support of same-sex marriages and submitted to the Senate in late May of this year, was in the legal counsel phase at the time of the budget hearing where Bolt spoke about the likelihood of same-sex marriage coming to the territory.

Currently, the U.S. Virgin Islands’ Code defines marriage as union between a man and a woman only, a definition that has a number of anti-homosexuality supporters throughout the territory.However, Buckley calls her bill “the marriage equality” bill, and the notion of equality has garnered an equal number of supporters who insist that the right to marriage is a basic human right — regardless of gender.

The bill, which might not make its way to the floor of the Senate by the time Buckley finishes her term in January, would replace the phrase “between a male and a female,” found in Title 16 of the USVI Code, with “between two persons.” Similar language replacements are being made around the United States, as more than a dozen states have recently enacted legislation that legalizes same-sex marriage.

Many of the changes to individual states’ measures regarding marriage laws have come about in response to the U.S. Supreme Court’s decision last year to strike down the federal Defense of Marriage Act on the grounds that marriage can be defined as a union between two people. Bolt referenced this monumental decision in his testimony for the V.I. Uniform Laws Commission, asserting that similar legislation would make its way to the territory — and soon. Even now, if a U.S. Virgin Islands family court denies two people a marriage license because of their genders, they have the opportunity to seek redress through the federal court system. And the national trend toward legalization suggests that even this barrier won’t remain for long.

BoltNagi PC is a well-established and widely respected family law firm serving individuals and families throughout the U.S. virgin islands.

will work for foodRequesting a business loan for your small business, whether you’re starting a new one or expanding your existing business, may seem daunting. However, there are a few small steps you can take to ensure your success in obtaining that loan.

It’s important to understand that business loans are significantly more difficult to obtain than a car or home loan because the stakes — the success or failure of your business — are much higher. Whereas cars and houses are physical assets that the lender can repossess and sell fairly easily if it becomes necessary, a business poses a much bigger loss.

If your business fails to repay the loan by the due date, all the lender can do is grant further, temporary funding in the hopes that your business will reach the point of repayment soon, restructure the loan to lessen the demands of repayment or call in the loan or foreclose on the business — none of which particularly benefit the lender. Therefore, lenders will likely require you to meet specific criteria:

1)      Good credit history. A lender can only grant a loan to someone who appears to repay money on time, and the best way to determine if failure to repay is a possibility is to review your credit history and factor in various considerations. Generally, your credit history has to be extremely good to qualify for a business loan.

2)      Equity. You have to make a financial commitment to your venture as well, to prove to the lender that it’s in your best interest to pursue the success of your business and repay your loan in a timely manner.

3)      Clear business plan. You will have to present the lender with a clearly drawn, carefully researched business plan that comprehensively describes your business and its market, demonstrates awareness of its competition, lays out employment and management plans, accounts for how the loan will be used and offers supporting documents like financial statements and credit reports. You will also need to provide estimates of your business’s cash revenue, income, summarized expenses and balance sheet.

4)      Previous experience. The more experience you have in owning or managing the type of business for which you’re requesting the loan, the better. Lenders prefer you to have at least three years of experience to be certain you can manage the loan responsibly and run the business well.

5)      Collateral. In addition to providing equity, you usually must also pledge an asset of value — up to and even more than the loan principal — as security that the loan will be completely repaid, including interest. The lender will determine the value of collateral required depending on the amount of risk assumed and the amount of any loans already in progress. Borrowers often put up property, inventory, savings or stocks as collateral.

If you approach all five of these requirements clearly and thoughtfully, you can show your lender you are well prepared to manage a loan efficiently and successfully. For further guidance on this important issue, speak with an experienced lawyer.

BoltNagi is a well-established and widely respected corporate and business law firm serving clients throughout the U.S. Virgin Islands. 

White Beach Chairs In Virgin IslandsPartitioning real property (as opposed to personal, financial or intellectual property) is a fairly common process that occurs when a piece of real estate, such as a building, an estate or a parcel of land, has multiple owners who no longer wish to have co-ownership. The property then has to be divided.

Often, not all of the co-owners are in agreement about what to do with the real estate. You may want to start a business in the building, build on the property or even sell it, while your co-owner does not. Usually, a property has multiple owners because it was inherited or because spouses purchased it together, so disputes like this are common. If the co-owner will not voluntarily divide the property, you have the option of bringing a partition action.

Partition options

There are two types of partitions. A “partition in kind,” or “actual partition,” separates each owner’s individual interests in the property, essentially dividing it into distinct portions, with each controlled only by one owner.

If a partition in kind is too difficult to carry out, the property may instead undergo a “partition by sale,” otherwise known as a partition by succession or licitation. In this case, the whole property is sold and its proceeds are divided among the owners.

The right to partition

Your right to partition is considered an absolute right, one that can only be limited by a provision in a will, a written waiver or the law. Even if you’ve been in a co-ownership for years, you can exercise your right to partition at any time. Courts are generally in favor of partitions and grant them willingly.

Preventing partitions

There are some situations in which you can take certain measures to avoid partition actions for a period of time. If the co-tenant agrees not to partition, particularly in writing, they may be prevented from invoking the right to partition temporarily. And if the co-tenant signed a non-partition agreement when obtaining the title to the property, that person will be held to those terms. However, a court usually will not enforce an agreement that permanently prevents the right to partition or that prevents it for an amount of time deemed to be unreasonable.

Partition acts are generally very complicated and require the involvement of the court to settle for a solution in the co-owners’ best interests. If you’re dealing with this issues, consult a skilled real estate attorney.

BoltNagi is a widely respected and well-established real estate law firm serving businesses and investors throughout the U.S. Virgin Islands.  

As a business owner, you may have to decide whether to hire independent contractors or regular employees for various positions. Both practices have their advantages and disadvantages, and are subject to very different rules when it comes to taxes.

Although you do not usually have to withhold or pay any partial taxes for independent contractors you hire, you do have to withhold income taxes, withhold and pay Medicare and Social Security taxes and pay unemployment taxes on wages for regular employees. With that in mind, it’s important to determine from the outset which category the individuals you’ve brought on are going to fall into to avoid tax issues later on.

The following information should help you determine the employment status of the people working for you:

Do you control their work?

Generally, if you have the right to direct and control when, where and how your workers go about or produce their work, no matter how much leeway you may allow them, they are considered employees. If the Internal Revenue Services tries to determine whether your workers are employees or independent contractors, the agency will examine the following specific categories of your control over them:

  • Behavioral control: This covers whether you have the right to direct how your workers perform their jobs, to control the times and locations they do it and to specify the protocol they are to follow through instructions or training.
  • Financial control: This category includes whatever control you may have over all of the business aspects of your workers’ performance, such as how and when they are paid, whether their expenses are reimbursed, who furnishes the necessary tools and supplies and what their profit, loss or investment opportunities are.
  • Type of relationship: This area takes into account how both you and your workers regard your relationship, examining the contracts or intents of both parties, the policy for termination or discharge, worker benefits (like vacation pay or insurance) and the intended continuance of the work.

Although these factors may vary depending on the business, it’s important to both consider and document all of these scenarios to make an accurate determination. If you’ve examined the evidence and are still unsure, you or your worker can file a worker status determination form with the IRS to obtain an official decision. For further guidance on this issue, consult an attorney experienced in labor law.

BoltNagi is a widely respected and well-established employment law firm serving businesses and organizations throughout the U.S. Virgin Islands.

tax catDuring tax time, it’s fairly common for people to realize that they don’t have the financial resources to pay the full or even a partial amount of their tax obligations. In these situations, the logical action for many is to avoid filing taxes altogether. After all, if you cannot pay the bill, what’s the point in filing?

It’s important to understand, however, that there are a number of reasons why you should file your taxes no matter your financial circumstances. The Internal Revenue Service not only charges you interest for paying late taxes, but also penalizes you 5 percent of the total amount you owe per month for up to five months. Even if you are unable to pay, at least filing your return will help you avoid this major penalty.

If you’re facing this challenge, the following options are available to you:

  • Set up an installment agreement: As long as you don’t owe more than $25,000 in combined taxes, interest and penalties and the IRS does not have records showing you haven’t filed all your past due tax returns, you are eligible for an installment plan. The IRS is willing to work with you on setting up a payment plan via installments for up to 60 months. Even if you do owe more than $25,000, you may have some room to negotiate with the IRS.
  • Request an extension for undue hardship: If you can show evidence that paying your taxes on time would cause you undue hardship, such as losing property, you may be eligible to file for a payment extension. This will give you an extra six months to pay the amount you owe. While the amount will still accumulate interest over the extension period, you won’t be charged any penalties.
  • Make an offer-in-compromise: Because the IRS would prefer to receive even a partial amount of what you owe over nothing at all, the agency may accept an offer-in-compromise (OIC). If you can convince the IRS that you are not able to pay the full amount, that your tax liability may be inaccurate or that payment in full would cause you economic hardship or unfair difficulty, the agency may accept your offer to pay only a partial percentage of what you owe.
  • Pay with credit: Although it is never advisable to incur debt, the interest rate on a personal bank loan, home equity loan or even your credit card may be less than the interest and penalties the IRS may impose on you for late taxes.

No matter your situation, it’s always safer and more responsible to file your tax return and follow one of the above methods than to jeopardize your future by missing the deadline.

BoltNagi is an experienced and widely respected tax planning law firm serving clients throughout the U.S. Virgin Islands.

BanksyRecently the federal government announced that certain provisions of the Affordable Care Act would no longer apply to U.S. territories — most specifically the requirement that insurance companies must offer coverage to all individuals. The decision related to the Public Health Service Act’s definition of the word “state.” Under the PHSA, the provisions of the health care law only apply to states, and territories are exempt.

For months, U.S. territories have grappled over the provisions of the ACA and how it applied to them. Previously, the law was read to require insurers to provide health insurance coverage to all residents, regardless of previous conditions, but did not impose a mandate on all residents to purchase insurance. This resulted in a larger percentage of unhealthy individuals buying policies, thereby increasing costs for insurance companies that rely on healthy individuals’ premiums to offset the cost.

Now, with the new reading of the ACA, insurance companies are no longer obligated to offer coverage to all residents of the territories and could discriminate against individuals based on their health, a practice the ACA was meant to curb. This means that insurance rates for unhealthy individuals will likely go up. Whereas previously people could purchase identical policies regardless of health, insurers may now bar certain individuals from purchasing policies and are exempt from providing fair health premiums.

Insurers also no longer must offer certain services, such as essential health benefits, another mandate of the ACA. This includes ambulatory services, emergency services, maternity and newborn care, hospitalization, mental health and addiction services and prescription drugs.

Certain provisions of the ACA will still apply to insurance companies in the U.S. territories, including the disallowance of bans on annual or lifetime benefits. Additionally, insurers must provide coverage for preventative care. The changes will go into effect over the next several months, although insurance companies do not have to repay any grant funds that have already been spent. All unspent grant money must be returned.

BoltNagi is a well-respected and established government relations law firm serving clients throughout the U.S. Virgin Islands.

old manChoosing your health care power of attorney is an incredibly important decision, as the person you authorize­­ — known also as an agent — will be able to make important decisions on your behalf if you can no longer communicate or become medically incapacitated, as in the instance of a coma.

When it comes to choosing a health care agent, individuals often choose people they know and are close to, such as spouses, partners, close friends, siblings or relatives. When engaged in this aspect of estate planning, it’s important to choose someone with whom you feel comfortable discussing your plans and wishes for medical treatment and who may already have knowledge of your medical history.

How much power does your health care agent have?

Although your health care agent may not agree with your medical plans entirely, they are legally obligated to carry out your wishes, so it always helps to choose agents who will respect your beliefs even if they have conflicting feelings themselves.

Because these medical decisions may become complicated and emotional, it’s important to keep the following considerations in mind when choosing who you would like to authorize with your health care power of attorney:

  1. Is the person located nearby? It is not mandatory that your health care agent live on the same island or area as you, but they may have to be on constant call if you contract a long-term illness to help ensure your physicians follow your medical wishes.
  2. Is the person confident and assertive? Occasionally, your health care agent may have to carry out your wishes in the face of conflicting opinions from your friends and family members and medical staff.
  3. Are you naming a separate financial agent? It’s somewhat common for agents authorized separately with power of attorney for health care and finances to run into conflicts, so it might be a good idea to authorize the same person for both powers.
  4. Are you naming an alternative agent? Strongly consider naming a back-up health care agent, whom you also trust, in case your current agent resigns, passes away or becomes incapacitated.
  5. Are you naming a health care provider as your agent? To prevent bias, it’s recommended that you avoid naming a doctor or employee of a health care organization as your agent, unless you are married or related to that person.

Above all, your health care agent should be someone you trust to carry out your wishes as fully and precisely as you’ve outlined. Make sure you prepare ahead of time and cover all possible scenarios with this important individual.

BoltNagi is a respected estate planning law firm serving individuals and families throughout the U.S. Virgin Islands.