2014

2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville
SCHEDULE THURSDAY, OCTOBER 30
8:00 - 8:30
Registration
8:30 - 9:30
Ethics (Trust Accounts) (federal credit)
Speaker: Trinity M. Braun-Arana, Asst. Director for Boards and
Commissions Office of Professional Regulation
9:30 - 10:00
Business Court 101
Speaker: Hon. John Telleen, Scott County Courthouse
and Joe Harris
10:00 - 10:30
Dos and Donts of Small Claims
Speaker: Samuel Jones, Shuttleworth & Ingersoll PLC
10:30 - 10:45
Break
10:45 - 11:30
Family Law 101
Speaker: Caitlin Slessor, Nazette Marner Nathanson & Shea LLP
11:30 - 12:30
Lunch (lunch on your own)
LITIGATION TRACK
12:30 -1:30
Deadline in Litigation
Speaker: Laura Bergus, Hayek Brown Moreland & Smith L.L.P.
1:30 - 2:15
Expedited Litigation Rules
Speaker: Karen Lorenzen, Hayes Lorenzen Lawyers
2:15 - 3:15
Criminal Law Update
Speaker: Meredith Rich-Chappel, Kids First Law Ctr.
3:15 - 3:45
Voir Dire (federal credit)
Speaker: Jim Weston, Tom Riley Law Firm PLC
3:45 - 4:00
Break
4:00 - 5:00
Anatomy of a Case (federal credit)
Speaker: Megan Dimitt, Lederer Weston & Craig PLC
TRANSACTIONAL TRACK
12:30 - 1:30
Business Formation
Speaker: Sean Wandro, Meardon Sueppel & Downer PLC
1:30 - 2:45
Real Estate
Speaker: Matt Hektoen, Simmons Perrine Moyer Bergman PLC
2:45 - 3:45
Estate Planning (federal credit)
Speaker: Janice Kerkove, Bradley & Riley
3:45 - 4:00
Break
4:00 - 5:00
Securities (federal credit)
Speaker: Bill Daly, Shuttleworth & Ingersoll PLC

CLE Hours
7 hours of state CLE which includes
1 hour of ethics CLE and 2.5 hours of federal CLE.
Activity ID # 156931

Caveat
The printed materials contained in this book
and the oral presentations of the speakers are
not intended to be a definitive analysis of the
subjects discussed. The reader is cautioned that
neither the program participants nor The Iowa
State Bar Association intends that reliance be
placed upon these materials in advising your
clients without confirming independent research.

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2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

Trust Accounts
8:30 a.m.-9:30 a.m.
Presented by
Trinity M. Braun-Arana
Asst. Director for Boards and Commissions
Office of Professional Regulation
1111 E. Court Avenue
Des Moines, Iowa 50319
Phone (515) 725-8100
Fax (515) 725-8032

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Trust Accounts in Iowa

October 2013

Authority
Iowa Rule of Professional Conduct 32:1.15 addresses the duty to
safeguard property of clients and third persons. Chapter 45 of the Iowa
Court Rules provides substantial detail regarding trust account
operations. Notably, chapter 45 addresses proper handling of client
advances for fees or expenses, and requires notice to clients when
advances are applied to earned fees or expenses. Chapter 45 also lists the
specific trust account records that must be maintained for at least six
years after termination of any representation.
The outline and presentation slides prepared by the Office of
Professional Regulation regarding trust account operations are available at
the Client Security Commission web page:
http://www.iowacourts.gov/For_Attorneys/Professional_Regulation/Client_Security/
Establishing an Account
Need for a Trust Account:
Not every lawyer needs a trust account. The key issue is whether
you accept funds of the kind that must be placed in a trust account. (See
the discussion regarding required trust account deposits under Operating
the Account, below.)
Government attorneys or corporate counsel
generally will not need to maintain a trust account.
Most private
practitioners will need to maintain a trust account. Iowa R. of Profl
Conduct 32:1.15; Iowa Ct. R. 45.1.
What Kind of Trust Account is Required:
For most client funds, the appropriate account is the pooled, or
IOLTA account, in which funds belonging to multiple clients or third
parties are pooled in a single account. Interest earned on a pooled trust
account (net of allowable service charges for that type of account) is paid
by the depository institution to the Lawyer Trust Account Commission
(LTAC). LTAC distributes grants annually as approved by the Iowa
Supreme Court for legal services for low-income persons and law-related
education. Iowa Ct. R. 45.4(1).

Court rules also authorize use of a separate interest-bearing

account for an individual client or third party. When a separate interestbearing account is used for an individual client or third party, the interest
earned on the account (net of account costs) is payable to the client or
third party for whom the account was established. Iowa Ct. R. 45.4(2)(a).
Court rules also authorize establishing a pooled trust account with
subaccounting, wherein the interest owed to each individual client is
computed and paid, net of pro rata account costs, to the individual client.
These accounts seldom are used due to the administrative overhead
associated with interest computation and the generally insignificant
amount of interest actually payable to any particular client after deduction
of costs. Iowa Ct. R. 45.4(2)(b).
In determining whether to deposit client or third-party funds into an
IOLTA account or a separate account for the individual client, the lawyer
must assess whether the funds to be invested could produce a positive net
return for the client. The lawyer should consider the following factors:
The amount of the funds to be deposited;
The expected duration of the deposit, including the likelihood of
delay in the matter for which the funds are held;
The rates of interest or yield at the financial institution in which the
funds are to be deposited;
The cost of establishing and administering the account, including
service charges, and the cost of preparing any tax reports required
for interest accruing to a clients benefit;
The depository institutions ability to calculate and pay interest to
individual clients;
Any other circumstances that affect the ability of the clients funds
to earn a net return for the client.
Iowa Ct. R. 45.4(3).
Tip: This is not a one-time analysis. Every client balance in a
pooled trust account should be considered in light of these factors
on a recurring basis. An excellent time to consider this issue is
incident to the monthly reconciliation of client balances with the
trust account checkbook and bank statement.

What Institutions May Serve as Trust Account Depositories:

A bank, savings bank, trust company, savings and loan association,
credit union, or federally regulated investment company may serve as a
depository institution, provided the institution is authorized to do
business in Iowa and is FDIC/NCUSIF insured. However, trust monies
may be deposited at credit unions only to the extent that each individual
clients funds are eligible for insurance. Iowa Ct. R. 45.3.
Other factors the attorney should consider when selecting a
depository institution:
Amount of deposit insurance available and likely client
balances
Institutional stability
Convenience
Bank interest rate and fees
Return of cancelled checks or facsimiles thereof
Location of the Account:
Although the ABA model rule allows maintenance of a lawyer trust
account in the state where the lawyers office is situated, or elsewhere with
the consent of the client or third person involved, this language is omitted
from the Iowa rule. In contrast, Iowa Court Rules 45.1 and 45.3 require
placement of trust accounts in Iowa financial institutions for all matters
arising out of the practice of law in Iowa.
Tip: Lawyers practicing in Iowa from offices outside the state
generally meet this requirement by opening their Iowa trust account
at an Iowa branch of a multistate bank, and then performing their
day to day banking operations at a branch location of that
multistate bank located near their office.
Deposit Insurance:
So long as a trust account at a bank is properly titled (trust
account) and the attorney maintains current records regarding the
interest of each client (subaccount ledger cards), deposit insurance limits
will be applied per client. If a trust account is located at a credit union,
the foregoing requirements must be met, and in addition the client
personally must qualify to be a depositor at the credit union, to qualify for
deposit insurance.
The standard insurance amount is $250,000 per depositor. You
likely will encounter the situation of client deposits exceeding the FDIC
3

insurance limits. The key considerations are first, that you owe your
clients a high duty of care as a fiduciary, but you are not an insurer or
guarantor. Second, it is acceptable to discuss the deposit insurance issue
with your clients and let them help formulate a strategy.
Tip: With the foregoing considerations in mind, here are some
recommendations:
1. Choose a strong bank to do business with. It is a good
idea to monitor the bank watch lists to ensure your bank is not on
the list, for example.
2. For deposits that will be on deposit for an extended period
of time, you will want to split the funds over two or more banks to
get coverage for the amount in its entirety. It is likely that the client
would be entitled to the interest in this situation, under the
provisions of Iowa Court Rule 45.4(3)(accounts generating positive
net earnings).
3. If a deposit is not going to be on deposit long enough to
make splitting it up over several banks practical, get the money in
and out as soon as possible. Speed is your ally, in this situation.
Verified electronic or wire deposits and transmittals are best for this
purpose.
4. If you routinely have deposits in excess of the insurance
limit, you might consult with your banker regarding commercial
deposit insurance. This is an expense that could be passed along to
the clients, so long as you disclose it to your clients and address it
in your fee or engagement agreement.
5. Some clients will have their own deposits at the same bank
where your trust account is located. It is imperative that you
discuss deposit insurance with them to ascertain if their personal
deposits will affect coverage for what you have in the trust account.
Nature of the Account to be Established:
The account agreement must allow withdrawals and transfers
without delay whenever the deposited funds are required, subject only to
any notice period the institution is required to impose by law or
regulation. In practice, this means a checking account or the functional
equivalent thereof. Iowa Ct. R. 45.3.
A lawyer trust account must include in the title of the account the
words Trust Account." Iowa Ct. R. 45.1. This account identification is
4

required to ensure coverage for each clients monies under federal deposit
insurance rules.
Bank Duties With Respect to IOLTA Accounts:
The lawyer is responsible for directing the institution to perform the
interest payment and reporting tasks required of IOLTA depositories no
less often than quarterly. These tasks include remitting interest or
dividends earned on the account, net of allowable service charges, to
LTAC, along with a copy of the account statement. Iowa Ct. R. 45.4(4). If
the allowable monthly service charge exceeds the IOLTA interest payable
and the institution does not waive the excess, the law firm is responsible
for paying the excess service charge. Charges associated with law firm
activities with the account such as wire transfer fees or check printing
charges may not be netted against IOLTA interest, and are a law firm
responsibility also.
Iowa Ct. R. 45.5.
LTAC asks that depository
institutions also prepare and send a summary report form with the
statement. Copies of the report form and an instruction document for
new IOLTA depository institutions are included in the forms portion of this
outline.
Iowa Court Rule 45.4(4) allows a depository institution to collect an
allowable monthly service charge from the interest earned on a pooled
lawyer trust account. For purposes of chapter 45 of the Iowa Court Rules,
allowable monthly service charge is defined as a monthly fee
customarily assessed by the institution against a depositor solely for the
privilege of maintaining the type of account involved.
Approximately
two-thirds of the banks and credit unions serving as depositories for trust
accounts in Iowa do not assess a service charge on these accounts. Of
those institutions that do assess a service charge, most simply assess a
small flat monthly fee, which is considered permissible under the rule.
Recently, a few institutions have begun assessing an activitybased service charge, computed on the basis of account activity such as
credit and debit transactions. These activity-based charges sometimes are
assessed in addition to a flat minimum monthly service charge. Iowa
Court Rule 45.5 provides that charges assessed for transactions involving
the account are a lawyer or law firm responsibility, and may not be paid
from interest or dividends otherwise payable to LTAC. Based on this rule,
the LTAC policy is that these activity-based charges may not be collected
from interest due LTAC under the IOLTA (Interest on Lawyer Trust
Account) program. If an institution chooses to assess these activity-based
charges, and the lawyer or law firm continues to house the trust account
at that institution, the lawyer or law firm is responsible for paying the
activity-based charges.
5

The federal tax identification number for LTAC is 42-1245104. This

number must be used in connection with any IOLTA trust account
established pursuant to Iowa Court Rule 45.4(1).
Overdraft Notification Program:
With respect to any account established under Iowa Court Rule
45.4(1), the lawyer is required to direct the depository institution to report
to the Client Security Commission any time an overdraft condition exists
with respect to a lawyer trust account. This rule is modeled after a similar
provision adopted in Minnesota in 1990. Most states have adopted a
similar provision requiring that banks immediately notify the lawyer and
the state disciplinary office whenever an overdraft occurs in a lawyer trust
account. The experience in those states that have adopted such a rule is
that early intervention following reporting of an overdraft helps prevent
additional losses to clients that would occur absent a timely inquiry by the
disciplinary authority. Iowa Ct. R. 45.4(c).
More than One Trust Account:
A lawyer or law firm may maintain more than one trust account.
However, because a single IOLTA trust account can hold funds for
multiple clients, most lawyers only need to maintain one IOLTA trust
account. Multiple accounts create additional record-keeping overhead
and increase the chance that mistakes will be made depositing and
disbursing funds. Multiple trust accounts most often are used where
circumstances dictate opening a trust account for an individual client
under the provisions of Iowa Court Rule 45.4(2)(a) in addition to the IOLTA
trust account normally maintained by the lawyer or firm.
Signature Authority on Trust Accounts:
Only a lawyer admitted to practice in Iowa or a person under the
direct supervision of a lawyer may be an authorized signatory on a trust
account.
Iowa Ct. R. 45.2(3)(b).
The Client Security Commission
recommends that lawyers carefully evaluate whether non-lawyer staff
members should be authorized to sign checks or authorize transfers. The
responsibility and accountability for client funds is non-delegable, and the
attorney will be personally responsible for any staff defalcation.
Tip: If signature or transfer authority is delegated to non-lawyer
staff, the Client Security Commission recommends procuring
employee dishonesty insurance coverage.

Provision for Stand-by Signature Authority:

Iowa Court Rule 45.11 allows a sole lawyer signatory to designate
another Iowa lawyer as a stand-by signatory on his or her trust account,
with that authority to become effective upon the occurrence of an event or
events described in the instrument, which might include death,
disappearance, abandonment of law practice, temporary or permanent
incapacity, suspension, or disbarment. The new rule facilitates planning
by sole practitioners for administration of their law practice in the event of
their death or disability.
Tip: Planning for death or disability is required on the part of most
sole practitioners, based on comment 5 to Iowa Rule of Professional
Conduct 32:1.3. An outline on planning, with sample forms, is
available at the Client Security Commission web page:
http://www.iowacourts.gov/For_Attorneys/Professional_Regulation/Client_Security/

Operating an Account
Principles of Trust Account Operations:
Do not Commingle Your Own Funds in the Trust Account, except for
the limited exception provided by Iowa Rule of Professional Conduct
32:1.15(b) and Iowa Court Rule 45.1(1).
Each Clients Funds in a Pooled Account Must Be Treated as a
Separate Subaccount
A Client Can Only Spend His or Her Subaccount Monies
A Client Subaccount Never Should Show a Negative Balance
Only Make Disbursements from Known Good Funds
You Must Account to the Penny at All Times
The End Result for Any Client Subaccount Must be Zero
An Audit Trail is Essential
What Funds Must Be Deposited in the Trust Account:
All funds of clients, regardless of size, paid to a lawyer or law firm,
including advances for costs and expenses and excluding only general
retainers (a defined term), must be deposited in an interest-bearing trust
7

account located in Iowa. Iowa R. Profl Conduct 32:1.15(a); Iowa Ct. R.

45.7(3), 45.9(1) and 45.10(2). The decision on where to place funds is based
on ownership at the time the funds are receivednot how quickly
ownership will change from client to the lawyer. Common examples:
Any advance fee or retainer except a general retainer. Iowa
Ct. R. 45.7(7)(3)(advance fees and expenses), 45.9(1)(special
retainers), and 45.10(2)(flat fees); Board of Professional Ethics
and Conduct v. Apland, 577 N.W.2d 50 (Iowa 1998)
Advances from the client for costs and expenses
Settlement proceeds that include a portion that is the attorneys
fee
Real estate loan proceeds prior to closing and disbursement
Funds from the sale of property belonging to the client
Funds and Property of Third Parties:
The rules make clear that the obligation to safeguard and account
extends to the property of third persons that comes into the lawyers
possession in the course of practice, in addition to client property. Iowa
R. of Profl Conduct 32:1.15(a); Iowa Ct. R. 45.1.
Requirement to Inform Client or Third Party Regarding Effect of Deposit in
IOLTA Trust Account:
If the funds of a client or third person are deposited in a pooled
account established under the provisions of Iowa Court Rule 45.4(1), the
lawyer must inform the client or third person that interest accruing on the
account, net of allowable monthly service charges, will be paid LTAC
under the IOLTA program described in chapter 45 of the Iowa Court
Rules. Iowa Ct. R. 45.4(1). The rule does not require that this be done in
writing.
Tip: Your law firm operating procedures should include this notice
as a matter of course any time you accept monies from anyone
client or third partythat will be placed in your IOLTA account.
Possible places you might put a written notice include your law firm
brochure; your written fee agreements; and the receipt or
acknowledgement you give a client when you accept monies for
deposit in the trust account. At a minimum, you probably will want
to make it standard operating procedure to advise the clients
8

verbally regarding the IOLTA program whenever you accept these

kinds of funds.
What Funds May NOT Be Deposited in the Trust Account:
No funds belonging to the lawyer or the law firm may be deposited in
the trust account. Common examples of funds that should not be placed in
the trust account include:
Fees already billed for and earned
Funds an attorney holds that are not related to the practice of
law (e.g., the monies belonging to the county bar association for
which the attorney is treasurer)
Exception: Funds reasonably sufficient to avoid or pay service
charges may be deposited in the trust account. Iowa Ct. R. 45.1(1). Where
a minimum balance requirement exists for the account, it is permissible to
deposit funds sufficient to maintain the minimum balance. A separate
subaccount ledger should be maintained for such deposits.
Exception: Funds belonging in part to a client and in part to the
lawyer or law firm (presently or potentially) must be deposited in the trust
account. This rule applies even if the funds will be disbursed to the parties
entitled thereto on the same day they are received. However, the lawyer or
law firms portion must be withdrawn promptly when due, unless
entitlement to that portion is disputed by the client. Disputed portions
must remain in trust until the dispute is resolved. Iowa Ct. R. 45.1(2).
What Payments or Disbursements May be Made from the Trust Account:
No payments for personal or office expenses of the lawyer should be
made from a trust account. If some portion of the money in a trust account
belongs to the lawyer because it is his or her earned fee, the lawyer should
write a check on the trust account payable to the lawyer, deposit it in the
lawyers business account and pay his or her expenses from the business
account.
Fees may and should be withdrawn as soon as they are earned and
undisputed. An accounting to the client for the fees deemed earned should
be provided the client no later than contemporaneously with the withdrawal
for such fees or expenses. Iowa Ct. R. 45.7(4).
Costs or expenses incident to services performed may be paid based
on agreement with the client. An accounting to the client for costs and
expenses paid from the clients subaccount should be provided the client no
9

later than contemporaneously with the withdrawal for such expenses. Iowa
Ct. R. 45.7(4).
Disbursements requisite to closing of a real estate transaction or
settlement of an injury claim may be made from the client subaccount. An
accounting to the client for all the disbursements should be provided to and
approved by the client incident to the disbursements.
If two or more parties dispute entitlement to funds held by a lawyer in
trust, the lawyer should retain those funds in trust until such time as the
dispute is resolved. Iowa R. of Profl Conduct 32:1.15(e). The disputed
funds should be placed in an account that will bear interest for the benefit
of the parties if the considerations of Iowa Court Rule 45.4(3) indicate the
funds could generate positive net earnings for the parties ultimately found
entitled to the funds.
When Disbursements May be Made Based on a Deposit:
Every deposit to a lawyer trust account must be allowed to clear
through the banking process before disbursement is made based on that
deposit. If this procedure is not observed, the likely eventual result will be
wrongful disbursement of other clients funds when a check or draft
deposited to the trust account is dishonored.
Cash deposits and verified electronic transfers are reliable enough to
support same day disbursement. Bank certified checks are reliable enough
to support same day disbursement provided authenticity of the check is
known to the lawyer or verified with the issuing bank. If authenticity is not
known to the lawyer, verification should be sought from the issuing bank.
(See the discussion under the heading Schemes Intended to Divert Trust
Account Balances, below, regarding the risk of counterfeit certified
checks.)
Cashiers checks and personal checks should be allowed to clear
completely through the issuing institution. Your own bank institution can
provide guidance regarding normal clearance times and can verify clearance
of individual instruments at the issuing bank.
If a same-day closing or settlement is desired, the best solution
generally will be to require that the deposit to your trust account be made
by wire transfer or bank certified check.
Form of Disbursements:
Disbursements from a trust account must be made by check or by
authorized bank transfer. Iowa Ct. R. 45.2(3)(b)(3). Any check drawn on the
10

trust account must be payable to a named payee, and never to cash. Cash
withdrawals from a trust account are not permitted. An authorized bank
transfer contemplates the common forms of electronic banking transactions,
including an authorized wire transfer, electronic fund transfer, or debit
transaction.
Handling Retainers and Advances for Fees and Expenses:
In Board of Professional Ethics and Conduct v. Apland, 577 N.W.2d
50 (Iowa 1998) the Iowa Supreme Court ruled that all advance fee
payments must be placed in the client trust account until earned. The
court also characterized so-called flat fees and special retainers as
advance fees, and stated that they also must be placed and held in trust
until earned. The court distinguished a true general retainer, in which the
consideration is paid in exchange for a commitment of future availability
to provide services, as earned at the time it is paid.
The Apland requirements regarding handling of advance fees,
general retainers, special retainers, and flat fees now are specifically set
out in Iowa Court Rules 45.7 through 45.10. The requirement for trust
account deposit specifically applies to advances for expenses as well as
any kind of advance fee. Iowa Ct. R. 45.7(2).
When a lawyer withdraws funds from the trust account to pay
earned fees or expenses, the client must be provided written notice of the
time, amount, and purpose of the withdrawal, along with a complete
accounting. This notice and accounting must be transmitted no later
than the date the withdrawal is made. Iowa Ct. R. 45.7(4).
Tip: It appears these rules dictate that fees and expenses be
handled one of two ways. The first, and most cumbersome way, is
to place the funds in your trust account, open a client subaccount
ledger card, pay the fee or expense by check or debit drawn on the
trust account, and then send the client a notice and accounting not
later than the day you make the deduction for fees or expenses. The
second, and less cumbersome way, is to place the funds in your
trust account, open a client subaccount ledger card, pay the fee or
expense from the law firm business account or by law firm credit
card on behalf of the client, and then include the fees and expenses
owed by the client in your periodic billing cycle, with your statement
showing the amounts owed for fees and advanced expenses, and the
amount you intend to deduct from the clients trust account
balance.
What You Must Not Do:
11

You must not deposit advances for unearned fees or advances for
expenses in your business account.
You must not pay anything from a clients monies in your trust
account until you provide notice and accounting for the deduction
or payment.
Flat Fees
A flat fee embraces all services that a lawyer is to perform, whether
the work is relatively simple or complex. Iowa Ct. R. 45.10(1). If a flat fee
is paid prior to performance of the services, it must be deposited in the
trust account.
Iowa Ct. R. 45.10(2).
Contracts providing for
nonrefundable flat fees are unethical and void. Board of Prof. Ethics and
Conduct v. Frerichs, 671 N.W.2d 470, 475 (Iowa 2003).
Absent an agreement with the client to the contrary, a lawyer is
entitled to the flat fee when the contemplated services have been
completed. However, the lawyer and client may agree regarding when and
how much of the flat fee will be earned and may be withdrawn as the work
progresses to completion. The agreement must reasonably protect the
clients right to a refund of the unearned portion of the flat fee in the event
the client engages new counsel or the lawyer fails to complete the work.
Iowa Ct. R. 45.10(3). Any withdrawal of a portion of the flat fee from the
trust account requires notice and accounting to the client under rule 45.7.
Conflicting Claims to Funds in Trust:
If a lawyer has possession of funds or other property to which there
are conflicting claims, the property should be separately maintained until
the dispute is resolved. Iowa R. of Profl Conduct 32:1.15(e). This may
include third party claims against client funds in the trust account. If the
third party claims are not frivolous, the lawyer must refuse to surrender
the property to the client until the claims are resolved. Iowa R. of Profl
Conduct 32:1.15, comment [5].
What Books and Records Must be Maintained:
Every lawyer engaged in private practice of law must maintain books
and records sufficient to demonstrate compliance with Iowa Rule of
Professional Conduct 32:1.15(a). Books and records relating to funds or
property of clients are to be maintained for at least six years after
termination of the representation to which they relate. Iowa Ct. R. 45.2(3).
A certification regarding this responsibility is included in the annual
report filed with the Client Security Commission each year. Iowa Ct. R.
45.6. Upon dissolution of a firm or practice or sale of a firm or practice,
12

arrangements must be made for maintenance of the books and records for
the required six year period. Iowa Ct. R. 45.2(3)(d), (e).
Implementation of the Record Keeping Duty:
Effective February 20, 2012, Iowa Court Rule 45.2 was amended to
describe in detail the financial records a lawyer must maintain for a client
trust account.
Records required by the rule may be maintained by
electronic, photographic, computer, or other media, so long as they
otherwise comply with the rules and printed copies can be produced.
Iowa Ct. R 45.2(3)(c).
For each account maintained, records should identify the name of
the depository, account number, account name, and date the account was
opened. The records should also show the type of each such account,
whether pooled with net interest paid to the Lawyers Trust Account
Commission (IOLTA account), pooled with allocation of interest, or
individual, including the client name. In addition to this basic record for
each
account,
the
following
records
must
be
maintained:
Receipt and disbursement journals containing a record of
deposits to and withdrawals from client trust accounts, specifically
identifying the date, source, and description of each item deposited, as
well as the date, payee and purpose of each disbursement;
Ledger records for all client trust accounts showing, for each
separate trust client or beneficiary, the source of all funds deposited, the
names of all persons for whom the funds are or were held, the amount of
such funds, the descriptions and amounts of charges or withdrawals, and
the names of all persons or entities to whom such funds were disbursed;
Copies of retainer and compensation agreements with clients
as required by Iowa R. of Profl Conduct 32:1.5;
Copies of accountings to clients or third persons showing the
disbursement of funds to them or on their behalf;
Copies of bills for legal fees and expenses rendered to clients;
Copies of records showing disbursements on behalf of clients;
The physical or electronic equivalents of all checkbook
registers, bank statements, records of deposit, pre-numbered canceled
checks, and substitute checks provided by a financial institution;
Records of all electronic transfers from client trust accounts,
13

including the name of the person authorizing transfer, the date of transfer,
the name of the recipient, and the trust account name or number from
which money is withdrawn;
Copies of monthly trial balances and monthly reconciliations
of the client trust accounts maintained by the lawyer, and
Copies of those portions of client files that are reasonably
related to client trust account transactions.
A record showing all property, specifically identified, other
than cash, held in trust from time to time for clients or others. Routine
files, documents and items such as real estate abstracts that are not
expected to be held indefinitely need not be so recorded but should be
documented in the files of the lawyer as to receipt and delivery. A
suggested form for recording property held in trust is included in the
forms portion of this outline.
Monthly Reconciliations Required:
Monthly reconciliations of the main trust account ledger, client
subaccount ledgers, and adjusted bank statement, the so-called threeway reconciliation, are required by rule 45.2(3)(a)(9). The Client Security
Commissions experience is that failure to perform trial balances and
reconciliations of client subaccounts on a monthly basis is a key
contributor to loss of accountability for client monies.
Tip: A monthly statement from your bank is a vital part of the
reconciliation process. If your bank normally provides statements
on a quarterly basis instead of monthly, you will need to make
arrangements to receive monthly statements or access monthly
statement information electronically.
Use of Computer Accounting Systems:
Lawyers or law firms may use computer systems to maintain trust
account records. A number of functional software programs are available
for this purpose. For an example of guidelines for use of a general
accounting software program, and information regarding just a few of the
many trust-account specific software modules available, see the following
web pages:
http://lprb.mncourts.gov/LawyerResources/TADocuments/Maintaining
Trust Accounts Using Quicken (2006).pdf
http://law.lexisnexis.com/back-office-pclaw
14

http://www.easysoft-usa.com
http://www.abacuslaw.com/products/trustaccounting.html
http://www.tabs3.com
http://www.lawyertrustaccount.com
http://www.esilaw.com
An attorney who maintains trust account records by computer
should print and retain, on a monthly basis, the checkbook register, the
balances of the subaccount ledgers, and the reconciliation report.
Electronic records should be regularly backed up by an appropriate
storage device. The frequency of the back up procedure should be directly
related to the volume of activity in the trust account.
Accounting to the Client:
The lawyer must render appropriate accounts to the client regarding
all funds, securities and other properties of a client coming into the
possession of the lawyer. Iowa Ct. R. 45.2(2). Prompt payment or delivery
must be made to the client of all such items the client is entitled to when
the client so requests. Iowa Ct. R. 45.2(2).
Simply stated: When clients ask you how much money youre holding for
them or what youve done with the money while youve had it, you must
tell them. You must advise the client every time something is added to the
clients subaccount, and every time something is taken from the client
subaccount.
Client Payments By Credit Card:
Three key issues must be addressed if you want to accept credit
card payments of retainers or billed fees. First, you must address the
surcharge imposed by the credit card company. Ordinarily, your credit
card merchant agreement will prohibit assessing the surcharge to the
client, so the law firm will have to pay the surcharge. The authority
provided by Iowa Court Rule 45.1(1) may be used to establish a law firm
subaccount with a small, periodically refreshed balance, within the trust
account, to pay the service charges associated with retainers paid by
credit card. A better alternative, if the credit card issuer is willing, is to
assess the service charges against the law firms general business
account.

15

Second, you must be careful not to make disbursements based on a

credit card deposit in your trust account until there is no possibility the
charges can be reversed. Normally there is an initial delay until the bank
actually credits a credit card payment to the trust account, and there is a
further period during which the client may object and reverse the charge
on the card. You should ascertain from the credit card issuer how quickly
it actually credits such deposits, and when these deposits become
ineligible for charge back by the credit card holder. Once again, you may
be able to arrange with your credit card issuer for charge-backs to be
made against your firm operating account rather than your trust account.
Third, if you will be accepting credit card payments of both retainers
and earned fees, and you only want to set up one account to accept the
credit card payments, you should set up your trust account to accept the
credit card payments, rather than your operating account. Put all credit
card payments in your trust account, and keep the retainers there until
earned and the contingencies have passed. Keep the earned fee payments
there until the contingencies have passed, and then transfer them over to
your business account for disbursement.
At least one credit card issuer now offers lawyers a product that
assesses all service charges and charge-backs against the law firm
business account, but allows the lawyer to direct each credit card
payment to the trust account or the business account, as appropriate,
depending on the nature of the receipt. This type of product appears to
best address the issues associated with acceptance of payments by credit
card.
How to Handle Electronic Payment of Fees:
With the advent of electronic filing of pleadings in cases, electronic
payment of filing fees now is possible, and in fact is required in some
courts. Electronic transfers from (and to) trust accounts are permitted by
Iowa Court Rule 45.2(3)(b)(3), but proper handling of electronic fee
payments on behalf of clients requires observance of several rules
pertaining to trust accounts:
Client advances for expenses, including filing fees, must be
deposited in a trust account, and withdrawn only as the expenses
are incurred. Iowa R. Prof. Conduct 32:1.15(c), Iowa Ct. R. 45.7(3).
The engagement agreement with the client must provide
authority to pay the filing fee from the funds advanced and placed in
the trust account. Iowa R. Prof. Conduct 32:1.5(b).

16

When an expense is paid from the trust account, the lawyer

must provide notice and an accounting to the client no later than
the day the withdrawal is made. Iowa Ct. R. 45.7(4).
The lawyer must keep a record of every electronic transfer
from the trust account, showing the date, amount, trust account
name or account number, the name of the recipient, and the name
of the person authorizing the transfer. Iowa Ct. R. 45.2(3)(a)(8).
Tip: One key consideration is whether the lawyer wants to provide a
notice and accounting under Iowa Court Rule 45.7(4) each time an
expense is paid, or on a periodic, consolidated basis, such as during
a monthly billing process. A second key consideration is whether
the lawyer wants to pay filing fees directly from the trust account, or
would rather advance fees on behalf of the client (subject to
reimbursement) as allowed by Iowa Rule of Professional Conduct
32:1.8(e)(1). A third key consideration is what form of electronic
payment the lawyer is willing and able to use, and what form of
payment the court will accept. The possibilities generally include a
credit card, a debit card, a prefunded pay down card, or E*check.
With these considerations in mind, the rules appear to dictate one of
the following two general approaches:
Direct Debit of Trust Account: The first approach is to place
the advance for fees in your trust account, open a client subaccount
ledger card, and make appropriate entries on the main trust
account ledger and the client subaccount ledger. The filing fee then
may be paid by debit card transaction or E*check drawn on the
trust account. The lawyer will need to procure or create a record of
the debit deduction from the trust account, and will need to send
the client a notice and accounting regarding the payment no later
than the date of the debit transaction. The deduction also would
need to be recorded on the main trust account ledger and the
clients subaccount ledger.
Advance of Fee with Reimbursement from Trust Account: The
second approach is to place the advance for fees in your trust
account, open a client subaccount ledger card, and make
appropriate entries on the main trust account ledger and the client
subaccount ledger. The filing fee may be paid using a law firm
credit card, prefunded pay down card, or a debit card transaction
or E*check drawn on the law firm business or operating account.
The advance of the filing fee then may be included in your periodic
billing cycle, with your statement showing the amounts owed for
fees and advanced expenses, and the amount you intend to deduct
from the clients trust account balance.
Once the periodic
17

statement and accounting has been provided the client, the law firm
may withdraw the amount of the advanced filing fee from the trust
account. The withdrawal might be performed by ACH transfer from
the trust account to the business or operating account, or by trust
account check payable to the business or operating account. The
withdrawal also could be performed by trust account check direct to
the credit card company, if the credit card is used only for advanced
expenses. The deduction also would need to be recorded on the
main trust account ledger and the clients subaccount ledger.
What Should be Done with Funds Owed a Client Who No Longer Can be
Located? (Stale Funds Procedure):
A lawyer or law firm must exercise due diligence to locate and
communicate with the client or clients to whom stale or excess funds
might rightfully belong. What constitutes reasonable due diligence will
vary depending on the amount of the funds involved. Reasonable efforts
might include, for example, corresponding with possible owners by mail,
searching for possible owner addresses through the Social Security
Administration if you have a Social Security Number for them, or
employing one of the firms that conducts searches for heirs.
If it is impossible to make proper disposition of the monies to the
client using the steps outlined above, then the monies should be
considered potentially subject to the provisions of Iowa Code section
556.7. If the time period specified in section 556.7 has not passed, the
monies may be deposited in a separate, interest-bearing account under
the provisions of Iowa Court Rule 45.4(2)(a). If the time period specified in
section 556.7 has passed, or when the time period specified in section
556.7 does pass, the lawyer or firm then may follow the procedures
specified in Iowa Code sections 556.11 and 556.13, regarding notice and
tender of the monies to the Treasurer of the State of Iowa.
Closing an Account
Moving Your Trust Account to a New Depository Institution:
A lawyer is not required to notify anyone before transferring a trust
account to a new depository institution. However, care should be taken to
ensure that all outstanding checks on the existing trust account are
accounted for, and that interest owed the Lawyer Trust Account
Commission will be properly disbursed by the institution. Moving a trust
account likely will result in a change in information previously reported to
the Client Security Commission, and will warrant an interim report to the
commission within thirty days after the change.
18

Closing the Trust Account:

Once again, a lawyer is not required to notify anyone before closing
a trust and leaving practice. However, here also care should be taken to
ensure that all outstanding checks on the trust account are accounted for,
and that interest owed LTAC will be properly disbursed by the institution.
All monies owed clients must be returned to the clients entitled thereto so
that no remaining client monies exist in the trust account. If a particular
client cannot be found, it may be necessary to complete the stale funds
procedure before closing the account. Closing a trust account likely will
result in a change in information previously reported to the Client Security
Commission, and will warrant an interim report to the commission within
thirty days after the change. Records for the account must be retained
for a minimum of six years, even if the law firm is sold or dissolved. Iowa
Ct. R. 45.2(3(d), (e).
Audit Program, Client Security Commission
The director of the Office of Professional Regulation is responsible
for conducting audits and investigations of attorneys accounts and office
procedures to determine compliance with Iowa Rule of Professional
Conduct 32:1.15 and chapter 45 of the Iowa Court Rules. Iowa Ct. R.
39.2(3)(c). Attorneys are required to cooperate fully with these audits and
investigations as a continuing condition of their license to practice. Iowa
Ct. R. 39.10, 39.12.
The director is assisted in the performance of audits and
investigations by part-time trust account auditors. The general goal of the
Client Security Commission is to conduct an unannounced periodic audit
of each lawyer trust account in Iowa no less than every three to four years.
Special audits or investigations are conducted on an as-needed basis.
Possible causes for special audits include claims against the Client
Security Trust Fund, unexplained overdrafts of trust accounts, and some
types of ethics complaints.
Schemes Intended to Divert Trust Account Balances
In recent years, would-be thieves have identified trust accounts as
potentially lucrative targets. The schemes used to target trust accounts
have become more sophisticated as electronic banking and international
transactions have become more common.
Counterfeit Checks: Lawyers should be cautious regarding checks
drawn on out-of-state or foreign banks, including certified checks and
cashiers checks drawn on such institutions. In recent years, the number of
19

counterfeit or fraudulent checks presented to Iowa lawyers has increased.

The common theme in these schemes is inducing you to deposit the
counterfeit check in your trust account and make an immediate
disbursement of a portion of the deposit back to the thief, before the
counterfeit check is returned by your bank. Clearance times, particularly
for checks drawn on foreign banks, are quite long. Some confidence artists
provide an initial check drawn on a foreign (often Canadian) bank, and then
follow up with another, more substantial check drawn on the same bank
when the first check appears to have been honored due to the long
clearance times on checks drawn on foreign banks. Soon after the second
check has been deposited, the clients circumstances change and they
demand that the bulk of the second check be wired back to them
expeditiously.
Tip: A countermeasure for this threat is to wait until the out-of-state
or foreign check actually clears through the banking system.
If
same-day disbursement is necessary the best approach is to require
deposit of funds in your trust account electronically, and verify the
presence of the funds before making any disbursement.
Counterfeit Checks Drawn on An Out-of-State Law Firm Trust
Account: An alternate scheme is to tender a check that appears to be drawn
on the trust account of a lawyer in another state, but actually is counterfeit,
and request your assistance with a business transaction that involves
disbursement the same day the counterfeit check is deposited.
Tip: One possible countermeasure for this threat is to require an
electronic deposit to your account if same day settlement is desired,
and verify the deposit has occurred. An alternative countermeasure is
to independently access the contact information for the law firm
involved and call that firm to verify that the trust account check is
authentic. A countermeasure for this threat also is to wait until the
out-of-state check clears through the banking system.
Keystroke Recording Implanted via Social Media: Social media sites
are used by some thieves as a tool to implant keystroke logging or recording
programs in the background on the computer used to access the social
media site. The keystroke logging program communicates in real-time over
the Internet with the thieves. When the user of the computer infected with
the virus accesses an electronic banking web site using that computer, the
thieves are alerted. The thieves note the bank web site address and login
data and quickly raid the bank account, transferring funds to an off-shore
account.
Tip: A countermeasure for this threat is adoption of a law firm policy
against accessing any social media site from any computer on the law
20

firm network, but especially from any computer used for electronic
banking. You may want to consider segregating the computer used
for electronic banking from the remainder of the computers on your
office network. You also may want to discuss with your bank the
anti-fraud features the bank has available. It may be possible also to
place your trust account at a bank that uses a second level of
authentication based on an RSA token before allowing you to create
electronic transfers online.
Common Issues
Improper Handling of Retainers: The Court has specified how
retainers of various kinds must be handled in Iowa. Virtually all the
commonly used variants of the retainer initially must be placed in the
trust account.
Failure to Provide Notice and Accounting: When a withdrawal is
made from a clients trust account balance to pay an expense or to pay
fees, notice of the withdrawal and an accounting regarding the clients
trust account balance must be provided the client no later than the day of
the withdrawal.
Failure to Take Fees when Warranted: Lawyers are responsible for
removing fees from retainers placed in the trust account on a timely basis
when they are earned. An accounting should be provided the client no
later than the time when the earned fee is withdrawn from the retainer.
Failure to remove earned fees on a timely basis constitutes commingling,
and over time can be the cause of unexplained excess funds in a trust
account.
Outstanding Checks: Frequently clients or other payees will fail to
promptly negotiate checks drawn on the trust account. The lawyer or law
firm should have an established procedure for periodically following up on
these outstanding checks, to clear them from the end of month
reconciliations and aid in placing client subaccounts in zero status when
warranted.
Unintentional Overdrafts: Overdrafts carry considerable risk of
inadvertently using funds in one clients subaccount to subsidize
operations with respect to another clients subaccount. Common causes
of overdraft situations include failure to make trust account deposits in a
timely manner; failure to ensure that a deposited check clears the bank
upon which it is drawn before issuing trust account checks based on it;
asking clients to wait until tomorrow to cash a settlement check.

21

Contact Information:
Mail: Office of Professional Regulation, Iowa Judicial Branch Building,
1111 E. Court Avenue, Des Moines, Iowa 50319
Telephone: (515) 725-8029 Voice, (515) 725-8032 Facsimile
E-Mail: client.security @iowacourts.gov
Web Site:
http://www.iowacourts.gov/For_Attorneys/Professional_Regulation/Client_Security/

22

References
Grateful acknowledgement is made of the following resources, from which
principles, concepts, tips and narrative have been readily adapted in the
foregoing outline. Particular credit is noted for Opinion Number 9 of the
Minnesota Lawyers Professional Responsibility Board, now appearing at
Appendix 1 of the Minnesota Rules of Professional Conduct, which
substantially provides the analysis regarding record keeping duties.
Appendix 1, Minnesota Rules of Professional Conduct (Maintenance of
Books and Records);
http://lprb.mncourts.gov/LawyerResources/Pages/TrustAccounts.aspx
The ABA Guide to Lawyer Trust Accounts, Jay G. Foonberg (ABA Section
of Law Practice Management, 1996)
Trust Accounts Everything You Ever Wanted to Know but Were Afraid To
Ask (Minnesota State Bar Association Continuing Legal Education, April
2002)
Client Trust Accounting for Delaware Attorneys (Lawyers Fund for Client
Protection of the State Bar of Delaware, November 23, 1998),
http://courts.delaware.gov/lfcp/docs/cta.htm
Illinois Client Trust Account Handbook (Attorney Registration and
Disciplinary Commission of the Supreme Court of Illinois, July 2011),
http://www.iardc.org/toc_main.html
Expiration of Temporary Unlimited Coverage for Non-Interest Bearing
Transaction Accounts (but specifically including IOLTA accounts),
http://www.fdic.gov/deposit/deposits/insured/temporary.html

23

Forms
NOTICE TO FINANCIAL INSTITUTION
TO ESTABLISH NEW INTEREST-BEARING ACCOUNT
My law firm, as required by rules of the Iowa Supreme Court, is participating in the
Interest on Lawyer Trust Accounts program. Under this program, please open an
account subject to negotiable orders of withdrawals paying the highest rate of interest
available for which the account qualifies.
Interest on this account should be remitted to the Lawyer Trust Account
Commission, Judicial Branch Building, 1111 East Court Avenue, Des Moines, Iowa
50319. The tax identification number for the Commission is 42-1245104 and must be
used in connection with this account.
Interest on the account, computed in accordance with your standard accounting
practice (net of any service charge or fee you charge for the bare privilege of
maintaining this kind of account) must be remitted by check mailed to the
Commission preferably monthly but not less than quarterly. You are not permitted
to deduct from interest any activity-based charges, or charges for transactions
involving this account such as stop payment fees, wire transfer fees or check printing
fees. These fees are the responsibility of the law firm to pay. With each remittance to
the Commission, please transmit a completed remittance report along with a copy of
the trust account statement for the reporting period. Remittance report forms are
available from the Commission.
Should an overdraft condition ever exist with respect to this account, you are
required to provide the Client Security Commission a copy of any notice issued the
law firm regarding the overdraft condition. The mailing address of this commission
is Judicial Branch Building, 1111 E. Court Avenue, Des Moines, Iowa 50319.

PRESENT ACCOUNT NAME

PRESENT ACCOUNT NO.

ALL ACCOUNT SIGNATORIES

_____________________________________________
DATE

24

LAWYER TRUST ACCOUNT COMMISSION

INTEREST REMITTANCE REPORT FOR
POOLED INTEREST-BEARING TRUST ACCOUNTS
TO BE COMPLETED BY FINANCIAL INSTITUTION AND SUBMITTED WITH EACH
REMITTANCE
FINANCIAL INSTITUTION:
Name: ________________________________________________________________
Office or Branch: ________________________________________________________
Address:_______________________________________________________________
Telephone:_____________________________________________________________
Contact Person:__________________________________________________________
(Name and Title)
Alternate Contact Person:__________________________________________________
(Name and Title)
Report Period:
through _______________________________
(MM/DD/YY)
(MM/DD/YY)
ATTORNEY/LAW FIRM POOLED INTEREST-BEARING TRUST ACCOUNT:
Name:_________________________________________________________________
Address:_______________________________________________________________
Account Number:_____________________________________________________________
Rate of Interest Applied:
%
Interest Earned for Period
$ ____________________________
Less: Service Charges and Fees (if any)
(
)
Net Amount Remitted
$ _____________________________

NOTES:
Attach this report to a copy of the depositor statement.
If remitting a lump sum payment for multiple attorneys/firms, please submit a separate Interest
Remittance Report for each pooled interest-bearing trust account.
Even if no interest was earned in a quarter, this report is to be submitted for such account.
Interest should be remitted by check payable to the Lawyer Trust Account Commission, and
mailed to:
LAWYER TRUST ACCOUNT COMMISSION
Iowa Judicial Branch Building
1111 E. Court Avenue
DES MOINES, IOWA 50319
Voice (515) 725-8029
Fax (515) 725-8032
25

TRUST ACCOUNT RECONCILIATION

________________, 20___
BEGINNING BALANCE
TOTAL RECEIPTS THIS MONTH
SUBTOTAL
LESS CHECKS WRITTEN THIS MONTH
BALANCE

$________________
$________________
$________________
$________________
$________________

ITEMIZATION OF SUBACCOUNT BALANCES

_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
_________________________________________
TOTAL

$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________
$________________

BANK STATEMENT CONFIRMATION

BANK BALANCE PER STATEMENT
PLUS OUTSTANDING DEPOSITS
LESS OUTSTANDING CHECKS
BALANCE
LESS INTEREST
RECONCILED BALANCE

$________________
$________________
$________________
$________________
$________________
$________________

26

2014 Nuts & Bolts Seminar

Des Moines October 28
Coralville October 30

Lawyers annually report trust account information

and compliance with trust account rules and
procedures

Client Security Trust Fund reimburses claims based

on dishonesty of Iowa lawyers engaged in practice or
fiduciary duties

Trust account auditors perform regular periodic and

on-demand special audits of all lawyer trust accounts
in Iowa

Most frequent ethics allegations :

neglect or incompetence (57%)
conflict of interest (10%)
litigation-related misconduct (10%)
dishonesty or misrepresentation (9%)
excessive or unlawful fee (8%)
mishandling of money or other property

(7%)

Public discipline issued 2013 to date:

neglect or incompetence (13 %)
conflict of interest (4 %)
litigation-related misconduct (6 %)
dishonesty or misrepresentation ( 9 %)
excessive or unlawful fee ( 1 %)
mishandling of money or other property

(43 %)

Iowa Rule of Professional Conduct

32:1.15

Chapter 45 of Iowa Court Rules

The answer for most attorneys is yes

Pooled interest-bearing for deposits of

nominal or short-term funds

May need multiple trust accounts

Could the clients or third persons funds

generate positive net earnings?

Client preference
Large balances

Bricks and mortar

Institution type

Account must be properly titled

Deposits must be federally insured

Service charges and fees?

No overdraft protection or credit line

Must supplement or amend your Client Security report

Interest On Lawyer Trust Account (IOLTA) program

IOLTA produces interest income from pooled trust

accounts previously non-interest bearing

Annual grants approved by Court support legal

services to the poor, law-related education

Historically receipts of over $1 million annually have

been distributed

BEFORE: only a lawyer admitted to the practice of law

in Iowa or a person who is under the direct supervision
of the lawyer

NOW: as before + ability to designate successor

attorney

Going to allow a paralegal to sign or authorize

electronic transfers?

The lawyer remains personally and professionally liable

for all transactions

Iowa rules formerly did not address stand-by

signature authority
Planning for death/disability is required for sole
practitioners
New Rule 45.11 allows sole lawyer signatory to
designate another Iowa lawyer as stand-by
signatory
Possible triggering events include death,
disability, disappearance, abandonment of
practice, incapacity, suspension, disbarment

1.
2.
3.
4.
5.
6.
7.
8.

Basic principles
What must/ must not be deposited
Making payments from the trust account
Earning the fee
Notice & accounting
Books and records maintenance
Triple reconciliations
The paperless office

1. Do not commingle your own funds in the trust account

(except for the limited exception for service charges).

2.Each clients funds in a pooled account must be
treated as a separate subaccount.
3. A client can only spend his or her subaccount monies.
4.A client subaccount never should show a negative
balance.
5. Only make disbursements from known good funds.
6.You must account to the penny at all times.
7. The end result for any client subaccount must be zero.
8.An audit trail is essential.

What funds must be deposited in the trust

account?
All funds of clients, regardless of size, including
advances for costs and expenses and excluding
only general retainer fees

No funds belonging to the lawyer or the law firm

may be deposited in the trust account; common
examples include:
Fees already billed for and earned
Funds an attorney holds that are not related to
the practice of law

Exception: Funds reasonably sufficient to pay

service charges

Exception: Funds belonging in part to a client

and in part to the lawyer or law firm

Fees may and should be withdrawn as soon as they

are earned and undisputed

All disbursements on behalf of a lawyer should be

made by check directly to the lawyer or law firm

Disbursements in cash or to Cash are no longer

permitted

Costs or expenses incident to services performed

may be paid based on agreement with the client

* Dont forget the accounting to the client

Every deposit must be allowed to clear

through the banking process before
disbursement

Cash deposits, verified electronic transfers

and bank certified checks support same day
disbursement

Cashiers checks should be allowed to clear

completely

Personalized checks, drafts and money orders

should be allowed to clear completely

And the big one

Can ethically take a fee only to the extent

that work is actually performed on a clients
case
An advance fee is earned once the service is
performed

Client must be given notice and an

accounting regarding any withdrawal of
trust funds for fees or expenses
Notice and accounting must be provided
no later than the date the withdrawal is
made
Advance fees and expenses must be
refunded if the fee is not earned or the
expense is not incurred

Maintain books and records

sufficient to show compliance with
rule 32:1.15 and chapter 45
for at least six years after completion
of the employment they relate to
New Iowa Court Rule 45.2(3) lists
specific record requirements

 Designed to address developments in

technology and provide uniform guidelines

Change incorporates Model Rules with a few
differences to reflect Iowa practice *
New Rules have greater specificity
Client Security has been informally
recommending this approach for some time

The master checkbook

A subaccount ledger for each client whose funds are
deposited in the trust account
Deposit slips, cancelled checks, and records of all electronic
transfers
All retainer and fee contracts with clients
All accounting statements provided to clients or third
persons showing disbursements from the trust account
All bills provided clients for legal fees and expenses
Checkbook registers and bank statements
Monthly trial balances and monthly reconciliations
Those portions of client files reasonably related to trust
account transactions

Receipts for all cash fee payments, preferably

countersigned by the client

Memo describing each electronic, ACH, or wire

transfer transaction, signed by the responsible
attorney

Property record for all property other than cash

Perform a monthly reconciliation of checkbook

balance, sub-account ledger balance total, and
adjusted bank statement balance

Model Rule requires monthly reconciliations and

quarterly 3-way reconciliations

Iowa kept a requirement of monthly

reconciliations and monthly 3-way
reconciliations
Bank Statement

General Ledger

Total of
Sub-Acct Ledgers

Maintenance of trust account records in electronic,

photographic, computer, or other media is allowed
provided the records
Comply with other trust account record requirements
Can be produced in paper when necessary

Regular back-up copies highly recommended for

computerized records

Perils of the computer cloud

1.
2.
3.
4.
5.
6.
7.
8.

Electronic transfers & payment of fees

Flat fees
Unbundled legal services
Retainers paid by credit card
Client deposits over $250,000
Retainers paid by a third party
Disputed funds
Abandoned or unclaimed funds/property

Electronic transfers
Electronic transfers from trust accounts are

specifically contemplated by Iowa Ct. R. 45.2(3)

Lawyer must keep a record of electronic transfers
showing:

1. date
2. amount
3. trust account name or number from which withdrawn
4. name of recipient
5. name of person authorizing transfer

Electronic payment of fees (e.g. EDMS)

Include authority in attorney fee agreement
Deposit fees in the trust account
Withdraw only as incurred
Possible approaches:

- direct debit of trust account

- advance the fee, reimburse from trust account
Notice and accounting
Keep a detailed record of each and every payment

Flat fees
Board of Professional Ethics & Conduct v. Apland

577 N.W. 2d 50 (Iowa 1998)

Can ethically take a fee only to the extent that
work is actually performed on a clients case
Fees are earned once the service is performed
Include understanding re: percentage completion
in attorney fee agreement
Notice & accounting to the client are required

Unbundled legal services

Iowa Rule of Professional Conduct 32:1.2(c)

expressly permits limited representation and

outlines requirements for written consent

Usually require lawyer to follow the flat fee

protocol

Auditors recommend establishing separate sub-

account ledger for the client for each matter in

which limited representation is provided

Retainers paid by credit card

Fees payable to the credit card institution are the

lawyers responsibility
Interest must be paid to IOLTA program on the full face
value of any retainer based on a credit card charge
Ensure credit card-based retainer is credited by the
bank and is ineligible for charge-back before writing
any checks against the retainer
print and retain verification, on a monthly basis

Client deposits over $250,000

Choose a strong bank
For extended deposits, split over multiple banks
For short-term deposits, speed is essential
Bank may offer commercial deposit insurance; can

expense to client if agreed

Discuss issue with client their personal deposits may
affect coverage

Retainers paid by a third party

A lawyer may not accept compensation from a person

other than the client unless 3 conditions are met

(See IRPC 32:1.8(f))
Best practice if possible: suggest funds be provided
directly to the client
Otherwise will need to clarify the parameters to the client
and third party, document thoroughly
Try to obtain clients consent before depositing retainer in
trust account
Consider a specific provision in fee agreement
Third party payor is not entitled to information regarding
the clients matter (including accountings)

Disputed Funds
See Iowa Rule of Professional Conduct 32:1.15(e)
Can distribute portions as to which the interests

are not in dispute

If funds could generate positive net earnings,

place disputed portion in an interest-bearing trust

account for the benefit of the party ultimately
found to be entitled to the funds

Consider fee arbitration if it is an option

Abandoned or unclaimed funds / property

Must exercise reasonable due diligence to locate

and communicate with the clients to whom the

stale or excess funds belong

If disposition is impossible despite reasonable due

diligence, then look to Iowa Code section 556.7

After time specified in section 556.7 has run,

tender monies to the Treasurer of the State of

Iowa (see sections 556.11 and 556.13)

Trust account auditors perform regular

periodic and on-demand special audits of
lawyer trust accounts

Attorneys annually report compliance with

client security and trust account rules

Auditors Verify Answers During Trust Account

Audits

 Last 3 months of bank statements, paid checks,

deposit slips, debit or credit slips and memos

Check register showing end of month balances for last
3 months
Client subaccount ledgers showing last end of month
balances
Last months triple reconciliation
Copy of firm letterhead
List of matters for which attorneys hold power of
attorney or are serving as executor, trustee,
conservator or guardian

Failure to Take Fees When Earned

Stale Outstanding Checks

Unintentional Overdrafts

Overages in Account Balance

Shortages in Account Balance

Improper Handling of Retainers

Top contributing factors to trust account

irregularities:
1. Failure to perform monthly triple reconciliations
2. Untrained staff
3. Lack of attorney involvement

Bank sends notice

of overdraft to
account holder
and to IOLTA

IOLTA sends
letter to account
holder

No response to
letter?
IOLTA issues a 15day notice

No response to
15-day notice?
Attorneys
license may be
temporarily
suspended

Administrative call OPR at 515-725-8029

Substantive
Trust Account Outline
Current set of Iowa Court Rules:
http://www.legis.iowa.gov/IowaLaw/courtRules.aspx

Advisory Opinions:
http://www.iabar.net/ethics.nsf

Formal Disciplinary Opinions:

Westlaw, Lexis, FastCase
http://www.iacourtcommissions.org/icc/SearchDiscipline.do

Office of Professional Regulation

Iowa Judicial Branch Building
1111 E. Court Avenue
Des Moines, Iowa 50319
(515) 725-8029

Fax: (515) 725-8032

Email: client.security@iowacourts.gov
Web Site:
http://www.iowacourts.gov/For_Attorneys/Professional_Regulation/

2014Nuts&BoltsSeminar
DesMoinesOctober28
CoralvilleOctober30

Lawyersannuallyreporttrustaccountinformation
andcompliancewithtrustaccountrulesand
procedures

ClientSecurityTrustFundreimbursesclaimsbased
ondishonestyofIowalawyersengagedinpracticeor
fiduciaryduties

Trustaccountauditorsperformregularperiodicand
ondemandspecialauditsofalllawyertrustaccounts
inIowa

Mostfrequentethicsallegations:
neglectorincompetence(57%)
conflictofinterest(10%)
litigationrelatedmisconduct(10%)
dishonestyormisrepresentation(9%)
excessiveorunlawfulfee(8%)
mishandlingofmoneyorotherproperty

(7%)

Publicdisciplineissued2013todate:
neglectorincompetence(13%)
conflictofinterest(4%)
litigationrelatedmisconduct(6%)
dishonestyormisrepresentation(9%)
excessiveorunlawfulfee(1%)
mishandlingofmoneyorotherproperty

(43%)

IowaRuleofProfessionalConduct
32:1.15

Chapter45ofIowaCourtRules

Theanswerformostattorneysisyes

Pooledinterestbearingfordepositsof
nominalorshorttermfunds

Mayneedmultipletrustaccounts
Couldtheclientsorthirdpersonsfunds

generatepositivenetearnings?
Clientpreference
Largebalances

Bricksandmortar

Institutiontype

Accountmustbeproperlytitled

Depositsmustbefederallyinsured

Servicechargesandfees?

Nooverdraftprotectionorcreditline

MustsupplementoramendyourClientSecurityreport

InterestOnLawyerTrustAccount(IOLTA)program

IOLTAproducesinterestincomefrompooledtrust
accountspreviouslynoninterestbearing

AnnualgrantsapprovedbyCourtsupportlegal
servicestothepoor,lawrelatededucation

Historicallyreceiptsofover$1millionannuallyhave
beendistributed

BEFORE:onlyalawyeradmittedtothepracticeoflaw
inIowaor apersonwhoisunderthedirectsupervision
ofthelawyer

NOW:asbefore+abilitytodesignatesuccessor
attorney

Goingtoallowaparalegaltosignorauthorize
electronictransfers?

Thelawyerremainspersonallyandprofessionallyliable
foralltransactions

Iowarulesformerlydidnotaddressstandby
signatureauthority
Planningfordeath/disabilityisrequiredforsole
practitioners
NewRule45.11allowssolelawyersignatoryto
designateanotherIowalawyerasstandby
signatory
Possibletriggeringeventsincludedeath,
disability,disappearance,abandonmentof
practice,incapacity,suspension,disbarment

1.
2.
3.
4.
5.
6.
7.
8.

Basicprinciples
Whatmust/mustnotbedeposited
Makingpaymentsfromthetrustaccount
Earningthefee
Notice&accounting
Booksandrecordsmaintenance
Triplereconciliations
Thepaperlessoffice

1. Donotcommingleyourownfundsinthetrustaccount

(exceptforthelimitedexceptionforservicecharges).
2. Eachclientsfundsinapooledaccountmustbe

treatedasaseparatesubaccount.
3. Aclientcanonlyspendhisorhersubaccountmonies.
4. Aclientsubaccountnevershouldshowanegative

balance.
5. Onlymakedisbursementsfromknowngoodfunds.
6.Youmustaccounttothepennyatalltimes.
7. Theendresultforanyclientsubaccountmustbezero.
8. Anaudittrailisessential.

Whatfundsmustbedepositedinthetrust
account?
All funds of clients, regardless of size, including
advances for costs and expenses and excluding
only general retainer fees

Nofundsbelongingtothelawyerorthelawfirm
maybedepositedinthetrustaccount;common
examplesinclude:
Feesalreadybilledforandearned
Fundsanattorneyholdsthatarenotrelatedto
thepracticeoflaw

Exception:Fundsreasonablysufficienttopay
servicecharges

Exception:Fundsbelonginginparttoaclient
andinparttothelawyerorlawfirm

Feesmayandshouldbewithdrawnassoonasthey
areearnedandundisputed

Alldisbursementsonbehalfofalawyershouldbe
madebycheckdirectlytothelawyerorlawfirm

DisbursementsincashortoCasharenolonger
permitted

Costsorexpensesincidenttoservicesperformed
maybepaidbasedonagreementwiththeclient

*Dontforgettheaccountingtotheclient

Everydepositmustbeallowedtoclear
throughthebankingprocessbefore
disbursement

Cashdeposits,verifiedelectronictransfers
andbankcertifiedcheckssupportsameday
disbursement

Cashierschecksshouldbeallowedtoclear
completely

Personalizedchecks,draftsandmoneyorders
shouldbeallowedtoclearcompletely

And the big one

Canethicallytakeafeeonlytotheextent
thatworkisactuallyperformedonaclients
case
Anadvancefeeisearnedoncetheserviceis
performed

Clientmustbegivennoticeandan
accountingregardinganywithdrawalof
trustfundsforfeesorexpenses
Noticeandaccountingmustbeprovided
nolaterthan thedatethewithdrawalis
made
Advancefeesandexpensesmustbe
refundedifthefeeisnotearnedorthe
expenseisnotincurred

Maintainbooksandrecords
sufficienttoshowcompliancewith
rule32:1.15andchapter45
foratleastsix yearsaftercompletion
oftheemploymenttheyrelateto
NewIowaCourtRule45.2(3)lists
specificrecordrequirements

 Designedtoaddressdevelopmentsin

technologyandprovideuniformguidelines
ChangeincorporatesModelRuleswithafew
differencestoreflectIowapractice*
NewRuleshavegreaterspecificity
ClientSecurityhasbeeninformally
recommendingthisapproachforsometime

Themastercheckbook
Asubaccountledgerforeachclientwhosefundsare
depositedinthetrustaccount
Depositslips,cancelledchecks,andrecordsofallelectronic
transfers
Allretainerandfeecontractswithclients
Allaccountingstatementsprovidedtoclientsorthird
personsshowingdisbursementsfromthetrustaccount
Allbillsprovidedclientsforlegalfeesandexpenses
Checkbookregistersandbankstatements
Monthlytrialbalancesandmonthlyreconciliations
Thoseportionsofclientfilesreasonablyrelatedtotrust
accounttransactions

Receiptsforallcashfeepayments,preferably
countersignedbytheclient

Memodescribingeachelectronic,ACH,orwire
transfertransaction,signedbytheresponsible
attorney

Propertyrecordforallpropertyotherthancash

Performamonthlyreconciliation ofcheckbook
balance,subaccountledgerbalancetotal,and
adjustedbankstatementbalance

ModelRulerequiresmonthlyreconciliationsand
quarterly3wayreconciliations

Iowakeptarequirementofmonthly
reconciliationsandmonthly3way
reconciliations
Bank Statement

General Ledger

Total of
Sub-Acct Ledgers

Maintenanceoftrustaccountrecordsinelectronic,
photographic,computer,orothermediaisallowed
providedtherecords
Complywithothertrustaccountrecordrequirements
Canbeproducedinpaperwhennecessary

Regularbackupcopieshighlyrecommendedfor
computerizedrecords

Perilsofthecomputercloud

1.
2.
3.
4.
5.
6.
7.
8.

Electronictransfers&paymentoffees
Flatfees
Unbundledlegalservices
Retainerspaidbycreditcard
Clientdepositsover$250,000
Retainerspaidbyathirdparty
Disputedfunds
Abandonedorunclaimedfunds/property

Electronictransfers
Electronictransfersfromtrustaccountsare

specificallycontemplatedbyIowaCt.R.45.2(3)
Lawyermustkeeparecordofelectronictransfers

showing:

1.date
2.amount
3.trustaccountnameornumberfromwhichwithdrawn
4.nameofrecipient
5.nameofpersonauthorizingtransfer

Electronicpaymentoffees(e.g.EDMS)
Includeauthorityinattorneyfeeagreement
Depositfeesinthetrustaccount
Withdrawonlyasincurred
Possibleapproaches:

directdebitoftrustaccount
advancethefee,reimbursefromtrustaccount
Noticeandaccounting
Keepadetailedrecordofeachandeverypayment

10

Flatfees
BoardofProfessionalEthics&Conductv.Apland

577N.W.2d50(Iowa1998)
Canethicallytakeafeeonlytotheextentthat

workisactuallyperformedonaclientscase
Feesareearnedoncetheserviceisperformed
Includeunderstandingre:percentagecompletion

inattorneyfeeagreement
Notice&accountingtotheclientarerequired

11

Unbundledlegalservices
IowaRuleofProfessionalConduct32:1.2(c)

expresslypermitslimitedrepresentationand
outlinesrequirementsforwrittenconsent

Usuallyrequirelawyertofollowtheflatfee

protocol

Auditorsrecommendestablishingseparatesub

accountledgerfortheclientforeachmatterin
whichlimitedrepresentationisprovided

Retainerspaidbycreditcard
Feespayabletothecreditcardinstitutionarethe

lawyersresponsibility
InterestmustbepaidtoIOLTAprogramonthefullface

valueofanyretainerbasedonacreditcardcharge
Ensurecreditcardbasedretaineriscreditedbythe

bankandisineligibleforchargebackbeforewriting
anychecksagainsttheretainer
printandretainverification,onamonthlybasis

Clientdepositsover$250,000
Chooseastrongbank
Forextendeddeposits,splitovermultiplebanks
Forshorttermdeposits,speedisessential
Bankmayoffercommercialdepositinsurance;can

expensetoclientifagreed
Discussissuewithclient theirpersonaldepositsmay

affectcoverage

12

Retainerspaidbyathirdparty
Alawyermaynotacceptcompensationfromaperson

otherthantheclientunless3conditionsaremet
(See IRPC32:1.8(f))
Bestpracticeifpossible:suggestfundsbeprovided
directlytotheclient
Otherwisewillneedtoclarifytheparameterstotheclient
andthirdparty,documentthoroughly
Trytoobtainclientsconsentbeforedepositingretainerin
trustaccount
Consideraspecificprovisioninfeeagreement
Thirdpartypayorisnotentitledtoinformationregarding
theclientsmatter(includingaccountings)

DisputedFunds
See IowaRuleofProfessionalConduct32:1.15(e)
Candistributeportionsastowhichtheinterests

arenotindispute

Iffundscouldgeneratepositivenetearnings,

placedisputedportioninaninterestbearingtrust
accountforthebenefitofthepartyultimately
foundtobeentitledtothefunds

Considerfeearbitrationifitisanoption

Abandonedorunclaimedfunds/property
Mustexercisereasonableduediligencetolocate

andcommunicatewiththeclientstowhomthe
staleorexcessfundsbelong

Ifdispositionisimpossibledespitereasonabledue

diligence,thenlooktoIowaCodesection556.7

Aftertimespecifiedinsection556.7hasrun,

tendermoniestotheTreasureroftheStateof
Iowa(seesections556.11and556.13)

13

Trustaccountauditorsperformregular
periodicandondemandspecialauditsof
lawyertrustaccounts

Attorneysannuallyreportcompliancewith
clientsecurityandtrustaccountrules

AuditorsVerifyAnswersDuringTrustAccount
Audits

Last3monthsofbankstatements,paidchecks,

depositslips,debitorcreditslipsandmemos

Checkregistershowingendofmonthbalancesforlast

3months

Clientsubaccountledgersshowinglastendofmonth

balances

Lastmonthstriplereconciliation
Copyoffirmletterhead
Listofmattersforwhichattorneysholdpowerof

attorneyorareservingasexecutor,trustee,
conservatororguardian

14

FailuretoTakeFeesWhenEarned

StaleOutstandingChecks

UnintentionalOverdrafts

OveragesinAccountBalance

ShortagesinAccountBalance

ImproperHandlingofRetainers

Topcontributingfactorstotrustaccount
irregularities:
1. Failuretoperformmonthlytriplereconciliations
2. Untrainedstaff
3. Lackofattorneyinvolvement

Banksendsnotice
ofoverdraftto
accountholder
andtoIOLTA

Noresponseto
15daynotice?
IOLTAsends
lettertoaccount
holder

Noresponseto
letter?
IOLTAissuesa15
daynotice

Attorneys
licensemaybe
temporarily
suspended

15

Administrative callOPRat5157258029
Substantive
TrustAccountOutline
CurrentsetofIowaCourtRules:
http://www.legis.iowa.gov/IowaLaw/courtRules.aspx

AdvisoryOpinions:
http://www.iabar.net/ethics.nsf

FormalDisciplinaryOpinions:
Westlaw,Lexis,FastCase
http://www.iacourtcommissions.org/icc/SearchDiscipline.do

OfficeofProfessionalRegulation
IowaJudicialBranchBuilding
1111E.CourtAvenue
DesMoines,Iowa50319
(515)7258029

Fax:(515)7258032
Email:client.security@iowacourts.gov
WebSite:
http://www.iowacourts.gov/For_Attorneys/Professional_Regulation/

16

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

Business Court 101

9:30 a.m.-10:00 a.m.
Presented by
Joe H. Harris
Attorney at Law
225 2nd Street SE
Suite 310
Cedar Rapids, Iowa 52401
Phone: 319-363-3512

Hon. John Telleen

Iowa District Court
7th Judicial District
Muscatine, Iowa

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

2014 Nuts & Bolts Seminar

Coralville Holiday Inn
Coralville, Iowa
October 30, 2014

IF WE BUILD IT, WILL THEY COME?

THE IOWA SUPREME COURT BUSINESS SPECIALTY COURT
PILOT PROJECT

The Honorable Judge John D. Telleen

Iowa District Court
7th Judicial District
Muscatine, Iowa
Joe H. Harris
Attorney at Law
225 2nd Street SE, Ste 310
Cedar Rapids, Iowa 52401
(319) 363-3512
joehharris@hotmail.com

I. BACKGROUND OF THE BUSINESS SPECIALTY

COURT PROJECT
On December 15, 2009 the Iowa Supreme Court issued an Order establishing The Task
Force for Civil Justice Reform1. In its Order the Court noted that each year Iowas trial courts
typically handle approximately 150,000 non-domestic civil cases such as tort claims and contract,
property, and commercial disputes which constitute nearly 46% of the states trial court docket.
The Court commented that the systems one size fits all approach may not be the most
effective method for resolving certain types of cases including complex commercial litigation.
The Court established the Task Force for Civil Justice Reform to develop a plan for a
multi-option civil justice system including proposals for new court processes and improvements
in current processes that would foster prompt, affordable and high-quality resolution of
non-domestic civil cases. The Task Force was instructed to identify the strengths and weaknesses
of the present processes for resolving non-domestic civil cases, examine innovative civil
litigation procedures and programs used in other jurisdictions or recommended by other civil
justice reform groups and from those procedures and programs identify those that hold the most
promise for Iowa litigants and the public-at-large, and to develop a collection of proposals for
new procedures and improvements to current procedures that will accomplish the mission of this
Task Force.
The Task Force submitted its report, Reforming the Iowa Civil Justice System 2 to the
Court on January 30, 2012. Chapter X of the Task Forcess report recommended the
establishment of a Business (Specialty) Court pilot program.
Specialty business courts have achieved widespread support across the country.
In addition, specialty courts provide excellent vehicles for implementing or
piloting other court innovations that may be useful in a broader court system
context. A specialty business court should be and could be piloted in Iowa within
the existing court system framework of the Iowa Judicial Branch.

In the Iowa Supreme Court, In the Matter of Appointments to the Task Force for Civil
Justice Reform, Filed December 18, 2009. (http://www.iowacourts.gov/About_the_Courts/
Advisory Committees/Civil_Justice_Reform_Task_Force)
2

Final Report of the Iowa Civil Justice Reform Task Force (March 14, 2012). id.
Page 1

II. IMPLEMENTATION
On December 21, 2012 the Court issued a Supervisory Order based on the Task Forces
recommendations establishing a three-year pilot program for the Iowa Business Specialty Court .
The pilot program is designed to operate within the framework of the existing court system. It is
not intended to elevate the priority of business cases. Rather, it is meant to establish a managed
docket that will leverage judicial expertise and the litigants desire to tailor case management
practices best suited for resolving substantial business disputes fairly and expeditiously. 3
The order called for the appointment of three highly qualified jurists to serve as Business
Court judges. The criteria for selection included educational background, judicial and trial
practice experience in complex commercial cases, and personal interest. On April 29, 2013 the
Court announced the names of the three District Court judges selected: the Honorable Annette J.
Scieszinski serving the 8th Judicial District, the Honorable John D. Telleen serving the 7th
Judicial District and the Honorable Michael D. Huppert serving the Fifth Judicial District. (See
Appendix.)
The Business Court began accepting qualifying cases on May 1, 2013.
III. OPERATION OF THE BUSINESS SPECIALTY COURT
The Court issued a Memorandum of Operation contemporaneously with its Supervisory
Order on December 21, 2012 (See Appendix) outlining the operation of the Business Court.
1.

Eligible Cases. Only cases which meet one or both of the threshold requirements of
alleged compensatory damages totaling $200,000 or more, and/or claims seeking
primarily injunctive or declaratory relief, are eligible for assignment to the Business Court
docket. In addition to these two threshold requirements, a case must satisfy one or more
of the following additional criteria set forth in Section E of the Memorandum of
Operation:

Supervisory Order, In The Matter of Establishment of the Iowa Business Specialty Court
Project, December 21, 2012.
Page 2

2.

i.

Arise from technology licensing agreements, including software and

biotechnology licensing agreements, or any agreement involving the licensing of
any intellectual property right, including patent rights.

ii.

Relate to the internal affairs of businesses (i.e., corporations, limited liability

companies, general partnerships, limited liability partnerships, sole
proprietorships, professional associations, real estate investment trusts, and joint
ventures), including the rights or obligations between or among business
participants, or the liability or indemnity of business participants, officers,
directors, managers, trustees, or partners, among themselves or to the business.

iii.

Involve claims of breach of contract, fraud, misrepresentation, or statutory

violations between businesses arising out of business transactions or relationships.

iv.

Be a shareholder derivative or commercial class action.

v.

Arise from commercial bank transactions.

vi.

Relate to trade secrets, non-compete, non-solicitation, or confidentiality

agreements.

vii.

Involve commercial real property disputes other than residential landlord-tenant

disputes and foreclosures.

viii.

Be a trade secrets, antitrust, or securities~re1ated action.

ix.

Involve business tort claims between or among two or more business entities or
individuals as to their business or investment activities relating to contracts,
transactions, or relationships between or among them.

Procedure for Designating a Matter for the Iowa Business Specialty Court. The Business
Court pilot project includes a voluntary opt-in format in which all parties agree to bring
their legal dispute to the Iowa Business Specialty Court docket.
i.

Filing of Consent to transfer eligible cases. Parties transfer a case to the Business
Court docket by filing the Joint Consent for Case Assignment to the Business
Court Pilot Project form. The joint consent acknowledges that the case meets the
criteria set forth in Section E of the Memorandum of Operation, above. (See
Appendix.)

ii.

The consent is filed with the Iowa State Court Administrator.

iii.

If the Iowa State Court Administrator determines the case satisfies the threshold
and minimum additional criteria of the Memorandum of Operation the
Administrator issues an Administrative Order assigning the case to the Business
Specialty Court Docket.

Page 3

3.

iv.

The Administrative Order assigns one of the three Business Specialty Court
Judges to the case.

v.

The Administrative Order also assigns one of the three Business Specialty Court
Judges to conduct settlement conferences, as necessary.

vi.

The assigned Business Court judge issues an order setting a conference with
counsel of record.

Rules. There are no special rules for the Business Court. Existing rules of civil procedure
and evidence apply. However, with court approval the parties can agree to streamlined
pretrial and discovery rules.

4.

Transfer Back to Regular Court Docket. Any party to an Iowa Business Specialty Court
case may, upon a showing of good cause and lack of unfair prejudice to any other party,
request transfer of the case from the Business Court docket to the regular court docket of
the judicial district in which it is filed.
IV. BENEFITS OF ASSIGNMENT TO THE BUSINESS SPECIALTY COURT
A number of benefits flow from assignment of a case to the Business Specialty Court.

They include:
1.

Skilled Judges. The assigned judge will be skilled and experienced in the area of complex
litigation and business law. The three Business Court judges volunteered for their
assignment to the court.

2.

Efficiencies for the Parties. All matters, other than settlement conferences, will be
handled by the same judge. This increases efficiency in presenting issues to the Court.
The attorney does not have to familiarize the court with the background of the case at
each hearing.

3.

Efficiencies for the Court. Because complex matters are presented to judges highly
qualified in the commercial field, cases are disposed of more rapidly freeing up judicial
resources to be used in other areas of general jurisdiction.

Page 4

4.

Access. The assigned judge is accessible to counsel and accommodating in scheduling

matters.

5.

No Additional Fees. No additional fees are charged to the litigants in cases assigned to
the Business Court.

6.

Venue Stays the Same. Venue will continue in the county where the case was filed. The
Business Court judge will travel to your county, you will not travel to the Business Court.

7.

Settlement. The settlement judge appointed by the Court Administrator is available to

conduct a settlement conference at the appropriate juncture. The assigned settlement
conference judge will make himself or herself available for the time necessary to conduct
an effective settlement conference. Unlike mediation, there is no charge to the parties.

8.

Innovative Technology. The courtrooms of the three Business Court judges have recently
been outfitted with the necessary telephone and video technological capabilities to allow
remote telephone and video appearances by counsel for hearings. This remote
accessability can potentially reduce clients attorney fees.

9.

Flexibility. The Business Court judges are allowed to be flexible, innovative and more
involved in the early stages of the litigation. For example, in complex litigation an early
case management conference can be conducted to flesh out legal and factual issues, set
discovery deadlines, deal with document production issues and prepare a case
management order tailored to the case.

10.

Firm Trial Date. Because the Business Court judges have considerable control over their
own dockets, once a trial is set it will be firm trial date.
V. STATUS OF THE PILOT PROGRAM.
As of October 2014, eleven cases have been assigned to the Business Specialty Court.

Seven have settled, one is set for trial this month and two in early 2015. The most recent case,
assigned to the Business Court in September, has been set for trial this November.

Page 5

The State Court Administrator is charged with reporting findings made in periodic
reviews of the program and making recommendations for its improvement in 2014, 2015 and
2016. A copy of the July 2014 evaluation is included in the Appendix.
For more information on the Iowa Business Specialty Court Pilot Program, visit the Iowa
Judicial Branch website at http://www.iowacourts.gov/Business_Court_Pilot_Project/, or contact
the State Court Administrators Office by email at Business.Court@iowacourts.gov or by
telephone at (515) 281-5241.

Page 6

APPENDIX
1.

Reforming the Iowa Civil Justice System, Chapter X. Business (Specialty)

Courts. January 30, 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

2.

In the Iowa Supreme Court, In The Matter of Establishment of the Iowa

Business Specialty Court Project, Supervisory Order, Filed December 21, 2012. . . 23

3.

In the Iowa Supreme Court, In The Matter of Establishment of the Iowa

Business Specialty Court Project, Memorandum of Operation, Issued
December 21, 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

4.

Biographies of Iowa Business (Specialty) Court Judges . . . . . . . . . . . . . . . . . . . . . . . 30

5.

Form Joint Consent for Case Assignment to the Business Court Pilot Project,
December 2013. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

6.

Sample Administrative Order of the State Court Administrator Assigning Case

to Business Specialty Court Pilot Project. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

7.

Iowa Business Court Pilot Program Annual Evaluation July 2014 . . . . . . . . . . . . . 37

8.

Status of Current Cases Assigned (September 22, 2104) . . . . . . . . . . . . . . . . . . . . . . 46

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Task Force Report

X. Business (Specialty) Courts

Summary
Specialty business courts have achieved widespread
support across the country. In addition, specialty courts
provide excellent vehicles for implementing or piloting
other court innovations that may be useful in a broader
court system context. A specialty business court should
be and could be piloted in Iowa within the existing court
system framework of the Iowa Judicial Branch.

Introduction
Judicial districts across the country have turned to specialty
courts as a proven way to gain efficiencies in the administration
of justice and improve the quality of justice in discrete areas of
the law. Specialty courts, also known as problem solving courts in
the criminal arena,78 have been developed for many kinds of legal
matters, including drug courts, OWI courts, veterans courts, teen
or peer courts, housing courts, mental health courts, family courts,
and domestic violence courts. Several states have turned to business
or commercial courts for handling complex commercial litigation
or business litigation. For reasons detailed below, the Task Force
focused its study and recommendations on business courts.
Business courts or commercial courts are not typically separate
courts set apart from ordinary courts hearing civil cases. They are
instead programs or tracks or dockets within existing civil divisions
in state trial courts. There are various models of business specialty
courts, discussed in more detail below.
Proponents of business courts identify a number of advantages for
businesses involved in litigation, including the following: (a) the
assignment of cases to judges with particular interest and expertise in

93

78 Specialty courts, or problem solving courts, in the criminal arena focus on

treatment and rehabilitation of offenders as a means to reduce recidivism of
offenders without institutionalization.

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Business (Specialty) Courts

business litigation enhances consistency, predictability, and accuracy
of decisions on business law issues; (b) special rules allow more
efficient handling of cases; (c) publication of business court decisions
promotes certainty and predictability, which are of great value to
commercial enterprises; (d) early, pro-active case management; (e)
early exploration of various forms of business-oriented ADR; and (f)
enhanced efficiency resulting from use of technology.
The chief objectives of specialized business court programs are the
development of judicial expertise, enhanced reliability, efficiency in
the resolution of business-to-business disputes and intra-corporate
disputes, economic development and business retention, and a
decrease in court backlogs.

A. National and Local Support

Specialized business courts enjoy broad support from legal
communities and notable legal organizations. Many business courts
have expanded because of continued success and support.79 Twenty
states have established business courts and at least three more are in
the process of doing so.80

Objectives
of business
courts include:
development of
judicial expertise,
enhanced
reliability,
efficiency in
resolution of
business-tobusiness and
intra-corporate
disputes,
economic
development
and business
retention, and
decrease in
court backlogs.

The ABA Section of Business Law endorsed creation of specialized

business courts fifteen years ago. In 1997, the sections Ad Hoc
Committee on Business Courts recommended that courts which hear
a substantial number of corporate and commercial disputes establish
specialized court divisions to provide the expertise needed to improve
substantially the quality of decision making and the efficiency of the
courts with respect to such business cases.81
79 The Task Force is aware of only two business courts which were created and
successfully implemented, but which were eventually discontinued. Rhode
Island created a business calendar in 2001. Because of a general backlog of
cases, the business court calendar was suspended in 2009. New Jersey
established a pilot program, but the legislature refused to make it permanent. The
New Jersey program is still in effect but is rarely used according to court officials.
In 2010, however, legislators introduced a bill in the New Jersey General Assembly
to create a business court. Opponents to the legislation contended the current
court system was satisfactory. Journal of Business & Technology Law, available at
http://www.law.umaryland.edu/academics/journals/jbtl/bus_tech_res.
html#aNew Jersey.
80 See Appendix I for an abbreviated reporting of how various states have addressed
the issue of business courts.
81 ABA Ad Hoc Committee on Business Courts, Business Courts: Towards a More
Efficient Judiciary, 52 Bus. Law. 947, 957 (1997).

Page 9

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Task Force Report

The Conference of Chief Justices adopted a resolution in February
2007 encouraging states to study and, where appropriate, establish
business courts or their equivalents for the effective management of
complex corporate, commercial and business cases.82
While most state chambers of commerce representatives the Task
Force contacted had little awareness of specialized courts, Californias
chamber executive was well aware of business courts in that state.83
The California business docket is vigorous and supported by the
business community.
When asked their opinion, 49.3% of Task Force survey respondents
agreed or strongly agreed that it would be beneficial to develop
specialty courts for specific kinds of disputes.84 Twenty-seven
percent (27%) of those respondents believed it would be beneficial
to develop a business court.85 Even though the survey instrument
instructed respondents not to consider juvenile law or family
matters,86 65% of respondents approving the concept of specialty
courts said Iowa should create a specialty court for family law.
The primary areas the remaining 8% of survey respondents identified
as potential subjects for specialty courts included administrative
appeals, workers compensation, medical malpractice, probate,
personal injury, and tort claims.

B. Advantages of Business Courts

Jurisdictions that have implemented specialty courts report a number
of advantages.

95

82 Resolution 6, In Support of Case Management of Complex Business, Corporate

and Commercial Litigation, Conference of Chief Justices (February 7, 2007).
83 Chamber executives from North Carolina, Ohio, Oregon, Indiana, and West
Virginia either did not know much about their states business courts or were not
aware of the courts existence. With the exception of North Carolina, however, all
of the other referenced states had only recently established pilot programs or are
in the process of doing so.
84 See survey, question 16 (Appendix B:8). Thirty-one percent expressed no opinion
and 14% disagreed that it would be beneficial to develop specialty courts in Iowa.
85 See survey, question 17. This open-ended question asked respondents to identify
specific areas in which they believed specialty courts would be beneficial. Available
at: http://www.iowacourts.gov/Advisory_Committees/Civil_Justice_Reform_Task_
Force/Survey/.
86 As the Civil Justice Reform Task Force did not address matters involving family
law, the Task Force focused on whether a business court should be established.

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Business (Specialty) Courts

1. Judicial expertise and consistent opinions

In Colorado, the Governors Task Force on Civil Justice

Reform, Committee on Business Courts, found that among
trial judges a lack of expertise or familiarity with the law
applicable to commercial cases caused inconsistent decisions.87
Specialization allowed judges to perform judicial functions
more proficiently, gain greater experience with particular
kinds of cases, and develop expertise. As a result, the quality
and consistency of decisions improved.

Other states reported similar dissatisfaction with their civil

justice systems before the establishment of a business court.

For example, before the creation of Pennsylvanias Commerce

Court, the controlling mindset among the states lawyers was

that the bench did not have the experience, knowledge or time

to deal with cases centered on business and commercial
disputes.88

After Pennsylvania developed its Commerce Court, it found

judges assigned to the court demonstrated expertise in
business law matters, as well as expertise in case management
and ADR techniques unique to business litigation.89 In
South Carolina, according to Business Court Judge John
Miller, the business courts helped develop consistent case
law regarding litigated business matters. In Arizona, business
court judges, with prior complex litigation experience as
practicing attorneys, stay on the business court bench for at
least five years, enhancing their level of expertise.

Many business organizations prefer Delaware law in part

because of the trial level expertise of Delaware courts. Business
frustrations increase when the development of entirely new
forms of legal entitiesthe limited liability company and the
limited liability partnership are two good examplesdemands
courts flesh out the meaning of statutory wording. Likewise,
the internet creates new relationships between businesses and

87 See Final Report of Governors Task Force on Civil Justice Reform, available at
http://www.state.co.us/cjrtf/report/report.htm.
88 L. Applebaum, The Commerce Courts First Decade, The Philadelphia Lawyer,
Spring 2009.
89 Id.

Page 11

Specialization
allowed judges to
perform judicial
functions more
proficiently,
gain greater
experience
with particular
kinds of cases,
and develop
expertise. As a
result, the quality
and consistency
of decisions
improved.

96

Task Force Report

Business courts
provide an
opportunity
to develop a
more complete
body of current
common law
for commercial
cases.

97

demands that courts define the rights and duties of those

who use it. A dearth of published judicial decisions in litigated
commercial cases as a consequence of the increasing use
of private ADR alternatives generates uncertainty in the
business community. Business courts offer a way to alleviate
such uncertainty through the published resolution of disputes.

2. Body of common law for commercial cases

Another frustration for businesses and their attorneys in

making decisions is the lack of a significant body of common
law business decisions from courts. It has long been thought
that business courts address this concern by enhancing the
consistency, and therefore the predictability, of commercial
cases. Business courts provide an opportunity to develop a
more complete body of current common law for commercial
cases. Publication of a business courts decisions assists
businesses and their attorneys in conducting and advising on
commercial activities.

The Pennsylvania Commerce Court publishes most of its

opinions, providing lawyers and litigants a consistent and
accessible body of business law. Because cases are assigned
from the start to an individual judge in the Pennsylvania court,
cases receive individual and expert attention that achieves a
just result more efficiently and more economically.90 North
Carolina and Maryland both report similar results from their
business court systems.

Organizers of an Ohio pilot program initiated in 2009 hope the

allocation of business cases to a limited number of judges will
result in more knowledgeable rulings and promote consistency
of decisions.

Delaware found the trend toward resolving commercial cases

outside the judicial system has exacerbated the problems
created by a scarcity of decisional precedent. Associations such
as the American Arbitration Association now process
thousands of business disputes entirely outside the judicial
system. When parties divert cases from the judicial system,

90 See id.

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Business (Specialty) Courts

development of the common law suffers because privately

resolved cases do not create binding precedent so essential to
the predictability and stability of the law.

Further, private resolution of disputes by arbitration is not

necessarily a better dispute resolution mechanism for

businesses, for it too can present substantial expense and risk

to the participants. Arbitration may require high docket fees,

time-consuming and expensive motions, and lengthy discovery

similar to complex court litigation. Moreover, arbitration

typically allows only limited opportunities for appeal, even if

the award is legally or factually incorrect or arbitrary and
capricious.

Privately resolved
cases do not
create binding
precedent so
essential to the
predictability
and stability of
the law.

3. Quicker resolution

South Carolina Business Court Judge John Miller reported

that the advantages of the business court there are that each
case is handled by a single judge. Each case is allowed wide
latitude in scheduling for discovery, motion hearings, and
trial. Moreover, Judge Miller reports that cases assigned to
the business court are not subject to time and scheduling
rules and constraints imposed on other cases on the regular
docket and they are quite often given precedence in scheduling
matters, thereby allowing faster resolution of issues.91

Judge Millers characterization of his states business court

model appears consistent with the objectives other states have
pursued with existing business courts. For example, in New
York, cases are processed more efficiently and quickly and
discovery rules are more consistently enforced. New York
business court judges have developed expertise, their decisions
are published, and they use vigorous and efficient case
management practices and cutting edge technology. Attorneys
with experience before the court report a high level of
satisfaction with it.

Oregon established the Oregon Complex Litigation Court

(OCLC) in 2010 after a four-year pilot program. The specialty

91 See Journal of Business & Technology Law, available at http://www.law.

umaryland.edu/academics/journals/jbtl/bus_tech_res.html#aSouth Carolina.

Page 13

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Task Force Report

court is available for circuit court civil cases across the

state that are complex due to a variety of factors, including
subject matter, number of parties, factual issues, legal issues,
discovery issues, and length of trial.92 The OCLC pilot
program was designed to handle complex litigation cases
from out of county that would have been burdensome to
a courts normal docket. The OCLC provides efficiency in
court services and statewide sharing of judicial resources.93
4. Greater efficiency
In New York, the court system realized efficiencies through
judicial specialization. The state created a commercial division
in the states trial courts and assigned certain justices to hear
commercial cases. Implementation of this business court led
to a 35% increase in the disposition of commercial cases.
In simple terms, specialized business judges could dispose
of more commercial cases than generalist judges in a given
amount of time. New York obtained these results without using
any additional judicial resources. Rather than maintaining a
separate court, New York integrated the commercial division
into the states trial level courts of general jurisdiction. Existing
judges became the initial contingent of business judges. Those
judges used the same courtroom staff and administrative
resources they would have used before specializing in business
cases. The business judges, however, became more efficient
after specializing, and were able to handle more commercial
cases, freeing up other judicial resources to be used in other
areas of the court of general jurisdiction.

99

Alabama reported a similar outcome as business courts in

that state offered business interests greater efficiency and
greater predictability in assessing the likely outcome
of potential litigation. North Carolina reported improved
case management, increased speed and efficiency in the
resolution of business disputes, and advanced use of
courtroom technology, encouraging business development in
that state.

92 Oregon Complex Litigation Court History and Description, available at http://

courts.oregon.gov/OJD/courts/circuit/complex_litigation_court.page.
93 Id.

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Business (Specialty) Courts

Orange County, California, reported a new business court

improved the effective administration of justice by reducing the
time and expense normally associated with litigation of
complex civil cases. The new court established there also
reported earlier resolution of disputes through mediation and
settlement and achieved greater use of technology facilitating
the trial of complex cases.

New Hampshire has reported that its business courts facilitate

prompt and cost-effective resolution of trade secret disputes,
breach of contract claims, and conflicts arising from business
purchase agreements.

In Arizona, only those judges interested in complex litigation

are assigned to the business court. More intense judicial
management of cases, regular status conferences, and the
appointment of special masters to handle discovery disputes
help make the Arizona business court more efficient.

In Maine, the business court serves two goals: improving the

states business climate by creating a fair and efficient court

and avoiding the detrimental effect that complex cases have on

other matters before the courts. Both business and consumer

groups have praised the Maine business courts fairness.

Attorneys have a favorable opinion of the court largely because

of its ability to manage and dispose of extremely complex
matters.
5. Laboratory for entire court system

Most states have created special rules governing their business

courts. These rules allow the courts to be innovative with
discovery rules and creative in using technology.

In Arizona, the business court initiated e-filing. Because the

practice was so successful there, the entire Arizona court

system now uses e-filing. Other states reported similar

findings, as innovations such as one case/one judge initially

deployed in business courts were adapted for use in all civil
cases.

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Task Force Report

C. Concerns with Business Courts

In many states,
legislatures have
not sufficiently
funded the
new business
courts, limiting
their reach and
effectiveness.

Two primary concerns with business courts include: (1) the business
court judges could become too business friendly; and (2) the
creation of a special judicial system, in which business litigants
take priority, could disadvantage other cases awaiting resolution in
the court system. Some Task Force members expressed a concern
voiced by some in North Carolina: that business courts create a
perception of elitism and are special courts providing better justice
for the wealthy than for others.
In many states, legislatures have not sufficiently funded the new
business courts, limiting their reach and effectiveness. In Oregon,
for example, stakeholders would like to explore the possibility of
expanding the scale of the business court, but the appropriation
of funds necessary to accomplish this has not been forthcoming
from the legislature. Similarly, New Hampshire reports the cost of
administering the business court has been a challenge. A related
concern in New Hampshire is that business court cases could
consume a disproportionate amount of limited court resources
Arizona business court judges (who also handle cases from the
general civil docket) report that they work longer hours than their
colleagues who are not assigned to the business court. Some business
court judges have expressed a degree of dissatisfaction attributed to
specialization and the resulting decrease in stimulation occasioned by
the variety of cases on the general court docket.
In Pennsylvania, the Commerce Court has strict and relatively high
jurisdictional limits relating to the amount at stake. There is concern
that some cases topically appropriate for the Commerce Court, such
as intra-corporate disputes and small-scale commercial litigation, are
excluded from the court as a consequence of the jurisdictional limit.

D. Business Litigation in Iowa

A threshold question in determining whether a special business
court is feasible and warranted in Iowa, is whether there is enough
business litigation to justify establishing a separate, dedicated docket.
Although the Iowa State Court Administrator does not keep statistics

101

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Business (Specialty) Courts

allowing a reliable assessment of the total number of business cases
or complex civil litigation cases, a September 6, 2010, report shows
that 1,229 cases filed in Iowa courts in 2009 (the most recent year
available) were contract or commercial cases. Roughly 10% of those,
or 122 cases, would fall in the category of complex civil litigation
according to the Judicial Caseload Assessment Committee, which
served as the steering committee for the National Center for State
Courts study of judicial work-time.94
The United States District Courts for the Northern and Southern
Districts of Iowa also do not keep business case statistics. According
to a 2010 breakdown of federal cases in Iowa, however:
35 involved insurance contract disputes;
1 involved a dispute among stock holders;
75 involved other contract disputes;
15 involved property;
11 involved anti-trust matters;
1 involved banks or banking; and
4 involved a securities/commodities exchange.
Thus, 142 cases filed in Iowa federal courts last year involved
business disputes of some nature.95
According to the American Arbitration Association (AAA), there were
thirty cases filed in Iowa in 2009 that were arbitrated or mediated,
including twenty-nine construction cases and one real estate
dispute.96
Although these numbers are relatively small compared with the
overall caseload of Iowa courts, many business courts across the
country have started with a relatively small caseload. For example, in
Georgia, which established a business docket in 2006, the business
94 See Appendix J for statistics on civil filings in the Iowa District Courts.
95 See Appendix K for statistics on filings in federal court.
96 AAA is a not-for-profit, public service organization that offers a broad range of
dispute resolution services to business executives, attorneys, individuals, trade
associations, unions, management, consumers, families, communities, and all
levels of government. Businesses that insert a standard arbitration clause in their
contracts often use the AAAs services, which are available through offices located
in major cities throughout the United States.

Page 17

102

Task Force Report

Many business
courts across
the country have
started with a
relatively small
caseload.

court heard twelve cases in its first year. That amount doubled to
twenty-four in 2007 and doubled again to fifty in 2008. In 2010,
the court handled sixty-four cases.97 Georgia Supreme Court Chief
Justice Carol Hunstein stated in the 2011 Georgia State of the
Judiciary Address that the Fulton County Superior Court Judges
decided in 2010 to make the countys business courtapproved in
2005a permanent division of the court because it has proved to
be effective and efficient. The growth noted in the volume of cases
handled by new business courts in other jurisdictions lends credence
to the observation of former Chief Justice Broderick who quipped, If
you build it, they will come!

E. Recommended Business Court Pilot Project

1. General parameters

The Task Force

recommends
that Iowa
implement a pilot
project to study
establishment
of a specialty
business court.

103

The Task Force recommends that Iowa implement a pilot

project to study establishment of a specialty business court

to handle commercial litigation and complex litigation.

The pilot program would last for an initial period of three
years.

The Task Force concludes that any system for assigning cases
to the business court docket must be flexible. The business
court docket should be reserved for cases in which there is
a substantial amount in controversy. This will typically include
significant money damages, but should also include cases in
which a claim of potential future economic loss will occur if
injunctive or declaratory relief is not granted.

The business court docket should be limited primarily to

cases involving business entities, including claims asserted
by sole proprietors and actions brought by partners against
partnerships. As access to the business court should not be
limited to corporate parties, individuals should be permitted to
take advantage of the benefits of the business court docket
when they are involved in appropriate cases.

97 See Fulton County Superior Court, Business Court Status Report: Celebrating
Five Years of Service, Oct. 2010, available at http://www.fultoncourt.org/
sca200807/offices/business-court.html.

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Business (Specialty) Courts

2. Structure of pilot program
a. Judges

The Task Force recommends that one to three district

court judges be selected to serve as business court
judges in the pilot program.

i. All interested judges should be invited to apply.

ii. The Iowa Supreme Court, with advice from

chief judges of all judicial districts, should

select the business court judge(s).
b. Types of cases

The following types of civil cases would be assigned to

the business court docket:98

i. Only cases in which compensatory damages

totaling $50,000 or more are alleged, or claims

seeking primarily injunctive or declaratory relief,

will be eligible for assignment to the business

court docket providing the other criteria identified
below are met.
ii. Disputes arising out of technology licensing

agreements, including software and biotechnology

licensing agreements, or any agreement involving

the licensing of any intellectual property rights,
including patent rights.
iii. Actions relating to the internal affairs of

businesses (i.e., corporations, general

partnerships, limited liability partnerships, sole

proprietorships, professional associations, real

estate investment trusts, and joint ventures),

including the rights or obligations between or

among shareholders, partners, and members, or
98 Most states that have created business or specialty courts have identified
categories of cases that are presumptively included and presumptively excluded
from specialty courts jurisdiction. The Task Force recommends following the same
approach in an Iowa pilot program.

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104

Task Force Report

the liability or indemnity of officers, directors,

managers, trustees, or partners.

iv. Actions claiming breach of contract, fraud,

misrepresentation, or statutory violations

between businesses arising out of business
transactions or relationships.
v. Shareholder derivative and commercial class
actions.
vi. Actions arising out of commercial bank
transactions.
vii. Actions relating to trade secret, non-compete,

non-solicitation, and confidentiality agreements.
viii. Commercial real property disputes other

than residential landlord/tenant disputes and
foreclosures.
ix. Trade secrets.
x. Antitrust.
xi. Securities litigation.
xii. Breach of business contract.
xiii. Business torts between or among two or

more business entities or individuals as to their

business or investment activities relating to

contracts, transactions, or relationships between
or among them.

105

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Business (Specialty) Courts

c. Excluded matters
Actions in which the principal claims involve the

following matters should be presumptively excluded

from the business court docket:
i. Personal injury or wrongful death matters.
ii. Medical malpractice matters.
iii. Residential landlord/tenant matters.
iv. Professional fee disputes.

v. Professional malpractice claims, other than

those brought in connection with the rendering
of professional services to a business enterprise.

vi. Employee/employer disputes, other than

those relating to matters otherwise assigned to
the docket under the criteria stated above.

vii. Administrative agency, tax, zoning, and other
appeals.


viii. Criminal matters, including computer related crimes.

ix. Proceedings to enforce judgments of any type.

x. Residential foreclosure actions.

d. Opt in cases

A party in any other case involving complex commercial

litigation not meeting the above criteria should be
allowed to request transfer of the case to the business
court docket. A judge of the business court should have
the discretion to decide whether the transfer is allowed.

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Task Force Report

e. Rules

The supreme court should appoint a committee

consisting of the judges selected as business court

judges and lawyers who routinely represent clients in

litigated matters of the type within the business courts

jurisdiction to recommend special rules for the business
court including:
i. Initial disclosures.
ii. Electronic discovery rules.
iii. Case management rules including but not

limited to pretrial conferences and the like.
f. Location of trials
The Task Force did not reach agreement on whether
business court trials should be held in the county
where the suit was originally filed or in a centralized
location. If the case is tried in a location other than the
county where originally filed, a legislative change may be
necessary. The research of the Task Force revealed that
court filings in Polk County and in the U.S. Southern
District of Iowa show the majority of business litigation
originated in the central Iowa, Polk County area.
Therefore, if a centralized location were chosen, it would
be logical to have that site located in Polk County.

107

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District Court Judge, Michael D. Huppert: District 5C

Business Court Judge Michael D. Huppert was appointed to the district court bench in
th

December of 1999 and serves Iowa's 5 Judicial District. He earned his bachelor's degree
summa cum laude from Drake University in 1979, and his law degree from Drake
University Law School in 1982, where he was inducted into the Order of the Coif.
Prior to his appointment to the bench, Judge Huppert was a partner with the Patterson
Law Firm in Des Moines, where he maintained a general civil litigation practice with
emphasis in insurance defense, commercial litigation, real estate, and debtor-creditor
relations. During his tenure as an attorney, he was also responsible for managing an
asbestos litigation caseload of approximately 1,000 cases in state and federal court. During his judicial career, Judge
Huppert has presided over a wide range of cases that would currently qualify for inclusion in the Business Court
program, including matters with issues such as breach of commercial contracts, banking transactions, certification of
class actions and, complex insurance coverage issues.
Judge Huppert is a member of The Iowa State Bar Association, the Polk County Bar Association, the American
Judicature Society, and the American College of Business Court Judges. He is also a member and former director
of the Iowa Judges Association, and currently serves that organization as the chair of its Legislative Policy
committee. He is a Master of the Bench and former president of the C. Edwin Moore American Inn of Court.

Page 30

District Court Judge, Annette J. Scieszinski

th

Business Court Judge Annette J. Scieszinski is in her 17 year serving Iowa's 8

th

Judicial

District. She graduated valedictorian of her class from Winfield-Mt. Union High School in
1973, graduated from Iowa Wesleyan College in 1977, and received her law degree from
the University of Iowa College of Law in 1980, where she served on the editorial board of
the Iowa Law Review.
Judge Scieszinski practiced law for 15 years in Albia, and was elected Monroe County
Attorney for two terms. She has served in many civic roles and has been appointed to
several state leadership posts, including President of the Iowa Judges Association in
2004. In her work with the Iowa State Bar Association, Judge Scieszinski has guided programming at the statewide
Bench-Bar Conference for many years, and continues to be active on the Board of Directors of the Public Service
Project. Judge Scieszinski brings a broad variety of case and trial management experiences to the business court,
with an emphasis on expeditious and cost effective trial practices..
Judge Scieszinski is a frequent speaker on professionalism and ethics for lawyers and judges, both in Iowa and
nationally. She represented Iowa judges at the first National Conference on Public Trust and Confidence in the
Courts. She is an Iowa delegate to the National Conference of State Trial Judges, has been elected an officer of
that group, and has also chaired the Ethics Committee for the American Bar Association's Judicial Division.

District Court Judge, John D. Telleen

Business Court Judge John D. Telleen was appointed to the district court bench in Iowa's
th

7 Judicial District in April, 2011. He earned his Bachelor of Arts Degree from Augustana
College in Rock Island, Illinois, in 1980 (Political Science Major; cum laude) and his law
degree from the University of Iowa College of Law (Juris Doctorate with Distinction) in
1984. Prior to his judicial appointment, Judge Telleen was in private practice with Lane &
Waterman, L.L.P., Davenport, Iowa, serving as an associate from 1984 through 1989 and
a partner from 1990 until 2011.
Judge Telleen's primary practice area as an attorney was civil litigation, including personal
injury, medical negligence, environmental insurance coverage, commercial, asbestos exposure, and broker/dealer
litigation, in addition to advising general business and corporate clients. A significant focus of his practice became
complex insurance coverage matters in Iowa and other states including Ohio, Wisconsin, California, Kentucky, Idaho,
and Kansas. Judge Telleen became a certified civil mediator in 1988 and regularly mediated tort, contract, and other
disputes.
Judge Telleen's current professional associations include the Iowa Judges' Association, American and Iowa Bar
Associations and the Inns of Court. Professional associations while in private practice included: Induction into Iowa
Academy of Trial Lawyers 2006; American Bar Association; The Iowa State Bar Association; Scott County Bar
Association; Iowa Defense Counsel Association; Illinois State Bar Association; Rock Island County Bar Association;
and Illinois Defense Counsel Association.

Page 31

Joint Consent for Case Assignment to the Business Court Pilot Project

Plaintiffs

Full name: first, middle, last

Case no.
County
Submit this form to the Iowa State Court
Administrator. Do not file this form with the clerk
of district court.

vs.

Defendants

Full name: first, middle, last

Joint Consent for Case Assignment to

the Business Court Pilot Project

1. Pursuant to the Iowa Supreme Court Memorandum of Operation for the Iowa Business Specialty
Court Pilot Project, the parties to this case hereby request and consent to assignment of this case to
the Iowa Business Specialty Court Pilot Project.
2. The parties assert that the claims in this case meet one or both of the criteria set forth in section E of
the Memorandum of Operation as follows:
A.

Claims for compensatory damages totaling $200,000 or more.

B.

Claims seeking primarily injunctive or declaratory relief.

3. This case also satisfies one or more of the following criteria as set forth in section E of the
Memorandum of Operation, as the case involves (check if applicable):
A.

Technology licensing agreements or any agreement involving the licensing of any intellectual
property right, including patent rights;

B.

The internal affairs of one or more businesses;

C.

Claims of breach of contract, fraud, misrepresentation, or statutory violations between

businesses;

D.

A shareholder derivative or commercial class action;

E.

Commercial bank transactions;

F.

Trade secrets, or non-compete, non-solicitation, or confidentiality agreements;

G.

Commercial real property disputes;

H.

Antitrust or securities-related actions;

I.

Business tort claims.

4. The following reflect the status of this case:

A. Trial scheduling order (Rule 23.5) has been filed:

Yes

No

B. All parties have been joined:

Yes

No

December 2013

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32 to the Business Court Pilot Project
Joint Consent for Case
Assignment

Page 1 of 3

Joint Consent for Case Assignment to the Business Court Pilot Project, continued

C. The pleadings have closed:

Yes

No

Yes

No

E. A demand for a jury trial has been filed:

Yes

No

F. Trial date is set:

Yes

No

If no, explain:

D. Discovery has been completed:

/

If no, it shall be completed by:

/ 20

Month Day

If yes, trial is set to begin:

Month Day

G. The estimated length of the trial is:

Year

/ 20
Year

days.

H. Pleadings have been filed:

(1)

Manually.

(2)

Electronically in the Electronic Document Management System (EDMS).

(3)

Combination Explain:

5. List the names of plaintiffs and attorneys and the contact information for attorneys of plaintiffs.
Attach additional sheets if necessary.
Plaintiff names

Attorney names and addresses

Attorney email and phone numbers

Check this box if you are attaching a sheet listing additional names and contact information for plaintiff(s).

Continued on next page

December 2013

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33 to the Business Court Pilot Project
Joint Consent for Case
Assignment

Page 2 of 3

Joint Consent for Case Assignment to the Business Court Pilot Project, continued

6. List of defendants and attorneys and contact information for attorneys of defendants.
Attach additional sheets if necessary.
Defendant names

Attorney names and addresses

Attorney email and phone numbers

Check this box if you are attaching a sheet listing additional names and contact information for plaintiff(s).

7. The undersigned is attorney for the following

Plaintiffs:
Defendants:
8. I certify under penalty of perjury and pursuant to the laws of the State of Iowa that the preceding is
true and correct, that all parties to this action have agreed to join this Joint Consent, and that all
parties to this action and the Iowa State Court Administrator have been served with a copy of this
Joint Consent.
, 20
Signed on:

Month

Day

Year

Attorneys signature

Attorneys printed name

Attorneys law firm

Mailing address

City

ZIP code

Phone number

Email address

Service to the State Court Administrator

(via email or regular mail):

December 2013

State

State Court Administrator

1111 East Court Avenue
Des Moines, IA 50319

Additional email address, if applicable

Email: Business.Court@iowacourts.gov
Phone: (515) 281-5241

Page
34 to the Business Court Pilot Project
Joint Consent for Case
Assignment

Page 3 of 3

Page 35

Page 36

Iowa Business Court Pilot Program

Annual Evaluation July 2014
A. Introduction
In March 2012, the Iowa Civil Justice Reform Task Force released its final report
proposing reforms to Iowas civil justice system. One of the key reforms the task force
recommended was implementation of a business specialty court as a pilot program. In
response, the supreme court initiated a three-year pilot program for a business specialty court
in Iowa, which began accepting cases in May 2013. The supreme court also directed state court
administration (SCA) staff to provide an annual evaluation report to monitor the progress and
assess the effectiveness of this pilot program.
1. Goals of the business court pilot program: The primary goals of the business court are
to move complex business litigation through the court system more expeditiously and with
lower costs for the litigants and the court system. Other potential benefits include:
Development of a published body of business court case law to provide guidance
for the fair and cost-effective resolution of business litigation
Removal of complex and time consuming business litigation from the regular
district court dockets
Development of innovative court practices and uses of court technology that could
be applicable across the justice system
2. Eligibility criteria for assignment to the business court pilot program: A case is eligible
for assignment to the business court pilot program if it involves a claim for least $200,000 in
compensatory damages or a party seeks primarily injunctive or declaratory relief, and the case
involves one or more of the following claims:
a. Technology licensing agreement
b. Internal affairs of a business
c. Breach of contract, fraud, or misrepresentation arising out of business transactions
d. Shareholder derivative or commercial class action
e. Commercial bank transactions
f. Trade secrets, non-compete clause in a contract, or confidentiality
g. Commercial real property
h. Anti-trust or securities
i. Business tort claims between or among two or more business entities
3. Presiding judges and venue: The supreme court appointed three district court judges
to preside over cases assigned to the business court: Judge Michael Huppert (District 5), Judge
Annette Scieszinski (District 8), and Judge John Telleen (District 7). During the pilot period,
cases assigned to the business court will be heard by one of these three judges in the county
where the cases were originally filed. Current Iowa venue rules apply.
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4. Procedure for designating a matter for the Iowa Business Court Pilot Program: A case
may be assigned to the business court pilot project if all parties agree to the assignment. They
must file a Joint Consent for Assignment to the Business Court Pilot Program with the state
court administrator asserting that their case meets the criteria for assignment to the business
court (see A.2, above).
If the case meets the eligibility criteria, it will be assigned by the state court
administrator to one of the three district court judges appointed to preside over business court
cases. Assignments to the three business court judges are generally random, though the state
court administrator attempts to maintain a fair distribution of the business court cases among
the three judges to prevent unduly burdening any one of the three districts where the three
business court judges reside. For each business court case, the state court administrator
assigns a primary judge to handle all litigation issues. A second business court judge is assigned
to to handle settlement negotiations in each case.
B. Eligibility Criteria Met by Business Court Cases
A total of ten cases have been assigned to the business court pilot program since May
2013. Table 1 shows the number of cases that met the various criteria for assignment to the
business court.
Table 1
Eligibility Criteria Met by the Ten Cases Assigned to the Business Court Pilot Program
Must meet at least one threshold criterion:

# of cases

a. Damages over $200,000, or

b. Injunctive or declaratory relief sought

AND must meet one or more of these criteria:

a. Technology licensing agreement

b. Internal affairs of a business

c. Business transactionse.g., breach of contract

d. Shareholder derivative or commercial class action

e. Commercial bank transactions

f. Trade secrets, non-compete, confidentiality

g. Commercial real property

h. Anti-trust or securities

i. Business tort claims

Eight of the ten cases assigned to the business court met the threshold criteria with
claims for damages of more than $200,000, while five cases met the threshold criteria by

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seeking injunctive or declaratory relief. Cases must also meet at least one of several additional
criteria to qualify for assignment to the business court. Seven cases met an additional criterion
because they involved a disputed business transaction (e.g., breach of contract), seven involved
a business tort claim, and six involved a dispute regarding the internal affairs of a business.
C. Characteristics and Current Status of Business Court Cases
1. Case Characteristics: Table 2 (below) shows the 10 cases assigned to the business
court pilot program and the following information about each case:
a. County and district where the case was originally filed
b. Primary business court judge assigned to the case
c. Settlement judge for the business court case
d. Number of plaintiffs
e. Number of defendants
f. Pleadings are manual or in EDMS
g. Bench trial or jury demand
h. Date filed in district court
i. Date Joint Consent for Assignment to Business Court filed
j. Date currently set for trial
2. Observations from Table 1 about the 10 cases assigned to the business court:
District 5 accounts for half of the 10 cases assigned to the business court: four were
originally filed in Polk County and one was filed in Dallas County.
District 8 accounts for two cases, and there is one case from each of three other districts
(Districts 1, 6, and 7).
No cases have been assigned to the business court from Districts 2, 3, or 4.
The first case was filed with the business court on 5-28-13 (see column I.); the second
was filed more than three months later, on 9-3-13; six more cases were filed in the
business court by the end of 2014; none have been filed since 3-11-14.
Only two of the cases involve pleadings that are entirely electronic (filed entirely in
EDMS); both of these cases are in Polk County.
Judge Scieszinski (District 8) has had four cases assigned to her as the primary judge
(handling all maters except settlement negotiations), though Judge Scienszinski recused
herself from one of these cases, which was reassigned to Judge Huppert.1
Judge Huppert (District 5) initially received three assignments as the primary judge, and
had one additional case reassigned to him as the primary judge (see previous bullet).
Judge Telleen (District 7) received three assignments as the primary judge.

After spending considerable time as the primary judge in the GM v. Leep case, Judge Scienszinski recused herself
and Judge Huppert became the primary judge. The case is going to a mediator in mid-August 2014.

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Judge Huppert has handled settlement negotiations in five of the ten cases, Judge
Scienszinski has been the settlement judge in three cases, and Judge Telleen has been
assigned as the settlement judge in two cases.
A jury demand was filed in seven cases.
Table 2
Cases Assigned to Business Court (May 28, 2013 to August 7, 2014)
A

Case title / District

Ct Case #
World Food Internat
v World Food Proc/
EQEQ087352
Bartling v LWBJ
Financial/
LACL124872
Gen Motors v Leep
Cheverolet/
LACE123778
Rothgeb & Meyers v
Axis Group Hldgs/
LALA006081

Jury
or
bench
trial

Date
case
filed
in
Dist Ct

Date
assigned
to
Business
Ct

Date trial
sched.
to start

County
(Dist.)

Primary
Judge*

Settlement
Judge*

# of
Pltfs

# of
Defs

Pleadings are
Manual
or EDMS

Mahaska
(D8)

Scies

Hupp

combo

Bench

01/11/
13

05/28/
13

Settled
7-12-14

Polk
(D5)

Hupp

Tell

combo

Jury

03/21/
12

09/03/
13

Settled
7-16-14

Scott
(D7)

Scies (D8)
1
Hupp (D5)

Hupp

manual

Jury

09/17/
13

09/27/
13

10-20-14

Lee
(D8)

Tell

Scies

10

manual

Jury

10/10/
12

10/09/
13

5-2-14;
awaiting
final docs.

10/24/
13

6-24-14;
awaiting
final docs.

Settled

Settled

WDM School Dist v

Weitz Co et al/
LACL123417

Polk
(D5)

Hupp

Scies

14

combo

Jury

10/03/
11

Flemmer v US Bank/
EQCE074673

Polk
(D5)

Tell

Hupp

EDMS

Jury

07/10/
13

11/07/
13

Settled
7-7-14

DBQ
(D1)

Scies

Hupp

manual

Bench

03/14/
12

12/05/
13

1-5-15

Dallas
(D5)

Hupp

Tell

combo

Bench

04/25/
13

12/11/
13

Settled
7-17-14

Linn
(D6)

Tell

Scies

manual

Jury

04/01/
13

01/03/
14

Settled
4-11-14

Polk
(D5)

Scies

Hupp

EDMS

Jury

11/25/
13

03/11/
14

2-16-15

Estate of Willenborg
v American Trust/
ESPR044243
Mettille et al v
Caluzzi/
EQCV038275
Desert Flour v
Timberline Mgmt/
LACV078149
Copy Systems Inc v
Laser Resources et
al/ LACL129210

*Judges: Hupp = Huppert (District 5), Scies = Scieszinski (District 8), Tell = Telleen (District 7)
1

After spending considerable time as the primary judge in the case, Judge Scienszinski recused herself and Judge
Huppert became the primary judge. The case is going to a mediator in mid-August 2014.

As of August 7, 2014, seven of the ten cases have been settled; in two of the seven cases
the court is awaiting final settlement and dismissal documents from the parties.
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The other three cases are still active and have trials scheduled to commence during
either 2014 (one case) or the first two months of 2015 (two cases).
The oldest case in the business court pilot program was the West Des Moines School
District case in Polk County, in which the school district sued a total of 14 construction
contractors and subcontractors. It was filed in the district court in October 2011, and
the parties requested assignment to the business court in October 2013. It settled in
July 2014, but the court is awaiting final settlement and dismissal documents.
Two other cases are or were more than 27 months old since they were initially filed in
their respective counties: the Bartling v. LWBJ Financil case in Polk County (which
settled in July 2014) and the Willenborg case in Dubuque County, which is still pending
and is scheduled to start a bench trial in January 2015.

D. Judges Time on Business Court Cases

Two important aspects of the pilot program evaluation are to determine the amount of
judge time generally required to manage these types of complex business litigation and
whether the program imposes an undue burden on any judicial districts where a business court
judge resides. Prior to the start of the pilot program, the three business court judges agreed to
provide weekly reports on the time they spent on each business court case to which they were
assigned so SCA staff could effectively examine these issues.
1. Judicial work time on business court cases: Table 3 provides information on the
hours the three business court judges spent on each of the 10 cases assigned to the pilot
program during its first year of operation. Row 12 in the table indicates the three judges spent
471 hours working on the 10 cases, which is approximately 24% of a full-time equivalent (FTE)
judge.2 Judge Scieszinski spent 232 hours (12% of an FTE judge), Judge Huppert spent 136
hours (7% of an FTE judge), and Judge Telleen spent 105 hours (5% of an FTE judge) on business
court cases. The three judges spent an average of 47 judge hours per business court case,
though the actual number of judge hours per case ranged from 13.5 hours (Desert Flour v.
Timberline Management) to 95 hours (Rothgeb and Meyers v. Axis Group Holdings).

For this report, a full-time equivalent (FTE) judge works 40 hours per week for 50 weeks per year, which means a
full-time judge works approximately 2,000 hours per year. The 472 hours spent by the three judges on business
court cases equal 24% of 2000 hours per year (472 divided by 2000).

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Table 3 -- Time (Hours) Spent by Judges on Business Court Cases (6-1-13 to 6-6-14)
Hours Spent on Bus. Ct Cases

Updated 6-12-14

Primary
Judge

Settlement
Judge

Judge
Huppert
(D5)

Judge
Telleen
(D7)

Dubuque
(D1)

Scies
(D8)

Hupp
(D5)

45*

45

Bartling v LWBJ Financial/

LACL124872

Polk
(D5)

Hupp
(D5)

Tell
(D7)

14**

14

WDM School Dist v Weitz Co et

al/ LACL123417

Polk
(D5)

Hupp
(D5)

Scies
(D8)

32**

32

Flemmer v US Bank/
EQCE074673

Polk
(D5)

Tell
(D7)

Hupp
(D5)

27**

27

Mettille et al v Caluzzi/
EQCV038275

Dallas
(D5)

Hupp
(D5)

Tell
(D7)

11**

25**

36

Copy Systems Inc v Laser

Resources et al/ LACL129210

Polk
(D5)

Scies
(D8)

Hupp
(D5)

46**

5**

51

Desert Flour v Timberline Mgmt/

LACV078149

Linn
(D6)

Tell
(D7)

Scies
(D8)

14**

14

Gen Motors v Leep Cheverolet/

LACE123778

Scott
(D7)

Scies (D8)
2
Hupp (D5)

Hupp
(D5)

4*

69**

73

World Food Internat v World

Food Proc/ EQEQ087352

Mahaska
(D8)

Scies
(D8)

Hupp
(D5)

28*

58*

86

10

Rothgeb & Meyers v Axis Group

Hldgs/ LALA006081

Lee
(D8)

Tell
(D7)

Scies
(D8)

39**

57*

95

12

Total Hours

135

105

232

471

County
(District)

Estate of Willenborg v American

Trust/ ESPR044243

Row

Cases Assigned to Business Ct:

-- Listed by District
where case was filed

Judge
Scieszinski Total
(D8)
Hours

13

*Hours "Out of Own District"

32

105

118

255

14

**Hours "In Own District"

103

114

217

15

% of time "Out of Own District"

24%

100%

51%

54%

16

Total Hours = % of an FTE judge*

7%

5%

12%

24%

2%

5%

6%

13%

17
18

*Hours Out of Own Dist = % FTE

**Hours in Own Dist = % FTE

5%
0%
6%
11%
FTE (full-time equivalent judge) = 40 work hours per week X 50 weeks per year = 2000 work hours per yr.
Total hours on business court cases divided by 2000 = the % of an FTE judge spent on business court cases.
2
After spending considerable time as the primary judge in the case, Judge Scienszinski recused herself and
Judge Huppert became the primary judge. The case is going to a mediator in mid-August 2014.
*Hours spent on cases outside the judges own district
**Hours spent on cases within the judges own district
1

2. Business court judges time spent on cases outside their own judicial district: Table 3
(row 15) shows that approximately half (54%) of the time spent by the three judges on business
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court cases was time spent on cases that were originally filed outside their own district. Row 15
also shows that Judge Huppert spent 24% of his time on business court cases on cases outside
his district; Judge Telleen spent 100% of his business court time on cases outside his district;
and Judge Scieszinski spent 51% of her business court time on cases outside her district.
While all of the judges spent a substantial portion of their business court time on cases
outside their own districts, there were substantial reciprocal contributions by the business
court judges toward work on cases that had been filed in their colleagues districts. Row 4 in
Table 4 (below) shows the total number hours that the business court judges contributed to
cases outside their own districts and the districts where those work hours were spent. It also
shows which districts received judge hours from judges in other districts (see row 5). Based on
this information, row 6 indicates the net gain or net loss of judge time experienced by districts
impacted by the business court pilot program during the first year:

The District 5 (D5) column shows that Judges Telleen and Scieszinski contributed a
total of 57 hours of work on business court cases that had been filed in District 5,
while Judge Huppert, who resides in District 5, worked 32 hours on cases outside of
District 5. Therefore, District 5 received a net gain of 25 judge hours during the first
year of the business court pilot program (see Table 4, row 6).
The District 7 (D7) column shows that Judges Huppert and Scieszinski contributed a
total of 73 hours on the case that had been filed in District 7, while Judge Telleen,
who resides in District 7, worked 105 hours on business court cases that had been
filed outside his district. Consequently, District 7 experienced a net loss of 32 judge
hours during the first year of the pilot program.
The District 8 (D8) column shows that Judges Huppert and Telleen worked a total of
67 hours on cases that had been filed in District 8, while Judge Scieszinski, who
resides in District 8, contributed 118 hours to cases that had been filed in other
districts. Therefore, District 8 experienced a net loss of 52 judge hours during the
first year of the pilot program.
3. Business court judges time spent on training, administration, and promotion of the
business court pilot project: Business court judges spent some additional time on matters not
related to any particular case. They have spent time in three meetings over the first year during
which the engaged in planning and ongoing assessment efforts. They have also attended
various meetings of state and local bar groups to educate attorneys about the business court.
In addition, Judges Huppert and Telleen attended a training program on business courts at the
National Judicial College (NJC), and Judge Scienszinski attended an E-Discovery Summit at the
NJC. Finally, they spent time in at least one training session on the use of Court Call, a video
conference system and service that is used in many courts throughout the U.S. The Court Call
system will be installed and available for use by the three business court judges for their

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business court cases and their regular district court cases, as appropriate, beginning in August
2014.
Table 4
Hours Spent by Business Court (BC) Judges
Outside Their Own District
A

Districts where the BC judges spent

time outside their own districts
Hours BC judges spent on cases
outside their own district:

D1

D5

Judge Huppert (D5)

Judge Telleen (D7)

Judge Scieszinski (D8)

45

Districts that received BC judge

hours from judges outside the
district [sum of rows 1 - 3]:

45

57

Districts that contributed BC

judge hours to other districts
(see column F):

Net BC judge hours gained or

lost due to business court
program [row 4 minus row 5]:

52

D6

25

D8

Total
hours

28

32

39

105

14
69

14

32

45

D7

14

119

73

67

256

105

119

256

-32

-52

E. Attorney Evaluation of the Business Court Pilot Program

Each attorney who has represented a party in a business court pilot program case will
receive a survey at the conclusion of each case. Because only one case (Desert Flour v.
Timberline Management) had been concluded by the end of June 2014, there were not enough
responses from attorneys to report meaningful data from attorneys. This will be a more
substantial component of the 2015 annual report on this pilot program.
F. Views of the Business Court Judges on the First Year of the Pilot Program
In June 2014, the business court judges met and discussed the status of the business
court pilot program. A summary of their observations and assessments is set forth below.
1. Assignments of cases to judges: The process the state court administrator used to
assign cases to the three judges has worked well. There has been a fair allocation of cases and
types of assignments (primary judge, settlement judge) to each of them. Because Judge
Telleens former law firm in Scott County has been involved in a few of the business court

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cases, and because he continues to recuse himself from cases involving that law firm, he has
received fewer business court assignments than the other two judges. The strategy of assigning
a separate business court judge to handle settlement negotiations works very well.
2. Management of cases outside the business court judges own districts. This has not
been a concern for the judges or the attorneys involved in the cases, according to the judges.
3. Need for a video conference system for business court cases. A goal of the business
court pilot project is to efficiently and effectively leverage the use of technology. SCA staff
explored the use of GoToMeeting for video conferencing, but this option was not favorably
viewed because it requires the judges or the judges staff to organize the meeting and operate
the GoToMeeting application. The limitation of only six participants being able to connect via
video conference is also problematic. Three of the 10 cases currently assigned to the business
court involve more than five attorneys, and GoToMeeting would not accommodate those cases.
Court Call, Inc., is another service considered for the project. Court Call provides all of
the equipment for the court and works with the court to coordinate and initiate all courtinitiated conference calls. There is no cost to the Judicial Branch, but the participating
attorneys or parties pay a fee for each conference call. Attorneys and parties, however, may
recoup some or all the Court Call fee by saving the costs of travel time and expenses. The state
court administrator has agreed to pilot test the Court Call system in the business court. Court
Call will work with each judge and court administration staff to have the necessary equipment
delivered and installed in Polk County (Judge Huppert), Monroe County (Judge Scieszinski), and
Scott County (Judge Telleen). Court Call will train the judges and their staff on how to
coordinate with Court Call personnel to effectively schedule and conduct conference calls. It is
expected that the Court Call systems will be operational for use sometime in August 2014.
4. Promotion of the business court pilot program: Attracting 10 cases to the pilot
project within the first year is a successful start to the pilot program. Attorneys may be slow to
choose a type of litigation system with which they are not familiar. As business court cases are
brought to a successful conclusion, it is anticipated that the program will be promoted by
attorneys who have experienced its benefits. Additional effort should be made to actively
promote the business court among attorneys who may not be aware of the business court
option. SCA staff should approach the Iowa Lawyer for publication of an article after this
annual report is completed and approved. Chief Judges in the judicial districts could also review
existing cases on the dockets in their districts and, if one or more cases seem appropriate for
the business court pilot project, could recommend to one or more of the attorneys that they
consider assignment of their case to the business court. Finally, the state court administrator
expressed his willingness to serve as a liaison between opposing attorneys in a civil case that
might qualify for assignment to the business court, if requested by one of the attorneys in the
case, to encourage the parties to apply for assignment to the business court.

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Status of Cases Assigned to Business Court (9-22-2014)

A

Case title / District

Ct Case #
World Food Internat
v World Food Proc/
EQEQ087352
Bartling v LWBJ
Financial/
LACL124872
Gen Motors v Leep
Cheverolet/
LACE123778
Rothgeb & Meyers v
Axis Group Hldgs/
LALA006081
WDM School Dist v
Weitz Co et al/
LACL123417
Flemmer v US Bank/
EQCE074673
Estate of Willenborg
v American Trust/
ESPR044243
Mettille et al v
Caluzzi/
EQCV038275
Desert Flour v
Timberline Mgmt/
LACV078149
Copy Systems Inc v
Laser Resources et
al/ LACL129210
Goetsch v Circle G
Farms

Jury
or
bench
trial

Date
case
filed
in
Dist Ct

Date
assigned
to
Business
Ct

Date trial
sched.
to start

County
(Dist.)

Primary
Judge*

Settlement
Judge*

# of
Pltfs

# of
Defs

Pleadings are
Manual
or EDMS

Mahaska
(D8)

Scies

Hupp

combo

Bench

01/11/
13

05/28/
13

Settled
7-12-14

Polk
(D5)

Hupp

Tell

combo

Jury

03/21/
12

09/03/
13

Settled
7-16-14

Scott
(D7)

Scies (D8)
1
Hupp (D5)

Hupp

manual

Jury

09/17/
13

09/27/
13

10-20-14

Lee
(D8)

Tell

Scies

10

manual

Jury

10/10/
12

10/09/
13

Settled

Polk
(D5)

Hupp

Scies

14

combo

Jury

10/03/
11

10/24/
13

6-24-14;
awaiting
final docs.

Polk
(D5)

Tell

Hupp

EDMS

Jury

07/10/
13

11/07/
13

Settled
7-7-14

DBQ
(D1)

Scies

Hupp

manual

Bench

03/14/
12

12/05/
13

1-5-15

Dallas
(D5)

Hupp

Tell

combo

Bench

04/25/
13

12/11/
13

Settled
7-17-14

Linn
(D6)

Tell

Scies

manual

Jury

04/01/
13

01/03/
14

Settled
4-11-14

Polk
(D5)

Scies

Hupp

EDMS

Jury

11/25/
13

03/11/
14

2-16-15

Ida
(D3)

Tell

NA

EDMS

Bench

9/5/14

9/12/14

TBD

8-21-14

Settled

*Judges: Hupp = Huppert (District 5), Scies = Scieszinski (District 8), Tell = Telleen (District 7)
1

After spending considerable time as the primary judge in the case, Judge Scienszinski recused herself and Judge
Huppert became the primary judge. The case is going to a mediator in mid-August 2014.

Page 46

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

Do's and Don'ts of Small Claims

10:00 a.m.-10:30 a.m.
Presented by
Sam Jones
Shuttleworth & Ingersoll
115 Third Street Ste.
500 PO Box 2107
Cedar Rapids, IA 52406
Phone: 319-365-9461

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

Family Law 101

10:45 a.m.-11:30 a.m.
Presented by
Caitlin Slessor
Shuttleworth and Ingersoll, PLC
115 3rd Avenue SE
Cedar Rapids, IA
Phone: 319-365-9461

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Divorce 101
CAITLIN SLESSOR
SHUTTLEWORTH AND INGERSOLL, PLC,
CEDAR RAPIDS, IA
319-365-9461
CLS@SHUTTLEWORTHLAW.COM

A few notes about this

presentation:
-T H I S I S M E A N T T O B E A V E R Y B A S I C O U T L I N E O F

DIVORCE LAW IN IOWA. THE FAMILY LAW COMMITTEE OF

THE IOWA STATE BAR ASSOCIATION PUTS ON A TWO DAY
SEMINAR EVERY YEAR THAT GOES INTO DEPTH ON
SPECIFIC TOPICS
-A T T H E E N D O F T H E O U T L I N E I S A N A P P E N D I X W I T H
FORMS AND STATUTES THAT ARE REFERRED TO
THROUGHOUT THE PRESENTATION
-T H E S E F O R M S A R E M E A N T T O B E A S T A R T I N G P O I N T F O R
THOSE CREATING THEIR OWN FORMS AND SHOULD BE
MODIFIED BY THE USER TO APPLY TO THEIR PARTICULAR
DISTRICT AND CLIENT.

Preliminary Matters
Iowas divorce statute is Chapter 598. Its not long

and you should give it a full read if youre going to

practice divorce law.
Also of interest:

Chapter 252 for child support questions

595: the marriage statute. Who, how, etc.
596: premarital agreements.
597: the husband and wife statute

Preliminary Matters
Iowa is a no fault divorce state, as all states are. New York

was the lone holdout but finally adopted no fault in 2010.

Historically, parties who wanted a divorce had to prove
wrongdoing or breach of the marital contract. Infidelity or
cruelty were the most common.
With no fault divorce, this is no longer necessary. This is
sometimes referred to as unilateral divorce: only one party
has to want it and doesnt have to have a particular reason
Studies have shown that no fault divorce leads to lower
incidence of female suicide and domestic violence. 1
In Iowa, you must simply assert that the legitimate objects of
matrimony have been destroyed and there remains no
reasonable likelihood that the marriage can be preserved.
http://www.freakonomics.com/2010/06/16/divorce-reformhits-new-york/
1

Preliminary Matters
A marriage is a legal contract between two people
A divorce is a dissolution of that contract
The statute is referred to as the Dissolution of

Marriage chapter

THE BASIC PARTS OF A DIVORCE CASE

1. Pre-filing
2. Filing
3. Discovery, i.e., information gathering
4. Evaluation

4 a. Temporary orders

5. Negotiation
6. Resolution

6 a. Settlement
6 b. Trial

7. Post-Decree

*I have left appeals out of this outline. This is far too

specialized to cover in todays time

1. Pre-filing- Dissolution of Marriage

Questionnaire
Create a dissolution of marriage questionnaire for

potential divorce clients. It will help you get much of

the information you need in one place.
Giving clients a questionnaire also helps them see
what kind of information you will need from them
and what will be relevant to their case.
Clients have busy lives and much of your job will be
to remind them of what their obligations are.

1. Pre-filing- Practice Tips

Its never too soon to lay the foundation for a healthy

family law attorney- client relationship

Talk to clients about finding a support person in their life:
counselor, minister, sister, friend
Let them know that you are there to help with the legal
issues but that many of the questions they will encounter
will not be of a legal nature. Those should be discussed
with a support person.
Set up realistic expectations. Keep in mind that you are
only hearing one side of the story and that their spouse is
unlikely telling the same story.

1. Pre-Filing- Practice Tips

From the very first meeting, listen for the problem areas and try to get the client used to the reality of the situation:

Look for flags like the client saying they will never pay alimony, wont divide their retirement, just want primary
care

Sometimes using language like family law disputes can be unpredictable or keep in mind that a judge may see

it differently can be a gentler way of telling someone something that they dont want to hear.
It is rarely going to help the client in the long-run if you mindlessly promise to get whatever they are asking for. 99%
of clients appreciate candor and will have better things to say about you if you give it to them straight.
Be realistic and up front about costs: if clients say things that indicate they will need a lot of service, let them know
how that will affect their bills. Give clients an idea of the range of costs they can expect and tell them that you will
help them plan for this. This will improve your relationship with the client, prevent arguments about bills later if the
case gets expensive and help ensure you get paid.

Keep in mind that many people do not have thousands or tens of thousands in savings. They may rely on a 401(k)
loan or a tax refund to pay their bills. If you quote them a retainer but dont explain the circumstances that might
lead to exceeding the retainer, they may be frustrated because they would have saved/borrowed more if you just
would have told them.

1. Pre-Filing- Common Jurisdictional Questions

Before you file a dissolution of marriage case in

Iowa, make sure you can.

The Respondent must be an Iowa resident and be
personally served OR the Petitioner must have
resided here for at least one year
There are endless combinations of facts that can
potentially occur, but here are a few basics that come
up:

1. Pre-Filing- Common Jurisdictional Questions

I just moved here from Hawaii because I missed the

winter. Can I get divorced in Iowa?

No, not until youve been here a year, or if your spouse moves
here and you have him/her personally served.

I just moved to Hawaii because I hate winter but I

want to get divorced in Iowa. Thats where my wife

and children live. Can I do that?

Yes, spouse is an Iowa resident

1. Pre-filing- Venue
Venue is proper in any county where either spouse

lives
If cost is an issue, consider filing in the county where
the attorney works, if that is an option
For example, client lives in Vinton (Benton Co),
spouse lives in Cedar Rapids. Client hires Linn
County lawyer: much cheaper to walk two blocks to
the courthouse than to drive 45 minutes to Vinton.

1. Pre-filing- a note about domestic abuse

It is important to determine whether domestic abuse

is an issue. If so, discuss the option of filing for a 236

protective order.
It is equally important to discuss domestic abuse in
the context of not doing it. This can be an awkward
conversation, but get comfortable doing it.
Once your client has perpetrated abuse, certain
things might be very difficult for them- getting
custody or shared care and remaining in their
homes, for example.

2. Filing The Case: The Petition

Now that you know this is the proper state and

youve decided on a proper venue, draft your

petition.
Iowa Code Section 598 has a subsection that
describes what to include in your petition. See the
Appendix.

2. Filing The Case- Injunctions

Consider whether an injunction against the

dissipation of assets is necessary.

In the Sixth Judicial District, you can get a standard
peacekeeping injunction pretty easily at the
beginning of a case if it is mutual and follows a
certain format. (See Injunction in the Appendix).
Requires a sworn statement (affidavit) from client on
the necessity and you must follow the Iowa Rules of
Civ. Pro. for injunctions (Division XV).

2. Filing the case- some notes

Your client must sign the petition
Must also include an original notice, confidential
information form and cover sheet
Include a $185 filing fee
Serve the opposing party- ask your client whether
personal service or an acceptance is better
It is helpful to establish a checklist for your case to keep
track of tasks. See Appendix-Divorce checklist.
Remind your clients to take their Children in the Middle
class.

3. Discovery
Tell your client to begin gathering their financial

information.
In fact, some areas have mandatory discovery, like in
the 6th Judicial District. (See Appendix for Family
Law Case Requirements Order).
Spend some time drafting a really good overview
letter that you can use in most cases. It will cut down
on getting the same question over and over. Hint: do
separate form letters for case with/without children.
(See Appendix for Initial Dissolution Letter).

3. Discovery
Find out if mediation is required in your district.
Find out if the local convention is for attorneys to go

to mediation or not.
Even if its not required, evaluate whether it will be
helpful and whether an attorney presence will also be
helpful.
Calendar some follow up dates: when to hound your
client about financial documents, when the 90-day
waiting period expires, any court ordered dates or
deadlines.

3. Discovery- Formal Discovery

Evaluate whether this is necessary.
Often, it is not. You can get information from the

source directly:

It is lying around the house.

Joint bank accounts- have your client obtain the information.
Joint tax returns- your client can request copies.
Subpoenas if you know where the information is located.

Just ask- the other attorney may provide it willingly.

Both sides are often under pressure to be costeffective.

3. Discovery- Formal Discovery

Same tools of discovery as any other civil case (Iowa

Rule Civ. Pro. Division XII (1.701 and subsequent)

Depositions
Interrogatories
Requests for Production
Requests for Admissions

Use judiciously- five good questions will be answered

more thoroughly than thirty form questions.

4. Case evaluation
When you have all the information you need, begin

thinking about your resolution.

Have a list of issues that you provide your client (See
Appendix-Settlement worksheet) or use for yourself.
Kids
Property (real estate, debts, cars, bank accounts,
retirement)
Support (alimony)
Misc. (name change, court costs, attorney fees)

4.a. Temporary Orders

Evaluate whether any temporary orders are

necessary. Here is what I say to clients:

Because a divorce may take over a year in our district to go to

trial, the court can enter orders for custody and support while
the case is pending so that you and your spouse know what
your obligations are to each other and so that youre not having
disagreements about the kids schedule and finances. Do you
think you will be able to work out these issues on your own by
agreement or that you will need a court order during this time?
It can be quite expensive to have a temporary matters hearing,
as well as divisive for spouses to have to take stances against
one another early in a case

4.a. Temporary Orders

Let people know they can file a request for temporary

orders any time. The decision doesnt have to be

made at the time of filing.
In contentious cases, recommend requesting a
temporary hearing right away.
Know whether the courts schedule is something that
a client should be aware of: for ex., in Linn County,
the wait on a temp. hearing is about 8 weeks right
now.

4.a. Temporary Orders

So, you think you need them. What can be decided at a
temporary matters hearing?

Look at the statute:

598.10 TEMPORARY ORDERS.

1. a. The court may order either party to pay the clerk a sum of money for the separate support and
maintenance of the other party and the children and to enable such party to prosecute or defend the
action. The court may on its own motion and shall upon application of either party or an attorney or
guardian ad litem appointed under section 598.12 determine the temporary custody of any minor child
whose welfare may be affected by the filing of the petition for dissolution.
b. In order to encourage compliance with a visitation order, a temporary order for custody shall provide for a
minimum visitation schedule with the noncustodial parent, unless the court determines that such
visitation is not in the best interest of the child.
2. The court may make such an order when a claim for temporary support is made by the petitioner in the
petition, or upon application of either party, after service of the original notice and when no application is
made in the petition; however, no such order shall be entered until at least five days' notice of hearing, and
opportunity to be heard, is given the other party. Appearance by an attorney or the respondent for such
hearing shall be deemed a special appearance for the purpose of such hearing only and not a general
appearance. An order entered pursuant to this section shall contain the names, birth dates, addresses, and
counties of residence of the petitioner and respondent.

At least in the sixth judicial district, the court does not

typically grant possession of the marital home to one

party or another at a temporary hearing.

4.a. Temporary Orders

Preparing your client

Dont reinvent the wheel: spend the time to write a good set of
instructions that you can use for every client. Everyone has the same
questions. (See Appendix).
Create a letter or instructions for witnesses (See Appendix). Give
witnesses padded deadlines.
Reiterate deadlines and let clients know that your ability to do your
best depends on them meeting their deadlines. It may take a few
experiences to learn this, but a rushed affidavit is never as good as
one that has been carefully prepared.
Figure out whether your client will personally testify and prepare
them. Even if clients dont normally personally testify, let them know
that it may be a possibility (if thats true).
Again, set up reasonable expectations

4.a. Temporary Orders

Preparing yourself:
Consider filing a requested relief statement.
Have some alternative child support guidelines if child support
is an issue.
Have a list of your best points to argue in chambers or to
examine your client about (if an in-person hearing is held).
Talk to opposing counsel about what is agreed upon. Make
sure you share this with the judge so it ends up in the order.

4.a. Temporary Orders

After the hearing:
No, you cant really appeal it. You can do an interlocutory
appeal, but in our office this has resulted in clients just paying
more attorney fees.
No, you cant modify it because of some small change. But, yes,
if something serious occurs you can apply to modify it. This
doesnt mean it will be modified.
Yes, you have to follow this for a year (or so).
Yes, it sets up a status quo that may be hard to get changed at
trial.

4. Evaluation- property
The law: We are striving for an equitable division of the

marital property.
Does not require equal but often gravitates that way.
Think: fair, not equal when you describe to clients.
Read Iowa Code Section 598.21. It tells you what to
consider.
Well developed case law on issues like pensions,
premarital property, etc.

But not terribly helpful for issues like what to do with the photo
albums.

4. Evaluation
For property issues:
Create a property division worksheet:

List each piece of property/debt that each party could receive and do
some math.
Play with the math. Explore minimums and maximums.
Share the math with your client.
Some people have a very hard time understanding financial
information. Figure out if you have one of those clients and explain it
until they get it. A few issues I see:
The client who doesnt understand that an encumbered asset, no
matter how big, is really only worth its equity.
The client who highly values the cash property settlement (i.e., she
had to pay me money! I must have won!).
The client who has trouble calculating the cost of trial into their
equation

4. Evaluation- children
For cases involving children
Get comfortable talking about legal custody and physical custody.
Explain primary physical custody versus joint physical custody.
Be thorough when you analyze how custody and support work together.

Sometimes, a parent is better off agreeing to shared custody and split expenses
rather than primary custody and greater child support.

There is plenty of case law regarding custody. Read it and get a feel for
the cases.
At least know these cases well:

- In RE Marriage of Winter 223 N.W.2d 165 (Iowa, 1974):

Discusses factors relevant to a custody determination.

-In re Marriage of Hansen, 733 N.W.2d 683, 695 (Iowa 2007):

Discusses the factors for determining whether a shared care
schedule is appropriate.

4. Evaluation- children
Practice tips

Print out some blank Google calendars. Use colors for a visual
Ask for a budget for the kids: include daycare, dance, car
insurance, school lunches, school registration, band
instrument rental, etc. Dont include in home costs like
dinner, water bill, clothing.
Explore what your client really wants. A lot of people say, I
just want primary care, I dont care about anything else, or, I
just want my kids to live with me. Find out why. They may just
be parroting what a friend has told them.

4. Evaluation- children
For cases involving children, contd
I actually draw out a picture of what people are fighting about
in custody cases:
What you are
paying me to fight
about

Client has 0
days with
children

Exactly equal
time with kids

Spouse has 0
days with
children

The client need not (usually) be concerned about spending 0

days with their children

4. Evaluation- children
For cases involving children, contd
Best

interest of the child is the prevailing standard.

Do not forget to explore legal custody- sole legal
custody is rarely granted but make sure you are
evaluating this issue.
If your client asks can we bring up x? the answer is
almost always yes.
The more important question is whether you should.
But read the statute for yourself to determine what
you can bring up, and what you should bring up:
598.41 is the relevant section.

4. Evaluation- children
For cases involving children, contd
Practice Tip:
Every once in a while the super-agreeable client can be a problem.
The most common problem I see is that when someone wants the
divorce to be over right away, they will urge you to stop requesting
so much detailed information about their custody arrangement.
They just want to keep it open.
This is a bad idea. Resist the urge! It leaves people with an
unusable document when they inevitably need it in the future.
I throw myself under the bus: just humor me and lets at least put
in some sort of default because Im so obsessive about this sort of
thing. Or you could try youll thank me when youre older.

4. Evaluation- child support

For cases involving children, contd

Child support: Apply the Child Support Guidelines.

Located here:

http://www.iowacourts.gov/wfdata/files/Childsupport/C
hapter9.pdf
And in your Iowa Court Rules book.
If you do a lot of divorces/custody cases, invest in Iowa
Support Master software
Located here: https://www.awism.com

If you want to deviate from the guidelines, spell out why in

your stipulation of settlement.

4. Evaluation- Alimony
Alimony can often be the most difficult issue.
This is because the law does not provide certainty.
Start by looking at whether there is an income disparity. If so, keep

going.
Look at the length of the marriage.
Look at earning capacity, non-monetary contributions to the
marriage, moving for one spouses career, asset division.
Consider what effect child custody and support decisions have on
the alimony analysis.
Read some recent court of appeals decisions.
Look for alimony calculators- from the American Academy of
Matrimonial Lawyers, other states, etc. These are not controlling
but can give you some ideas.
Consider property settlements in lieu of alimony where appropriate.

5. Negotiation
Once you have evaluated your case and provided your client

with a reasonable set of expectations, you are ready to begin

negotiating your case.
You have a variety of techniques at your disposal.
Think of easier/less expensive techniques versus more
involved/more expensive techniques.
Level 1 (easier) techniques:

Pick up the phone and talk to the other attorney.

Consider e-mail- this provides a written record of agreements and makes
drafting easier. It also allows clients to see the negotiations directly. It
also ensures that nothing is forgotten.
Letter writing- just as a note, sometimes it can be hard for a client to
receive a strongly worded letter in the mail from the opposing attorney
without warning. Consider calling to give them advance warning or
putting a cover letter with it.

5. Negotiation
Level 2 negotiation techniques
Mediation- required in many districts.
Consider having attorneys attend and have a stipulation of
settlement circulated prior to mediation.
Settlement conferences- both attorneys and both clients, meet
at an office and try to work it out.

This is far more effective for an initial divorce than any subsequent
modification actions as both parties will probably want the case to
be over.

Judge-led settlement conference- this varies from district to

district.

6.a. Resolution- Settlement

If you have utilized negotiating techniques that have

led to settlement, get it finalized right away.

Even sitting on an agreement overnight can mean
the agreement will fall through.
Be careful in your drafting. Learn from your
experiences in contempt cases and modifications.
Practice tip- if you use forms or re-use stipulation
language, make sure that it is a blank document and
has no names in it. It can be easy to miss these
changes when you are down to the wire on a
settlement.

6.a. Resolution- Settlement

Set parameters for yourself for settlement and stick to

them.
I like to tell clients that I want to know whether their case
will likely settle or go to trial by about four months from
the trial date. This is padded as I really only need about
two months to get ready for most trials, but it helps them
stay on task.
Some clients vastly prefer to put their head in the sand
and it can be easy not to look at a case if a client isnt
bothering you.
Dont mistake their lack of contact for intent to agree.

6.a. Resolution- Settlement

BUT- You are dealing with people and families, not

insurance companies, and this doesnt always work.

Still, try to make last minute settlements an
exception, not the rule.
Request trial retainers by a certain date and use that
as a tickler to check in on how a client wants to
proceed.
Dont avoid trying to settle just because a case is
contentious- some of the most contentious cases do
settle. There is a difference between the chatter of
disagreement and real, fundamental disagreement.

6.b. Resolution-Trial

This could be a presentation all of its own. But here are some tips:
Some cases must be tried. Get a retainer. Do not be afraid to try a
case.
Prepare well in advance. Create a checklist that you use in every case
and follow it.
Go over everything again and again. Knowing the case like the back
of your hand will be your most powerful tool at trial. This enables
you to maximize your presentation.
Be well organized: use trial binders and sub-dividers.
Dont miss deadlines.
Stick to only essential witnesses and only ask them what they need to
add to the relevant issues.
Ensure that your client knows that his/her credibility is the most
important thing about the trial.

6.b. Resolution-Trial
Instruct your client about body language/sighing/furious

whispering.
Manage your time: I tell my clients that if the biggest deal
to them is custody, I will spend the bulk of our time on
that. If they only care a little about the retirement
accounts, I will spend relatively little time on that.
Make sure you are utilizing exhibit binders. Piles of
papers that get disorganized are distracting.
Practice tip- explain to your client what to expect after
the trial and prepare them for post-trial deadlines.

7. Post-Decree
Consider available post-trial motions
Consider appealing adverse rulings (30 days to file notice

of appeal).
Figure out whether you have to do anything pursuant to
the decree. Do everything you are supposed to do:

Deeds
Qualified Domestic Relations Orders
Income withholding Orders, etc.

Make sure your client understands the ruling.

Tell them to pay their court costs. If you dont, they will

be mad at you when they try to register their car and are
told they cant.

7. Post-Decree
Consider withdrawing from cases when youve

completed the case. This prevents you from being

noticed on future contempt filings, modifications,
etc.
Return photos, tax returns, etc. to client.
Learn from your experiences and change how you do
things in the next case.
Ask your clients for constructive feedback. We are in
a service industry and should be striving to provide
satisfactory service to our clients.

A final note
Family law is stressful. No one going through a divorce is

happy to spend thousands of dollars on your services.

Remember, the clients have created their own
circumstances. It was not you who locked the other
spouse out of the house/said something mean to the
kids/etc.
Keep this in mind when you are talking to the opposing
counsel. Fight zealously for your client but try not to take
on the controversies personally.
Figure out what the legal issues are and make the case
about that. Keep it professional, not personal.
Dont do it if you hate it.

Divorce 101
Appendix

598.5

CONTENTS OF PETITION -- VERIFICATION -EVIDENCE.

1. The petition for dissolution of marriage shall:

a. State the name, birth date, address and county of
residence of the petitioner and the name and address of the
petitioner's attorney.
b. State the place and date of marriage of the parties.
c. State the name, birth date, address and county of
residence, if known, of the respondent.
d. State the name and age of each minor child by date of
birth whose welfare may be affected by the controversy.
e. State whether or not a separate action for dissolution of
marriage or child support has been commenced and whether such action
is pending in any court in this state or elsewhere. State whether
the entry of an order would violate 28 U.S.C. 1738B. If there is
an existing child support order, the party shall disclose identifying
information regarding the order.
f. Allege that the petition has been filed in good faith and
for the purposes set forth therein.
g. Allege that there has been a breakdown of the marriage
relationship to the extent that the legitimate objects of matrimony
have been destroyed and there remains no reasonable likelihood that
the marriage can be preserved.
h. Set forth any application for temporary support of the
petitioner and any children without enumerating the amounts thereof.
i. Set forth any application for permanent alimony or
support, child custody, or disposition of property, as well as
attorneys' fees and suit money, without enumerating the amounts
thereof.
j. State whether the appointment of a conciliator pursuant to
section 598.16 may preserve the marriage.
k. Except where the respondent is a resident of this state
and is served by personal service, state that the petitioner has been
for the last year a resident of the state, specifying the county in
which the petitioner has resided and the length of such residence in
the state after deducting all absences from the state, and that the
maintenance of the residence has been in good faith and not for the
purpose of obtaining a dissolution of marriage only.
2. The petition shall be verified by the petitioner.
3. The allegations of the petition shall be established by
competent evidence.

Divorce Checklist

Document
Cover
Petition
Confidential
information
Original Notice
Acceptance of Service
Return of Service
Engagement letter
Fee Agreement
Directions for service
Acceptance of service
letter
Financial affidavit
Child support
worksheet
Financial discovery
Temporary Affidavits
Responsive Affidavits
Explanation of
temporary orders
Income withholding
order
CIM certificate
Mediation
certification
Interrogatories

Filed or provided to OP

Deadline

Date filed/provided

Request for
Document production
Answers to
Interrogatories
Answers to requests
for documents
Stipulation
Decree
Addendums
Final Child support
worksheet
Health Dept. form

First of all, thank you for retaining me to assist with your case. I have filed the enclosed
petition and accompanying documents. I am also sending them your spouse with a
request for an acceptance of service.
Now that you are a party to an open dissolution case, there are several things you need
to note:
CASE DEADLINES
1. Enroll in the class for separated parents. (see your brochure about class times and
locations) . Im worried that you may not have received that brochure so Im
including a copy in this mailing.
2. Provide me with the financial information listed in the Family Law Case
Requirements Order. This is mandatory and failure to comply could result in
court-ordered sanctions against you. While the order says to provide this to me
within 60 days, the sooner I get it, the sooner I can begin to analyze your case.
3. Let me know if you and your spouse reach any agreement on settlement
provisions so that I may work toward preparing the proper paperwork.
4. Note all deadlines in the Family Law Case Requirements Order. Your deadlines
and important dates are as follows:
a. Class for divorcing parents- 45 days from [insert]
b. Discovery Deadline (exchange of financial information)-60 days from
[insert].
c. Mediation- must be complete by: [insert]. Your assigned mediator is
[insert]. You do not have to use this person for mediation, however, if you
and your spouse cant agree on another mediator, this mediator is your
default.
d. Pre-trial conference- will be at the Linn County Courthouse on: [insert
date and time]
e. Trial setting conference- (you do not need to attend) will be held over the
phone on: [insert date and time]. This is the time the court will contact
the attorneys to choose an available trial date. You will get a letter and
order shortly thereafter regarding the trial.
When I receive your financial documentation, I will prepare a financial affidavit and
asset/liability worksheet for us to review. Please do this as soon as possible.

TEMPORARY CUSTODY HEARING INSTRUCTIONS FOR CLIENTS

Your temporary matters hearing is scheduled for: _____________. In our county, all
temporary matters hearings are conducted by affidavit only. You are allowed to file
your affidavit and the affidavits of up to three (3) witnesses. These must all be
filed three business days in advance of the hearing. In order for me to meet this
deadline, you must provide me with the affidavits no later than: _______________
Your personal affidavit
My clients all have different preferences as to how they want to prepare their own
affidavits. Your options are as follows:
1. Write it up yourself and drop it off to me for filing.
2. Write a draft yourself and provide me with an electronic copy of it so that I can
review it and provide editing feedback.
3. Make an appointment to meet with me so that we can prepare it together.
Regardless of which option you choose, it is important that you are mindful of the
deadlines so that we dont run out of time to provide the court with your best affidavit
possible. In addition, we are required to submit a financial affidavit as well as proposed
child support guidelines. This means that you have to get me your financial information
well in advance of the hearing, but no later than that October 19 deadline.
Witness Affidavits
I have instructions and signature pages for witness affidavits that I am enclosing for
you. Please provide each of your potential witnesses with a set of instructions.
Responsive Affidavit
After we receive copies of the affidavits filed by the other side in the case, you will have
up until the day before the hearing to file a response to that. This response should only
include new information or responses to information that you did not anticipate. Again,
you are free to meet with me to prepare this or to prepare it on your own and forward it
to me for filing. Keep in mind that this is a very last-minute event and scheduling can
be difficult. I will do my best to accommodate you if you would like to meet with me to
do this.
Mediation
If custody is a disputed issue, you are required to mediate your case in advance of the
hearing. Please call the mediator immediately to schedule this. Your default mediator is

__________ with a phone number of _______________. This is the person you should
use for mediation if you and the other party to the case cannot reach agreement on
another mediator. Attorneys do not ordinarily attend mediation, but there are
exceptions to this. Let me know if you have questions or concerns about mediation.
The day of the hearing
The day of the hearing, you should appear at the courthouse about 15 minutes early.
You are free to bring a supportive friend or family member with you. You will not
likely see or meet the judge who will be deciding your case. Ordinarily, you will wait
outside the courtroom while the attorneys go into the judges office, or chambers. We
usually do not receive a decision immediately; it may take a week or more. However,
the court does prefer to rule as quickly as possible.

Instructions for Temporary Affidavits

Thank you for agreeing to provide an affidavit for our pending temporary hearing. Below
are some tips and guidelines for preparing an effective affidavit. This is meant to be a general
guideline and some cases may call for an exception to these suggestions.
1. Typed affidavits are preferred. Electronic information is even better (in Word format, or by email).
2. All witnesses providing an affidavit must sign the attached affidavit form to be included with
their statement. Only documents with original signatures can be filed in court.
3. Witnesses should talk about the following:
a. Who they are (name, employment, family, residence, etc)
b. How they know the parties to the case and for how long.
c. Specific events they have witnessed or impressions they have gained by personal
experience. Details are important but some details are irrelevant. Dates should be
included where remembered.
d. Information about both parties and the children are most helpful.
e. Its unusual for a witness affidavit to be more than 3-5 pages. One page is often fine.
4. Witnesses should avoid:
a. Relying heavily on hearsay, or information that they receive from third parties.
b. Clear bias
c. Making conclusory statements without further detail (i.e., she is a great mother
without explaining why you say that).
d. Providing opinions on topics on which they are unqualified (i.e., making mental health
diagnoses).

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com
Caitlin L. Slessor- email cls@shuttleworthlaw.com

SETTLEMENT WORKSHEET:
Issues to be addressed by dissolution decree
Below is a list of possible issues in a divorce case with children. Please note in detail the agreement that
you believe you have reached with your spouse. If you cannot agree right now, please note in detail the
outcome you would like to propose.

1. Custodya. Legal Custody____________________________________________________

______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________

b. Physical Care_____________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
c. Visitation schedule_________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
d. Holidays and vacations_____________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________

e. Transportation
________________________________________________________________________
________________________________________________________________________
Shuttleworth & Ingersoll, P.L.C.
115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com
Caitlin L. Slessor- email cls@shuttleworthlaw.com

________________________________________________________________________
________________________________________________________________________
f. School/daycare___________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
g. Other____________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
2. Child Support __________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
3. Health Insurance and uncovered medical expenses___________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
4. College education for children_____________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
5. Tax dependency exemption_______________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
6. Real estate/mortgage____________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Shuttleworth & Ingersoll, P.L.C.
115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com
Caitlin L. Slessor- email cls@shuttleworthlaw.com

7. Personal property________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
8. Vehicles________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
9. Other items (businesses, collections, boats, etc. ______________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
10. Debts__________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
11. Alimony/support, if any_________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
12. Retirement accounts, pensions, 401(k), annuities____________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
13. Life insurance ______________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
14. Court costs______________________________________________________________
________________________________________________________________________
________________________________________________________________________
15. Name change, if desired (for wife, if a married name was taken)______________
Shuttleworth & Ingersoll, P.L.C.
115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com
Caitlin L. Slessor- email cls@shuttleworthlaw.com

________________________________________________________________________
________________________________________________________________________
If one of the items does not apply to your case, for example, you do not have real estate, simply note that
you do not have that item. This worksheet is just meant to be a guide to help you and your spouse discuss
settlement. If you need legal advice or suggestions regarding the issues, please ask me.

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com
Caitlin L. Slessor- email cls@shuttleworthlaw.com

LITIGATION TRACK
12:30-5:00 P.M.

Caveat
The printed materials contained in this book
and the oral presentations of the speakers are
not intended to be a definitive analysis of the
subjects discussed. The reader is cautioned that
neither the program participants nor The Iowa
State Bar Association intends that reliance be
placed upon these materials in advising your
clients without confirming independent research.

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

LITIGATION TRACK
Deadline in Litigation
12:30 p.m.-1:30 p.m.
Presented by
Laura Bergus
Hayek, Brown, Moreland and Smith L.L.P.
120 E. Washington St.
Iowa City, IA 52240
Phone: 319-337-9606

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Deadlines in Litigation
ISBA Nuts & Bolts Seminar
October 30, 2014, 12:30 p.m., Coralville Holiday Inn
Laura E. Bergus, Hayek, Brown, Moreland and Smith, L.L.P., Iowa City
I.

SOURCES OF LITIGATION DEADLINES

1.
2.
3.
4.
5.
6.

CONSTITUTION Federal and state; standards may be different.

STATUTE Review the code as well as regulations implementing the code.
STATEWIDE COURT RULES Esp. Chapters 1 and 2 of the Iowa Court Rules.
LOCAL RULES Can vary from district to district, and from county to county.
CASE LAW INTERPRETING ALL OF THE ABOVE Check it before citing
other authority on a deadline or timing issue.
COURT ORDER IN A SPECIFIC CASE Review pretrial orders to be sure
theyre clear and that all parties interpret them the same way, before issues arise.

The authority for deadlines comes from a variety of sources, and a single deadline may
arise from multiple sources. For example, a criminal defendants right to speedy trial comes from
the constitutional speedy trial right found in the Sixth Amendment to the US Constitution and
Article I, Section 10 of the Iowa Constitution. This right is codified and quantified in statutes: 18
U.S.C. Section 3161 et seq. in federal law and Iowa Code Section 813.2 in Iowa law. The Iowa
statute in turn is a reference to the Iowa Rules of Criminal Procedure, wherein the speedy trial
right can be found at Rule 2.33(2). The statutory authority includes a right to speedy indictment
(30 days in federal law, 45 in Iowa) from the date the defendant is arrested. In Iowa, whether an
arrest has occurred, for the purposes of invoking the speedy indictment and speedy trial rights,
is determined on a case-by-case basis, considering a multitude of factors. See State v. Wing, 791
N.W.2d 243, 246 (Iowa 2010). If the State blows the speedy indictment or speedy trial deadline
in Iowa, the remedy is dismissal of the case. Rule 2.33(2).
Be aware deadlines can come from a variety of sources, and that the simple arithmetic of
determining a deadline like counting 45 days from the date of arrest may not be as simple as
it seems.
II.

THREE STEPS IN EVERY CASE CIVIL OR CRIMINAL

An attorneys involvement in litigation may begin with filing a petition, an appearance,

an answer, or the court ordering appointment. Regardless of when you step into a case, be aware
that there are deadlines you must be accountable for in every single case. To meet your
professional and ethical obligations, you must know the deadlines, keep track of the deadlines,
and meet the deadlines (or maintain some legally sufficient excuse). The author suggests the
following steps for every case, regardless of type or procedural posture.

1.

READ THE RULES OF PROCEDURE. These should be a starting point for

every question about timing and deadlines in litigation.
a.

Know which Chapter to review. Deadlines are usually found in the

procedural court rules:
i.
Chapter 1 Civil Procedure
ii.
Chapter 2 Criminal Procedure
iii.
Chapter 6 Appellate Procedure
iv.
Chapter 7 Probate Procedure
v.
Chapter 8 Juvenile Procedure
vi.
Chapter 12 Mental Illness Commitments
vii.
Chapter 13 Substance Abuse Commitments

b.

Know the Rules well enough to know where to look. Motion deadlines
may be under a Rule governing motions, or under a Rule specific to that
type of motion. Some refer to other Rules, like the time for filing a motion
to amend or enlarge (Rule 1.904(2)) refers to the time to make motion for
new trial (Rule 1.1003; 1.1007).

Note there are upcoming changes in the civil rules, effective January 1,
2015: discovery changes and new expedited cases. Again, READ THE RULES.
(Start reading them now so you can be prepared on January 1!)
Be aware there are some fundamental differences between how deadlines
in civil and criminal cases are calculated: many civil trial deadlines count
backwards from the time of trial, whereas Rules of Criminal Procedure set several
deadlines by counting forwards from date of arrest/custody, trial information, or
arraignment.
2.

REVIEW PRETRIAL ORDERS They can be different in every case due to the
judges preferences, the type of case, and the status of the case at the time the
pretrial orders are entered. For example, a complex case with many parties or
claims may have pretrial deadlines set sooner than they would be set in a simpler
case.
a. Spot the holes: know whats not addressed in the order. Do the Rules
provide deadlines for issues not in the pretrial order? Consider talking
with opposing counsel to agree on informal deadlines (but appreciate the
consequences of either of you failing to abide by those).

b. If the case is continued, what happens to the pretrial deadlines? Be

aware when asking for a new trial date if you want the court to expressly
reset deadlines that count backwards from the trial date.
3.

CALENDAR AND TICKLE ALL DEADLINES your malpractice insurance

probably requires you to be able to show that youre on top of deadlines. How do
you do this? Redundant systems. Not just one not just Google Calendar, not just
Outlook calendar thats synced with Google Calendar. There are many different
practice management options out there: the authors office uses a date-based
electronic database from which we literally print a list of upcoming deadlines
every day, and reminders set in Outlook calendar, and a system of triplicate paper
slips, managed by staff and shoved under the attorney noses every day.
a.

b.
c.

III.

Proposed checklist for tracking every deadline in every case:

i.
In the file on a piece of paper or in some other way represented
in the file. For example, print out or scan/save every order with a
deadline in it, or make a memo to the file of deadlines not courtordered.
ii.
On the calendar double check youre on the right week, day,
yearCheck it against the court order, memo, etc. when entering.
iii.
Tickler paper, electronic, or both.
iv.
To the client inform the client of all deadlines as soon as you are
made aware of them. Keep the correspondence informing the client
of deadlines in the file (paper, electronic, or both).
Enter and track deadlines even if youre 99.9% sure you wont have to
follow through. Examples: 1.944 orders, trial date for case about to settle.
Set notifications far enough in advance you have a chance to get prep
work completed: set subpoena deadlines for documents you might not get
in discovery, far enough in advance you can use them in deposition of an
expert, for example.

SOME DEADLINES ARE REALER THAN OTHERS

Different attorneys, judges, and local practices can dictate very different outcomes in the
enforcement (or attempted enforcement) of deadlines. The practitioner should never assume that
opposing counsel will be ok with, for example, tardy interrogatory responses simply because
some other opposing counsel granted a two-month extension without even asking his client.
Similarly, while the Rules push counsel to resolve discovery disputes between ourselves (note
the upcoming changes in discovery rules requiring explicit disclosure of conversations to resolve

such disputes), one never knows how a judge will address a motion to compel. Below are some
examples from the Rules and from the authors own experiences.

1.

WRITTEN DISCOVERY: in the Rules and pretrial orders

a.
Requests for Admissions: Serve responses within 30 days or allegations
become facts of the case, conclusively established in this case and
evidentiary admissions in other cases. Rules 1.510 and 1.511.
b.
Interrogatory Answers: 30 days to answer in writing under oath; not
always strictly enforced.
c.
Requests for Production: response in 30 days, but response can simply be,
Will be made available for inspection; not always strictly enforced.

2.

OTHER PRETRIAL DEADLINES: These deadlines should be noted in pretrial

orders. If theyre not, check the Rules, or confer with opposing counsel and
ultimately the court to establish them, if needed.
a.
b.
c.
d.
e.
f.

Expert designation.
Depositions.
Pretrial reports.
Designation of exhibits, witness lists.
Exchange of final, marked exhibits.
Motions in limine.

Note these deadlines can vary widely from case to case. They also generally differ
between civil and criminal cases. For example, in the criminal context, the defendant
must file with the court a witness list no later than the time of the taking of a deposition
by a defendant. Rule 2.13(3). This can happen very early in the case, especially if the
defendant seeks to invoke Rule 2.13(6), which requires depositions to be completed
within 30 days of arraignment. (But also note the 30-day-deposition-completion rule
appears never to be enforced in Johnson County) A failure to disclose defense
witnesses at least nine days before trial can result in exclusion of those witness
testimony. In many civil cases, names of potential witnesses are disclosed relatively early
in written discovery, but the final witness list often need not be filed until 10 days before
trial (which is generally long past any final discovery deadlines within which to depose
those witnesses).
3.
POST-JUDGMENT CHALLENGES: Deadlines for challenging a decision of the
court are often jurisdictional, meaning the court may not have authority to even hear the
challenge if its not timely filed. The follow are examples of post-judgment challenges.
4

a.

b.

c.

d.
e.

f.

IV.

Motion to Enlarge or Amend: Rule 1.904(2): need to request the court

address something it inadequately addressed. 15 days from final order
unless good cause shown, then up to additional 30 days.
Motion to Reconsider: Beware! Not every motion to reconsider extends
the time for appeal...Motions to reconsider that are not in substance
motions for new trial or rule [1.904(2) ] motions will not extend the time
for appeal. Jovanovic v. Iowa State Univ. Veterinary Teaching Hosp.,
674 N.W.2d 683, 2003 WL 22807529 *2 (Iowa Ct. App. Nov. 26, 2003).
Motion for Judgment Notwithstanding the Verdict; Motion for New Trial:
Rules 1.1003 through 1.1010; 15 days from final order unless good cause
shown, then up to additional 30 days.
Certiorari: Rules 1.1401 through 1.1412. 30 days from challenged tribunal
action. How do you define the final action being challenged?
Judicial Review: generally 30 days from final administrative action.
Again, whats final? All remedies exhausted first? Whats the timeline
for those remedies?
Appeal: Rule 6.101. 15 days from final order in TPR and CINA cases; 30
in other cases. Do you know what constitutes a final order? Examples:
i.
Order for temporary child custody is not a final order, requiring
interlocutory appeal. In re Marriage of Denly, 590 N.W.2d 48, 51
(Iowa 1999).
ii.
Order for temporary child support, spousal support, or attorneys
fees is a final order, appealable by right (and generally not
appealable upon rendition of permanent orders therefore). In re
Marriage of Winegard, 257 N.W.2d 609, 614 (Iowa 1977).

RAMIFICATIONS OF MISSING DEADLINES

The results of missing deadlines range from lowering your self-esteem or embarrassing
yourself in front of clients, opposing counsel, or the court, all the way to losing your license to
practice law and facing personal liability for damages. Avoid these consequences:
1.

LOOKING STUPID AND UNPREPARED Your professional reputation is

yours to ruin.

2.
LOSING STRATEGIC ADVANTAGE Missing deadlines often means you are
unprepared, in addition to looking unprepared. If the other side is on top of
discovery and youre not, you will miss facts that could have helped you better
serve your client: good facts to leverage a better outcome in court or settlement,
or bad facts to help you counsel your client to the right resolution of his or her
case.
5

3.
DIRECT HARM TO YOUR CLIENT Missing a deadline can ultimately lead to
your client losing his or her liberty or property. An ineffective assistance of
counsel claim down the road is little consolation to the criminal client sitting in
prison because you blew the deadline for submitting his alibi defense or naming
his best witness. In the civil context, missing a deadline can mean loss of your
clients rights due to failure to designate that expert who would have made a
helpful difference in the jurys understanding; or failure to discover a smoking
gun document that could have settled the case in the first few months of litigation.

V.

4.

DISCOVERY SANCTIONS Rule 1.517. Your failure to keep up with discovery

deadlines could ultimately result in sanctions, including you or your client paying
the other sides attorney fees.

5.

ETHICAL VIOLATIONS Rule 32.1.3. This Rule of Professional Conduct

requires the attorney to be diligent in representing the client. There are many
disciplinary opinions based on dilatory conduct by counsel. Your license is your
livelihood. Dont jeopardize it just because you forgot to calendar a hearing in
your haste to pass along some news to your client, or because your email inbox
was too full.

6.

MALPRACTICE A failure to act with due care in meeting deadlines can result
in a private lawsuit. A malpractice case can bring: increased insurance premiums,
reputational damage, and actual damages, not to mention the tremendous stress
and cost of resources in defending the same.

WHEN IN DOUBT

A little self-help on the front end can go a long way in avoiding the bad results of missing
deadlines listed above. The following is a list of suggestions for clarifying, and therefore
meeting, deadlines, if youre ever in doubt. Ultimately, its in the interest of justice to be sure the
parties are playing by the same set of rules. Getting a judge to weigh in can also be a way to
protect your clients interests, if you have been or might be prejudiced by some difference of
interpretation or failure to follow deadlines on the other side. Youre also protecting yourself
against negligence claims and ethic complaints from your client if you make a paper (or
electronic) trial of your attempts to verify and comply with the deadlines in a case.
1.

DO THE RESEARCH - Theres no excuse not to conduct a few minutes of legal

research. Fastcase (free to ISBA members); Google Scholar (free to everyone).

2.

ASK COLLEAGUES Ask more experienced attorneys inside or outside of your

office how they have handled issues relating to deadlines in litigation. Take their
answers with a grain of salt because their opposing counsel might not have
reacted the same way yours will when facing the same issue. But, these responses
can help you approach the issue with opposing counsel. For example: I
understand the deposition deadline provided in the pretrial order isnt considered
a hard deadline by some practitioners. Nevertheless, your request to depose our
duly designated expert three days before trial cannot be accommodated. Or: I
read Rule 2.13(6) to require depositions to be completed within 30 days of
arraignment. I realize the County Attorneys office may not often field requests to
comply with this Rule. However, my client has not waived his right to speedy trial
and he is requesting to depose the investigating officer in this matter no later than
x date, which is the 30th day after my clients arraignment.

3.

ASK OPPOSING COUNSEL Do not hesitate to pick up the phone and confer
with opposing counsel about a deadline. This is required by the Rules if the
deadline at issue leads to a discovery dispute you wish to ultimately bring to the
court. None of us want to sound ignorant to opposing counsel (especially if that
person has already reminded you they have been practicing law longer than you
have been alive), but you are protecting yourself and your client by checking to be
sure you and the other side are on the same page or verifying that youre not.

4.

ASK THE COURT If youre unsure about the how and when of purely
procedural aspects of a case, and neither your mentors nor opposing counsel can
be of help, dont be afraid to request the court enter an order establishing
deadlines with greater clarity. Depending on the parties and judge involved, an
email to the court (not ex parte, of course!) requesting informal clarification can
also help all parties stay on track and avoid the harm of missing deadlines.

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

LITIGATION TRACK
Expedited Litigation Rules
1:30 p.m.-2:15 p.m.
Presented by
Karen A. Lorenzen
Hayes Lorenzen Lawyers, PLC
125 S. Dubuque Street, Suite 580
Iowa City Iowa 52240
Phone: 319-887-3688

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

The New Two Tier System

On January 20, 2012, the Iowa Civil Justice Reform Task Force issued its report following
months of meetings, research and suggestions from the task force members.
The initial project of the task force was to help conduct a survey of over 9,000 licensed
Iowa attorneys and judges to obtain their input on a variety of civil justice system topics.
One such topic was a "two tiered justice system." The essential question underlying the
work of the task force was whether there should be a simpler, more expeditious civil
litigation system for claims falling below a certain threshold value. The questions
discussed by the task force were the jurisdictional amounts and how we would in theory
manage a two tier system. It was the recommendation of the task force that a pilot
program based on a two tier system be implemented. Provided along with this outline is
the task force's report as it relates to the two tier system. See Attachment A. In addition,
Attachment B is the task force's report on implementing changes to the discovery
process.
On August 28, 2014, the Iowa Supreme Court announced that it had adopted an
expedited civil action rule and amendments to the Iowa discovery rules. The Court's
announcement identified the following changes in implementing this expedited civil
action rule:
1.
2.
3.
4.
5.

Chapter 1 Expedited Civil Action Rule 1.281 (Attachment C)

Chapter 1 Discovery Amendments (Attachment E) I
Expedited Civil Action Certification: Rule 1.1901-Form 16 (Attachment F)
Expedited Civil Action Certification: Rule 1.1901-Form 17 (Attachment G)
Joint Motion to Proceed as an Expedited Civil Action: Rule 1.1901-Form 18
(Attachment H)

6. Health Care Provider Statement in Lieu of Testimony:

Rule 1.1901-Form 19

(Attachment I)

7.
8.
9.
10.

Chapter 23 Time Standards for Case Processing (Attachment J)

Notice of Civil Trial Setting Conference: Rule 23.5-Form 1 (Attachment K)
Trial Setting Order and Discovery Plan: Rule 23.5-Form 2 (Attachment L)
Trial Scheduling Order and Discovery Plan for Expedited Civil Action: Rule 23.5Form 3 (Attachment M).
I. RULE 1.281 EXPEDITED CIVIL ACTIONS

TI1e rule specifically lays out the actions eligible to be considered "expedited civil
actions." Essentially, relief is limited to a money judgment in which all claims (other
1

Attachment Dis the abolition of verification requirement.

than compulsory counter claims) for all damage by or against any one party totals
$75,000 or less including damages of any kind, penalties, pre-filing interest and
attorney fees, but excluding prejudgment interest accrued after the filing date, postjudgment interest and costs.
The Supreme Court specifically indicated that the Iowa Rules of Civil Procedure shall
ill2ID to expedited civil actions, except as otherwise specifically provided by Rule
1.281.

II. INITIATION OF AN EXPEDITED ACTION

This action may proceed in one of two fashions. First, an eligible plaintiff may elect to
proceed as an expedited civil action by certifying the relief sought as a money
judgment for all claims will not exceed $75,000 or second,. under subsection (f) that the
parties may stipulate to an expedited civil action. This can be done through a joint
motion to proceed as an expedited civil action such as set forth in number (5) above,
form 18.

III. DISCOVERY CHANGES IN EXPEDITED ACTIONS

Pursuant to Rule 1.281(2)(b), expedited actions are subject to the initial disclosure
requirements of Rule 1.500(1). In addition, there are limited and simplified discovery
procedures. Under subsection (c) each party is limited to ten interrogatories, ten
requests for production, ten requests for admission.
Further, and probably most significant as it relates to cost reduction, the parties may
have one deposition of each party and each side may take up to two depositions of
non-parties. Further, the parties are entitled to retain one expert, except upon
agreement of tl1e parties of leave of court showing good cause. Further, under
1.281(3), motions, motions for s=ary judgment are limited to six specified
grounds.

IV. PROCEDURE FOR EXPEDITED TRIAL

Unless a jury demand is submitted, expedited cases are tried to the court.
a. Parties must file one jointly proposed set of instructions and a verdict form. If
an instruction or verdict form is controverted, party must file specific
rejection(s), with autl1ority, and proposed alternative instruction or vedict
form.

b. Expedited civil jury trial. Unless otherwise ordered, the jury in an expedited
case will consist of six jurors chosen from a panel of twelve.
c. Expedited non-jury trial. Court in its discretion may dispense with findings of
fact and conclusions of law and instead render judgment or general verdict,
special verdicts, or answers to interrogatories that are accompanied by relevant
legal instructions.

V. DOCUMENTARY EVIDENCE ADMISSIBLE WITHOUT CUSTODIAN

CERTIFICATION OR TESTIMONY

Documentary evidence will be admissible without custodian certification or testimony

under the following conditions:
1.
2.
3.
4.

Must offer document at least 90 days before trial.

Appearance is as offered.
No hearsay or an exception.
Objecting party has not raised a substantial question as to authenticity or
trustworthiness of document.

VI. HEALTH CARE PROVIDER'S STATEMENT IN LIEU OF TESTIMONY

1. Report of the health care provider in lieu of deposition or in-court testimony.

2. Report must be accompanied by certification from counsel listing all
communications between counsel and health care provider.

CONCLUSION

The intent behind the Expedited Civil Action Rule is to provide equal access to the
justice system. In order to accomplish that, a quicker, more efficient and less expensive,
albeit limited, alternative has been created for claims falling below a set monetary
threshold. Only time will tell if this "system" which has been created for well intentioned
and well thought out reasons can be successfully implemented and managed.

Attachment A

TAsK FoRcE REPORT

II. Two-TIER JusTICE SYSTEM

I
Summary
The Task Force recommends a pilot program based on
a two-tier civil justice system. A two-tier system would
streamline litigation processes-including rules of evidence
and discovery disclosures-and reduce litigation costs of
certain cases falling below a threshold dollar value.

Introduction

A consensus
developed that a
two-tier structure
in the Iowa civil
justice system
would contribute
to processing
smaller value
cases more

quiclcly and cost

effectively.

Access to justice for all Iowans must be a primary goal of the Iowa
Judicial Branch. The number of jury trials in Iowa has decreased in
the past two decades. The increased cost of litigation dictates that
maiJ.y meritorious claims are never pursued simply because the costs
of litigation substantially offset or outweigh any potential recovery. 8
Even if the anticipated cost is not an obstacle precluding judicial
resolution of a dispute, the length of time consumed in litigated
resolutions of disputes often is. Whether due to costs or delay, the
negative consequences of these deterrents includes a diminution
of public participation in the civil justice system and a dangerous
marginalization of the courts.
A central question underlying much of the work of the Task Force is
whether there should be a simpler, more expeditious civil litigation
system for claims falling below a certain threshold value. With this
in mind, several of the Task Force subcommittees considered the
potential merits of a tiered civil litigation structure. A consensus
developed that a two-tier structure in the Iowa civil justice system
would contribute to processing smaller value cases more quickly
and cost effectively. Under such a tiered structure, civil cases falling
below a certain threshold dollar value, or cases of a particular legal
category, would receive Tier 1 or Tier 2 classification.
8 Task Force member Steve Lawyer conducted a survey of members of the Iowa
Association of Justice and the Iowa Defense Counsel Association to assess the
degree to which attorneys are turning down cases because the costs of litigation
outweigh the potential recovery. See Appendix C, Access to Courts Survey Results.

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Many states have experience with tiered civil justice systems,
and there are myriad ways to structure such a system. Common
denominators of Tier 1 cases include the following: cases valued
below a certain threshold amount; streamlined or limited discovery
processes; limited motion practice; 9 simplified rules of evidence;
accelerated pre-trial deadlines and earlier trial dates; possible
mandatory ADR; 10 and cases presenting claims of personal injury,
debt collection, breach of contract, breach of warranty, or property
damage. Common denominators of Tier 2 cases include the following:
higher dollar-value cases; cases that are not easily quantified
monetarily, such as civil rights violation claims under 42 U.S. C.
section 1983 and Iowa Code chapter 216; will contests, punitive
damage claims, employment, environmental, constitutional, copyright
or trademark infringement, and declaratory judgme11t actions; cases
involving equitable remedies, even though the amount in controversy
may be less than the threshold limit; and complex litigation matters.

A. Jurisdictional Amounts
The Task Force investigated the threshold dollar amount in different
states separating the tiers and concluded $50,000 would be an
appropriate jurisdictional limit for Tier 1 cases in Iowa. 11 Some
consideration was given to a $75,000 threshold, but the consensus of
the Task Force is that a lower humber is preferable given the volume
of such cases in Iowa.
The survey asked respondents about a streamlined, tiered civil justice
process in Iowa. A large majority of respondents favored the concept.
When asked whether a streamlined civil justice process should be
created for cases valued below a certain dollar amount, 74.4% of the
respondents either agreed (47.0%) or strongly agreed (27.4%), with
only 8.7% either disagreeing (6.0%) or strongly disagreeing (2.7%).
The average dollar-value threshold survey respondents suggested
was just under $30,000. But, upon removing outlier responses to this
9 For example, summary judgment could be limited to jurisdictional issues or by
leave of court.
10 The Task Force considered many facets of a tiered court system in conjunction
with its study of potential court-annexed ADR recommendations for the Iowa court
system. Jurisdictions with court-annexed ADR systems commonly prescribe ADR
in either specific subject matter categories or dollar-value thresholds, or both.
11 The Task Force recommendations for establishment of business specialty courts
also reference dollar-value thresholds.

TASK FORCE REPORT

open-ended question-those that listed a $1 million or $0 threshold

runount-the average dollar-value limitation respondents suggested
was approximately $50,000. 12

B. Judicial Management of a Two-Tier System

1. Preliminary judicial management conferences

During a
preliminary
management
conference
the court
would assign
the case to
either Tier 1 or
Tier 2 status.

The Task Force recommends that a presiding judge should

hold a preliminary management conference in all civil cases
in which the amount in controversy exceeds the small claims
jurisdictionallimit13 within sixty days of the last party's answer
or after all automatic disclosures are due. The court at these
conferences would assign the case to either Tier 1 or Tier 2
status. Court rules should require plaintiffs requesting Tier 1
classification to expressly note their request on the cover page
of the pleading commencing the action. The rules should
authorize courts to assign Tier 1 status in any case by
agreement of the parties at the case management conference.
2, Tier 1 judicial management practices
a. Trial dates and motions for extension of time

The Task Force recommends Tier 1 trials be held within

one year of filing or within one year following the initial
judicial management conference.
Parties should file any motion to extend discovery
deadlines no later than ten days in advance of any
established deadline. Parties resisting motions to extend
deadlines should respond within fourteen days of the
motion. Courts should promptly rule on motions within
ten days of the resistance.

12 A majority of the survey respondents also favored limitations on the scope and
duration of discovery in cases that would fit within the Tier 1 category. Sixty-three
percent of respondents favored such limitations, with 20% strongly agreeing
and 43.3% agreeing with the concept. Nearly 22% of respondents
either disagreed (17. 7%) or strongly disagreed (4.2%) with imposing discovery
limitations on lower value cases. Survey, question 14 (Appendix B:7).
13 The small claims court jurisdictional limit is currently $5,000 exclusive of interest
and costs. See Iowa Code 631.1(1).
'

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Two-TIER JusTICE SYsTEM

b. Discovery deadlines and sanctions

Courts should strictly enforce discovery deadlines by

imposing automatic monetary fines on the responsible
person for failure to respond to discovery within
established deadlines. The court should be authorized
to rescind such penalty upon motion for good cause
shown by the penalized party after response by affected
parties. Imposition of penalties on pro se litigants
should not be automatic and should be left to the
discretion of the court.
c. Summary judgment

Parties should file summary judgment motions in

Tier 1 cases no less than ninety days before trial, and
courts must rule promptly on summary judgment
motions .
Members of the Task Force disagreed whether summary
judgment motions should be restricted in Tier 1 cases.
Some believe summary judgment motions consume
valuable time and waste resources that could be
better spent adjudicating the case at trial. Others .
believe summary judgments are an efficient vehicle
for resolving many smaller Tier 1 cases (e.g., collection .
cases). This split of opinion was reflected in the survey
results. A majority of the respondents disagreed with
the idea of prohibiting summary judgment in small
value cases, with 36.9% disagreeing and 18% strongly
disagreeing.
The survey asked respondents to rate the frequency of
several aspects of summary judgment motions:
J> Only occasionally (51.3%) or almost never
(18.6%) are summary judgment motions used
as a tool to leverage settlement, rather than in
a good faith effort to narrow the issues.
J> Only occasionally (39.1 %) or almost never
(23.0%) does summary judgment practice
increase the cost of litigation without
commensurate benefit to judicial economy.

16

TASK FORCE REPORT

>-

Only occasionally (35.9%) or almost never

(30. 7%) does summary judgment practice
delay the course of litigation without
commensurate benefit to judicial economy.

Seventy-three percent (73%) of respondents reported

that judges rule on summary judgment motions
promptly about~ time (31.2%) or less frequently, with
29.1% of respondents reporting timely rulings
occasionally and 12.8% of respondents reporting
timely rulings are almost never received.
Most respondents (61.1 %) report that judges grant
summary judgment when appropriate about ~ time
(25.6%) or more frequently, with 28% reporting
often and 7.5% almost always. Conversely, 39%
reported that judges grant summary judgment when
appropriate less frequently than one-half the time with
29.8% reporting occasionally and 9.2% almost never.
More than half of the survey respondents (55.5%)
reported that judges only occasionally (37.8%) or almost
never (17.7%) decline to grant summary judgment
motions when it is warranted.
A large percentage of the respondents (78.6%) believe
attomeys rarely file summary judgment motions without
regard for the likelihood of success because of
malpractice concerns, with 48.8% reporting this
happens almost never and 31.9% only occasionally.
3. Tier 2 judicial management practices
The Task Force urges adoption of the following judicial
management practices in Tier 2cases.
a. Firm trial date
In Tier 2 cases the court should set a firm trial date at
an initial trial management conference pursuant to
current supreme court scheduling standards and Iowa
Rule of Civil Procedure 1.944--the rule for dismissal for
want of prosecution.

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Two-TIER Jus:ricE SYSTEM

b. Motions for extension of time

Parties should file any motion to extend discovery

deadlines no later than ten days in advance of any
established deadline. Parties resisting motions to extend
deadlines should respond within fourteen days of the
motion. Courts should promptly rule on motions within
ten days of the resistance.
c. Judicial management conferences

Courts should automatically schedule and hold judicial

management conferences every six months in Tier 2
cases to address outstanding discovery issues, assess
adherence to established pre-trial schedules, determine
trial readiness, and consider sanctions for discovery
violations.

d. Summary judgment motions

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Parties should file any motion for summary judgment no

less than 120 days before trial in Tier 2 cases. Courts
should rule promptly on summary judgment
motions.

C. Discovery Limitations in a Two-Tier System

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1. Tier 1 discovery limitations

a. Interrogatories

Interrogatories should be limited to fifteen per party,

including discrete subparts in the absence of leave
of court or agreement of the parties permitting a greater
number. Without differentiating between Tier 1 and Tier
II cases, 56.3% of the survey respondents agreed
(42.0%) or strongly agreed (14.3%) with the notion of
placing limitations on the number of interrogatories. 14

Interrogatories
and requests
for admissions
should be limited
to fifteen per
party in Tier 1
cases.

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disagreed (19.5%) or strongly disagreed (9.9%) with limitations on interrogatories.

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TASK FORCE REPORT

b. Admissions

Requests for admissions should be limited to fifteen per

party without leave of court or a contrary agreement of
the parties. Although survey respondents were not
asked to differentiate between Tier I and Tier II cases,
respondents were equally split on whether requests for
admissions should be limited. 15
c. Discovery supplementation

All parties should be permitted to rely upon and enforce

written discovery supplementation requirements within
the existing rules for any party's discovery responses.
Such rules would reduce the exchange of unnecessary
and cumulative discovery by multiple parties.

d. Depositions

Each party should be allowed to take two depositions

without leave of court unless the parties agree
otherwise.
e. Expert witnesses

The 2009 ACTL/IAALS Report, 16 set forth in Appendix D,

recommends "[e]xcept in extraordinary cases, only one
expert witness per party should be permitted for any
given issue." 17 In Arizona, unless the court orders
otherwise upon a showing of good cause, each side
is limited to one independent expert witness per issue.
Ariz. R. Civ. P. 26(b)(4)(D). Multiple parties on the same
side of litigation must agree on that one expert, or the
court will designate the expert. Id.
Task Force members disagreed whether limitations
should be placed on the number of expert witnesses,

15 Survey, question 30a (Appendix B:15). Forty-two percent of respondents agreed

(30.8%) or strongly agreed (11. 7%) with limiting requests for admissions, while
40.9% either disagreed (23.5%) or strongly disagreed (17.4%).
16 Final Report on the Joint Project of The American College of Trial Lawyers Task
Force on Discovery and The Institute for the Advancement of the American Legal
System, March 11, 2009.
17 Id. at 17.

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Two- TIER JusTICE SYSTEM

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even in Tier 1 cases. Task Force members most

closely scrutinizing the twa-tier court structure
recommend a limitation of one expert per liability issue
per party (not per side), 18 with a limitation of two liability
experts testiJY:ing per party in any Tier 1 case without
leave of court unless the parties agree otherwise. There
was no consensus, however, whether to limit the
number of expert witnesses addressing damages in Tier
1 cases.
Limiting the number of expert witnesses, even in Tier
1 cases, is not necessarily a straightforward proposition.
The term "issue" is broadly encompassing and must
be defined. In addition, multiple experts may be
necessary for different aspects of damages (e.g.,
economic damages, mental and physical injuries', etc.).
Finally, multiple parties on the same side of a lawsuit
may have divergent interests, rendering it problematic
to utilize the same expert on behalf of all co-parties. For
these reasons, the Task Force does not recommend
limiting the number of expert witnesses in suits other
than Tier 1 cases. In Tier 1 cases, the court could
permit additional experts for good cause shown.
f. Expert opinions
Parties should disclose expert opinions, and the reasons
for them, in signed answers to interrogatories or
by report within the deadlines prescribed in the pre-trial
scheduling order. Expert testimony should be strictly
limited to the content of an expert's interrogatory answer
or report .
g. Expert depositions
Task Force members disagreed on restricting litigants
from talcing expert depositions in Tier 1 cases. Some
members would presumptively prohibit expert
depositions, subject to a party seeking leave of court
18 This is consistent with the recommendation of the 2009 ACTL/IAALS Report,
supra n.l6, at 17 (Appendix D:22).

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TASK FORCE REPORT

for good cause shown. Other members believe that while

parties might forgo a deposition in such cases, Iowa
procedure should permit expert depositions as of
right. Given the lack of consensus within the Task
Force, it recommends against eliminating expert
depositions altogether even in Tier 1 cases.
h. Expert designations

Plaintiffs should be required to designate any expert(s)

within five months after filing a petition. The designation .
should include a preliminary report or signed
interrogatory answer. Defendant's expert designation
should be due within two months following plaintiffs
designation, with a preliminary report or signed
interrogatory answer provided thirty days after
designation.
2. Tier 2 discovery limitations
a. Interrogatories

. Interrogatories
and requests
for admissions
should be
limited to twenty
per party in
Tier 2 cases.

Interrogatories should be limited to twenty per party,

including discrete subparts, in the absence ofleave of
court or agreement of the parties authorizing a greater
number.
b. Admissions

Requests for admissions should be limited to twenty per

party in the absence of leave of coUrt or agreement of
the parties authorizing a greater number.
c. Discovery supplementation

All parties should be permitted to rely upon and enforce

written discovery supplementation requirements within
the existing rules for any party's discovery responses.
Such rules would reduce the exchange of unnecessary
and cumulative discovery by multiple parties.

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11
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d. Expert witnesses

Plamtiffs should be required to designate any expert

within six months of filing a petition. The designation
shall include the expert's report or a signed
interrogatory answer. Defendant's expert designation
should be due within two months following plamtiffs
designation, and the expert's preliminary report or
signed interrogatory answer shoUld be provided within
thirty days after designation .
The Task Force considered restricting the length of
experts' depositions in all cases similar to Federal Rule
of Civil Procedure 30(d)(l) (depositions limited to one
day of seven hours). This reform does not appear
warranted in Iowa at this time.

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Attachment B

TASK FORCE REPORT

IV.

DISCOVERY PROCESSES
Summary
Reforms addressing inefficient discovery processes will
reduce delays in and costs of litigation. Such measures
include adopting an aspirational purpose for discovery
rules to "secure the just, speedy, and inexpensive
determination of every action," holding discovery
proportional to the size and nature of the case, requiring
initial disclosures, limiting the number of expert witnesses,
and enforcing existing rules.

Introduction and Guiding Principles

Systematic
changes,
including the
one judge/ one
case construct
the two-tier
court system,
and the initial
disclosures
requirement,
are well-vetted
innovations that
have proven
successful
in other
jurisdictions.

Task Force recommendations addressing the broad subject of

discovery touch on a variety of aspects of the civil justice system. The
recommendations range from broad aspiration-based approaches to
discovery to fundamental changes in the structure of the civil justice
system, and they include targeted measures to help reduce the costs
and increase the efficiency of the system.

29

The Task Force implicitly recognizes that efficiencies and reduced

costs will more likely be achieved if participants in the systemlawyers, judges, parties-have more options, more flexibility, and
more autonomy in conducting discovery. The Task Force recommends
amending Iowa Rule of Civil Procedure 1.501(2) to include the
aspirational goal that discovery rules be administered in a way that
assures ')ust, speedy, and inexpensive" resolution of legal disputes.
Systematic changes, including the one judge/one case construct,
the two-tier court system, and the initial disciosures requirement,
are well-vetted innovations that have proven successful in other
jurisdictions. Enacting such measures with a focus on enforcement
of existing rules, encouragement of party cooperation, and an overall
sensitivity to ensuring proportionality and scope of discovery relevant
to each matter should result in positive improvements in the Iowa
civil justice system.

DISCOVERY PROCESSES

Current Iowa discovery practice differs significantly from federal

practice in that Iowa does not require automatic disclosure of relevant
information absent a discovery request. In contrast, the federal rules
impose on parties a duty to disdose certain basic information that the
disclosing party may use to support its claims or defenses, without a
formal discovery request. See Fed. R. Civ. P. 26(a)(1)(A). Under federal
practice,. these initial disclosures occur very early in the case before
formal discovery commences. Fed. R. Civ. P. 26(d).
The Task Force urges adoption of the following reforms to counter
unnecessary and inefficient discovery practices and the resulting
problems of delay and increasingly costly litigation:
)>

Iowa does not

require automatic
disclosure
of relevant
information
absent a
discovery
request.

Amend Iowa Rule of Civil Procedure 1.501(2)

Iowa Rule of Civil Procedure 1.501(2) should incorporate
the aspirational purpose of Rule 1 of the Federal Rules of
Civil Procedure 08 and read as follows (suggested language in
italics):
The rules providing for discovery and inspection
shall be liberally construed and- shall be enforced to
provide the parties with access to all relevant facts,
and shall be administered to secure the just, speedy,
andinexpensive determination of every action and
proceeding. Discovery shall be conducted in good
faith, and responses to discovery requests, however
made, shall fairly address and meet the substance of
the request.

)>

One judge/ one case

One judge assigned to each case for the life of the matter
will enhance judicial management, promote consistency
and adherence to deadlines, and reduce discovery excesses.

)>

Proportionality and relevant scope

Discovery should be proportional to the size and nature of
the case. Overly broad and irrelevant discovery requests
should not be countenanced .

28 Rule 1 of the Fed. R. of Civ. Proc. provides in its entirety as follows: ''These rules
govern the procedure in all civil actions and proceedings in the United States
district courts, except as stated in Rule 81. They should be construed and
administered to secure the just, speedy, and inexpensive determination of every
action and proceeding. n

Discovery should
be proportional
to the size and
nature of the
case.

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TASK FORCE REPORT

Tier 1 and Tier 2 cases

Cases should be classified into one of two categories: "Tier

1" cases involving less tban $50,000 in controversy and
"Tier 2" cases involving more tban $50,000.
~

Initial disclosures

Many recommendations for case management and

discovery limitations presume discovery reforms requiring
basic information disclosure in all cases at tbe outset of
litigation without tbe necessity of discovery requests from a

party.
~

Expert witness limitations

Discovery relating to expert witnesses is believed to be a

significant factor contributing to tbe. cost and delay of civil
litigation. Reasonable limitations on expert discovery are
warranted in Tier 1 cases, while existing rules on expert
discovery are perceived to be sufficient in Tier 2.
~

Party agreements

Discovery, to the extent possible, should proceed pursuant

to an agreement of tbe parties.
~

Enforcement of existing rules

Courts should enforce existing rules more regularly and

consistently to promote just, speedy, and inexpensive
determination of every action and proceeding. 29

29 See survey, open-response question 33: "If there were one aspect of'discovery that
you could change in order to achieve a more timely and cost-effective court
process for litigants, what would it be and why?" Over 75% of the survey
respondents said current discovery-related sanctions were seldom or only
occasionally imposed. Stricter enforcement of existing discovery procedures and
imposition of sanctions for discovery abuses were common suggestions from the
respondents when asked to identify aspects of Iowa discovery practices they would
change to achieve a better, more efficient discovery system. Available at:
http: I lwww.iowacourts.gov I Advisory_Committeesl Civil_Justice_Reform_Task_
Force I SurveyI.

31

DISCOVERY PROCESSES

A. Initial Disclosures

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The Task Force examined the following aspects of initial disclosures:

whether the Iowa Rules of Civil Procedure should require automatic
initial disclosures in most civil cases; the appropriate scope and
content of such initial disclosures; the timing and procedure for
making such initial disclosures; and possible sanctions for failure to
make initial disclosures.
1. Require mandatory initial disclosures

A major purpose of initial disclosures in the federal system "is

to accelerate the exchange of basic information about the
case and to eliminate the paper work involved in requesting
such information." Fed. R. Civ. P. 26(a) advisory committee
note to 1993 amendments. Implementation of an automatic
initial disclosures requirement in the Iowa system could reduce
the amount and cost of discovery that parties would otherwise
incur during a case.
The survey data supports this conclusion: 50.7% of
respondents with federal court experience agreed that initial
disclosures at least occasionally {38.9%) or about halfthe time
{11.8%) reduce the amount of discovery, with 27.5% agreeing
initial disclosures reduce the amount of discovery often {23.6%)
or almost always {3.9%). Slightly fewer respondents agreed
that initial disclosures reduced the cost of discovery
(occasionally--35.1%; about halfthe time--8.6%). More than
28% of respondents, however, agreed that initial disclosures
reduced the cost of discovery often {24. 7%) or almost always
(3.9%). A majority of respondents {57.4%) agreed {43.7%) or
strongly agreed {13.7%) that Iowa should implement an initial
disclosure requirement, with only 16.2% disagreeing and 7.6%
strongly disagreeing.

An automatic
initial disclosures
requirement in

the Iowa system

could reduce the.
amount and cost
of discovery that
parties would
otherwise incur
during a case.

a. Exempted cases

The federal rules specifically exempt certain categories

of cases from the initial disclosure obligation. See Fed.

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TASK FORCE REPORT

R. Civ. P. 26(a)(l)(B).3 The Task Force acknowledges

there might be certain categories of cases in state court
in which initial disclosures might likewise be
inappropriate or cost-prohibitive.

b. Case-specific stipulations and court orders

The federal rules permit litigants to forgo disclosures

b:y: stipulation. Additionally, litigants have the right
to object to the disclosure requirement in particular
cases, and the court, through case-specific court orders,
can modifY the duty to disclose. See Fed. R. Civ. P. 26(a)
(l)(A) ("Except ... as otherwise stipulated or ordered by
the court, a party must .... ").The Task Force
recommends similar phrasing for any initial disc;:losure
rule in Iowa to permit case-specific court orders and
party stipulations that can eliminate or modifY the
disclosure obligation in appropriate cases.
2. Scope of initial disclosures

In 2000, the federal discovery rules were amended to. limit

the scope of initial disclosures to discoverable information
"that the disclosing party may use to support its claims or
defenses, unless the use would be solelyfor impeachment."
See Fed. R. Civ. P. 26(a)(l)(A)(i) and (ii). Thus, under federal
practice, a party need not automatically disclose adverse
information or other information that the disclosing party does
not plan on using to support its claims or defenses. This
information might still be discoverable, but a party need only
disclose it in response to a legitimate discovery request.
Some states require a broader scope of automatic initial
disclosures than is required under the federal rule. In Arizona,
for example, civil litigants must automatically disclose all
relevant information known by or available to the parties
and their lawyers. See Ariz. R. Civ. P. 26.1. In September,

30 Cases exempted from the initial disclosure requirement include, in part,

administrative reviews, habeas corpus petitions and other challenges to criminal
conviction or sentence, pro se prisoner complaints, U.S. government actions
to recover benefit payments or to collect on student loans, and actions to enforce
arbitration awards. See Fed. R. Civ. P. 26[a)(l)(B).

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2009, the Institute for the Advancement of the American Legal

System (IAALS) surveyed Arizona judges and lawyers for
insight on how well certain 1992 amendments to Arizona's
rules of civil procedure were working. The survey revealed
strong consensus that Rule 26.1 disclosures helped "reveal
the pertinent facts early in the case," helped "narrow the issues
early in the case," and "facilitate[d) agreement on the scope and
timing of discovery."31 There was no consensus in Arizona,
however, "concerning whether disclosures ultimately reduce
the total volume of discovery (49% agreed; 48% disagreed) or
reduce the total time required to conduct discovery (46%
agreed; 50% disagreed).
The Task Force decided against recommending wholesale
expansion of the scope of initial disclosures in Iowa beyond
the scope imposed under the federal rule but does recommend
expanding disclosure requirements in certain respects. This
recommendation finds some support in the survey responses.
More than 300 survey respondents (322) indicated sufficient
civil litigation experience in federal court to respond to
questions pertaining to the subject of initial disclosures.
More than one-half of respondents agreed that Iowa state
courts should require Rule 26(a)(1) initial disclosures, with
43.7% agreeing and 13.7% strongly agreeing; 23% either
disagreed (16.2%) or strongly disagreed (7.6%). Respondents
were substantially split, however, as to whether Iowa should
require broader disclosures of all relevant information
than current federal practice. Of the respondents with civil
litigation experience in federal court, 46% agreed (35.5%) or
strongly agreed (10.5%) with the proposition that broader
disclosures should be required; 34% disagreed (24.6%) or
strongly disagreed {9.4%); and 20% (19.9%) neither agreed nor
disagreed. 32

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31 Survey of the Arizona Bench & Bar on the Arizona Rules of Civil Procedure, at 19,

Institute for the Advancement of the American Legal System (2010).

32 See survey, question 7lc (Appendix B:37).

TAsK FoRcE REPORT

3. Content of disclosures
a. Identity of witnesses, documents, insurance

The Task Force considered what information litigants

should be required to disclose initially before a formal
discovery request. The Task Force concluded tbat like
tbe federal rules, an Iowa rule should require parties, at
a minimum, to disclose:

l> The identity of "each individual likely to

have discoverable information-along witb

tbe subjects of tbat information-that
tbe disclosing party may use to support its
claims or defenses, unless tbe use would be
solely for impeachment." Fed. R. Civ. P.
26(a)(l)(A)(i);
l> "A copy-or a description by category and

location-of all documents, electronically

stored information, and tangible things tbat
tbe disclosing party has in its possession,
custody, or control and may use to support its
claims or defenses, unless tbe use would be
solely for impeachment." Fed. R. Civ. P. 26(a)
(l)(A)(ii); and

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l> Any insurance agreement tbat might be

available to satisfY a possible judgment. See

Fed. R. Civ. P. 26(a)(l)(A)(iv).
b. Production of documents

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The Task Force agrees witb tbe recommendation of

tbe 2009 ACTL/IAALS Report to broaden tbe disclosure
obligation for relevant documents. The federal rule
currently only requires a disclosing party to describe
such documents by category and location. The 2009
ACTL/IAALS Report proposes tbat the disclosing party
actually "produce" such documents, at least to tbe
extent tbat tbey are "reasonably available non privileged,
non-work product." According to tbe 2009 ACTL/IAALS
Report, tbis proposal "is intended to achieve a more
meaningful and effective exchange of documents in tbe
early stages of the litigation," and "facilitate [earlier]

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narrowing of the issues and, where appropriate,

settlement. "33
c. Tailoring disclosures in specific types of cases

There are categories of cases in which parties routinely

disclose certain information or documents during the
discovery process. Requests for waivers, releases,
and medical reports are just a few examples of standard
discovery requests in many cases. Efficiencies could
result by requiring disclosure of particular discoverable
information beyond the constructs of Federal Rule 26(a)
(l)(A) without formal discovery requests. Similarly, a
list of basic information subject to automatic disclosure
could be developed for particular kinds of litigation, for
example, employment litigation and personal injury
litigation. Several Iowa judicial districts already order
such disclosures in family law matters.
The Task Force suggests the following additional
information may also be appropriate for automatic
initial disclosure:
~

Each party's identifying information;

Identification of witnesses;

Case-appropriate executed waivers (medical,

employment, school);

Applicable contracts and related documents;

Social Security disability claim status, etc.;

Subrogation information;

Workers' compensation payments received; and

The amount of liquidated damages and the

method of computation for each category of
damages claimed for "amounts owed along with
available documentary evidence of these
amounts. See Fed. R. Civ. P. 26(a)(l) .

33 2009 ACTL/IAALS Report, supra n.l6, at 7-8 (Appendix D:l2-13).

36

[I
TASK FORCE REPORT

The Task Force further recommends consulting specialty

sections of the bar regarding potential categories of
automatic disclosures in other areas.

Among the survey

respondents a
notable complaint
is that too
often discovery
requests are
boilerplate
documents that
are not specific to
the nature of the
dispute at hand.

Among the survey respondents a notable complaint

is that too often discovery requests are boilerplate
documents that are not specific to the nature of
the dispute at hand. For example, discovery requests
sometimes seek information regarding the "accident"
when the case does not involve an accident or personal
injury. 34 A related complaint is that instructions
accompanying discovery requests are unreasonably
prolix, too broad, and often not relevant to the case
in which the discovery is propounded. lf the scope of
the required initial disclosures were linked to specific
types of case, some of these sources of inefficiency and
frustration in the discovery process might be reduced.
d. Damages

The federal rules also require parties to provide a

computation of each category of damages claimed
by the disclosing party-who must also make
available for inspection and copying as under
Rule 34 the documents or other evidentiary
material, unless privileged or protected from
disclosure, on which each computation is based,
including materials bearing on the nature and
extent of injuries suffered.
Fed. R. Civ. P. 26(a)(l)(A)(iii).
Damages discovery arguably differs from discovery
relating to other issues, and the Task Force considered
the usefulness of requiring automatic disclosure
of this information at the inception of discovery when
damages can be difficult to compute. Task Force
members could not reach consensus on the utility of
requiring automatic damages disclosures at the
inception of discovery compared to relying on formal,
more traditional, discovery processes.

34 See survey, open-response question 33. Available at http:/ fwww.iowacourts.gov/

Advisory_Committees f Civil_Justice_Reform_Task_Forcef Surveyf.

37

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DISCOVERY PROCESSES

The 2009 ACTL/IAALS Report likewise acknowledged

that "damages discovery often comes very late in the
process" and recommended that discovery rules should
reflect the "reality of the tinting of damages discovery."
Absent automatic disclosure, damages discovery could
be left to existing or traditional formal discovery
processes, party stipulations, or court-ordered pretrial
deadlines. The 2009 ACTL/IAALS Report states "[t]he
party with the burden of proof should, at some point,
specifically and separately identify its damage claims
and the calculations supporting those claims.
Accordingly, the other party's discovery with respect to
damages should be more targeted. "35
An alternative approach favored by some Task Force

members would require initial automatic disclosure of

known damages, the method of computation, and
available supporting documentary evidence, subject
to the continuing duty to supplement the disclosure
when more detailed information and damages
computations become available.
4. Timing and procedure of disclosures

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The Task Force recommends that any Iowa disclosure

provision should, to the extent possible and for the sake of
uniformity, follow the federal rules of civil proced14I"e on.
aspects of tinting and procedure of initial disclosures. The
federal rules provide that disclosures "must be made at or
within 14 days after the parties' Rule 26(f) conference unless
a different time is set by stipulation or court order .... " See
Fed. R. Civ. P. 26(a){l)(C) and 26(d)(l). The federal rules provide
that initial disclosures occur before other formal discovery
is sought. Fed. R. Civ. P. 26(d). The federal rules also provide
that discovery methods "may be used in any sequence," id. at
26(d){2){A), be signed, in writing, and served, id. at 26{a)(4) and
(g), and be subject to the duty to supplement, see id. at 26(e).

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35 2009 ACTL/IAALS Report, supran.16, at 12 [Appendix D:17).

38

TAsrc FoRcE REPoRT

S.Sanctions
To ensure compliance with any new initial disclosure reforms,
the rules governing discovery sanctions should be modified
to address a party's failure to initially disclose or to
supplement a disclosure. See Fed. R. Civ. P. 37(c)(l).
The federal rule provides that unless the failure to disclose
was substantially justified. or is harmless, "the party is not
allowed to use that information or witness to supply evidence
on a motion, at a hearing, or at a trial." I d.

I
B. Expert Discovery
Discovery relating to expert witnesses contributes to the cost and
delay of civil litigation. It is less clear, however, whether cost and
delay arising from expert witnesses is such a significant problem in a
sufficiently substantial number of Iowa cases as would justif'y revision
of Iowa's expert discovery rules. Iowa's existing discovery rules may
adequately address disclosure of information relating to expert
witnesses, as well as the cost of such discovery. See Iowa R. Civ. P.
1.508.
The Task Force survey similarly fails to evidence. clearly the need or
popular support for expert discovery reform in Iowa. For instance,
while 43.6% of respondents favored limiting depositions of expert
witnesses, 39.3% disagreed with such limits.' 5 A m!ljority of
respondents viewed expert depositions as a cost-effective tool for
litigants at least one-half of the time, regardless of whether expert
testimony is limited to the expert report. 37 Expert witness costs, other
trial costs, and attorney's fees are among the determining factors
leading to settlement of Iowa cases. 38
The Task Force discussed several potential reforms of expert
discovery rules. Limitation of the number of expert witnesses,
restriction of experts' testimony to the contents of their reports, and
acceleration of disclosure requirements were thoughtfully considered.
In the end, the members reached no consensus in support of such
36 Survey, question 30 (Appendix B:15).
37 Survey, question 29 (Appendix B: 14).
38 Survey, question 55 (Appendix B:29).

39

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DISCOVERY PROCESSES

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changes because of the perceived risk that the changes would

unreasonably restrict litigants' ability to develop their claims and
defenses. Accordingly, with one exception discussed below, the Task
Force reached no clear consensus concerning limitations on expert
discovery in Tier 2 cases. The Task Force did conclude, however,
that some limitations on expert discovery would advance the prompt,
inexpensive, and effective disposition or resolution of smaller Tier 1
cases.
1. Discovery of draft expert reports and expert-attorney

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communications

Iowa should adopt the December 2010 amendment to the

federal rules providing work product protection to the discovery
of draft reports by testiJYing expert witnesses and some
categories of attorney-expert communications. See Fed. R.
Civ. P. 26(b)(4)(B) and (C). The federal amendments are
calculated to prevent significant "artificial and wasteful"
problems created when "lawyers and experts take elaborate
steps to avoid creating any discoverable record and at the
same time take elaborate steps to attempt to discover the
other side's drafts and communicati9ns." Fed. R. Civ. P. 26
advisory committee notes to Dec. 2010 amendments. The
change has broad support among lawyers and bar
associations-including the American Bar Association, the
American College of Trial Lawyers, and the American
Association of Justice. The Task Force recommends adoption
of this provision for all Iowa civil cases.
2. Expert disclosures and depositions

The Task Force compared the federal approach to disclosure of

expert witnesses with the current Iowa procedure but was
unable to reach a consensus on possible changes to Iowa's
procedure for expert witness opinion disclosure or the taking of
expert depositions.
Federal Rule of Civil Procedure 26(a)(2)(D)(i) requires parties to
disclose the identity of testiJYing experts in a written report
no later than ninety days before trial. For experts "retained or
specially employed to provide expert testimony in the case," the

4o

TASK FORCE REPORT

disclosure must include a detailed signed expert report that

contains: "a complete statement of all opinions the witness
will express and the basis and reasons for them"; "the facts
or.data considered by the witness in forming'' the opinions;
"any exhibits that will be used to summarize or support" the
opinions; "the witness's qualifications" and publications
during the last ten years; a list of cases in the last four years in
which the expert has given testimony; and a statement of
the expert's compensation. Fed. R. Civ. P. 26(a)(2)(B)(i)-(vi). For
testifYing experts who have not been "specially retained" to
provide expert testimony (for example, treating physicians), a
party need only describe the subject matter of the expert
testimony and "a summary of the facts and opinions to which
the witness is expected to testifY." Fed. R. Civ. P. 26(a)(2)(C)(ii).
The 2009 ACTL/IAALS Report urges state courts to similarly
require that experts "furnish a written report setting forth.
their opinions, and the reasons for theii).,'' and further
recommends "their trial testimony should be strictly limited
to the contents of their report. "39 811ch a detailed report
"should obviate the need for a deposition in most cases."40
Under existing Iowa procedure, parties can obtain much the
same information regarding expert witnesses, but must do so
through interrogatories or other discovery devices. See Iowa R.
Civ. P. 1.508. The Iowa rule provides that the expert's trial
testimony
may not be inconsistent with or go beyond the fair
scope of the expert's testimony in the discovery
proceedings as set forth in the expert's deposition,
answer to interrogatories, separate report, or
supplement thereto. However, the expert shall not be
prevented from testifYing as to facts or mental
impressions and opinions on matters with respect to
which the expert has not been interrogated in the
discovery proceedings.

Iowa R. Civ. P. 1.508(4). The Task Force believes current Iowa

practice works well in most civil cases and thus does not
recommend the expert disclosure and report procedure

39 2009 ACTL/IAALS Report, supra n.l6, at 17 {Appendix D:22).

40 Id.

41

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followed in federal practice or recommended in the ACTL/

IAALS Report.

C. Discovery Limitations and Judicial Management

The Task Force studied a number of discovery limitations and judicial
management procedures intended to reduce litigation expense,
promote speedier trials, and eliminate discovery abuses. Some of
these limitations and procedures are discussed elsewhere in this
report.
1. Discovery abuse

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Discovery abuse occurs when the discovery process is used

to increase the costs of or ~to delay litigation. It takes many
forms, including failing to respond timely to proper discovery
without communication or explanation for the delay, which
then prompts frequent attorney follow up, motions to compel,
court hearings, and court orders. Too often discovery
responses are untimely even after court intervention. When
answers to discovery are made, they are too often evasive or
non-responsive. Interrogatories are sometimes served in
numbers or complexity disproportional to the size or nature of
the case. Legitimate discovery requests met with reflexive and
non-meritorious objections generate unnecessary follow l.lP,
delay, and even court intervention. Failure to invest good faith
efforts to resolve discovery disputes also causes delay,
increases costs, and wastes court resources. 41 Whatever its
form, discovery abuse slows the progress of litigation and
increases expense for litigants.
2. Survey responses

The Task Force survey asked respondents to gauge the

availability of judges to resolve discovery disputes. When
asked how often judges are available to resolve discovery
disputes on a timely basis, 34.3% of respondents
41 According to the survey, 20.4% of respondents identified utime to complete
discovery'' as the primary cause of delay in civil litigation, and 23.3% of
respondents identified "lack of attorney collaboration on discovery issues and
proceedings" as the primary cause of delay. See survey, question 53
(Appendix 8:28).

TASK FORCE REPORT

answered occasionally and 11. 1% indicated almost never,

while nearly 30% said often. More than half of
respondents (55.3%) said judges should be more available to
resolve discovery disputes, with 17.4% disagreeing with
that statement. When filtered for judge responses, only 44.4%
of judges agreed they should be more available to resolve.
discovery disputes, and 35.2% of judges disagreed.
Survey respondents gave a strong indication that sanctions the
discovery rules allow are infrequently imposed even when
warranted, with 39.6% indicating warranted sanctions
are imposed only occasionally, and 36.1% stating
warranted discovery sanctions are almost never imposed:
Nearly 95% of the respondents indicated that judges
rarely invoke Rule 1.504(1)(b) discovery limitations on their
own initiative, with 74.4% of respondents saying this
almost never occurs and 20.1% saying occasionally.
The survey asked respondents a series of questions on
potential causes of excessive discovery relative to the size of
case or scope of issues. Forty-four percent (44%) of the
respondents indicated that counsel conducting discovery for
the purpose of leveraging settlement was often (35.1 %) or
almost always (9.2%) the cause of excessive discovery. Onethird of the respondents stated leveraging settlement was
occasionally a cause of excessive discovery. Slightly more than
one-third (35.9%) indicated a desire to engage in fishing
expeditions was often a cause of excessive discovery and just
under one-third (32.4%) said fishing expeditions were
occasionally a cause.
Most respondents do not consider involvement of selfrepresented parties to be a significant cause of excessive
discovery in their cases with one or more pro se parties, with
59.8% answering almost never and 19.7% answering
occasionally.
More than half of respondents (56.3%) either agreed (42%)
or strongly agreed (14.3%) that limitations could be placed on
the number, frequency, timing, or duration of interrogatories

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without jeopardizing the fairness of the litigation process, while

nearly 30% disagreed (19.5%) or strongly disagreed
(9.9%). One-half of respondents either agreed (37.6%) or
strongly agreed (13%) that liinitations could be placed on
requests for production of documents without jeopardizing the
fairness of the litigation process, while 35% disagreed (24.4%)
or strongly disagreed (11. 7%) with the proposition.
More than 93% of respondents reported that Rule 1.507
discovery conferences almost never (70.2%) or only occasionally
(23.2%) occur in their cases. Also, more than 80% of
respondents reported that when Rule 1.507 discovery
conferences do occur, they do not often promote overall
efficiency in the discovery process for the course of litigation:
almost never (29%), occasionally (42.9%), and about J6 time
(9.9%) .

D. Electronic Discovery
The Task Force examined whether the Iowa Rules of Civil Procedure
should be amended specifically to address preservation and discovery
of electronically stored information.
1. Survey results

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Forty-one percent (41 %) of respondents reported experience

with electronic discovery (e-discovery) in their civil litigation
cases. Most of the questions on e-discovery elicited a relatively
high-about one-third or higher-neither agree nor disagree
reply from respondents .
Forty-five percent (45%) of respondents either agreed (28. 7%)
or strongly agreed (17.9%) that e-discovery causes a
disproportionate increase in discovery costs as a share of total
litigation costs, while one-quarter of respondents (25.9%)
disagreed.
A majority of respondents (53.6%) believe courts should be
more active in managing e-discovery, with 38.7% agreejng and
14.9% strongly agreeing, while only 10.5% disagreed and 0.8%
strongly disagreed.

TASK FORCE REPORT

The survey asked respondents about potential causes of

e-discovery perceived as excessive when compared to the value
of the case or the scope of the issues. One of the most
frequently cited causes included counsel with limited
experience conducting or responding to e-discovery, with
42.6% agreeing and 10.4% strongly agreeing; only 15.3% either
disagreed (14 .2%) or strongly disagreed (1.1 %) .42 Another
frequently cited cause of excessive e-discovery was the inability
of opposing counsel to agree on scope or timing of e-discovery,
with 50% of respondents agreeing and 11.3% strongly
agreeing, and with only 8.1% disagreeing. 43 A third frequently
cited cause of excessive e-discovery was counsel conducting
e-discovery for the purpose of leveraging settlement, with
45.5% of respondents agreeing that this was a cause and
13.4% strongly agreeing, and only 10.2% disagreeing.

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2. Iowa Rules of Civil Procedure

The Task Force concludes the existing Iowa Rules of

Civil Procedure pertaining to electronic discovery provide
courts with the flexibility to handle electronic discovery issues
and the rapidly changing advances made in information
technology.

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3. Commentary to Iowa Rule of Civil Procedure. 1.507

The Task Force recommends adding a comment section to

Iowa Rule of Civil Procedure 1.507 to reflect recommendations
several federal circuit courts and study groups have offered

42 A majority of respondents {55 .6%) asked generally about tbe frequency of

excessive discovery, as opposed to e-discovery specifically, indicated that counsel's
limited experience conducting or responding to discovery was only occasionally a
cause. Survey, question 26g {Appendix B: 13).
43 A majority of respondents {53.5%) asked generally about the frequency of
excessive discovery, as opposed to e-discovery specifically, stated the inability_of
counsel to agree on the scope or timing of discovery was only occasionally (41.4%)
or almost never {12.1 %) a cause. Survey, question 26a {Appendix B:13).
44 Just over one-third of respondents (35.1 %) reported that counsel conducting
discovery for the purpose or leveraging settlement was often a cause of excessive
discovery, while one-third (33.4%) reported tllis as an occasional cause. Survey,
question 26c {Appendix B:13).

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on electronic discovery issues. 45 The official comment to Rule

1.507 should include the following:
Counsel should be encouraged to meet and discuss
at an early stage of litigation, issues pertaining to
electronically stored information (ESI), including but not
limited to: (1) identification of relevant and discoverable
ESI; (2) the scope of discoverable ESI the parties are to
preserve; (3) the format for preservation and production
of ESI; (4) the potential for conducting discovery in
phases or stages as a method for reducing costs and
burdens; (5) the procedures for handling inadvertent
production of privileged information and other privilege
waiver issues; and (6) the necessity, if any, of
appointment of third-party consultants to assist counsel
and the court with technical aspects of e-discovery.

4. Develop Best Practices for Electronic Discovery

The Task Force recommends that the bar, through the
Iowa State Bar Association, develop a best practices manual for
electronic discovery in civil litigation. This could address the
issues of identification, scope, and preservation of
electronically stored information likely to be involved in specific
types of civil cases.

45 Iowa R. Civ. P. 1.507 sets forth parameters foi" pre-trial discovery conferences.
Iowa R. Civ. P. 1.507(1)(d) includes "Any issues relating to the discovery and
preservation of electronically stored information, including the form in which
it should be produced" as a subject parties may raise in a Rule 1.507 discovery
conference,

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46

Attachment C

CHAPTER!
RULES OF CIVIL PROCEDURE

DIVISION II
ACTIONS, JOINDER OF ACTIONS, AND PARTIES

[New Rule)

G. EXPEDITED CIVIL ACTIONS

Rule 1.281 Expedited civil actions
1.281(1) General provisions.

a. Eligible actions. Rule 1.281 governs "expedited civil actions" in which the sole relief
sought is a money judgment and in which all claims (other than compulsory counterclaims) for
all damages by or against any one party total $75,000 or less, including damages of any kind,
penalties, prefiling interest, and attorneys' fees, but excluding prejudgment interest accrued after
the filing date, postjudgment interest, and costs.
b. Excluded actions. Rule 1.281 does not apply to small claims or domestic relations cases.
c. Electing expedited procedures. Eligible plaintiffs can elect to proceed as an expedited civil
action by certifying that the sole relief sought is a money judgment and that all claims (other than
compulsory counterclaims) for all damages by or against any one party total $75,000 or less,
including damages of any kind, penalties, prefiling interest, and attorneys' fees, but excluding
prejudgment interest accrued after the filing date, postjudgment interest, and costs. The
certification must be on a form approved by the supreme court and signed by all plaintiffs and
their attorneys if represented. The certification is not admissible to prove a plaintiff's damages
in the expedited civil action or in any other proceeding.

d Iowa Rules of Civil Procedure othen11ise apply. Except as otherwise specifically provided
by this rule, the Iowa Rules of Civil Procedure are applicable to expedited civil actions. Iowa
Court Rule 23.5-Form 3: Trial Scheduling Order and Discovery Plan for Expedited Civil
Action must be used for expedited civil actions in lieu of Form 2 of rule 23.5.
e. Limitation on damages. Except as provided in rule 1.281(1)(/), a party proceeding under
rule 1.281 may not recover a judgment in excess of $75,000, nor may a judgment be entered
against a party in excess of $75,000, excluding prejudgment interest that accrues after the filing
date, postjudgment interest, and costs. The jury, if any, must not be informed of the $75,000
limitation. If the jury returns a verdict for damages in excess of $75,000 for or against a party,

the court may not enter judgment on that verdict in excess of $75,000, exclusive of prejudgment
interest that accrues after the filing date, pos1judgment interest, and costs.

f Stipulated expedited civil action. In a civil action not eligible under rule 1.281(1)(a) and
not excluded by rule 1.281(1)(b), the parties may request to proceed as an expedited civil action
upon the parties' filing of a Joint Motion to Proceed as an Expedited Civil Action. If the court
grants the parties' motion, and unless the parties have otherwise agreed, the parties will not be
bound by the $75,000 limitation on judgments in rule 1.281(l)(e). The parties may enter into
additional stipulations regarding damages and attorneys' fees. Unless otherwise ordered, the
joint motion and any stipulations must not be disclosed to the jury.
g. Termination ofexpedited civil action. Upon timely application of any party, the court may
terminate application of this rule and enter such orders as are appropriate under the
circumstances if:
(1) The moving party makes a specific showing of substantially changed circumstances
sufficient to render the application of this rule unfair; or
(2) A party has in good faith filed a compulsory counterclaim that seeks relief other than that
allowed under rule 1.281 (1 )(a).

h. Permissive counterclaims. Permissive counterclaims are subject to the $75,000 limitation

on damages under rule 1.28l(l)(e), unless the court severs the permissive counterclaim.
i. Side. As used throughout rule 1.281, the term "side" refers to all the litigants with
generally common interests in the litigation.
Comment:
Rule 1.28l(l)(a). The rule provides that absent stipulation, a single party in an expedited civil action

cannot recover more than $75,000 or be liable for more than $75,000. A single party could obtain a
damage verdict in excess of$75,000, so long as the final judgment in the proceeding in favor of that party
(after apportionment of fault and offsets for any settlements and exclusive of prejudgment interest,
postjudgment interest, and costs) does not exceed $75,000.
Rule 1.281(1)(c). Rule 1.1901 provides the Expedited Civil Action Certificate for eligible plaintiffs to
complete.
Rule 1.28I(l)(g). If the judgment in an expedited civil action is reversed and remanded on appeal, the
case remains subject to rule I .281 on remand, unless the trial court, upon motion, terminates the expedited
civil action pursuant to this provision.
1.281(2) Discove1y in expedited civil actions.

a. Discove1y period. Except upon agreement of the parties or leave of court granted upon a
showing of good cause, all discovery must be completed no later than 60 days before trial.
b. Initial disclosures. Expedited civil actions are subject to the initial disclosure requirements
ofru!e 1.500(1).

c. Limited and simplified discovel)' procedures. Except upon agreement of the parties or
leave of court granted upon a showing of good cause, discovery in expedited civil actions is
subject to the following additional limitations:
(!) Interrogatories to parties. Subject to rule 1.509(4), each side may serve no more than ten
interrogatories on any other side.

(2) Production of documents. In addition to document disclosures required under rule

1.500(1 )(a), each side may serve no more than 10 requests for production on any other side
under rule 1.512.
(3) Requests for admission. Each side may serve no more than 10 requests for admission on
any other side under rule 1.510. This limit does not apply to requests for admission of the
genuineness of documents that the party intends to offer into evidence at trial.
(4) Depositions upon oral examination.

1. Parties. One deposition of each party may be taken. With regard to corporations,
partnerships, voluntary associations, or any other groups or entities named as a party, one
representative deponent may be deposed.
2. Other deponents. Each side may take the deposition of up to two nonparties.

d. Number of expert witnesses. Each side is entitled to one retained expert, except upon
agreement of the parties or leave of court granted upon a showing of good cause.
e. Motion for leave of court. A motion for leave of court to modifY the limitations provided
in rule 1.281(2) must be in writing and must set forth the proposed additional discovery and the
reasons establishing good cause for its use.
1.281(3) Motions.

a. Motions to dismiss. Any party may file any motion permitted by rule 1.421. Unless the
court orders a stay, the filing of a motion to dismiss will not eliminate or postpone otherwise
applicable pleading or disclosure requirements.
b. Motions for swnlllDIJ' judgment.
(1) Limited grounds. Motions for summary judgment under rule 1.981 may be made in an
expedited civil action only upon the following grounds:
I. To collect on an open account or other liquidated debt.
2. To establish an obligation to indemnity.
3. To assert an immunity defense.
4. Failure to comply with Iowa Code section 668.11 or other deadline for disclosure.
5. Failure to provide notice or exhaust remedies as required by law.
6. To raise any other matter constituting an avoidance or affirmative defense.

(2) Limited number. Each party may file no more than one motion for summary judgment
under rule 1.981. The motion may include more than one ground authorized under rule
1.281(3)(b)(l).
(3) Deadline. Motions for summary judgment under rule 1.981 must be filed no later than 90
days before trial.
Comment:
Rule 1.281(3)(b)(l)(4). If a case requires expert testimony, failure to timely designate an expert or to

make a timely expert disclosure could be a permissible ground for summary judgment under this rule.
1.281(4) Procedure for expedited trials.

a. Demand for jwy trial. Any party who desires a jury trial of any issue triable of right by a
jury must file and serve upon the other parties a demand for jury trial pursuant to rule 1.902.
Otherwise, expedited civil actions will be tried to the court.
b. Trial setting. The court shall set the expedited civil action for trial on a date certain, which
will be a firm date except that the court may later reschedule the trial for another date during the
same week. Unless the court otherwise orders for good cause shown, expedited civil actions
must be tried within one year of filing.
c. Pretrial submissions. In addition to the pretrial submissions required by rules 1.500(3) and
23.5-Form 3(8), the parties must file one jointly proposed set of jury instructions and verdict
forms. If a jury instruction or verdict form is controverted, each side must include its specific
objections, supporting authority, and, if desired, a proposed alternative instruction or verdict
form for the court's approval, denial, or modification. Both stipulated and alternative proposed
jury instructions and verdict forms must be set forth in one document that is filed electronically
in word processing format with the court.
d. Expedited civil jwy trial. Unless otherwise ordered, the jury in an expedited civil jury trial
will consist of six persons selected from a panel of twelve prospective jurors. Each side must
strike three prospective jurors. If the expedited civil jury is unable to reach a unanimous verdict
after deliberating for a period of not less than three hours, the verdict can be rendered by a fivejuror majority. Where there are more than two sides, the court in its discretion may authorize and
fix an additional number of jurors to be impaneled and strikes to be exercised.
e. Expedited norifwy trial. The court trying an expedited civil action without a jury may, in its
discretion, dispense with findings of fact and conclusions oflaw and instead render judgment on
a general verdict, special verdicts, or answers to interrogatories that are accompanied by relevant
legal instructions that would be used if the action were being tried to a jury. In such cases, the
parties must comply with the pretrial submission requirements of rule 1.281(4)(c). When the
court follows this procedure, parties must make their record with respect to objections to or
requests for instructions, special verdicts, and answers to interrogatories as in a jury
trial. Posttrial motions will be permitted as in a jury trial except that the court may, in lieu of
ordering a new trial, enter new verdicts or answers to interrogatories on the existing trial record.

f Time limit for trio!. Expedited civil actions should ordinarily be submitted to the jury within
two business days from the commencement of trial. Unless the court allows additional time for
good cause shown, each side is allowed no more than six hours to complete jury selection,
opening statements, presentation of evidence, examination and cross-examination of witnesses,
and closing arguments. Time spent on objections, bench conferences, and challenges for cause
to a juror is not included in the time limit.
g. Evidence.
(l) Stipulations. Parties should stipulate to factual and evidentiary matters to the greatest
extent possible.
(2) Documentmy evidence admissible without custodian certification or testimony. The court
may overrule objections based on authenticity and hearsay to the admission of a document,
notwithstanding the absence of testimony or certification from a custodian or other qualified
witness, if:

I. The party offering the document gives notice to all other parties of the party's intention to
offer the document into evidence at least 90 days in advance of trial. The notice must be given to
all parties together with a copy of any document intended to be offered.
2. The document on its face appears to be what the proponent claims it is.

:i. The document on its face appears not to be hearsay or appears to fall within a hearsay
exception set forth in Iowa Rule of Evidence 5.803(3), 5.803(4), 5.803(6), 5.803(7), 5.803(8},
5.803(9), 5.803(1 0), 5.803(11), 5.803(12), 5.803(13), 5.803(14), 5.803(15), 5.803(16), 5.803(17),
or 5.803(22).
4. The objecting party has not raised a substantial question as to the authenticity or
trustworthiness of the document.
5. Nothing in rule 1.281(4)(g)(2) affects the operation of other Iowa Rules of Evidence such
as rules 5.402, 5.403, and 5.404.
6. Nothing in rule 1.281 (4)(g)(2) authorizes admission of a document that contains hearsay
within hearsay, unless the court determines from the face of the document that each part of the
combined statements conforms with an exception to the hearsay rule set forth in rule
1.281 (4)(g)(2)(3 ).
7. Any authenticity or hearsay objections to a document as to which notice has been provided
under rule 1.281(4)(g)(2)(1) must be made within 30 days after receipt of the notice.

(3) Health Care Provider Statement in Lieu of Testimony.

I. The report of any treating health care provider concerning the claimant may be used in lieu
of deposition or in-court testimony of the health care provider, provided that the report offered
into evidence is on the Health Care Provider Statement in Lieu of Testimony form adopted by
the supreme court, and is signed by the health care provider making the report.
2. A Health Care Provider Statement in Lieu of Testimony must be accompanied by a
certification from counsel for claimant listing all communications between counsel and the
health care provider.
5

3. Unless otherwise stipulated or ordered by the court, a copy of the completed health care
provider statement must be served on all parties at least 150 days in advance of trial. Any
objections to the health care provider statement, including an objection that the statement is
incomplete or does not otherwise comply with rule 1.281(4)(g)(3), must be made within 30 days
after receipt of the statement. For good cause shown, the court may issue such orders regarding
the health care provider statement as justice may require, including an order permitting a health
care provider to supplement the statement.
4. Any party against whom a health care provider statement may be used has the right, at the
party's own initial expense, to cross-examine by deposition the health care provider signing the
report, and the deposition may be used at trial.
Comment:
Rule 1.281(4)(b). The parties may stipulate to a reasonable time beyond the one-year time limit in
order to accommodate scheduling conflicts. The court, however, may set the expedited civil action for
trial within the one-year period absent party consent.
Rule 1.281(4)(e). The rule is intended to conserve judicial time and resources by giving the court
discretion to dispense with findings of fact and conclusions of Jaw and instead render a verdict as if the
court were sitting as a 'jury of one." The use of jury instructions and a verdict form in lieu of findings of
fact and conclusions of Jaw permits appellate review of the court's ruling. The cross-reference to rule
1.281 (4)(c) clarifies that the parties must submit jointly one proposed set of jury instructions and a verdict
form to the court (rying the case without a jury. And, as also required by rule 1.281(4)(c), the parties
must timely note objections to the final form of jury instructions and verdict form used by the court. Rule
1.904(2), governing motions to enlarge or amend findings and conclusions, does not apply in expedited
nonjury trials in which the court dispenses with findings and conclusions.
Rule 1.281(4)(g)(2). The rule streamlines the presentation of records at trial, such as medical and
business records, by allowing admission without a sponsoring witness to establish authenticity and the
elements of a hearsay exception. This rule authorizes the court to review and admit the record on its face
subject to other objections, such as relevance, upon a determination that the record appears to be genuine
and appears not to be hearsay or to fall within one of several enumerated hearsay exceptions, such as
statements for purpose of medical diagnosis or treatment, records of regularly conducted activity, or
public records and reports (rules 5.803(4), 5.803(6), and 5.803(8)). If the record appears genuine and
appears to qualifY for one of the enumerated hearsay exceptions, the burden shifts to the other side to
raise a substantial question as to its authenticity or trustworthiness. Rule 1.281(4)(g)(2) may only be used
if the proponent of the record has given notice to other parties sufficiently in advance of trial of its intent
to rely on this rule, while serving a copy of the record. See rule 1.281 (4)(g)(2)(1 ).
Rule 1.281(4)(g)(3)(1). The rule permits a party to admit the out-of-court declaration of a health care
provider in lieu of the health care provider's in-court testimony. It prohibits hearsay objections based
solely on the fact that the health care provider has not testified at trial or in a deposition subject to crossexamination.
Rule 1.281(4)(g)(3)(3). Any party may object to all or part of the Health Care Provider Statement in
Lieu of Testimony, including the proponent of the statement. The rule provides that the court must rule
on any objection to the health care provider statement sufficiently in advance of trial so as to give the
proponent an opportunity to rectifY any deficiencies in the statement. In ruling on such objections, the
court has discretion to determine matters such as whether the health care provider has provided actual
medical treatment for the patient, whether the health care provider has substantially answered the
questions on the statement, or whether to redact any portion of the statement.

1.281(5) Settlement conftrence; alternative dispute resolution. Unless the parties have
agreed to engage in alternative dispute resolution or are required to do so by contract or statute,

the court may not, by order or local rule, require the parties to engage in a settlement conference
or in any other form of alternative dispute resolution.
1.281(6) Claim preclusion; issue preclusion. Judgments or orders in an expedited civil action
may not be relied upon to establish claim preclusion or issue preclusion unless the party seeking
to rely on a judgment or order for preclusive effect was either a party or in privity with a party in
the expedited civil action.

Attachment D
,.r,..

CHAPTER1
RULESOFCnnLPROCEDURE
DIVISION IV
PLEADINGS AND MOTIONS

B. PLEADINGS, FORMAT AND CONTENT

Rule 1.413 Verification abolished; affidavits; certification.

1.413(1) Pleadings need not be verified unless special statutes so require and, where a
pleading is verified, it is not necessary that subsequent pleadings be verified unless special
statutes so require. Counsel's signature to every motion, pleading, or other paper shall be deemed
a certificate that: counsel has read the motion, pleading, or other paper; that to the best of
counsel's knowledge, information, and belief, formed after reasonable inquiry, it is well
grounded in fact and is warranted by existing law or a good faith argument for the extension,
modification, or reversal of existing law; and that it is not interposed for any improper purpose,
such as to harass or cause an unnecessary delay or needless increase in the cost of litigation. If a
motion, pleading, or other paper is not signed, it shall be stricken unless it is signed promptly
after the omission is called to the attention of the pleader or movant. If a motion, pleading, or
other paper is signed in violation of this rule, the court, upon motion or upon its own initiative,
shall impose upon the person who signed it, a represented party, or both, an appropriate sanction,
which may include an order to pay the other party or parties the amount of the reasonable
expenses incurred because of the filing of the motion, pleading, or other paper, including a
reasonable attorney fee. The signature of a party shall impose a similar obligation on such party.
This rule does not apply to disclosures. discovery requests. responses. objections. and motions
under rules 1.500 throu!!h 1.517. which are !!overned by rule 1.503(6).

Attachment E

Rule 1.500 Duty to disclose; required disclosures.

1.500(1) Initial disclosures.

a. In general. Except as exempted by rule 1.500(])(e) or as otherwise stipulated or ordered by

the courL a party must. without awaiting a discovery request. provide to the other parties:
(]) The name and. if known. the address. telephone numbers. and electronic mail address of
each individual likely to have discoverable information. along with the subjects of that
information. that the disclosing party may use to support its claims or defenses. unless the use
would be solely for impeachment.
(2) All documents. electronically stored information. and tangible things that the disclosing
partv has in its possession. custody. or control and may use to support its claims or defenses.
unless the use would be solely for impeachment.
1. Unless good cause exists for not doing so. copies of the documents or electronically stored
information listed must be served with the disclosure.
2. If copies of any document or electronically stored information are not produced. the
disclosing party must state the good cause for not producing the items and provide a description
by category. location. and the name and address of the custodian of the document or
electronically stored information.
3. A party who provides documents in disclosure must produce them as they are kept in the
usual course of business.
(3) A computation of each category of damages claimed by the disclosing party. who must
also make available for inspection and copying as under rule 1.512 the documents or other
evidentiary material. unless privileged or protected from disclosure. on which each computation
is based. including materials bearing on the nature and extent of injuries suffered; provided.
however. that this rule 1.500(])(a)(3) does not require disclosure of the exact dollar amounts
claimed for noneconomic damages.
(4) For inspection and copying as under rule 1.512. and notwithstanding rule 1.503(2). the
declarations page of any insurance agreement under which any person carrying on an insurance
business may be liable to satisiY part or all of a judgment that may be entered in the action or to
indemnify or reimburse for pavments made to satisfy the judgment. and. in any action in which
coverage is or may be contested. a copy of the agreement and all letters from the insurer to the
insured regarding coverage.

b. Claims for personal or emotional injurv. Except as exempted bv rule 1.500(l)(e) or as

otherwise stipulated or ordered by the court. and in addition to the initial disclosures required by
rule 1.500(])(a). any party asserting a claim for damages for personal or emotional injuries must.
without awaiting a discovery request. provide to the other parties:

(I)

The claimant's full name and date of birth.

C2l The claimant's Medicare health insurance claim number CHTCNl.

The names and addresses of all doctors. hospitals. clinics. pharmacies. and other health
care providers claimant consulted within five years prior to the date of injury up to the present
date.
(3)

Legally sufficient written waivers allowing the opposin!l partv to obtain those records
subject to appropriate protective provisions authorized by rule 1.504. The opposing partv must
give contemporaneous notice to the claimant when the opposin!l partv uses the waivers to obtain
records and must provide a copy of all records obtained by waiver to the claimant and all other
parties. Any partv who reguests that the opposinll party produce these records in nonelectronic
form must bear the opposing partv's costs of producing them in that form.
(4)

c. Claims tor lost time or earning capacitv. Except as exempted by rule 1.500(])(e) or as
otherwise stipulated or ordered by the court. and in addition to the initial disclosures reguired by
rule 1.500(])(a). any partv assertin!l a claim for damages for lost time or lost earning capacity
must. without awaiting a discovery reguest. provide to the other parties:
(1) The claimant's federal and state income tax returns for the five years prior to the date of
disclosure.

(2) The names and addresses of all persons by whom the claimant has been employed for the
five years prior to the date of disclosure.
(3) Legally sufficient written waivers allowing the opposing party to obtain the claimant's
personnel files and pavment histories from each employer subject to appropriate protective
provisions authorized by rule 1.504.

I. The opposing partv must !live contemporaneous notice to the claimant when the opposinll
partv uses the waiver to obtain records and must provide a copy of all records obtained by waiver
to the claimant and all other parties.
2. Any partv who requests that the opposing partv produce these records in nonelectronic form
must bear the opposing partv' s costs of producing them in that form.
d. Domestic relations proceedings.

Except as otherwise stipulated or ordered by the court and in lieu of the initial disclosures
required by rule 1.500(1)(a). in domestic relations actions involvin!l any contested claim.
including divorce. custody. modification. and paternity actions. each partv must. without
awaiting a discovery request. provide to the other partv copies of the followinll:
(I)

I. Paystubs or other documentation showing the party's income from all sources. deductions
for federal and state taxes. health insurance premiums. union dues. and mandatory pension
3

withholdings for the oast six months. If children are involved. the party providing health
insurance must provide a breakdown of the cost of an individual health insurance plan and the
cost of a family plan.
2. The party's federal and state income tax returns. including all schedules and W-2's. for the
three most recent years if not in the possession of the other person.
3. A current financial affidavit. including a description of all assets and liabilities.
4. Statements of account or other documentation to support the assets or liabilities listed in the
financial affidavit.
(2) If the action is a modification case or an unmarried custody case. the parties must provide
only the information contained in rules 1.500(1)(d)(])(]) and 1.500(])(d)(])(2).

e. Proceedings exempt fimn initial disclosure. Unless otherwise ordered by the court or
agreed to by the parties. the requirements of rules 1.500(Jl(a) through (d) do not apply to the
following:
(]) Actions for certiorari or for judicial review of administrative agency actions under Iowa
Code chapter 17A.
(2) Actions for forcible entry and detainer.
(3) Domestic relations proceedings in which there are no contested claims.
(4) Adoption proceedings. name change proceedings. actions under Iowa Code chapter 236.
and actions initiated by the Child Support Recovery Unit.
(5) Foreclosure proceedings in which there are no contested claims.
(6) Actions for postconviction relief or any other proceeding to challenge a criminal
conviction or sentence.
(7) Probate proceedings in which there are no contested claims.
(8) Juvenile proceedings.
(9) Mental health proceedings.
(I 0)

Actions under Iowa Code chapters 225. 229. and 229A.

(II)

Actions to enforce an arbitration award or an out-of-state judgment.

(12) Small claims proceedings under Iowa Code chapter 631.

t: Time fOr initial disclosures in general. A party must make the initial disclosures at or
within 14 days after the parties' rule 1.507 discovery conference unless a different time is set by
stipulation or court order. or unless a party objects during the conference that initial disclosures
are not appropriate in the action and states the objection in the proposed discovery plan. In
ruling on the objection. the court must determine what disclosures. if any. are to be made and
must set the time for disclosure.
g. Time !Or initial disclosures fOr parties served or joined later. A partv who is first served or
otherwise joined after the rule 1.507 discovery conference must make the initial disclosures
within 30 days after being served or joined. unless a different time is set by stipulation or court
order.
h. Basis fOr initial disclosure: unacceptable excuses. A party must make the initial
disclosures based on the information then reasonably available to the partv. A partv is not
excused from making the disclosures because the partv has not fully investigated the case.
because the partv challenges the sufficiency of another party's disclosures. because another partv
has not made that party's disclosures. or because the infonnation is in the possession. custody. or
control ofthe party's insurance carrier.
Comment:
Rule 1.500. The entirety of rule 1.500 is added. With some modifications. the rule adopts the required

disclosures currently used by the federal courts and by a number of states that have also recently engaged
in civil justice reform. Like its federal counterpart. the rule seeks to accelerate the exchange of basic
information and eliminate the delay and expense of serving formal discovery requests seeking routine
information that will be produced as a matter of course in most cases.
The information disclosed under rule 1.500(1) is subject to a continuing duty to supplement. See rule
1.500(5).
1.500(2) Disclosure ofexpert testimonv.

a. In general. In addition to the disclosures required by rule 1.500(1). a party must disclose
to the other parties the identitv of any witness the party may use at trial to present evidence under
Iowa Rules of Evidence 5.702. 5.703. and 5.705.
b. Witnesses who must provide a written report. Unless otherwise stipulated or ordered by
the court. this disclosure must be accompanied by a written report-prepared and signed by the
witness-if the witness is one retained or specially employed to provide expert testimony in the
case or one whose duties as the party's employee regularly involve giving expert testimony. The
report must contain the following:
(]) A complete statement of all opinions the witness will express and the basis and reasons
for them.
(2) The facts or data considered by the witness in forming the opinions.
(3) Any exhibits that will be used to summarize or support the opinions.

(4) The witness's qualifications. including a list of all publications authored in the previous 10
years.
(5) A list of all other cases in which. durin!! the previous four years. the witness testified as an
expert at trial or by deposition.
(6) A statement of the compensation to be paid for the study and testimony in the case.

c. Witnesses who do not provide a written report. Unless otherwise stipulated or ordered by
the court. if the witness is not required to provide a written report. this disclosure must state:
(!) The subject matter on which the witness is expected to present evidence under Iowa Rules
of Evidence 5.702. 5.703. or 5.705.

(2) A summary of the facts and opinions to which the witness is expected to testifY.

d. Time to disclose expert testimonv. A partv must make these disclosures at the times and in
the sequence set forth in the court's trial schedulinf! order. If not otherwise ordered. expert
disclosures shall be due:
(I)

No later than 90 days before the date set for trial: or

(2) Within 30 days after the other partv's disclosures if the evidence is intended solely to
contradict or rebut evidence on the same subject matter identified by another partv under rule
1.500(2)(b) or (c).

e. Supplementing disclosures. The parties must supplement these disclosures when required
under rule 1.508(3).
Comment:
Rule 1.500 (2)(tfl. The rule contemplates that in many. if not most. cases. scheduling of disclosure of

expert testimony will be governed by a trial scheduling order. See Iowa R. Civ. P. 1.907: Iowa Ct. R.
23.5-Form 2: Trial Scheduling Order and Discovery Plan.
1.500(3) Pretrial disclosures.

a. In general. In addition to the disclosures required by rules 1.500(1) and 1.500(2). a partv
must provide to the other parties and promptlv file the following information about the evidence
the partv may present at trial other than evidence to be used solely for impeachment:
(!) The name and. if not previously provided. the address. telephone numbers. and electronic
mail address of each witness. separately identifyinf! the witnesses the partv expects to present
and those the partv may call if the need arises.

(2) The page and line designation of those witnesses whose testimony the partv expects to
present by deposition and. if not taken steno!!raphically. a transcript of the pertinent parts of the
deposition.
6

(3) An identification of each document or other exhibit. including summaries of other

evidence. separately identifving those items the partv expects to offer and those it may offer if
the need arises.

b. Time for metrial disclosures: objections. Pretrial disclosures must be made at least 14 days
before trial. This deadline may be modified by order of the court or stipulation of the parties.
provided. however. that the parties may not stipulate to a pretrial disclosure deadline of Jess than
7 days before trial. A partv may serve and promptly file a list of the following objections: any
objections to the use under rule 1.704 of a deposition designated by another partv under rule
1.500(3)(a)(2). and any objection. together with the grounds for it. that may be made to the
admissibilitv of materials identified under rule 1.500(3)(a)(3). Objections must be served and
filed within 7 days of the pretrial disclosures. or within 4 days if the pretrial disclosure deadline
is less than 10 days before trial. unless the court directs otherwise. An objection not so made.
except for one under Iowa Rule of Evidence 5.402 or 5.403. is waived unless excused by the
court for good cause.
c. Dutv to supplement unafkcted. Rule 1.500(3) does not affect the obligation of a partv to
timely supplement disclosures and discovery responses as required by rule 1.503(4)(a)(2).
Comment:
Rules 1.500(3)(a) and 1.500(3l(b). Rules 1.500(3)(a) and (b) mirror Federal Rule of Civil Procedure.
26(a)(3). The duty to disclose trial witnesses. deposition testimony. and exhibits is governed by the Time
Standards for Case Processing in rule 23.5 of the Iowa Court Rules. Rule 23.5 is mandatory and applies
to aJJ civil actions. This rule incorporates into the Iowa Rules of Civil Procedure the dutv to make pretrial
disclosures. Iowa Court Rule 23.5-Form 2: Trial Scheduling Order and Discovery Plan. implements
these and other scheduling deadlines.
Rule 1.500(3)(b). The federal rules require that pretrial disclosures occur within 30 days of trial and
that objections occur within 14 days thereafter. Former rule 23.5-Form 2 of the Iowa Court Rules
imposed a later deadline. requiring disclosure of aJJ witness and exhibit lists at least 7 days before trial.
with objections due within 5 days thereafter (2 days before triall. Requiring pretrial disclosures 30 days
before trial could result in unnecessarv time and effort. The former 7 day deadline. however. may have
been in some circumstances too close to trial. Rule 1.500(3)(b) requires parties to make pretrial
disclosures two weeks in advance of trial. unless they stipulate to a different deadline. which cannot be
Jess than one week before trial. The rule also gives opposing parties one week thereafter to respond.
unless the disclosure deadline was Jess than I 0 days before trial. Iowa Court Rule 23.5-Form 2: Trial
Scheduling Order and Discovery Plan reflects these changes.
1.500{4} Form ofdisclosures. Unless the court orders otherwise. all disclosures under rule 1.500
must be in writing. signed. and served.
1.500(5) Supplementing the disclosures. The parties must supplement these disclosures when
required under rules 1.503(4) and 1.508(3).
1.500(6) Effective date. Rule 1.500 applies only to actions commenced on or after January I.
2015. provided that the court may in any case direct the parties to comply with all or part of the
rule as part of a pretrial order.

Rule 1.501 Discovery methods.

1.501(1) Fames In addition to the disclosures required by rule 1.500. and subject to the
timing provisions of rule 1.505. parties may obtain discovery by one or more of the following
methods: depositions upon oral examination or written questions; written interrogatories;
production of documents or things or permission to enter upon land or other property, for
inspection and other purposes; physical and mental examinations; and requests for admission.
1.501(2) The rules providing for discovery and inspection shall-should be liberally construed,
aad shall se eafereee administered. and employed by the court and the parties to secure the just.
speedy. and inexpensive determination of every action and proceeding and to provide the parties
with access to all relevant facts. Disesvery shall se esaElHeleEl ia gssEi faill!, aaEi resj3sases Is
Elisesvery reqHesls, hswever maEie, shall fairly aEIEiress aael meellhe Stlsslaaee sflhe reqHesl.
1.501(3) lJHless !he estlrt srelers slherwise HaEier mle l.G1, !he freqHeaey sf Hse sf ll!ese
melhsds is as! limileel. Discovery must be conducted in good faith. and responses to discovery
requests. however made. must fairly address and meet the substance of the request. Any
discovery motion presented to the court must include a certification that the movant has in good
faith personally spoken with or attempted to speak with other affected parties in an effort to
resolve the dispute without court action. The certification must identify the date and time of any
conference or attempts to confer.
Comment:
Rule 1.501(3). The rule makes the certification of conference requirement apply to all discovery
motions. A similar provision is contained in rule 1.504(3) governing motions for orotective order and in
rule 1.517(5) governing sanctions and motions to compel. Telephonic conferences satisfy the conference
requirement of these rules.
1.501(4) A rule requiring a matter to be under oath may be satisfied by an unsworn written
statement in substantially the following form: "I certify under penalty of perjury and pursuant to
the laws of the state oflowa that the preceding is true and correct.
Date

Signature"

Rule 1.503 Scope of discovery.

1.503(1) In general. Parties may obtain discovery regarding any matter, not privileged, which
is relevant to the subject matter involved in the pending action, whether it relates to the claim or
defense of the party seeking discovery or to the claim or defense of any other party, including the
existence, description, nature, custody, condition, and location of any books, documents, or other
tangible things~aafr.the identity and location of persons having knowledge of any discoverable
matter. and the identitv of witnesses the partv expects to call to testify at the trial. It is not
ground for objection that the information sought will be inadmissible at the trial if the

information sought appears reasonably calculated to lead to the discovery of admissible

evidence.
a. Unless otherwise provided in a request for discovery, a request for the production of a
"document" or "documents" shall encompass electronically stored information. Any reference
in the rules in this division to a "document" or "documents" shall encompass electronically
stored information.
b. All discovery is subject to the limitations of rule 1.503[8).
1.503(2) Insurance agreements. A In addition to the initial disclosures required by rule
a party may obtain discovery of the existence and contents of any insurance
agreement under which any person carrying on an insurance business may be liable to satisfy
part or all of a judgment which may be entered in the action or to indemnify or reimburse for
payments made to satisfy the judgment. Information concerning the insurance agreement is not
by reason of disclosure admissible in evidence at trial. For purposes of this rule, an application
for insurance shall not be treated as part of an insurance agreement.
1.500(])(a)(4).

Comment:

Rule 1.503[2). Notwithstanding the initial disclosure obligation in rule 1.500(])(a)(4). rule 1.503[2)
clarifies that additional discovery regarding insurance is still allowed. but the fruits of that discovery will
not necessarily be admissible.

1.503(4) 8upplemenlatien ef Supplementing disclosures and responses. A party who has

made a disclosure under rule 1.500. or who has responded to a request for discovery, is HaEler a
ElHty to sHpplemeat or ameaE! the must timely supplement or correct the partv's disclosure or
response to iaelHEle iaformatioa thereafter aeEjHireEl as follows:

a. A party must timely supplement or correct any disclosure or response that concerns is HHEler
a ElHt)' seasoaaely to sHpplemeat the respoase with respeet to aay EjHestioa Elireetly aE!ElresseE! to
any of the following:
(I) The identity and location of persons having knowledge of discoverable matters.

(2) The identity of each person expected to be called as a witness at trial.

(3) Any matter that bears materially upon a claim or defense asserted by any party to the
action.
b. A party is under a duty seasonably to ameaEl supplement or correct its disclosure or a prior
response if the party eetaias iaformatieH HpOH the aasis of whieh:
(1) The party kaev<s that the respease was iaeerreet when I'Raae.

(2) The party !mews that the respease theHgh eerreet when maae is ae !eager lrHe
aaEl the eireHmstanees are sHeh that a fai!Hre to ameaEl the response is in sHastaaee
a lmowiag eeaeealmeat.
9

learns that in some material respect the disclosure or response is incomplete or incorrect. and if
the additional or corrective information has not otherwise been made known to the other parties
during the discovery process or in writing.

c. As provided in rule 1.508(3), a party shall-must supplement discovery as to experts and the
substance of their testimony.
d. An additional duty to supplement responses may be imposed by order of the court,
agreement of the parties, or at any time prior to trial through new requests fer sepplemeRtatieH sf
to supplement prior responses.
Comment:
Rule 1.503(4)(b).

The amendment eliminates the "!mowing concealment" requirement that had

triggered the duty to supplement incorrect discoverv responses. Rule 1.503( 4)(b) now tracks the federal
rule by requiring supplementation of any response that the answering partv learns is materially incomplete
or incorrect unless that information has already otherwise been disclosed in discovery. See Fed. R. Civ.
P. 26CelCllCAl.

1.503(6) Signing disclosures ond discoverv requests. responses. and objections.

a. Signature required: efkct of sirmature. Every disclosure under rule 1.500 and every
discovery request. response. or objection must be signed by at least one attorney of record in the
attorney's own name--or by the partv personally. if unrepresented-and must state the signer's
name. law firm. or name of partnership. association. corporation. or tribe on behalf of which the
filing agent is sirming. and mailing address. telephone number. and electronic mail address. By
signing. an attorney or party certifies that to the best of the person's knowledge. information. and
belief formed after a reasonable inquiry:
(])The disclosure is complete and correct as of the time it is made.
(2) The discovery request. response. or objection is:
1. Consistent with these rules and warranted by existing law or by a nonfrivolous argument
for extending. modifying. or reversing existinll: law. or for establishinll: new law.
2. Not interoosed for any improper purpose. such as to harass. cause unnecessary delay. or
needlessly increase the cost oflitill:ation.
3. Neither unreasonable nor unduly burdensome or expensive. considering the needs of the
case. prior discovery in the case. the amount in controversy. and the importance of the issues at
stake in the action.

10

b. Failure to sign. Other parties have no duty to act on an unsigned disclosure. request.
response. or objection until it is signed. and the court must strike it unless a signature is promptly
supplied after the omission is called to the attorney's or partv's attention.
c. Sanction for improper certification. If a certification violates this rule without substantial
justification. the court. on motion or on its own. shall impose an appropriate sanction on the
signer. the partv on whose behalf the signer was acting. or both. The sanction may include an
order to pay the reasonable expenses. including attorney's fees. caused by the violation.
Comment:
Rule 1.503(6}. The rule is patterned on Federal Rule of Civil Procedure 26(gl. Having a separate
certification requirement tailored specifically to discovery more effectively deters discovery abuse. See
rule 1.413(1) (providing that its certification obligation does not apply to discovery).
1.503(7) Reliance an disclosures and discoverv responses of other parties. Any party may
rely on any other party's disclosures or discoverv responses to the extent permitted by otherwise
applicable evidentiary rules and regardless of when that party is joined. Unless requested to do
so by a current partv. the responding partv has no duty to supplement its responses to discovery
requests after the propounding party has been dismissed from the case.
1.503(8) Limitations on ti-equencv and extent. On motion or on its own. the court shall limit
the frequency or extent of discovery otherwise allowed by these rules if it determines that:

a. The discovery sought is unreasonably cumulative or duplicative. or can be obtained from

some other source that is more convenient. less burdensome. or less expensive:
b. The party seeking discovery has had ample opportunity to obtain the information by
discovery in the action: or
c. The burden or expense of the proposed discovery outweighs its likely benefit. considering
the needs of the case. the amount in controversy. the parties' resources. the importance of the
issues at stake in the action. and the importance of the discovery in resolving the issues.

Rule 1.504 Protective orders.

1.504(1) Upon motion by a party or by the person from whom discovery is sought or by any
person who may be affected thereby, and for good cause shown, the court in which the action is
pending or alternatively, on matters relating to a deposition, the court in the district where the
deposition is to be taken:
a. May make any order which justice requires to protect a party or person from annoyance,

embarrassment, oppression, or undue burden or expense, including one or more of the following:
(1) That the discovery not be had.

11

(2) That the discovery may be had only on specified terms and conditions, including a
designation of the time or place. or the allocation of expenses.
(3) That the discovery may be had only by a method of discovery other than that selected by
the party seeking discovery.
(4) That certain matters not be inquired into, or that the scope of the discovery be limited to
certain matters.
(5) That discovery be conducted with no one present except persons designated by the court.
(6) That a deposition after being sealed be opened only by order of the court.
(7) That a trade secret or other confidential research, development, or commercial information
not be disclosed or be disclosed only in a designated way.

(8) That the parties simultaneously file specified documents or information enclosed in sealed
envelopes to be opened as directed by the court.

b. Shalt On motion or on its own. shall limit the frequency and extent of use of the methods
described in rule 1.501(1) in accordance with the limitations of rule 1.503(8). if it determiHes
tfiat frll)' ef tHe fellewiHg Bflj3lies:
(I) Tfie diseevery seHgfit is HHreaseHaely eHmHlative er dHJ3lieative, er is estaiHasle fFem
seme etHer seHree tafrt is mere eeHveHieAt, less sHrdeAseme, er less el<fleAsive.

(2) Tae 13arty seekiAg diseevery fias fiad amj3le ej3J3ertHAity sy diseevery ifl tae aetiefl te
estaiH tae iHfermfrtiSH SeHgfit.
(3) Tfie sHrdeH er enJ3eHse ef tae J3reJ3esed diseevery eHtv.eigas its likely seAefit, takiAg
iAte aeeeHHt tae Aeeds ef tHe ease, tHe ameHHt iH eeHtreversy, tae j3arties' reseHrees, tae
imj3ertaAee ef tHe issHes at stake iH tHe litigatieH, aHd tae imj3ertaHee ef tae J3rSJ38Seel diseevery
iH reselviHg tae issHes.
Comment:
Rule 1.504Cll. Rather than repeating the proportionality limitations contained in the scope of
discovery. rule 1.504(1) cross-references proportionality. Additionally. in recognition of the court's
independent obligation to ensure the proportionality of discovery. rule 1.504(1) expressly authorizes the

court to limit sua sponte the frequency and extent of discovery.

1.504(2) A party need not provide discovery of electronically stored information from sources
that the party identifies as not reasonably accessible because of undue burden or cost. On motion
to compel discovery or for a protective order, the party from whom discovery is sought must
show that the information is not reasonably accessible because of undue burden or cost. If that
showing is made, the court may nonetheless order discovery from such sources if the requesting
party shows good cause, considering the limitations of rule 1.5Q1(l)(h)1.503(8). The court may
specify conditions for the discovery.
12

1.504(3) A motion for protective order must include a certification that the movant has in
good faith personally spoken with or attempted to speak with other affected parties in an effort to
resolve the dispute without court action. The certification must identify the date and time of any
conference or attempts to confer. If the motion for a protective order is denied in whole or in
part, the court may, on such terms and conditions as are just, order that any party or person
provide or permit discovery. The provisions of rule 1.517(l)(d) apply to the award of expenses
incurred in relation to the motion.

Rule 1.505 Sequeuee aud timing Timing and sequence of discovery.

1.505(1) Timing.
a. A partv may not seek discovery from any source before the parties have conferred as
required by rule 1.507. except in a proceedin!! exempt from initial disclosure under rule
1.500(] )(e). or when authorized by these rules. bv stipulation. or by court order.

b. The discovery moratorium of rule 1.505(]) applies only to actions commenced on or after
January I. 2015. provided that the court may in any case direct the parties to comply with all or
part of the rule as part of a pretrial order.
1.505(2) Sequence. Unless the court upon motion orders otherwise for the convenience of
parties and witnesses and in the interests of justice, or the parties stipulate. methods of discovery
may be used in any sequence and the fact that a party is conducting discovery, whether by
deposition or otherwise, shall not operate to delay any other party's discovery.

Rule 1.507 Discovery conference of the parties.

1.507(1) At aRy time after eemmeReemeRt sf aR aetieR, the eeurt may direet the atterneys

fer the j3arties te aJ3J3ear llefere it fer a eeRfereRee BR the sulljeet sf diseevery. The eeurt shall
de sa UJ3BR metieR lly the atterney fer aRy j3aFt)' if the metieR iReludes:
e. A statemeAt efthe issues as they theA a1313ear.
h. A J3FSJ3SSed J3laH aud sehedule sf diseavery.
e. ARy limitatieRs J3rSJ3SSed te lle J3laeed SR diseevery.
d. ARy issues relatiAg te the diseeYery aAd J3FeservatieA sf eleetreAieally stared iAfermatieR,
iReludiRg the ferm iR whieh it sheuld lle J3Fedueed.
e. AA)' issues relatiRg te elaims sf j3Fivilege er j3FSteetieA as trial J3FeJ3aratieA material,
iAeludiAg (ifthe J3arties agree SA a J3FSeedure te assert sueh elaims after J3reduetieA) whether te
ask the eeurt te iuelude their agreemeRt iu au erder.
f Auy ether J3FBJ3ased erders with res13eet te diseevery.
g. A statemeAt shewiAg that the atterney makiug the metieu has made a reaseuallle effert te
reaeh agreemem with BJ3J3Ssiug atterneys eu the matters set ferth iR the metieR. Conterence
timing. Except in a proceedin!! exempt from initial disclosure under rule 1.500(])(e) or when the
court orders otherwise. the parties must confer as soon as practicable. but no later than 21 days
13

after any defendant has answered or appeared. The plaintiff must notify all parties of the
discovery conference deadline. Except as otherwise stipulated or ordered by the court. the filing
of a pre-answer motion under rule 1.421 does not affect the obligation to participate in the
discovery conference or to make disclosures required by rule 1.500(1).
1.507(2)_ Baeh 13arty aae that 13arty's attemey are !mEier a E!Hty te j3artieij3ate ia gee a faith
ia the ifamiag ef a Elise every j3lar. if a 13laa is j3rBj3eseEl 8y tile attemey fur aay 13arty. J>letiee ef
the metiea shall 8e servee ea all j3arties. Objeetieas er aE!Elitieas te matters set furth ia the
metiea shalllle servee aet later thaa tea Elays after serviee eftile metiea. Conference content:
parties' responsibilities. In conferring. parties must consider the nature and basis of their claims
and defenses and the possibilities for promptly settling or resolving the case: make or arrange
for the disclosures required by rule 1.500(1): discuss any issues about preserving discoverable
information: and develop a proposed discovery plan. The attorneys of record and all
unrepresented parties that have appeared in the case are jointly responsible for arranging the
conference. for attempting in good faith to agree on the proposed discovery plan. and for
submitting to the court within 7 days after the conference a written report outlining the plan.
The court may order the parties or attorneys to attend the conference in person. The discovery
plan must be submitted in all events prior to the trial-setting conference.
1.507(3) Discoverv plan. Fellewiag the Eliseevery eeafureaee, tile eeurt silall eater aa erder
teatatively ieeatifyiag the issues fer diseevery, settiag limitatieas ea diseevery, if aay, aad
detefffiiaiag sueh ether matters, iaelueiag the alleeatiea ef enj3eAses, as are aeeessary fur the
j3f8j3er maaagemeat ef Eliseevery ia the aetiea. An ereer may lle altered er amended Nileaever
justiee se reEJHires. The discovery plan will be included in Iowa Court Rule 23.5-Form 2: Trial
Scheduling Order and Discovery Plan. and except as otherwise ordered by the court. a discovery
plan must state the parties' views and proposals on the following:

a. Changes that should be made in the timing. form. or requirement for disclosures under rule
1.50](1). including a statement of when initial disclosures were made or will be made.
b. Subjects on which discovery mav be needed. when discovery should be completed. and
whether discovery should be conducted in phases or be limited to or focused on particular issues.
c. Issues about disclosure. discovery. or preservation of electronicallv stored information.
including the form or forms in which the information should be produced.
d. Issues about claims of privilege or of protection as trial preparation materials. includingif the parties agree on a procedure to assert these claims after production-whether to ask the
court to include the parties' agreement in an order under Iowa Rule of Evidence 5.502.

e. Changes that should be made to the limitations on discovery imposed under these rules.
and other limitations that should be imposed.

t:

Any other orders that the court should issue under rule 1.504 or under rule 1.602.

14

1.507(4) Pretrial conference. SH!Jjeet ts the right ef a j3arty WAS J3FSJ3erly ffiS'tes fer a
siseevery eeefereeee te J3F8ffiJ3! eeeveeieg sf tHe eeefureeee, tfie eeHrt ffi!I-J" eeffiaiee tfie
siseevery esefureeee witH a J3Fetrial eeefereeee aHtflsrizes ay FHle UiQ2. Following the parties'
discovery conference. any partv may request the court to convene a pretrial conference under
rule 1.602 to resolve any objection or disputed issue identified in the parties' discovery plan.
Comment:
Rule 1.507. The rule is substantiaJiy rewritten to provide that parties. including prose litigants, have a
dutv to confer early in a case and cooperate in framing a discovery plan to submit to the court. The rule is
patterned on the federal attorney conference rule. Federal Rule of Civil Procedure 26(1). Rule 1.507
envisions that the discovery conference will occur on or before the rule 1.906 trial-setting conference.
The parties must submit the discovery plan within 7 days of the trial-setting conference. and initial
disclosures are due within 14 days of the discovery conference.

Rule 1.508 Discovery of experts.

1.508(1) Expert who is expected to be called as a witness. In addition to the disclosures and
discovery provided pursuant to fllle-rules 1.500(2) and 1.516, discovery of facts known, mental
impressions, and opinions held by an expert whom the other party expects to call as a witness at
trial, otherwise discoverable under the provisions of rule 1.503(1) and acquired or developed in
anticipation oflitigation or for trial, may be obtained as follows:
a. A 13arty ffi!I-J' tmsHgll ieterregateries reEjHire aey stfier 13arty te state tfie eaffie aes assress
sf eaefi J3ersee '.VAS HI tfie stfier 13arty elif!eets ts eall as ae exJ3ert wimess at trial aes ts state,
with reasseaale J3artieHlarity, all sf tHe fellsvtieg:
(I) Tfie sHbjeet ffiatter se wfiiefi tfie exJ3ert is ex13eetes te testify.
(2) Tfie sesigeates 13ersse's EjHalifieatiees te testify as ae exJ3er! se SHeA sHBjeet.
(3) The meAtal imj3FessiSH5 aHS 8j3iHi8HS fiels B)' !fie el<j3ert ElHS tfie faets I<HSV>'H tS tfie
exj3ert (regarsless sf wl!ee tfie fae!Hal iefeFFAatise was aeEjHires) whieh relate ts, sr fsFFA tHe
aasis ef, tfie meetal imJ3ressiees aes S]3ieises fiels sy !He exJ3ert.
Nstl!ieg ie tfiis mle sfiall se eeestmes te J3Fee1Hse a Vfiteess freffi testifyieg as ts lmswlesge
sf !He faets el3taieeE113y tile wimess ]3Fisr ts seieg retaieeEI as ae exJ3ert sr meAtal imJ3ressises sr
S]3ieises feFFAes 8y !He wimess 'NAiefi are aaseEI se st~efi lmswleEige.
Ie tae ease sf ae eJif!erl retaiees ie aetieij3atise sf litigatise sr fer trial, aeswers ts
ieterrsgatsries askieg fer tae EjHalifieatises sf tfie 13ersse eltJ3eetes ts testii) as ae elif!er!, tfie
meetal im13ressises aes SJ3ieises fiels 8y !He elif!ert, aes tae faets lrnewe te tae el<J3er! shall se
se13arately sigeeEI 13~ tfie ElesigeateEI elt]3ert witeess. If tfie ]3arty servieg sHeA ieterrsgatsries
aelie,es !Hat !He aeswers were reEjHires te ae sigees ay !He elt]3ert aes !Hey .vere est se
sigeeEI, tfie 13arty ffi!I-J' sBjeet se tfiat sasis aes meve fer ae srEier eem]3ellieg siseevery. Ae
eBjeetisH easeS SA tile faiiHFe sf SHea aHSVfeFS !8 se sigees B)' !fie sesigeates eXj3ert SHall se
assertes witaie 39 S!I-J'S sfserviee sfsHea aes.vers, stfierwise tfie sbjeetise is waives.

a. Deposition of an expert who mav /estifi;. A partv mav depose any person who has been
identified as an expert whose opinions may be presented at trial. If rule 1.500(2)(b) requires a
report from the expert the deposition may be conducted only after the report is provided.

15

b. Discoverv bv other means. Diseo~ery lly other means is availallle without leave of eourt
iA lieu afar iA addition to interrogatories:
(I) A 13arty m!lj' take tile deJ3osition of any J3erson identified lly any other 13arty as a J3ersefl
eltj3eeted to lle ealled as an ellJ3ert witness at trial.
f-l1--A Subject to rules 1.508(1) (d) and (e). a party may also obtain discovery of documents
and tangible things including all tangible reports, physical models, compilations of data, and
other material prepared by an expert or for an expert in anticipation of the expert's trial and
deposition testimony. The disclosure of material prepared by an expert used for consultation is
required even if it was prepared in anticipation of litigation or for trial when it forms a basis,
either in whole or in part, of the opinions of an expert who is expected to be called as a witness.
(3) If c. Tangible fOrm. Subject to rules 1.508(]) Cd) and (e). if the discoverable factual
observations, tests, supporting data, calculations, photographs, or opinions of an expert who will
be called as a witness have not been recorded and reduced to tangible form, the court may order
these matters be reduced to tangible form and produced within a reasonable time before the date
of trial.

d. Trial preparation protection fOr drafi reports or interrogatorv answers. Rule 1.503(3)
protects drafts of any report or disclosure required under rule 1.500(2). regardless ofthe form in
which the draft is recorded.

e. Trial preparation protection fOr communications between a partv's attornev and expert
witnesses. Rule 1.503(3) protects communications between the partv's attorney and any witness
required to provide a report under rule 1.500C2lCbl. regardless of the form of the
communications. except to the extent that the communications:
(] l Relate to compensation for the expert's study or testimony.
Identify facts or data that the party's attorney provided and that the expert considered in
forming the opinions to be expressed.
(2)

(3) Identify assumptions that the party's attorney provided and that the expert relied on in
forming the opinions to be expressed.

1.508(2) Expert who is not expected to be called as a witness. The disclosure of the same
information concerning an expert used for consultation and who is not expected to be called as a
witness at trial is required if the expert's work product forms a basis, either in whole or in part,
of the opinions of an expert who is expected to be called as a witness. Otherwise, a party may
discover the identity of and facts known, or mental impressions and opinions held, by an expert
who has been retained or specially employed by another party in anticipation of litigation or
preparation for trial and who is not expected to be called as a witness at trial, only as provided in
rule 1.516 or upon a showing of exceptional circumstances under which it is impracticable for
the party seeking discovery to obtain facts or opinions on the same subject by other means.
1.508(3) Duty to supplement discoveiJ' as to experts. If a 13arty en13eets to eall aA e1<13ert
witHess wheH tae ideHtity or the sHllstaHee of sHel! en13ert witHess' testimoHy has not lleeA
16

f1revist~sly

EliselsseEl iH resflSHse ts aH aflflFOflriate iHqt~iry Elireetly aElElresseEl ts these matters, sr

wheH the s!lsstaHee sf aH 9llflert's testimSH)' has seeH !lflSateEl, revises sr ehaHgeEl siHee the
respsF!se, 5!leh re5f1SF!5e m!lst se S!lflfllemeHteS ts iHel!lSe the ififermatisB SeseriseS ifl fllle
1.08(l)(a)(l) ts (3), as seeH as praetiea8le, sift iH He eveHt less thaa 30 SaJ's 13risr te the
segiHHiHg ef trial eJ<ee13t SF! leave ef ee!lrt. If the iEleHtity ef an eK13ert witaess aBEl the
iafermatieH EleseriseEl iH fllle 1.08(l)(a)(l) te (3) are Het EliseleseEl er 5liflfllemeBieEl ia
esmflliaaee with this rille, the ee!lrt ia its Eliseretiea maJ' eKelt~Ele er limit the testimeHy sf
s!leh eJlflert, er make s!leh erElers iH regarEl te the HBHEliseles!lre as are jt~st.For an expert whose
report must be disclosed under rule 1.500C2lCbl. the partv's duty to supplement extends both to
information included in the report and to information given during the expert's deposition. Any
additions or changes to this information must be disclosed no later than 30 days before trial.
Failure to disclose or supplement the identity of an expert witness or the information described in
rule 1.500(2) is subject to sanctions under rule 1.517C3lCal.

1.508(4) Expert testimony at trial. Te the eJcteHt that the faets lrnewa, er meHtal impressieas
aHEl epiaieHs helEl, sy aH eJ93ert have seea Elevelsf1eEl ia Eliseevery f1reeeeEliags <mEler fllle
1.08(l)(a) er 1.508(1)(8), the The expert's direct testimony at trial may not be inconsistent
with or go beyond the fair scope of the expert's testimBB)' ia the Elisesvery flFOeeeEliHgs as set
fertfi iH the eKflerl's Elef1esitiea, aaswer te iBierregateries, disclosures. separate report,
deposition testimonv. or supplement thereto. Hev;ever, the eJ<pert shall Het be preveHteEl ftem
testiJ)'iHg as te fuels er meatal im13ressieas aaEl BfliHieHs ea matters with res13eet te whieh the
eXflert has FISt seef! iHterrsgateS ifl the Siseevery prseeeSiBgs.
1.508(5) Ceurt ~ riiseretien te eempel dise!Es1we &j experts. The eet~rt has EliseretieH te
eem13el a flaFt)' te make the EletermiaatieH aHS Eliseles!lre ef v?hether aH expert is eKpeeteEl te
ae ealleEl as a .vitHess aaEl shall Ele se te eas!lre that Eletermiaatisa ana the EliselesHres
reqHireEl sy this rille eee!lr withiH a reaseHasle aHEl speeifie time sefere the Elate ef trial.
UpeH metieH, er at a Eliseevery esnfereHee helElfl!lrs!laBt ts fllle 1.507, sr SA its swA iAitiative,
the es!lrt may 13reseriae the seq!leAee iH .vhieh the parties make the EletermiHatisa aaEl
Eliseles!lres prsviEleEl fer !lASer this rille.
1.508(6) Expert fees during discoveiJ' Unless manifest injustice would result, the court
shall require that the party seeking discovery pay the expert a reasonable fee for time spent in
responding to discovery under rules 1.508(1) and 1.508(2). With respect to discovery obtained
under rule 1.508(1), the court may require, and with respect to discovery obtained under rule
1.508(2), the court shall require the party seeking discovery to pay the other party a fair portion
of the fees and expenses reasonably incurred by the latter party in obtaining facts and opinions
from the expert. Any fee which the court requires to be paid shall not exceed the expert's
customary hourly or daily fee; and, in connection with a party's deposition of another party's
expert, shall include the time reasonably and necessarily spent in connection with such
deposition, including time spent in travel to and from the deposition, but excluding time spent in
preparation.
1.508(6) Effective date. Rules 1.508CllCal. !.508(])(d). !.508(])(e). and 1.508(3) apply only to
actions commenced on or after January I. 2015. provided that the court may in any case direct
the parties to comply with all or part of the rules as part of a pretrial order.

17

Rule 1.509 Interrogatories to parties.

1.509(1) Availability; procedures for use.
a. Except in small claims, any party may serve written interrogatories to be answered by
another party or, if the other party is a public or private corporation or a partnership or
association or governmental agency, by any officer or agent, who shall furnish such information
as is available to the party. !Hterregateries may, witheut leave efeeurt, ee aireetea te the J3laintiff
after eemmeneement ef the aetien ana UJlen any ether jlarty with er after serviee ef the eriginal
netiee UJlen that jla.Ft)'.

Q. Each interrogatory. unless the court has ordered otherwise. slwJ!-must be fullewea ey a
reasenaele SJlaee fur insertien eftfie ans.ver unless tfie interregateries are provided in an
electronic word processing format in whieh an answer ean ee inserted. An interrogatory whleh
that does not comply with this requirement is subject to objection.
c. Each interrogatory 5flaH must. to the extent it is not objected to. be answered separately and
fully in writing under oath, unless it is esjeetea te, in 'Nhieh event the reasens fur eBjeetien shall
se stated in lieu efan ansNer. The grounds for objecting to an interrogatory must be stated with
specificity. Any ground not stated in a timely objection is waived unless the court. for good
cause. excuses the failure. A party may answer an interrogatory in whole or in part subject to an
objection without waiving that objection. Any answer so provided is subject to the duty to
supplement set forth in rule 1.503(4). but the party does not waive the objection by
supplementing. Where an answer is provided subject to an objection. the answering party must
specify the extent to which the requested information has not been provided.

d. A party answering interrogatories must set out each interrogatory immediately preceding
the answer to it. A failure to comply with this rule shall be deemed a failure to answer and shall
be subject to sanctions as provided in rule 1.517. Answers are to be signed by the person making
them. Answers shall not be filed; however, they shall be served upon all adverse parties within
30 days after the interrogatories are served. Objections, if any, must be signed bv the attornev
who objects and must shall-be served within 30 days after the interrogatories are served.
Defunaants, hewever, may serve their eBjeetiens er answers within eG days after they have seen
served eriginal netiee. The court may allow a shorter or longer time. The party submitting the
interrogatories may move for an order under rule 1.517(1) with respect to any objection to or
other failure to answer an interrogatory.
g_. A Except as provided in rule 1.509(4). or unless otherwise stipulated or ordered by the
court for good cause shown. a party 5flaltmust not serve on any other party more than 30
interrogatories. including all discrete subparts en any ether Jl!lrty eneejlt HJlen agreement sf the
jlarties er leave sf eeurt granted HJlBn a shev:ing sf geed eause. Any discrete subpart to a
non pattern interrogatory will be considered a separate interrogatory. A motion for leave of court
to serve more than 30 interrogatories must be in writing and shall set forth the proposed
interrogatories and the reasons establishing good cause for their use.

18

Comment:
Rule 1.509(1)(c). The rule mirrors Federal Rule of Civil Procedure 33(b)(3) and (4) in requiring that

objections to interrogatories be specific and providin~ that any ~ound not raised in a timely objection is
waived. The rule further allows a partv to respond to an interrogatory subject to an objection without
waiving that objection. In such cases. however. the responding partv must clearly indicate whether any
responsive information is being withheld subject to the objection.
1.509(2) Scope; use ot trial.

a. Interrogatories may relate to any matters which can be inquired into under rule 1.503,
including a statement of the specific dollar amount of money damages claimed, the amounts
claimed for separate items of damage, and the names and addresses of witnesses the party
expects to call to testify at the trial. Interrogatory answers may be used to the extent permitted by
the rules of evidence.
12.,. An interrogatory otherwise proper is not necessarily objectionable merely because an
answer to the interrogatory involves an opinion or contention that relates to fact or the
application of law to fact, but the court may order that such an interrogatory need not be
answered until after designated discovery has been completed or until a pretrial conference or
other later time.
1.509(3) Option to produce business records. Where the answer to an interrogatory may be
derived or ascertained from the business records, including electronically stored information, of
the party upon whom the interrogatory has been served or from an examination, audit or
inspection of such business records, or from a compilation, abstract or summary based thereon,
and the burden of deriving or ascertaining the answer is substantially the same for the party
serving the interrogatory as for the party served, it is a sufficient answer to such interrogatory to
specify the records from which the answer may be derived or ascertained and to afford to the
party serving the interrogatory reasonable opportunity to examine, audit or inspect such records
and to make copies, compilations, abstracts or summaries. A specification shall be in sufficient
detail to permit the party serving the interrogatory to locate and identify as readily as can the
party served, the records from which the answer may be ascertained.
1.509(4) Pattern interrogatories. The supreme court. by supervisory order or otherwise. may
approve pattern interrogatories for different classes of cases. Any pattern interrogatory and its
subparts are counted as one interrogatory.
Comment:
Rule 1.509(41.

Parties are encouraged to use supreme court-approved pattern discovery when

appropriate. A partv may use one or more pattern interro~atories that are part of an approved set of
pattern interro~atories. Any approved pattern interrogatory is counted as one interrogatory in determining
the total number of permissible interrogatories. regardless of the number of subparts or multiple inquiries
within the interrogatory. In contrast. each discrete subpart of a nonpattern interrogatory will count as a
separate interrogatory. A partv may combine pattern interro~atories with other interrogatories. subject to
applicable limitations as to number. A partv should not serve pattern interrogatories that have no
application to the case.

19

Rule 1.512. Production of documents, electronically stored information, and things; entry
upon land for inspection and other purposes.
1.512(1) Requests. Any party may serve on any other party a request:
a. To produce and permit the party making the request, or someone acting on that party's
behalf, to inspect, copy, test, or sample any designated documents or electronically stored
information-including writings, drawings, graphs, charts, photographs, sound recordings,
images, and other data or data compilations stored in any medium from which information can
be obtained-translated, if necessary, by the respondent into a reasonably usable form.

b. To inspect, copy, test, or sample any designated tangible things which constitute or contain
matters within the scope of rule 1.503 and which are in the possession, custody or control of the
party upon whom the request is served.
c. To permit, except as otherwise provided by statute, entry upon designated land or other
property in the possession or control of the party upon whom the request is served for the
purpose of inspection and measuring, surveying, photographing, testing, or sampling the
property or any designated object or operation thereon, within the scope of rule 1.503.
1.512(2) Procedure.
a. !Yfaking requests. The reEJI!est may, withs11t leave sf es11rt, se serveEIIIJ3Sn the J3laintiff after
esmmeneement of the aetion anEIIIJ30n aft)' otHer J3aFI:)' witH or after serviee of the original notiee
llJ30R tHat j3arty. The request shall set forth the items to be inspected either by individual item or
by category, and describe each item and category with reasonable particularity. The request shall
specify a reasonable time, place, and manner of making the inspection and performing the related
acts. The request may specify the form in which electronically stored information is to be
produced.
b. Responses and objections.

ill

The party upon whom the request is served shall serve a written response within 30 days
after the service of the request, el(6ej3t that a ElefunEiant may serve a reSJ3SRse witHin 89 Elays after
serviee ofthe original notiee llJ30A taat ElefunEiant. The court may allow a shorter or longer time.
The reSJ30nse shall state, witH res13eet ts eaeh item sr eategsry, tHat insJ3eetion anEI relateEI
aetivities will se permittee as reEJHesteEI, Hnless the reEJHest is oBjeeteEI to, inelHEiing an osjeetion
to the reEJI!esteEI form for proEIHeing eleetronieally storeEI informatisn, stating the reassns for the
oBjeetion. If sBjeetion is maEie to J3arl: sf an item or eategsry, the part shall se speeifieEI. If
oBjeetion is maEie to the reEJHesteEI form for preEI11eing eleetronieally stores infsrmatisn sr if as
form was speeifieEI in the reEJHest the responEiing party mHst state the form it intenEis to Hse.
(2) For each item or cate!!ory. the response must state that inspection and related activities

will be permitted as requested or state the !!founds for objectin!! to the request with specificity.
includin!! reasons. If the responding partv states that the partv will produce copies of documents
or of electronically stored information instead of permitting inspection. the production must be

20

completed no later than the time for inspection stated in the request or a later reasonable time
stated in the response.
(3) Any ground not stated in a timely objection is waived unless the court. for good cause.
excuses the failure. A partv may respond to a request in whole or in part subject to an objection
without waiving that objection. Any response so provided is subject to the duty to supplement
set forth in rule 1.503(4). but the party does not waive the objection by supplementin!!.
(4) An objection must state whether any responsive materials are being withheld on the basis
of the objection. An objection to part of a request must specify the part and permit inspection of
the rest. When a response is provided subject to an objection. the respondin!! partv must specify
the extent to which the requested information has not been provided.
(5) The response may state an objection to a requested form for producin!! electronically
stored information. If the respondin!! partv objects to a requested form for producing
electronically stored information. or if no form was specified in the request. the responding partv
must state the form or forms it intends to use.

c. Jvfotion to compel. The party submitting the request may move for an order under rule 1.517
with respect to any objection to or other failure to respond to the request or any part thereof, or
any failure to permit inspection as requested.
d. Production. Unless the parties otherwise agree, or the court otherwise orders:
(I) A party who produces documents for inspection shall produce them as they are kept in the
usual course of business or shall organize and label them to correspond with the categories in the
request.
(2) If a request does not specify the form for producing electronically stored information, the
responding party must produce the information in a form in which it is ordinarily maintained or
in a form that is reasonably usable.
(3) A party need not produce the same electronically stored information in more than one
form.

1.512{3) Pattern requests. The supreme court. by supervisory order or otherwise. may
approve pattern requests for production for different classes of cases.

Rule 1.517 Consequences of failure to make disclosures or discovery.

1.517(1) Motion for order compelling disclosures or discove1y. A party, upon reasonable
notice to other parties and all persons affected thereby, may move for an order compelling
disclosure or discovery as follows:

21

a. Appropriate court. A motion for an order to a party may be made to the court in which the
action is pending, or, on matters relating to a deposition, to the court in the district where the
deposition is being taken. A motion for an order to a deponent who is not a party shall be made
to the court in the district where the deposition is being taken.
b. }.felien Specific motions.
(]) To compel disclosure. If a party fails to make a disclosure required by rule 1.500. any
other party may move to compel disclosure and for appropriate sanctions.
(2) To compel a discoverv response. If a deponent fails to answer a question propounded or
submitted under rule I. 701 or I. 710, or a corporation or other entity fails to make a designation
under rule I. 707(5), or a party fails to answer an interrogatory submitted under rule 1.509, or if a
party, in response to a request for inspection submitted under rule 1.512, fails to produce
documents. or fails to respond that inspection will be permitted, as reEjues!ed or fails to permit
inspection as reEjHes!ed, the party seeking discovery may move for an order compelling an
answer, a designation, or an inspection in accordance with the request.
(3) Related to a deposition. When taking a deposition on oral examination, the proponent of
the question may complete or adjourn the examination before moving for an order.
(4) Detault: notice: protective orders. If a motion to compel is filed and the time for
resistance of that motion has expired without a resistance having been filed. the court may grant
the motion without a hearing.
(5) Sanctions. Any order granting a motion made under this rule shall include a statement that
a failure to comply with the order may result in the imposition of sanctions pursuant to rule
1.517.

(6) Protective order. In ruling on such motion, the court may make such protective order as
it would have been empowered to make on a motion pursuant to rule 1.504(1).
c. Evasive or incomplete answer. For purposes of this rule an evasive or incomplete answer is
to be treated as a failure to answer.
d. Award of expenses of motion.

ill If the motion is granted. or if the disclosure or requested discovery is provided after the
motion was filed. the court shall, after opportunity for hearing, require the party or deponent
whose conduct necessitated the motion or the party or attorney advising such conduct or both of
them to pay to the moving party the reasonable expenses incurred in obtaining the order,
including attorney's fees, unless the court finds that the opposition to the motion was
substantially justified or that other circumstances make an award of expenses unjust.
ill If the motion is denied, the court shall, after opportunity for hearing, require the moving
party or the attorney advising the motion or both of them to pay to the party or deponent who
22

opposed the motion the reasonable expenses incurred in opposing the motion, including
attorney's fees, unless the court finds that the making of the motion was substantially justified or
that other circumstances make an award of expenses unjust.

ill If the motion is granted in part and denied in part, the court may apportion the reasonable
expenses incurred in relation to the motion among the parties and persons in a just manner.
e. Notice to litigants. If the motion is granted, the court shall direct the clerk to mail-serve a
copy of the order to counsel and to the party or parties whose conduct, individually or by
counsel, necessitated the motion.

1.517(3) Failure to disclose. to supplement an earlier response. or to admit.

a. Failure to disclose or supplement. If a party fails to provide information or identify a

witness as required by rule 1.500. 1.503(4). or 1.508(3). the party is not allowed to use that
information or witness to supply evidence on a motion. at a hearing. or at a trial. unless the
failure was substantially justified or is harmless. In addition or instead of this sanction. the court.
on motion or after giving an opportunity to be heard:

(])May order payment of the reasonable expenses. including attorney's fees. caused by the
failure.
(2) May inform the jury of the party's failure.
(3) May impose other appropriate sanctions. including any of the orders listed in rule
1.517(2)(b).
!!.,_Expenses on failure to admit. If a party fails to admit the genuineness of any document or
the truth of any matter as requested under rule 1.51 0, and if the party requesting the admissions
thereafter proves the genuineness of the document or the truth of the matter, the requesting party
may move for an order requiring the other party to pay the reasonable expenses incurred in
making that proof, including reasonable attorney's fees. The court shall make the order unless it
finds any of the following:

tr.ill The request was held objectionable pursuant to rule 1.51 0.

lr.Jll The admission sought was of no substantial importance.
e,Jll The party failing to admit had reasonable grounds to believe that the party might prevail
on the matter.

4ill There was other good reason for the failure to admit.

23

1.517(4) Failure ofparty to attend at own deposition or serve answers to interrogatories or

respond to request for inspection. If a party or an officer, director, or managing agent of a party
or a person designated under rule 1.707(5) to testify on behalf of a party fails:

a. To appear before the officer who is to take the person's deposition, after being served with
a proper notice; or
b. To serve answers or objections to interrogatories submitted under rule 1.509, after proper
service of the interrogatories; or

c. To serve a written response to a request for inspection submitted under rule 1.512, after
proper service of the request, the court in which the action is pending on motion may make such
orders in regard to the failure as are just, and among others it may take any action authorized
under rule 1.517(2)(b)(1), (2), (3), and (5).
d,__The failure to act described in rule 1.517(4) may not be excused on the ground that the
discovery sought is objectionable unless the party failing to act has applied for a protective order
as provided by rule 1.504.
1.517(5) lvfotions relating to discove1y. No motion relating to depositions, discovery. or
discovery sanctions shall mav be filed with the clerk or considered by the court unless the motion
alleges that eel!Hsel far the maviHg f3arty movant has maEle a in good faith slit liHSl!eeessful
attemf3! personally spoken with or attempted to speak with other affected parties in an effort to
resolve the dispute without court action. isst~es raiseEI ay tfie metieR '.Vitfi BflflBSiHg eeHHsel
witfieHt iHterveAtieA sf tfie eeHrt. The certification must identify the date and time of any
conference or attempts to confer.
1.517(6) Electronically stored information. Absent exceptional circumstances, a court may
not impose sanctions under these rules on a party for failing to provide electronically stored
information lost as a result of the routine, good-faith operation of an electronic information
system.
1.517(7) Failure to participate in fiaming a discoverv plan. If a partv or its attorney fails to
participate in good faith in developin!! and submitting a proposed discovery plan as required by
rule 1.507. the court may. after givin!! an opportunity to be heard. require that partv or attorney
to pay to any other party the reasonable expenses. includin!! attorney's fees. that the failure
causes.

DIVISION VII
DEPOSITIONS AND PERPETUATING TESTIMONY

A. DEPOS!TlONS

Rule 1. 701 Depositions upon oral examination.

24

1.701(1) When depositions may be taken.

a. Without leave. After eemmeneement efthe aetien, any Any party may. by deposition upon
oral examination. take the testimony of any person, including a party, without leave of court
except as provided in rule 1.701Cb). The attendance of witnesses may be compelled by subpoena
as provided in rule I. 715. B)' Eleflesitisn tlflen era! enaminatisn.

b. With leave. Leave of court, granted with or without notice, must be obtained eH!y it tl3e
fllaiHtiff seeks ts take a Eleflesitien flFisr ts the el<fliratisn eften Elays after the Elate fer metisn sr
answer fer any ElefenElant, e:<eeflt that lewie is net reEjtlireEI t!nEler any sf the felle.ving
eiret~mstanees:

(]) The parties have not stipulated to the deposition and the party seeks to take the deposition
before the time specified in rule 1.505(]). unless special notice is given as provided in rule
1.701(2): or

a. If a ElefenElaHt has serves a netiee eftaking Eleflesitisn sr stherwise

set~ght

EliseeieF)'.

h. IfsfJeeial nstiee is given as flFeviEleEI in mle 1.7Ql(2)(h);

(2) The parties have not stipulated to the deposition and the deponent has already been
deposed in the case: or
The attenElanee sf witnesses may Be esmflelleEI 8y St!Bfleena as flFeviEleEI in

rt~le

1.715.

ill

Tlle ElefJesitien ef a flersen The deponent is confined in prison may ae taken enly B)' lea-ve
efee1ont en sHell terms as tlle eetlrt flFeseriaes.

Rule 1.708 Conduct of oral deposition.

1. 708(1) Examination; cross-examination; recording examination; administering the oath;
objections; written questions.

a. Examination and cross-examination: recording examination: administering oath.

Examination and cross-examination of witnesses may proceed as permitted at the trial. The
officer before whom the deposition is to be taken shall put the witness under oath and shall
personally, or by someone acting under the officer's direction and in the officer's presence,
record the testimony of the witness. The testimony shall be taken stenographically or recorded by
any other means ordered in accordance with rule 1.701(4). If requested by one of the parties, the
testimony shall be transcribed.

b. Obiections. All objections made at the time of the examination to the qualifications of the
officer taking the deposition, or to the manner of taking it, or to the evidence presented, or to the

25

conduct of any party, and any other objection to the proceedings, shall be noted by the officer
upon the deposition. Evidence objected to shall be taken subject to the objections. An objection
must be stated concisely in a nonargumentative and nonsuggestive manner. A person may
instruct a deponent not to answer only when necessary to preserve a privilege. to enforce a
limitation ordered by the court. or to present a motion under rule 1.708(2).

c. Participating through written questions. In lieu of participating in the oral examination,

parties may serve written questions in a sealed envelope on the party taking the deposition who
shall transmit them to the officer. The officer shall propound them to the witness and record the
answers verbatim.
1. 708(2) Sanction;1.fatien motion to terminate or limit examination.
a. Sanction. The court may impose an appropriate sanction. including the reasonable
expenses and attorney's fees incurred by any party. on a person who impedes. delays. or
frustrates the fair examination of the deponent.
b. Motion to terminate or limit. At any time during the taking of the deposition, on motion of
a party or of the deponent and upon a showing that the examination is being conducted in bad
faith or in such manner as unreasonably to annoy, embarrass, or oppress the deponent or party,
the court in which the action is pending or the court in the district where the deposition is being
taken may order the officer conducting the examination to cease forthwith from taking the
deposition, or may limit the scope and manner of the taking of the deposition as provided in rule
1.504. If the order made terminates the examination, it shall be resumed thereafter only upon the
order of the court in which the action is pending. Upon demand of the objecting party or
deponent, the taking of the deposition shall be suspended for the time necessary to make a
motion for an order. The provisions of rule 1.517(1)(d) apply to the award of expenses incurred
in relation to the motion.

Rule 1.906 Civil trial-setting conference. No later than 9G n_ days after the aetisH is
esmmeHeeeany defendant has answered or appeared, the clerk shall semi provide a notice of
civil trial-setting conference to all parties not in default. The clerk shall use Iowa Court Rule
23.5-Form 1~-lbe Notice of Civil Trial-Setting Conference, to semi provide the notice. The
notice shall schedule a trial-setting conference no lateF earlier than +W 35 days after
esmmeHeemeHt sf the aetisH and no later than 50 days after any defendant has answered or
appeared. The parties are responsible for obtaining a timely trial-setting conference witHiH IQ
B!IJ"S after esmmeHeemeHt sfthe aetisH regardless of whether a party receives notice of the trialsetting conference. Failure to receive notice shall not be grounds to avoid dismissal under rule
1.944. A party may move for an earlier trial-setting conference upon giving notice to all parties.
The court and the parties shall use Iowa Court Rule ?3 .5-Form 2~-tfle- Trial Scheduling Order
and Discovery Plan ts set the trial Elate. If a trial is continued, the court shall set the trial to a
date certain. Unless otherwise ordered, the deadlines established in the trial scheduling order
shall continue to apply to the case.

26

Attachment F

Rule 1.1901-Form 16: Etpedited Civil Action Certification

In the Iowa District Court for

County
Civil case no._ _ _ _ _ _ _ _ _ __

Plaintiff
Full name of Plaintiff: first, middle, last

Expedited Civil Action Certification

vs.

Defendant
Full name ofDeftndant: first, middle, last

Plaintiff, _ _:-:---:-::-:-:--:-::--------- together with Plaintiff's attorney

Name af Plaintiff

----:-:---=------------ elect to bring this lawsuit as an Expedited

Name ofattorney
Civil Action under Iowa Rule of Civil Procedure 1.281.

Plaintiff certifies that the sole relief sought is a money judgment and that all claims (other than
compulsory counterclaims) for all damages by or against any one party total $75,000 or less,
including damages of any kind, penalties, prefiling interest, and attorneys' fees, but excluding
prejudgment interest accrued after the filing date, post judgment interest, and costs.
Plaintiff certifies the following:
1.

I am a plaintiff in this action.

2.

If I am represented by an attorney, I have conferred with my attorney about using the

Expedited Civil Action procedures available to parties in the State of Iowa.

3.

I understand that by electing to proceed under Expedited Civil Action procedures, the
total amount of my recovery will not exceed $75,000, excluding prejudgment interest
accrued after the filing, post judgment interest, and court costs. Additionally, no single
defendant can be liable for more than $75,000 to all plaintiffs combined, excluding
prejudgment interest accrued after the filing, post judgment interest, and court costs.

4.

I understand that if a jury were to award more than $75,000 as damages to me, or if a
jury were to award more than $75,000 in total against a single defendant, the trial
judge would reduce the amount of the judgment to $75,000, plus any applicable
interest and court costs to which I may be entitled.

With this knowledge, I agree to proceed under the Expedited Civil Action procedures.
Dated this _ _ day of _ _ _ _ _ _ , 20__ .

Plaintiff

August 2014

Rule 1.1901-Form 16

Page 1 of2

Rule 1.1901-Fonn 16: E.rpedited Civil Action Certification, continued

Oath and Signatures

I, -::-:-----::-:-:---:-:::::----------' certify under penalty of perjury and pursuant to the
Print Plaintiff's name

laws of the State of Iowa that the preceding is true and correct.

Month

-;:---' 20-::--Day

Handwritten signature of Plaintiff

Year

Full name of Plaintiff: first, middle, last

Plaintiff's attorney's name,

Signature ofattorney,

if applicable

if applicable

Law firm, if applicable

Mailing addr. ofallomey (or Plaintiffif unrepresented)

Telephone no. of attorney (or Plaintiff if unrepresented)

Email address ofallorney (or Plaintiffifunrepresented)

Additional email address,

August 2014

Rule 1.1901-Form 16

if available

Page 2 of2

Attachment G

Rule 1.1901-Form 17: Altemative Expedited Civil Actio11 Certijicatio11

County

In the Iowa District Court for

Civil case no._ _ _ _ _ _ _ _ _ __

Plaintiff

Alternative Expedited Civil Action

Certification for Plaintiffs that Are Not
Natural Persons or Otherwise Must
Act Through a Representative

Full name ofPlaintiff: first, middle, last

vs.

Defendant
Full name ofDefendant: first, middle, fast

Plaintiff,:-:---:::::-:--:-::---------- together with Plaintiff's attorney,

Name of Plaintiff

- : - : - - - - : : - - - - - - - - - - - - - - - - elect to bring this lawsuit as an Expedited

Name ofattorney
Civil Action under Iowa Rule of Civil Procedure 1.281.
Plaintiff certifies that the sole relief sought is a money judgment and that all claims (other than
compulsory counterclaims) for all damages by or against any one party total $75,000 or less,
including damages of any kind, penalties, prefiling interest, and attorneys' fees, but excluding
prejudgment interest accrued after the filing date, post judgment interest, and costs.
The undersigned person certifies the following:
1.

I am the ;:::;-_ _ _ _ _ of Plaintiff in this action. I am duly authorized to execute this

Title

certification.
2.

If Plaintiff is represented by an attorney, I have conferred with that attorney about

using the Expedited Civil Action procedures available to parties in the State of Iowa.

3.

I understand that by electing to proceed under Expedited Civil Action procedures, the
total amount of Plaintiff's recovery will not exceed $75,000, excluding prejudgment
interest accrued after the filing, post judgment interest, and court costs. Additionally,
no single defendant can be liable for more than $75,000 to all plaintiffs combined,
excluding prejudgment interest accrued after the filing, post judgment interest, and
court costs.

4.

I understand that if a jury were to award more than $75,000 as damages to Plaintiff, or
if a jury were to award more than $75,000 in total against a single defendant, the trial
judge would reduce the amount of the judgment to $75,000, plus any applicable
interest and court costs to which Plaintiff may be entitled.

Continued onne:1.t page

August2014

Rule 1.1901-Form 17

Page 1 of2

Rule 1.1901-Fonn 17: Alternative Expedited Civil Action Certification, continued

With this knowledge, Plaintiff agrees to proceed under the Expedited Civil Action procedures.
Dated this __ day o f - - - - - - - - ' 20__.
A1onth

Year

Plaintiff
Name and title of Plaintiff's representative signing
this form

Oath and Signature

I, - - - - = - = - - - - - - - ' certify under penalty of perjury and pursuant to the
Print name of Plaintiff's representative

laws of the State of Iowa that the preceding is true and correct.

Alonth

-=---'
20'-:-:-Day
Year

Handwritten signature of Plaintiff's representative

Full name of Plaintiff's representative

Name of attorney

Signature of attorney

Name of law firm

A1ailing address ofattorney

Telephone number ofattorney

Email address ofattorney

Additional email address,

August2014

Rule 1.1901-Form 17

if available

Page 2 of2

Attachment H

Rule 1.1901-Form 18: Joint Motion to Proceed as an Expedited Civil Action

In the Iowa District Court for

County
Civil case no._ _ _ _ _ _ _ _ _ _ __

Plaintiff
Full name ofPlaintiff: first, middle, last

Joint Motion to Proceed as an

Expedited Civil Action

VS.

Defendant
Full name ofDefendant: first, middle, last

1. Pursuant to Iowa Rule of Civil Procedure 1.281 (1 )(f), the parties hereby move upon
stipulation that this action proceed as an Expedited Civil Action.
2. All parties agree to this motion.

3. If the court grants this joint motion, the parties acknowledge and agree that this case will be
subject to the Expedited Civil Action rule (Iowa R. Civ. P. 1.281 ), except for any limitations
on damages set forth in the rule.

Status of Trial Scheduling Order and Discovery Plan: Check one

The parties have already filed a Trial Scheduling Order and Discovery Plan. This case has
a current trial date of
. The parties
wish to retain that trial date. The parties acknowledge and agree that in the event of any
conflict between the existing Trial Scheduling Order and Discovery Plan and Iowa Rule of
Civil Procedure 1.281, the deadlines in rule 1.281 will apply.

The parties will be filing a Trial Scheduling Order and Discovery Plan in an Expedited Civil
Action case.

I certify that all parties and attorneys to this action have agreed to this Joint Motion and have
been served with a copy.

- - - - - - - _ _ _ , 20_ _
Signed:

liionth

Day

Year

Printed name

__) ________

.A1ailing address
\--

Phone number

August 2014

Party's or attorney's signature

Allorney 's lclll' firm,

City

Email address

Rule 1.1901-Form 18

if applicable
State

ZIP code

Additional email address,

if applicable

Page 1 of1

Attachment I

Rule 1.1901-Form 19: Health Care Provider Statement in Lieu of Testimony

County

In the Iowa District Court for

Civil case no. ____________

Plaintiff
Full name ofPlaintiff: first, middle, last

Health Care Provider Statement in

Lieu of Testimony
(and Attorney Certificate)

VS.

Defendant
Full name ofDefendant:first, middle, last

Patient N a m e : - - - - - - - - - - - - - - - Type of Incident: _ _ _ _ _ _ _ _ _ _ _ _ __

Date of Incident: _ _ _ _ _ _ _ _ _ _ _ _ _ __
Answer the following questions with information and opinions regarding the named patient.

Check this box if you are attaching separate pages for any of your answers to the questions
below. Be sure that the question to which your answer relates appears at the top of each
additional page. Number of additional pages: _ __

1.

What degrees, licenses, and board certifications do you hold, if any, and what year was
each attained? Alternatively, you rnay attach your curriculum vitae.

2.

What injuries, if any, did -::--:-______ sustain in the above-referenced incident?

Patient

3.

Did . , - - - - - - have any pre-existing, symptomatic conditions that were

Patient

aggravated by the injuries sustained in the incident? If so, describe the pre-existing
conditions and the extent of their aggravation .

4.

Did .,------have any pre-existing, non-disabling, non-symptomatic conditions

Patient

that became symptomatic as a result of the incident? If so, describe.

August2014

Rule 1.1 901-Form 19

Page 1 of4

Rule 1.1901-Form 19: Health Care Provider Statement in Lieu of Testimony, continued

5.

What treatment has -::-.,....----- received from you that was necessitated by the
Patient

injuries sustained in the incident? Include treatment provided by other care providers; to
the extent you are aware of such. Include medications prescribed, therapy recommended,
surgery recommended and any other treatments needed as a result of this condition.

6.

Have there been or are there any restrictions or limitations placed on -=--------Patient

due to injuries sustained in the incident? If so, describe them, including the actual or
expected duration of the restrictions or limitations.

7.

Has-::-,.....------ made a full recovery from the injuries sustained in the

Patient

incident? If not, what are your expectations for-::-...,-------- regarding future

Patient

symptoms and the duration of such symptoms?

8.

Is there any additional care or medications that may reasonably be required in the future as
a result of the injuries sustained in the incident? If so, describe the expected care,
including the expected frequency, duration, and cost.

9.

Is-:-.,.------- now susceptible to further health problems in the future as a

Patient

result of injuries sustained in the incident? If so, explain.

10. Is there anything -::-.,....------ has done or failed to do that has aggravated
Patient

his or her condition or impaired his or her recovery? If so, explain.

11. Have you reviewed or relied upon any medical records other than those generated by you
or other providers in your office in forming your opinions to the answers to the questions
above? If so, identify or attach the records that you have reviewed and relied upon in
forming your answers.

August 2014

Rule 1.1901-Form 19

Page 2 of4

Rule 1.1901-Form 19: Health Care Provider Statement in Lieu ofTestimony, continued

12. Have you relied upon any other documents or information about-::-..,-------or
Patient

the incident, other than the records indicated above? If so, state what documents or
information you relied upon, and the manner by which you received it.

Oath and Signature

I, ..,.,.~---,.,..-.,...--------- certify under penalty of pe~ury and pursuant to the
Health care provider's name
laws of the State of Iowa that the preceding is true and correct.

Signed on:

Month

-:::--- 20'-::--Day

Year

Health care provider's signature

Attomey Certificate 011 next page

August 2014

Rule 1.1901-Form 19

Page 3 of4

Rule 1.1901-Form 19: Health Care Provider Statement in Lieu of Testimony, continued

Attorney Certificate
List any oral, written, or electronic communications between you or anyone in your office and
the above-named treating health care provider or anyone in the provider's office regarding
Patient

For each such communication, identify the date of the communication and, if the communication
was written or electronic, attach copies of such communications:

Oath and Signature

I, - - - - - - - - - - - - - - - certify under penalty of pe~ury and pursuant to the
Print attorney's name

laws of the State of Iowa that the preceding is true and correct.

.Month
Handwritten sig11ature

-;:;-- 20--;-;--Day
Year

Information supplied by:

Full name: first, middle, last

Law firm, ifapplicable

}Jailing address
Telephone number
Email address
Additional email address- ifavailable

August2014

Rule 1.1901-Forrn 19

Page4of4

Attachment J

CHAPTER 23
TIME STANDARDS FOR CASE PROCESSING
Rule
Rule
Rule
Rule
Rule

23.1
23.2
23.3
23.4
23.5

Time standards - considerations

Trial scheduling time standards
Estate time standards
Juvenile standards
Forms for implementing time standards
Form I: Notice of Civil Trial-Setting Conference
Form 2: Trial Scheduling Order and Discovery Plan
Form 3: Trial Scheduling Order and Discovery Plan for Expedited
Civil Action

CHAPTER 23
TIME STANDARDS FOR CASE PROCESSING
Rule 23.1 Time standards - considerations. The time standards contained in this chapter
are subject to statutes and rules affecting the same proceedings.
Rule 23.2 Trial scheduling time standards. The time standards commence from the time a
case is filed except in indictable criminal cases where the time shall be measured from date
the trial information or indictment is filed.
23.2(1) Court administration shall schedule cases to commence trial within the following
time standards:
a. lndictable Criminal

6 months

b. Simple Misdemeanors

4 months

c. Expedited Civil Actions

12 months

frd. Torts (all except "complex civil")

18 months

tf..g,_Complex Civil

24 months

~i

12 months

Other Law & Equity

f&- Domestic-Dissolution & Modification

9 months

g,fl. Domestic Abuse

2 months

lr.L. Domestic-All Other

6 months

f.-,LSmall Claims & Infractions

4 months

23.2(2) If a party shows good cause for exceeding the trial time standards in rule 23.2(1), a
court may order an extension of the time for trial to commence using the standards below as
guidelines:

a. Indictable Criminal

12 months

b. Simple Misdemeanors

6 months

c. Expedited Civil Actions

15 months

~d.

24 months

Torts (all except "complex civil")

tf..g,_ Complex Civil

36 months

e-.. Other Law &

Equity

18 months

f&- Domestic-Dissolution & Modification

15 months

g,h. Domestic Abuse

lr.L. Domestic-All Other

i-.,L Small Claims & Infractions

4 months
12 months
8 months

Rule 23.3 Estate time standards. Except for good cause shown, estates opened shall be
closed within the following time standards:
a.

Estates w/o admin. & small

b. Estates with full admin.

I 00% in 6 months
85% in 24 months
100% in 36 months

Rule 23.4 Juvenile standards.

23.4(1) Detention and shelter hearings:
a.

From detention facility admission to hearing

b. From admission to shelter care facility pursuant to Iowa Code section 232.21
court order to hearing

24 hours

48 hours

23.4(2) Pre-adjudicatory hearings for physical and mental health examinations:

a. From court ordered admission to detention or shelter care facility to hearing

15 days

b. From filing, if juvenile is not in detention or shelter care facility, to hearing

30 days

23.4(3) Adjudicatory hearings:

a. From court ordered admission to detention or shelter care facility to hearing

15 days

b. From filing, if juvenile is not in detention or shelter care facility, to hearing

30 days

c. From entry of order for physical or mental examination to hearing

45 days

23.4(4) Dispositional hearings:

a. From entry of adjudicatory order to hearing, if juvenile is:

In a detention or shelter care facility

30 days

Not in a detention or shelter care facility

40 days

b. From court ordered placement for physical or mental examination, following

a delinquency or CINA adjudication, to hearing

60 days

23.4(5) Termination of parental rights (Iowa Code chapter 232):

a. From filing to hearing

b. From filing to disposition

I.

E.\duding; Si!lurday, Sunday, nnd legnl holidays

60 days
5 mos.

Attachment K

Rule 23.5--Form 1: Notice of Civil Trial-Setti11g Co11fere11ce

County

In the Iowa District Court for

No.______________________________
Plaintiff(s) I Petitioner(s)

Notice of Civil Trial-Setting Conference

Full name: first, middle, last

vs.

Use of this form is mandat01y

Defendant(s) I Respondent(s).

Full name:

1rst,

middle, last

To the parties or their attorneys of record:

In accordance with Iowa Rule of Civil Procedure 1.906, notice is hereby given that this case
has been set
0 a.m.
for trial-setting conference on *

. 20_. at _ _.__

Month

Day

Year

D p.m.

Time

before -;;-________________ at ..--"7-----------------------------

Person
Location
*This date shall be no earlier than j j days after and no later than 50 days after any defendant has answered or
appeared unless set sooner by special order on application of one or more parties.

This conference shall be held: Check one

By telephone with the conference call to be initiated by ..,..----,---=c-.--.---;;-Person who will initiate the call

The court administrator will be connected to the call at (-;;-;__.__-{ ---,c:,-...,--,~=cc

Phone number ofcourt administrator

In person.

Attorneys for all parties appearing in the case shall participate at this conference. A party will
participate in person if the party does not have an attorney.
At this trial-setting conference, every case will be set for trial within the time periods provided by
Iowa Court Rules chapter 23, Time Standards for Case Processing.
Prior to the trial-setting conference, the parties must file a Trial Scheduling Order and Discovery
Plan, Iowa Court Rule 23.5-Form 2 (Form 3 for Expedited Civil Actions).
In judicial districts that allow it, the parties may, in lieu of holding a trial-setting conference, first
file their Trial Scheduling Order and Discovery Plan and then, prior to the date scheduled for the
trial-setting conference, obtain a trial date from the court administrator that complies with the
provisions of chapter 23. The date will be entered by the court on the Trial Scheduling Order
and Discovery Plan.
The trial date that is agreed upon at this conference will be a firm date. Continuances will not be
granted, even if all parties agree, unless for a crucial cause that could not have been foreseen.
The clerk of court will notify all counsel of record and parties not represented by counsel.
Dated this _ _ day of
Day

August 2014

, 20_ _ .
Month

Year

Clerk of Court or District Court Administrator

Rule 23.5-Form 1

Page 1 of 1

Attachment L

Rule 23.5--Form 2: Trial Scheduling Order and Discovery Plan

Do not file this form in an Expedited Civil Action case, instead use Form 3.

This form is to be filed within 7 days after the parties' discovery conference and before the trial-setting
conference with the court.

The parties should complete the entire form except as otherwise indicated.

In the Iowa District Court for

County
No. _ _ _ _ _ _ _ _ _ _ _ _ _ __

Trial Scheduling Order and

Discovery Plan

Plaintiff(s) I Petitioner(s)
Full name: first, middle, last

Use of this form is mandatory

Date Petition filed:. _ _..J/-;-;-_ _,/ _ __

mm
dd
JY.Y.!'
Case type: D Law
D Equity D Other
D Judicial Review
0PCR
Trial type: D Jury
D Nonjury

vs.

Defendant(s) I Respondent(s).

Expected trial length:

days
The amount in controversy
exceeds $10,000.
Yes

Full name: first, middle, last

No

Appearances:
Plaintiff(s) I Petitioner(s)

Defendant(s) I Respondent(s)

It is ordered:

1.

Trial Note to parties: Leave this date blank. The court will enter the date after the trial-setting conference.

D a.m.
D p.m.

Trial of this case is set for-;-;---:;----- _ _, 20 _ _, at

Month

Day

Year

Time

in the district court in the courthouse of the county named above.

2.

Pretrial conference Check one. Note to parties:

will enter the date after the trial-setting conference.
A.

If box A is checked, /eone the dote blank. The court

A pretrial conference will be held on

, 20 _ _, at=--
lllonth

Day

Year

Time

Oa.m.
Op.m.

The conference may be held telephonically with prior approval of the court.
B.

3.

A pretrial conference will be held upon request.

New parties
No new parties may be added later than 180 days before trial or---'...,..,...-mm
dd
JY.Y.l'

If you need assistance to participate In court due to a disability, contact the d!sablJity coordinator at:(___)
Persons who are
hearing or speech Impaired may call Relay Iowa TTY {1-B00-735-2942). Disability coordinators cannot provide legal advice. Disability coordinator
contact Information available at: http://www.iowacourts.gov/Adminlstration/Directories!ADA_Access/

August2014

Rule 23.5-Form 2

Page 1 of5

Rule 23.5-Fonn 2: Trial Scheduling Order and Discovery Plan, continued

4.

Transcripts and records

All required agency records or prior criminal transcripts will be filed within 30 days of the date of
this order or by -::::::---_1 ___ 1 ___.
mm
dd
J0,Y

5.

Pleadings
Pleadings will be closed 60 days before trial or ____ I..,.,..__
mm
dd

6.

---

Initial disclosures Check all that apply

A.
B.

C.

D
D
D

The parties have exchanged initial disclosures.

The parties will provide initial disclosures no later than - - - - - - - - - - - - - The parties have stipulated that the following will not be included in initial disclosures:
List items not included

D.

E.

D
D

The parties have stipulated not to provide any initial disclosures.

The following party objects to providing initial disclosures on the following grounds:
Identify the party and state all applicable grounds

7.

Discovery
The parties have held a discovery conference as required by Iowa Rule of Civil Procedure 1.507.
All written discovery will be served no later than 90 days before trial. All depositions will be
completed no later than 60 days before trial. Or, all discovery will be completed by

____ 1...,.,..__ 1___~

mm

dd

m0

Check all that apply

A.
B.

D
D

c. D

E.

D
D

F.

D.

August 2014

No discovery of electronically stored information is expected in this case.

The parties have conferred about discovery of electronically stored information and reached
agreement as set out in Attachment __.
The parties have conferred about discovery of electronically stored information and have
been unable to reach an agreement. If box C is checked, the parties should contact the court to
obtain a hearing date, time, and location, and insert that information below.
Da.m.
A hearing is set for _ _ _ I.,.,.__ _ _ _ at =--- ---0
mm
dd
JY.J,'
' Time
p.m.

at the;;-...,-------- County Courthouse, courtroom-;;---,---.,...---' or

County
Courtroom number

at the following location:---------------------~

The parties have agreed to a discovery plan, and their agreement is set forth in Attachment __.
The parties have agreed to deviate from the limits on discovery otherwise applicable to this
action, and their agreement is set forth in Attachment_.
The parties have agreed to conduct discovery in phases, and their agreement is set forth in
Attachment
Rule 23.5-Form 2

Page 2 of5

Rule 23.5-Fonn 2: Trial Scheduling Order and Discovery Plan, continued

G.

The parties have agreed to an order under Iowa Rule of Evidence 5.502 as set forth in
Attachment

H.

The parties have agreed to an order under Iowa Rule of Civil Procedure 1.504 as set forth in
Attachment

I.

The parties have conferred about a discovery plan and have been unable to reach
agreement on the issues set forth in Attachment __. 1f box I is checked, the parties should
contact the court to obtain a hearing date, time, and location, and insert that information below.
A hearing is set for _ _ _ !..,. _ _ ! _ _ _, at: ;;;;------0 a.m.
mm
dd
Y.Y.v.l'
Time
0 p.m.

8.

n:==:::-c==--' or

at the==:-------- County Courthouse, courtroom

County
Courtroom number

at the following l o c a t i o n : - - - - - - - - - - - - - - - - - - - - - -

Expert Witnesses
A. A party who intends to call an expert witness, including rebuttal expert witnesses, shall certifY to
the court and all other parties the expert's name, subject matter of expertise, and qualifications,
within the following time period, unless the Iowa Code requires an earlier designation date (see,
e.g., Iowa Code section 668.11 ):
(1)

Plaintiff: 210 days before trial or---'--;-;-- _ __

111111
dd
Y.lJQ'

(2)

DefendanUThird Party Plaintiff: 150 days before trial or ___ l_,,---1==-

dd

111111

(3)

)Y.JQI

Third Party Defendant/Others/Rebuttal: 90 days before trial or - - - ' . . , . . . - - _ __

mm
dd

B. Any disclosures required by Iowa Rule of Civil Procedure 1.500(2)(b) will be provided:
Check each that applies
(1)

At the same time the expert is certified.

(2)

According to the following schedule:

a.

Plaintiff:

1-..,-- _ _ __
/11/11

b.

dd

Y.lJQI

DefendanUThird Party Plaintiff:

I
mm

c.

I
dd

Third Party Defendant/Others/Rebuttal:

I
111111

c.

dd

),,"'
I
JY.J'Y

This section does not apply to court appointed experts.

The deadlines listed in paragraphs 5 1 6, 7, and 8 may be amended, without further leave of court, by filing a
Stipulated Amendment to Scheduling Order with the clerk listing the dates agreed upon and signed by all
attorneys and self-represented litigants. Such an Amendment may not override any requirement ofthe Iowa
Court Rules and cannot seJ,,e as a basis for a continuance ofthe trial date or a.ffoct the date for pretrial
submissions.

9.

Pretrial submissions
At least 14 or __ (no more than 7) days before trial, counsel for the parties and self-represented
litigants must:
A. File a witness and exhibit list with the clerk of court, serve a copy on opposing counsel and
self-represented litigants, and exchange exhibits. In electronic cases, witness and exhibit lists
must be electronically filed, and the EDMS system will serve copies on all registered parties.
Exhibits must be electronically submitted in lieu of exchanging them. These disclosures must

August 2014

Rule 23.5-Form 2

Page 3 of 5

Rule 23.5-Form 2: Trial Scheduling Order and Discovery Plan, continued

include lhe following information about the evidence that the disclosing party may present at trial
other than solely for impeachment:
(1)

The name and, if not previously provided, the address, telephone numbers, and electronic
mail address of each witness, separately identifying those the party expects to present and
those the party may call if the need arises.

(2)

The page and line designation of those witnesses whose testimony the party expects to
present by deposition and, if not taken stenographically, a transcript of the pertinent parts of
the deposition.

(3)

An identification of each document or other exhibit, including summaries of other evidence,

separately identifying those items the party expects to offer and those it may offer if the
need arises. The following rules govern exhibits and exhibit lists:
a.

Plaintiff will use numbers and Defendant will use letters. Pretrial exhibit lists will identify
each exhibit by letter or number and description. Exhibits must be marked before trial.

b.

Immediately before commencement of trial, the court must be provided with a bench
copy, and the court reporter with a second copy, of the final exhibit list for use in
recording the admission of evidence.

c.

In nonjury cases, immediately before commencement of trial, parties must provide the
court with a bench copy of all exhibits identified on the exhibit lists.

d.

Within 7 days after the filing of an exhibit list, or within 4 days if the deadline for filing of
the list is less than 10 days before trial, counsel and self-represented litigants must file
with the clerk of court, and serve on each party, any identification, authentication, and
foundation objections to the exhibits listed; otherwise such objections are deemed
waived for trial purposes. In electronic cases, any identification, authentication, and
foundation objections will be electronically filed, and the EDMS system will serve
copies on all registered parties. Electronic filing of these objections must be done
within 7 days of the filing of an exhibit list, or within 4 days if the deadline for filing of the
list is less than 10 days before trial; otherwise, such objections are deemed waived for
trial purposes.

B. File and serve motions in limine, with supporting legal authority.

C. File and serve all proposed jury instructions in a form to be presented to the jury, including a
statement of the case, the stock jury instruction numbers, and verdict forms. The court must be
provided the instructions in written form and electronically.
D. Deliver to the judge and serve a concise trial brief addressing factual, legal, and evidentiary
issues, with citation to legal authorities.

10. Motions
All motions including motions for summary judgment and except motions in limine, must be filed with
the clerk of court's office or electronically filed at https://www.iowacourts.state.ia.us/EFile/ at least 60
days before trial, with copies to the assigned judge.

11. Settlement conference Note to parties: If A or B is checked, leave any date blank. The court will jill in
the settlement conference date after the trial-setting conference.
A.

Month

at the

Oa.m.

, 20_, at""=--

A settlement conference will be held on

Day

Year

Time

Op.m.

County Courthouse.

All parties with authority to settle must be present.

B.

A settlement conference will be held on~~--Month

20
Day'

at
Year'

D a.m.
--0 p.m.

:
Time

at the following l o c a t i o n - - - - - - - - - - - - - - - - - - - - - - - All parties with authority to settle must be present.

August 2014

Rule 23.5-Form 2

Page 4 of5

Rule 23.5-Form 2: Trial Scheduling Order and Discovery Plan, continued

C.

A settlement conference will occur at a date, time, and location arranged by the parties.
All parties with authority to settle must be present.

D.

A settlement conference will be held upon request.

The parties are encouraged to consider alternative dispute resolution including private mediation or
arbitration.

12. Settlements
The parties are responsible for immediately notitying the court administrator of settlement.

13. Late settlement fees

Late settlement fees under Iowa Rule of Civil Procedure 1.909 are applicable.

14. Continuances
Continuances are discouraged and will only be granted for good cause. Motions to continue are
governed by Iowa Rule of Civil Procedure 1.91 0. In the event the trial date is continued, all time
deadlines in this order and stipulated amendments remain in effect relative to the new trial date
unless the court approves new deadlines.

15. Notice
Failure to comply with any of the provisions of this order or an amendment to the scheduling order
may result in sanctions being imposed by the court pursuant to Iowa Rule of Civil Procedure
1.602(5), including limitation and exclusion of evidence and witnesses and payment of costs or
attorney fees. The court will resolve disputes regarding oral agreements on scheduling by reference
to this scheduling order or any written amendments to this order.

The following signature lines are optional

Approved (signed) by counsel/self-represented litigants:
Plaintiff(s) I Petitioner(s)

Defendant(s) I Respondent(s)

Include addresses and te!eplzone numbers

Include addresses and telephone numbers

Original filed with the clerk of court or electronically filed at https://www.iowacourts.state.ia.us/EFile/.

Copies to: counsel of record, self-represented litigants, and court administration.
For questions regarding documents filed with the court in this case, please see
www.judicial.state.ia.us/Online_Court_Services/Online_Docket_Record/ or call the clerk of court.

August2014

Rule 23.5-Form 2

Page 5 of5

Attachment M

Rule 23.5---Form 3: Trial Scheduling Order and Discovery Plan for E:>.pedited Civil Action
Use of this form is mandatory in Expedited Civil Actions under Iowa Rule of Civil Procedure 1.281.

This form is to be filed within 7 days after the parties' discovery conference and before the trial-setting
conference with the court.

The parties should complete the entire fonn except as olherwise indicated.

In the Iowa District Court for

County
No. _ _ _ _ _ _ _ _ _ _ _ _ _ __

Trial Scheduling Order and

Discovery Plan for Expedited
Civil Action

Plaintiff(s) I Petitioner(s)

Full name: first, middle, last

vs.

Date Petition filed: _ _-'/-,-,-_ _ _ __

111111
dd
Y.Y.J:V
Case type: D Law
D Equity
D Other
D
Judicial
Review
DPCR

Defendant(s) I Respondent(s).

Trial type: D Jury

Full name: first, middle, last

D Nonjury

Expected trial length: 2 days

The amount in controversy
Yes
exceeds $10,000.

No

Appearances:
Plaintiff(s) I Petitioner(s)

Defendant(s) I Respondent(s)

1.

Trial Note to parties: Leave this date blank. The court will enter the date after the trial-setting conference.
Trial of this case is set for

D a.m.
D p.m.

_ _ , 20 _ , at
Month

Day

Year

Time

in the district court in the courthouse of the above-named county.

2.

Pretrial conference

Check one. Note to parties:

If box A is checked,

lem'e the date blank. The court

will enter the date after the trial-setting conference.

A. D

A pretrial conference will be held on

20
Month

Day

'

at

Year'

D a.m.
--0 p.m.

:
Time

The conference may be held telephonically with prior approval of the court.

B. D

3.

A pretrial conference will be held upon request.

New parties
No new parties may be added later than 180 days before trial or _ _ _ 1...,..,..__ 1_ _ _ .
111111

dd

Y.JY.Y

If you need assistance to participate in court due to a disability, contact the disability coordinator at:~
Persons who are
hearing or speech impaired may call Relay Iowa TIY (1-800-735-2942). Disability coordlnators cannel provide legal advice. D!sablllly ccordlnalor
contact Information available at: http://www.lowacourts.gov!AdmlnlslralionJD!rectories/ADA_Accessf

August2014

Rule 23.5-Fonn 3

Page 1 of5

Rule 23.5-Fonn 3: Trial Scheduling Order and DiscoveiJ' Plan for Expedited Civil Action, continued

4.

Pleadings
Pleadings will be closed 60 days before trial or _ _ _ _ I
mm

5.

I ___.

~m:v

Initial disclosures. Check all that apply

A.

The parties have exchanged initial disclosures.

B.

D
D

The parties will provide initial disclosures no later than _ _ _ _ _ _ _ _ _ _ _ _ __

C.

The parties have stipulated that the following will not be included in initial disclosures:
List items not included

D.
E.

D
D

The parties have stipulated not to provide any initial disclosures.

The following party objects to providing initial disclosures on the following grounds:
identify the party and state all applicable grounds

6.

Discovery
The parties have held a discovery conference as required by Iowa Rule of Civil Procedure 1.507.
All written discovery will be served no later than 90 days before trial. All depositions will be
completed no later than 60 days before trial. Or, all discovery will be completed by
_ _ _ l~dd~
mm
Y.l:Y.l'
Check all that apply and attach any appropriate exhibits

A.
B.

D
D

No discovery of electronically stored information is expected in this case.

The parties have conferred about discovery of electronically stored information and reached
agreement as set out in Attachment __.

C.

The parties have conferred about discovery of electronically stored information and have
been unable to reach an agreement. fj box C is checked, the parties should contact the court to
obtain a hearing date, time, and location, and insert that information below.
A hearing is set for _ _ _ I~ _ _ I _ _ _, at:~-- ___ D a.m.
111111
dd
Y.l:Y.I'
Time
0 p.m.

at t h e = - - - - - - - - - County Courthouse, courtroom.----.,---- or

County
Courtroom number

at the following l o c a t i o n : - - - - - - - - - - - - - - - - - - - - - -

The parties have agreed to a discovery plan, and their agreement is set forth in Attachment_.

E.

D
D

F.

The parties have agreed to conduct discovery in phases, and their agreement is set forth in
Attachment __.

G.

The parties. have agreed to an order under Iowa Rule of Evidence 5.502 as set forth in
Attachment

H.

The parties have agreed to an order under Iowa Rule of Civil Procedure 1.504 as set forth in
Attachment __.

0.

August2014

The parties have agreed to deviate from the limits on discovery otherwise applicable to this
action, and their agreement is set forth in Attachment_.

Rule 23.5-Fonn 3

Page 2 of5

Rule 23.5-Form 3: Trial Scheduling Order and Discovery Plan for Expedited Civil Action, continued

I.

The parties have conferred about a discovery plan and have been unable to reach
agreement on the issues set forth in Attachment __. If box I is checked, the parties should

contact the court to obtain a hearing date, time, and location, and insert that iriformalion below.
A hearing is set for

dd

YJY.l'

mm

7.

D a.m.
D p.m.

, at:
Time

at the ,--,--------County Courthouse, courtroom-.,..----.,.-----' or

at the following l o c a t i o n : - - - - - - - - - - - - - - - - - - - - - -

County

Courtroom number

Health Care Provider Statement

Unless otherwise stipulated or ordered by the court, a copy of any completed Health Care
Provider Statement in Lieu of Testimony, Iowa R. Civ. P. 1.281 (4)(g)(3), must be served on all
parties at least 150 days before trial. Any objection to the Health Care Provider Statement must
be filed with the court, together with a copy of the statement, within 30 days after receipt of the
statement.

B.

Expert Witnesses
A. A party who intends to call an expert witness, including rebuttal expert witnesses, must certify to
the court and all other parties the expert's name, subject matter of expertise, and qualifications,
within the following time period, unless the Iowa Code requires an earlier designation date (see,
e.g., Iowa Code section 668.11 ):

(1)

Plaintiff: 210 days before trial or

mm

!_ __
dd

J:lry:v

(2)

Defendant/Third Party Plaintiff: 150 days before trial or ___ !---;-;-- --~
mm
dd
Y.Y.J~'

(3)

Third Party Defendant/Others/Rebuttal: 90 days before trial or =--I.,.,_ _ I _ _ _.

mm
dd
JY.JY

B. Any disclosures required by Iowa Rule of Civil Procedure 1.500(2){b) will be provided:
Check each that applies
(1)

At the same time the expert is certified.

(2)

According to the following schedule:

a.

Plaintiff:

I
llllll

b.

dd

Y.m'

Defendant/Third Party Plaintiff:

I
111111

c.

dd

Third Party Defendant/Others/Rebuttal: _ _ _ !-,-,-_ _ _ __

111111

dd

):Jryryl

C. This section does not apply to court appointed experts.

The deadlines listed in paragraphs 4, 5, 6, 7, and 8 may be amended, without further leave ofcourt, by filing
a Stipulated Amendment to Scheduling Order with the clerk listing the dates agreed upon and signed by all
counsel and self-represented litigants. Such an Amendment may not override any requirement of the Iowa
Court Rules and cannot senre as a basis for a continuance ofthe trial date or affect the date for pretrial
submissions.

9.

Pretrial submissions
At least 14 or __ (no more than 7) days before trial, counsel for the parties and self-represented
litigants must:
A. File a witness and exhibit list with the clerk of court, serve a copy on opposing counsel and
self-represented litigants, and exchange exhibits. In electronic cases, witness and exhibit lists

August2014

Rule 23.5-Form 3

Page 3 of 5

Rule 23.5-Fonn 3: Trial Scheduling Order and Discovery Plan for &rpedited Civil Action, continued

must be electronically filed, and the EDMS system will serve copies on all registered parties.
Exhibits must be electronically submitted in lieu of exchanging them. These disclosures must
include the following information about the evidence that the disclosing party may present at trial
other than solely for impeachment:
(1)

The name and, if not previously provided, the address, telephone numbers, and electronic
mail address of each witness, separately identifying those the party expects to present and
those the party may call if the need arises.

(2)

The page and line designation of those witnesses whose testimony the party expects to
present by deposition and, if not taken stenographically, a transcript of the pertinent parts of
the deposition.

(3)

An identification of each document or other exhibit, including summaries of other evidence,

separately identifying those items the party expects to offer and those it may offer if the
need arises. The following rules govern exhibits and exhibit lists:
a.

Plaintiff will use numbers and Defendant will use letters. Pretrial exhibit lists will identify
each exhibit by letter or number and description. Exhibits must be marked before trial.

b.

Immediately before commencement of trial, the court must be provided with a bench
copy, and the court reporter with a second copy, of the final exhibit list for use in
recording the admission of evidence.

c.

In nonjury cases, immediately before commencement of trial, parties must provide the
court with a bench copy of all exhibits identified on the exhibit lists.

d. Within 7 days after the filing of an exhibit list, or within 4 days if the deadline for filing of
the list is less than 10 days before trial, counsel and self-represented litigants must file
with the clerk of court, and serve on each party, any identification, authentication, and
foundation objections to the exhibits listed; otherwise such objections are deemed
waived for trial purposes. In electronic cases, any identification, authentication, and
foundation objections must be electronically filed, and the EDMS system will serve
copies on all registered parties. Electronic filing of these objections must be done
within 7 days of the filing of an exhibit list, or within 4 days if the deadline for filing of the
list is less than 10 days before trial; otherwise, such objections are deemed waived for
trial purposes.

B. File and serve motions in limine, with supporting legal authority.

C. File and serve a complete set of joint jury instructions and verdict forms, in a form to be
presented to the jury or judge, including a statement of the case and any stock jury instruction
numbers. If there is any disagreement about an instruction or verdict form, each side must
include its specific objections, supporting authority, and a proposed alternative instruction or
verdict form for the court's approval. The court must be provided the instructions in written form
and electronically.
D. Deliver to the judge and serve a concise trial brief addressing factual, legal, and evidentiary
issues, with citation to legal authorities.

10. Motions
All motions including motions for summary judgment and except motions in limine, must be filed with
the clerk of court's office or electronically filed at https://www.iowacourts.state.ia.us/EFile/ at least 90
days before trial, with copies to the assigned judge.

11. Settlements
The parties are responsible for immediately notifying the court administrator of settlement.

August 2014

Rule 23.5-Form 3

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Rule 23.5-Form 3: Trial Scheduling Order and Discovery Plan for Expedited Civil Action, continued

12. Late settlement fees

Late settlement fees under Iowa Rule of Civil Procedure 1.909 are applicable.

13. Continuances
Continuances are discouraged and will only be granted for good cause. Motions to continue are
governed by Iowa Rule of Civil Procedure 1.91 0. In the event the trial date is continued, all time
deadlines in this order and stipulated amendments remain in effect relative to the new trial date
unless the court approves new deadlines.

14. Notice
Failure to comply with any of the provisions of this order or an amendment to the scheduling order
may result in sanctions being imposed by the court pursuant to Iowa Rule of Civil Procedure
1.602(5), including limitation and exclusion of evidence and witnesses and payment of costs or
attorney fees. The court will resolve disputes regarding oral agreements on scheduling by reference
to this scheduling order or any written amendments to this order.

The following signature lines are optional

Approved (signed) by counsel/self-represented litigants:
Plaintiff(s) I Petitioner(s)

Defendant(s) I Respondent(s)

Include addresses and telephone numbers

Include addresses and telephone numbers

Original filed with the clerk of court or electronically filed at https://www.iowacourts.state.ia.usiEFilel.

Copies to: counsel of record, self-represented litigants, and court administration.
For questions regarding documents filed with the court in this case, please see
www.judicial.state.ia.usiOnline_Court_ServicesiOnline_Docket_Recordl or call the clerk of court.

August 2014

Rule 23.5-Form 3

Page 5 of5

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

LITIGATION TRACK
Criminal Law Update
2:15 p.m.- 3:15 p.m.
Presented by
Meredith Rich-Chappell
Kids First Law Center
420 6th Street SE Suite 160
Cedar Rapids, Iowa 52401
Phone: (319) 365-5437

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Criminal Law Update

ISBA Nuts and Bolts Seminar
October 30, 2014
This first part of this outline is organized according to when the particular issue addressed arises
in criminal cases, beginning with issues that arise in motions to dismiss and motions to suppress,
then issues related to proving certain offenses at trial and concluding with issues arising at
sentencing. The second part of the outline discusses the importance of making arguments under
the Iowa Constitution and provides an overview of the growing body of law the Iowa Supreme
Court has created by thrust[ing] [itself] into a position of prominence in the struggle to protect
the people of our nation from governmental intrusions on their freedoms. State v. Baldon, 829
N.W.2d 785, 790 (Iowa 2013). I have also included at the end of the outline a chart summarizing
the main procedural and statutory deadlines that govern the practice of criminal law in Iowa.
I.

Pre-Trial Motions
Iowa Rule of Criminal Procedure 2.11(2)
Any defense, objection, or request which is capable of determine without the trial of
the general issue may be raised before trial by motion. The following must be raised
prior to trial:
....
b. Defenses and objections based on defects in the indictment or information
A. Motion to DismissSpeedy Indictment
Iowa R. Crim. Pro. 2.33 Dismissal of prosecution; right to speedy indictment
When an adult is arrested for the commission of a public offense, or, in the case of a
child, when the juvenile court enters an order waiving jurisdiction . . . and an
indictment is not found against the defendant within 45 days, the court must order the
prosecution to be dismissed, unless good cause to the contrary is shown or the
defendant waives the defendants right thereto.
1. Delay between arrest and indictment/filing of trial information
Iowa Code 804.5
Arrest is the taking of a person into custody when and in the manner
authorized by law, including restraint of the person or the persons submission
to custody.

Iowa Code 804.14(1)

A person making an arrest must inform the person to be arrested of the
intention to arrest the person, the reason for arrest, and that the person making
the arrest is a peace officer, if such be the case, and require the person being
arrested to submit to the persons custody, except when the person to be
arrested is actually engaged in the commission of or attempt to commit an
offense, or escapes, so that there is no time or opportunity to do so.
State v. Wing, 791 N.W.2d 243 (Iowa 2010)
If officer does not specifically tell someone he is or is not under arrest, or in
other words does not comply with Iowa Code 804.14(1), then the Court
looks to whether a reasonable person in defendants position would have
believed an arrest occurred.
Not all seizures by law enforcement officers constitute an arrest. For example,
being seized for purposes of Fourth Amendment is not the same as being
under arrest for purposes of the speedy trial rights contained in Iowa R. Crim.
Pro. 2.33.
What factors did the Iowa Supreme Court consider in determining whether a
reasonable person in defendants position would believe be he or she had been
arrested? Did the officer manifest a purpose to arrest?

What was the suspect told or not told about status? Told that he or she was
under arrest?
Has the suspect been handcuffed or booked?
Has the suspect been transported by officers to a different location?
Has the suspect submitted to officers show of authority?
NOTE: The Court determined that an officers subjective intent is not
part of the reasonable person analysis

What role do cooperation agreements play in the reasonable person analysis?

Did officers discuss details of cooperation agreement?

Did the suspect know what was expected of him or her in agreement?
Did officers and suspect complete written cooperation agreement?
Did the agreement contain language stating the person is not under arrest?
Length of delay in seeking arrest warrant

Court suggests that language of cooperation agreement could be specific

enough to be factor in determination that a reasonable person would not
believe he or she was under arrest.

Obtaining arrest warrant within 45 days of event does not toll the 45 days for
speedy indictment rule of Iowa R. Crim. Pro. 2.33.
2. An arrest for one crime is not an arrest for all crimes arising out of the same
incident.
State v. Miller, 818 N.W.2d 267 (Iowa Ct. App. 2012)
Court of Appeals affirmed that Wing did not change the rule that an arrest for
an indictable public offense, which triggers the start of the 45-day speedy
indictment rule, does not extend to other indictable offenses, arising from the
same circumstances, which could have but did not result in an arrest. In other
words, the Courts speedy indictment precedents do not require law
enforcement to make an arrest based on every crime for which they possess
probable cause.
In cases in which another offense is charged out of the same incident, the
court looks to the totality of the circumstances, including the defendants
actions and officers responses, to determine if a reasonable person would
believe he or she was under arrest for the later-charged offense.
3. When an officer makes an arrest for one public offense and later charged the
defendant with an indictable offense arising out of same incident, the Court
will determine whether the stated reason for arrest was valid as part of the
reasonable person analysis.
State v. Penn-Kennedy, No. 13-1615 (Iowa Ct. App. Sept. 17, 2014)
A reasonable person would not believe he or she was under arrest for public
intoxication when facts known to officer only gave him reasonable cause to
believe that defendant committed the offense of operating while intoxicated. If
the officer, in fact, did not have reasonable cause to believe that the defendant
was intoxicated in public, a reasonable person subjected to field sobriety tests
and invocation of implied consent could believe that he or she was under
arrest for operating while intoxicated.
B. Motions to SuppressInvestigatory (Terry) Stops
1. Anonymous Tips of Driving Behavior
Navarette v. California, 572 U.S. ____ (2014)
Unnamed caller reported that a red truck with specific license plate ran her off
the road. Officer responded to the call, found a truck matching callers
3

description, and made a traffic stop. Search of the truck located 30 pounds of
marijuana.
United States Supreme Court held that information provided in this
anonymous tip supported Terry stop. Tip had accurate indicia of reliability
based on the specific details provided by the 911 caller and the nature of the
call:

a description of the vehicles make, model, color, license plate, by which

the caller necessarily claimed eyewitness knowledge of the alleged
dangerous driving
the contemporaneous nature of the dangerous driving behavior and the
report to 911officers located the vehicle approximately 19 highway
miles south of the location reported in the 911 call approximately 18
minutes after the 911 call
Modern 911 calls have features that allow officers to trace and identify
callers that reduce the chance of false reports

Court also considered danger to public safety and limited nature of intrusion
during a Terry stop.
Court cited State v. Walshire, 634 N.W.2d 625 (Iowa 2000) as example of
case with similar facts and similar conclusions.
State v. Kooima, 833 N.W.2d 202 (Iowa 2013)
The Iowa Supreme Court decided this case under the Fourth Amendment, not
the Iowa Constitution, but noted that even where a party has not advanced a
different standard for interpreting a state constitutional provision, we may
apply the standard more stringently than federal caselaw.
Four-justice majority held that the information provided by caller, which it
described as a bare assertion by an anonymous tipster did not possess
requisite indicia of reliability because
caller did not relay[] to the police a personal observation of erratic
driving;
caller did not provide other facts to indicate driver was intoxicated; and
caller did not provide details not available to the general public as to the
defendants future actions.
The majority was also concerned about potentially malicious false reports.

Three-justice dissent disagreed, noting that caller gave specific location of

vehicle, specific description of vehicle, described specific behavior, noted that
people in vehicle had been at a golf outing, all of which supported an
inference that the caller had personally observed the occupants of the vehicle.
By the time of the stop, officers corroborated what 911 caller predicted: silver
Suburban, with several occupants, same license plate and registered to
company identified by the caller, arrived in Rock Valley coming from
direction of Doon. Callers description and officers corroboration established
indicia of reliability necessary to create reasonable suspicion. Dissenting
justices also rejected majoritys concern that 911 calls can be used to harass
people by providing false information, noting ability to identify 911 callers
and criminal penalties for providing false information.
2. Motions to SuppressSearch Warrants and Exceptions to Warrant
Requirement
Iowa Rule of Criminal Procedure 2.11(2)
Any defense, objection, or request which is capable of determine without the
trial of the general issue may be raised before trial by motion. The following
must be raised prior to trial:
....
c. Motions to suppress evidence on the ground that it was illegally
obtained including, but not limited to, motions on any ground listed in rule
2.12
Iowa Rule of Criminal Procedure 2.12 Suppression of evidence obtained
by an unlawful search and seizure
(1) Motion to Suppress Evidence. A person aggrieved by an unlawful search
and seizure may move to suppress for use as evidence anything so
obtained on any of the following grounds:
a. The property was illegally seized without a warrant. [No valid
exception to the warrant requirement]
b. The warrant is insufficient on its face.
c. The property seized is not described in the warrant. [Seized item
was not authorized by the warrant/was outside the scope of the
warrant]
d. There was not probable cause for believing the existence of the
grounds on which the warrant was issued. [Facts and inferences
taken from those facts do not establish probable cause]
5

e. The warrant was illegally executed.

1. The property was illegally seized without a warrant.
a. Exigent circumstances: officer safety and destruction of evidence
State v. Watts, 801 N.W.2d 845 (Iowa 2011)
Concerns for officer safety and potential destruction of evidence can
constitute exigent circumstances, but these concerns must be based on
information known to officers, as well as reasonable inferences therefrom,
rather than on possibilities or assumptions
FIRST ALTERNATIVETHREAT TO OFFICERS
Protective sweep = quick and limited search of premises, incident to an
arrest and conducted to protect the safety of police officers or others,
including cursory inspection of places a person might hide

Must have articulable facts which, taken together with the rational
inferences from those facts, would warrant a reasonably prudent
officer to believe the area contains a person who is a threat

The Court found there was no evidence that would lead the officer to
believe that anyone else was in apartment. The possibility that there
could have been another person inside apartment is not, by itself,
enough to allow a warrantless protective sweep. The State must be able
to point to some specific reason as to why officer thought someone else
was in the residencei.e., officers heard another persons voice from
inside, saw another person inside the residence
SECOND ALTERNATIVEGUARDING AGAINST DESTRUCTION
OF EVIDENCE

Officers must have specific and articulable facts, along with rational
inferences from those facts, that would lead a reasonably prudent
officer to believe that there will be immediate removal or
destruction of evidence

The Court found that there was no identifiable reason for officer to believe
that any drugs inside of apartment would be destroyed. The Court rejected
the States argument that the possibility that the driver who told officers
about Watts could have called Watts and tipped him off to destroy
marijuana created exigency.

The Court also rejected exigency rationale because (1) Watts was detained
and handcuffed outside of his apartment when officers entered; and (2)
marijuana is not inherently dangerous and does not in and of itself create
exigency.
Court excised from search warrant affidavit information obtained during
protective sweep (officers observations of marijuana, packaging materials
and bong). Ultimately the Court held that drugs seized pursuant to the
search warrant still admissible because the remaining information in the
search warrant affidavitofficer who had training and experience in
identifying marijuana smelled overwhelming odor of marijuana coming
from apartmenton its own, established probable cause to believe that a
controlled substance would be found in the apartment.
b. Voluntary Consent
State v. Pals, 805 N.W.2d 767 (Iowa 2011)
Iowa Supreme Court held that search of vehicle that located marijuana
after traffic stop for a dog-at-large call was not voluntary under Article I,
Section 8 of the Iowa Constitution.
Sub-issue: What is the test for voluntariness?
Under Article I, Section 8 of the Iowa Constitution is an officer required to
tell a person that he or she can refuse to consent to a search in order for
consent to be voluntary? Court leaves the answer for that question for
another day. The Court uses the totality of the circumstances to
conclude that Pals consent was not voluntary
Factors Court considered in concluding consent was not voluntary:

Deputy subjected Pals to pat-down search, including emptying his

pockets, before detaining Pals in patrol vehicle when there was no
evidence that Deputy detected danger from Pals. This pat down
search projected authority over Pals.

Pals sat in the front seat of a patrol vehicle when he consented to the
search of his truck, rather than in a public area or his home. The Court
found that the setting of a traffic stop on a public road is inherently
coercive. The Court is willing to assume that police are exerting
authority in a fashion that makes it likely that a citizen would not feel
free to decline to give consent for a search even though the search is
unrelated to the rationale of the original traffic stop.

Deputy never told Pals that he was free to leave or that he could refuse
consent without retaliation. If the officer notified Pals that he could
leave or decline to give consent it would significantly neutralize
coercive setting.

Deputy did not tell Pals that stop was over before he asked for consent
to search.

Deputy conveyed impression that Pals may receive more favorable

treatment if he consented.

State v. Baldon, 829 N.W.2d 785 (Iowa 2013)

Standard provision in parole agreement that provides the parolee will
submit his or her person, property, place of residence, vehicle, personal
effects to search at any time, with or without a search warrant, warrant of
arrest or reasonable cause by any parole officer or law enforcement
officer does not constitute voluntary grant of consent and is therefore not
a valid exception to the warrant requirement.
[O]ur concern when presented with a search-and-seizure claim in the
context of contractual consent is that the consent promised under the
contract be voluntary. Baldon, 829 N.W.2d at 792.
The Court focused on a potential parolees lack of bargaining power and
lack of free will in entering a parole agreement. The majority discounted
the reasoning of the majority of courts in other jurisdictions and relied on
Justice Stevens dissenting opinion in Samson v. California, 547 U.S. 843,
863 (2006) and Justice Kennedys concurring opinion in Ferguson v. City
of Charleston, 532 U.S. 67, 90-91 (2001) as well as Wayne R. LaFaves
Search and Seizure treatise in holding that consent obtained as a necessary
condition of a parole agreement is not voluntary consent.
c. Special Needs Exception/Community Caretaking
State v. Kern, 831 N.W.2d 149 (Iowa 2013)
Iowa Supreme Court suggested, without specifically deciding, that the
need to maintain Iowas parole system is not a special need
sufficient to support warrantless search of a parolees residence. Even if
the Court recognized the special needs doctrine under Article I, section 8
of the Iowa Constitution, it would not apply in Kern because the search
was instigated and dominated by the needs and interests of law
enforcement rather an a search by a parole officers consistent with the
parole mission, and there was nothing about the search that showed the
8

warrant requirement was impractical or frustrated the governments

purpose behind the search.
The Court also rejected the search a part of a community caretaking
function because search was part of investigation and collection related to
criminal activity. Officers caretaking function and assistance ended when
officers removed children from the home.
2. There was not probable cause for believing the existence of the grounds on
which the warrant was issued.
State v. Fleming, 790 N.W.2d 560 (Iowa 2010)
The Iowa Supreme Court rejected community-living exception to
particularized suspicion requirement for search warrants, holding that a person
who has an individual bedroom in apartment has a reasonable expectation of
privacy in that room.
Search warrant application for multi-room dwelling must contain information
connecting criminal activity to each room or area to be searched.
Must have specific information linking resident/occupier of bedroom to drug
possession/dealing to obtain valid search warrant for specific bedroom. The
State did not present any evidence to indicate that anyone else who lived in
house who was involved in possessing drugs had access to Flemings room
Even though Flemings room was included in search warrant as a place to be
searched, there was not sufficient evidence to connect his particular room with
criminal activity
II.

Trial Issues
A. Sufficient Evidence of Possession
State v. Thomas, ____ N.W.2d ____, No. 121491 (Iowa May 30, 2014)
The most recent case to address what constitutes sufficient evidence of possession
when item not found on the defendants person. Summarizes the Iowa Supreme
Courts analysis of actual and constructive possession cases and concludes that
circumstantial evidence was sufficient to support finding that Thomas possessed the
drugs found in the same room where he was located.
B. Lesser-Included Offenses: Escape and Absence from Custody
State v. Miller, 841 N.W.2d 583 (Iowa 2014)
The Court reversed many years of precedent, holding that absence from custody, a
serious misdemeanor, is a lesser-included offense of escape, a Class D felony.
9

The final element of absence from custodydefendant was knowingly and

voluntarily absent from a place the defendant was required to be sufficiently matches
the final element of escapedefendant intentionally left the [correctional] facility
without consent because a person cannot intentionally leave a place without also
being voluntarily absent.
C. Evidence: Admission of Certified Driving Records
State v. Kennedy, 846 N.W.2d 517 (Iowa 2014)
Admission at trial of certified abstract of defendants DOT driving record does not
violate Confrontation Clause because it is merely a historical report of information
already contained in DOT records, and is not testimonial.
III.

Sentencing Issues
A. Mandatory Minimum Sentences for Offenses Committed as a Juvenile
Iowa Constitution Article I, Section 17
Excessive bail shall not be required; excessive fines shall not be imposed, and cruel
and unusual punishment shall not be inflicted.
United States Constitution, Eighth Amendment
Excessive bail shall not be required, nor excessive fines imposed, nor cruel and
unusual punishments inflicted.
State v. Null, 836 N.W.2d 41 (Iowa 2013)
[A]rticle I, section 17 of the Iowa Constitution, requires a district court sentencing
juveniles as adults to consider mitigating circumstances, including the distinctive
qualities of youth when determining whether to sentence juvenile to mandatory
minimum sentences before they are eligible to be considered for parole.
Mansfield, J. (concurring in part and dissenting in part)
[W]e have said in various contexts that we may applyor will apply
provisions of our constitution more stringently than corresponding
provisions of the United States Constitution. See, e.g., State v. Kooima, 833
N.W.2d 202, 206 (Iowa 2013); State v. Oliver, 812 N.W.2d 636, 650 (Iowa
2012); State v. Pals, 805 N.W.2d 767, 772 (Iowa 2011); [State v.] Bruegger,
773 N.W.2d at 883.
While I wholeheartedly agree we have the ultimate authority to interpret the
Iowa Constitution, I have misgivings about these kinds of statements. We are
10

all judges who seek to apply the law neutrally and fairly as we understand it.
To say we apply the Iowa constitution more stringently is to import a valueladen terminology into our opinions. Stringent is not a term that helps one
decide a particular case; it describes instead a mindset or outlook. It is like
saying, We are more protective of rights than the United States Supreme
Court, or depending on your perspective, We are more willing than the
United States Supreme Court to overturn the decisions of the people's elected
representatives.
State v. Lyle, ____ N.W.2d ____, No. 111339 (Iowa July 18, 2014)
A statue requiring a prison sentence for juvenile offenders without opportunity for
parole until a minimum period of time has been served is cruel and unusual
punishment under article I, section 17 of the Iowa Constitution.
Article I, section 17 of the Iowa Constitution forbids a sentencing schema for
juvenile offenders that deprives the district court the discretion to consider youth and
its attendant circumstances as a mitigating factor and to impose a lighter punishment,
including one that suspends all or part of the sentence, including any mandatory
minimum.
The Iowa Supreme Court used the federal analytical framework in deciding Lyle,
but ultimately used [its] judgment in giving meaning to [the Iowa Constitutions]
prohibition against cruel and unusual punishment in reaching [its] conclusion.
IV.

Independent Analysis under the Iowa Constitution

Iowa ConstitutionArticle 1, section 8
The right of the people to be secure in their persons, houses, papers and effects, against
unreasonable seizures and searches shall not be violated; and no warrant shall issue but
on probable cause, supported by oath or affirmation, particularly describing the place to
be searched, and the persons and things to be seized.
A. Differences Between Fourth Amendment and Article I, Section 8
1. Comma v. Semi-Colon
Fourth Amendment: reasonableness clause is separated from warrant clause by a
comma
Article I, Section 8: reasonableness clause is separated from warrant clause by a semicolon
11

2. Ordering of search and seizure

Fourth Amendment: right of the people to be secure . . . against unreasonable
searches and seizures
Article I Section 8: right of the people to be secure . . . against unreasonable
seizures and searches
3. Warrants v. warrant
Fourth Amendment: no warrants shall issue but on probable cause
Article I Section 8: and no warrant shall issue but on probable cause
B. Relationship between Fourth Amendment and Article I, Section 8
State v. Ochoa, 792 N.W.2d 260, 267 (Iowa 2010)
In order to resolve any inconsistency in our prior cases, we now hold that,
while United States Supreme Court cases are entitled to respectful
consideration, we will engage in independent analysis of the content of our
state search and seizure provisions. A Fourth Amendment opinion of the
United States Supreme Court, the Eighth Circuit Court of Appeals, or any
other federal court is no more binding upon our interpretation of article I,
section 8 of the Iowa Constitution than is a case decided by another state
supreme court under a search and seizure provision of that state's
constitution. The degree to which we follow United States Supreme Court
precedent, or any other precedent, depends solely upon its ability to
persuade us with the reasoning of the decision. When both federal and
state constitutional claims are raised, we may, in our discretion, choose to
consider either claim first in order to dispose of the case, or we may
consider both claims simultaneously.
B. Ochoa Factors
The Iowa Supreme Court set forth seven factors it analyzes when considering whether
to depart from United States Supreme Court precedent:
Text of the federal and state constitutional provisions
History of the constitutional provisions
Contemporaneous discussions
United States Supreme Court precedents
12

Similar cases in other states

Precedents under the Iowa Constitution
Academic commentary

Ochoa, 792 N.W.2d 268-87.

C. Future Issues Under the Iowa Constitution
1. Must officers inform a person that he or she has a right to refuse requested
consent to search in order for a subsequent consent search to be voluntary?
2. Must officers have a search warrant, or be acting under a recognized exception to
the warrant requirement, to conduct a dog sniff in the common areas of a multiunit building?
3. Does the special needs exception to the warrant requirement support a warrantless
search of a parolees person or residence when it is conducted by a parole officer
to maintain and further the goals of Iowas parole system?

13

Timeline of a Criminal Case

Event
Arrest (with/without warrant)
Initial Appearance
Trial Information

Arraignment

Motion for Bill of Particulars

Pre-Trial Motions
(Motions to dismiss, motions
to suppress)

Notices of Defendant
(alibi, insanity and diminished
responsibility, intoxication,
entrapment, self-defense)

Time Standard

Rule of Criminal
Procedure/Case Law

without unnecessary delay

which means within 24 hours
45 days from an arrest for a
commission of a public
offense or, for juvenile, entry
of waiver order by juvenile
court
as soon as practicable but
must occur after trial
information filed
A motion for a bill of
particulars may be made any
time prior to [after trial
information filed] or within
ten days after arraignment
unless the time be extended by
the court for good cause
shown.
shall be filed when the
grounds therefore reasonably
appear but no later than 40
days after arraignment

Iowa R. Crim. Pro. 2.2(1)

Failure of the defendant to

timely raise defenses or
objections . . . which must be
made prior to trial . . . shall
constitute waiver thereof, but
the court, for good cause
shown, may grant relief from
such waiver
within the time provided for
making/filing of pre-trial
motions
If either party fails to abide
by the time periods . . .
described, such party may not
offer evidence on the issue of
alibi, insanity, diminished
responsibility, intoxication,
14

Iowa R. Crim. Pro. 2.33(2)

Iowa R. Crim. Pro. 2.8

Iowa R. Crim. Pro. 2.11(5)

Iowa R. Crim. Pro. 2.11(4)

Iowa R. Crim. Pro. 2.11(3)

Iowa R. Crim. Pro.

2.11(11)(a-c)

Iowa R. Crim. Pro. 2.11(d)

Depositions of State
Witnesses

Notice of Defense Witnesses

entrapment, or self-defense
without leave of court for
good cause shown
shall be taken within 30 days
after arraignment unless the
period for taking is extended
by the court for good cause
shown
At or before the time of the
taking of a deposition by the
defendant . . . the defendant
shall file a written list of the
names and addresses of all
witnesses expected to be
called for the defendant
(except defendant) . . . . Such
witnesses shall be subject to
being deposed by the State

If the defendant has taken

depositions under rule 2.13(1)
and does not disclose to the
[State] all of the defense
witnesses (except defendant)
at least nine days before trial,
the court can order a
deposition, continue the trial
or order the exclusion of that
witnesss testimony
Speedy Trial
Within 90 days after filing of
trial information unless
defendants waives right to
speedy trial or court find good
cause for delay
Right to Trial within One Year
All criminal cases must be
brought to trial within one
year after the defendants
initial arraignment . . . unless
an extension is granted by the
court, upon a showing of good
cause [or defendants waiver]
Waiver of Jury Trial
within 30 day after
arraignment . . . [or] within ten
days of completion of
discovery, but not later than
ten days prior to the date set
15

Iowa R. Crim. Pro. 2.13(6)

Iowa R. Crim. Pro. 2.13(3)

Iowa R. Crim. Pro. 2.13(4)

Iowa R. Crim. Pro. 2.33(2)(b)

Iowa Rule Crim. Pro.

2.33(2)(c)

Iowa Rule of Crim. Pro.

2.17(1)

Motion in Arrest of Judgment

Motion for a New Trial

for trial, . . . and after such

times only with the consent of
the prosecuting attorney
motion must be made not
later than 45 days after plea of
guilty, verdict of guilty, . . .
but in any case not later than 5
days before the date set for
pronouncing judgment
application for a new trial . . .
shall be made not later than 45
days after verdict of guilty . . .
. In any case, the application
shall not be made later than 5
days before the date set for
pronouncing judgment.

Iowa R. Crim. Pro. 2.24(3)(b)

Iowa R. Crim. Pro. 2.24(2)(a)

Only exception if for motions

based on newly discovered
evidence, which may be made
after judgment

Notice of Appeal

A motion for a new trial shall

be heard and determined by
the court within 30 days from
the date it is filed, except upon
good cause entered in the
record.
A notice of appeal must be
filed within 30 days after the
filing of the final order or
judgment.

16

Iowa R. Crim. Pro. 2.24(2)(e)

Iowa R. App. Pro. 6.101(1)(b)

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

LITIGATION TRACK
Jury Selection
3:15 p.m.- 3:45 p.m.
Presented by
James Weston II
Tom Riley Law Firm, PLC
1210 Hwy 6 West
Iowa City, IA 52246
Phone: 319-351-4996

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

LITIGATION TRACK
Anatomy of a Case
4:00 p.m.- 5:00 p.m.
Presented by
Megan Dimitt
LEDERER WESTON CRAIG, PLC
118 Third Avenue SE, Ste 700
Cedar Rapids, IA 52401
Phone: 319-365-1184

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

ANATOMY OF A CASE
A Young Lawyers Guide to Civil Litigation

Megan R. Dimitt
LEDERER WESTON CRAIG, PLC
118 Third Avenue SE, Ste 700
Cedar Rapids, IA 52401
319.365.1184
mdimitt@lwclawyers.com

I.

Pleadings
A.

B.

Petition/Answer
1.
Notice Pleading
The petition need not allege ultimate facts that support each
element of the cause of action. The petition, however, must
contain factual allegations that give the defendant fair
notice of the claim asserted so the defendant can adequately
respond to the petition. Rees v. City of Shenandoah, 682
N.W.2d 77, 79 (Iowa 2004) (internal citations omitted).
2.

Statutes of Limitation - 614.1

3.

Iowa Rules of Civil Procedure

a.
Know how to serve a petition 1.305
b.
Know what parties and claims to join 1.2331.245
c.
Know formatting requirements 1.411 & 1.412
d.
Know what defenses have to be raised 1.419 & 1.421

4.

Federal Rules of Civil Procedure

a.
Summons & serving Rules 4 & 5
b.
Pleadings & formatting Rule 711
c.
Defenses Rule 12

Common Errors
1.
Sloppy Pleadings failure to state a claim clearly; failure to assert a
necessary affirmative defense
2.

II.

Poor Formatting federal court has rules regarding formatting. State

courts have accepted conventions of formatting. Learn them.

Written Discovery
A.

Purpose
Discovery should expedite the disposition of litigation by
educating the parties in advance of trial of the real value of their
claims and defenses. Barks v. White, 365 N.W.2d 640, 643 (Iowa
Ct. App. 1985)
Not filed with the court! Only served between the parties.

B.

Interrogatories
1.
Iowa Rules of Civil Procedure 1.509
a.
Limited to 30
b.
30 days to answer, unless extension, or objections waived
2

c.
2.

C.

Federal Rules of Civil Procedure Rule 36

a.
30 days to answer or deemed admitted
b.
Denials require explanations

Failure to Make Discovery

1.
Iowa Rule of Civil Procedure 1.517
a.
Motion to Compel
b.
Can ask for attorney fees
c.
Have to attempt to work out dispute with counsel first (1.517(5))
2.

F.

Federal Rules of Civil Procedure Rule 34

a.
Unlimited requests
b.
Must describe with reasonable particularity each item
c.
30 days to respond

Requests for Admissions

Iowa Rule of Civil Procedure 1.510 & 1.511
1.
a.
30 days to answer or deemed admitted
b.
Denials require explanations
2.

E.

Federal Rules of Civil Procedure Rule 33

a.
Limited to 25
1)
Mandated disclosures Rule 7.1 & 26

Requests for Production of Documents

1.
Iowa Rules of Civil Procedure 1.512
a.
Unlimited requests
b.
30 days to respond
c.
Can ask to inspect documents or places
2.

D.

Must be signed by person answering under oath

Federal Rules of Civil Procedure Rule 37

a.
Motion to Compel
Can ask for attorney fees
b.
c.
Have to attempt to work out dispute with counsel first (LR 37)

Common Errors
1.
Sloppiness think about what you are asking for
2.

Failure to supplement Continuing duty to supplement

3.

Failure to object to responses given read the answers other parties

provide. The objections may not be applicable or the information
provided inadequate.
3

4.

III.

Failure to object to the question you shouldnt object just to object, but
always be cognizant that discovery may call for work product or
information protected by privilege

Depositions
A.

Notice & court reporter

1.
Iowa Rules of Civil Procedure 1.7071.709 & 1.713
a.
Must give written notice to all other parties to the lawsuit
b.
You need a court reporter. Also consider whether you need a video
deposition
c.
You do not subpoena parties to the lawsuit
d.
Corporate entities 1.707(5)
e.
When to terminate a deposition 1.708(2)
2.

B.

Federal Rules of Civil Procedure Rule 30

a.
Must give written notice to all other parties to the lawsuit and a
court report
Corporate entities 30(b)(6)
b.
c.
Objections 30(c)(2) & 30(d)

Preparation
1.
Attorneys
a.
Review the records, the discovery served and answered, and social
media pages
Make an outline, but be willing to deviate from it
b.
c.
Know what objections you can make and remedies for deposition
misconduct
2.

Clients
a.
What to expect
b.
Rules
1)
Speaking clearly
2)
Not speaking over the court report
3)
Answering out loud
4)
Dont volunteer
c.
Safe Harbors
1)
Case theme
2)
Dont defend facts that will be admitted
d.

C.

Objections what they are, what they mean

Dos & Donts

1.
Listen to the answers!
2.
Dont be afraid to follow-up!
4

3.
4.
5.
6.

IV.

Dispositive Motions
A.

V.

Dont be afraid to deviate from your outline.

There are no wrong questions to ask. Ask now so you can prepare for the
same answer at trial.
Open ended questions.
Use silence to your advantage.

Motions for Summary Judgment

1.
Iowa Rules of Civil Procedure 1.981
a.
Motion, Memorandum in Support (1.442(4)), & Statement of
Undisputed Facts
2.
Federal Rules of Civil Procedure Rule 56 & LR 7, 10, & 56
a.
Motion, Brief, & Statement of Facts
b.
Briefs longer than 10 pages need a TOC
c.
For briefs longer than 20 pages = motion to file over-length brief

Good Practices
A.

Writing
1.
Know your bluebook!
2.
Proofread!

B.

Preparation

C.

Research Sources think outside the box

1.
Jury Instructions www.iowabar.org
2.
Iowa Code & Cases Westlaw, LexisNexis, Fast Case
3.
Secretary of State Website sos.iowa.gov
4.
Iowa Courts Online www.iowacourts.state.ia.us
5.
Local Bar Association websites
6.
Iowa Land Records www.iowalandrecords.org

D.

Ask Questions!

TRANSACTIONAL TRACK
12:30-5:00 P.M.

Caveat
The printed materials contained in this book
and the oral presentations of the speakers are
not intended to be a definitive analysis of the
subjects discussed. The reader is cautioned that
neither the program participants nor The Iowa
State Bar Association intends that reliance be
placed upon these materials in advising your
clients without confirming independent research.

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

TRANSACTIONAL TRACK
Business Formation

12:30 p.m.- 1:30 p.m.

Presented by
Sean W. Wandro
Meardon, Sueppel & Downer P.L.C.
122 S. Linn St.
Iowa City, IA 52240
Phone: 319-338-9222

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Business Formation
Presented
by
Sean W. Wandro
Meardon, Sueppel & Downer P.L.C.
122 S. Linn Street
Iowa City, IA 52240
Telephone: (319) 338-9222
Facsimile: (319) 338-7250
E-mail: seanw@meardonlaw.com
www.meardonlaw.com

I.

Introduction and assumptions.

A.

This outline focuses on the nine (9) most common business entity
options in Iowa.

B.

There are two (2) general categories of these business entity

options: for profit and nonprofit.

C.

All business entity options discussed herein are domestic business

entities.

D.

Domestic business entities are defined as a business organized

under and subject to the laws of Iowa.

E.

Foreign business entities, or those organized under laws other than

those of Iowa, should seek legal counsel before transacting business
in Iowa. Permission from the Secretary of State of Iowa may be
required and the business entity options available to foreign
business entities may not include those discussed herein.

F.

The selection of a business entity is a complicated process that

should only be undertaken after sufficient due diligence and
consultation with appropriate advisors, including but not limited to
attorneys, accountants and bankers.

G.

Initial meetings.

H.

What, where, who, when, how and why?

I.

Conflict checks.

J.

Tax issues.

K.

Financing.

L.

Insurance.

II.

For profit entities.

A.

Sole proprietorships.
1. Typically the most simple business entity to form and
administer, as there is essentially nothing to do to form one.
2. There are no statutes in Iowa that govern the formation or
operation of sole proprietorships.
3. Very common form of business entity.
4. As the name implies, they are a one person shop.
5. No distinction between the owner and the sole proprietorship,
which from an owner/operator perspective, creates the leading
advantage to sole proprietorships: total control.
6. Total control also creates the leading disadvantage to sole
proprietorships: total liability.
7. Another disadvantage is that sole proprietorships do not always
enable succession planning.
8. An additional disadvantage is that sole proprietorships may
have difficulty obtaining financing.
9. Another issue to consider is taxation. Owners/operators of sole
proprietorships are taxed at the taxation rate of
owners/operators.
10. One final disadvantage to sole proprietorships is the issue of
separation.
11. This is more of a counseling issue.
12. Sole proprietorships are advantageous for a new business that
will operate on a small scale with limited exposure to liability
and which will not require the time, cost and effort of entity
formation.

B.

General partnerships.
1. General partnerships in Iowa are governed by the Iowa
Uniform Partnership Act (Chapter 486A of the Iowa Code).
2. Section 486A.101(6) defines a partnership as an association of
two or more persons to carry on as co-owners a business for
profit formed under section 486A.202, predecessor law, or
comparable law of another jurisdiction.
3. Section 486A.202 provides that: 1. Except as otherwise
provided in subsection 2, the association of two or more persons
to carry on as co-owners a business for profit forms a
partnership, whether or not the persons intend to form a
partnership. 2. An association formed under a statute other than
this chapter, a predecessor statute, or a comparable statute of
another jurisdiction is not a partnership under this chapter
4. General partnerships are essentially a sole proprietorship for
two.
5. No fees.
6. Oral agreements are permissible, written agreements are
preferred.
7. No reporting requirements.
8. Section 486A.303 provides that a filed Statement of Partnership
Authority must include:
a.

Name;

b.

Street address, if one exists;

c.

The names and mailing addresses of all the partners,

or of an agent appointed and maintained by the
general partnership for the purpose of the above
subsection; and

d.

The names and mailing addresses of the partners, or

of an agent authorized to execute an instrument

transferring real property held in the general

partnerships name.
9. SAMPLE STATEMENT OF PARTNERSHIP AUTHORITY.
10. Section 486A.303 provides that a Statement of Partnership
Authority may state the authority, or limitations on the
authority, of some or all of the partners to enter into other
transactions on behalf of the partnership, and any other matter.
11. A filed Statement of Partnership Authority is canceled by
operation of law five (5) years after the date on which the
Statement, or the most recent amendment thereto, was filed,
unless canceled earlier.
12. General partnerships are subject to pass-through taxation.
13. Partners can agree on management and control of general
partnerships, but in the event that partners have no agreement
with respect to management and control, see Section
486A.401(6).
14. Partners can agree on capital, but in the event that partners have
no agreement with respect to capital, see Section 486A.204.
15. Partners can divide their profits and losses by agreement, but in
the event that partners have no agreement with respect to
profits and losses, see Section 486A.401(2).
16. Partners can agree on the transferability of ownership of general
partnerships, but in the event that partners have no agreement
with respect to transferability, see Section 486A.503.
17. The key disadvantage to general partnerships is that the
individual assets of all partners can be used to cover any
liability incurred by general partnerships. Even if another
partner incurred the liability, all partners are liable for it. See
Section 486A.306.
18. Partners can agree on the duration of general partnerships,
which can be dissolved through the filing of a Statement of
Dissolution with the Secretary of State of Iowa.

19. With respect to dissolution, Section 486A.801 provides that: A

partnership is dissolved, and its business must be wound up,
only upon the occurrence of any of the following events: 1. In a
partnership at will, the partnership's having notice from a
partner, other than a partner who is dissociated under section
486A.601, subsections 2 through 10, of that partner's express
will to withdraw as a partner, or on a later date specified by the
partner. 2. In a partnership for a definite term or particular
undertaking if any of the following occur or are present: a. The
expiration of ninety days after a partner's dissociation by death
or otherwise under section 486A.601, subsections 6 through 10,
or wrongful dissociation under section 486A.602, subsection 2,
unless before that time a majority in interest of the remaining
partners, including partners who have rightfully dissociated
pursuant to section 486A.602, subsection 2, paragraph b,
subparagraph (1), agree to continue the partnership. b. The
express will of all of the partners to wind up the partnership
business. c. The expiration of the term or the completion of the
undertaking. 3. An event agreed to in the partnership
agreement resulting in the winding up of the partnership
business. 4. An event that makes it unlawful for all or
substantially all of the business of the partnership to be
continued, but a cure of illegality within ninety days after notice
to the partnership of the event is effective retroactively to the
date of the event for purposes of this section. 5. On application
by a partner, a judicial determination that concludes any of the
following: a. The economic purpose of the partnership is likely
to be unreasonably frustrated. b. Another partner has engaged
in conduct relating to the partnership business which makes it
not reasonably practicable to carry on the business in
partnership with that partner. c. It is not otherwise reasonably
practicable to carry on the partnership business in conformity
with the partnership agreement. 6. On application by a
transferee of a partner's transferable interest, a judicial
determination that it is equitable to wind up the partnership
business at any of the following times: a. After the expiration of
the term or completion of the undertaking, if the partnership
was for a definite term or particular undertaking at the time of
the transfer or entry of the charging order that gave rise to the
transfer. b. At any time, if the partnership was a partnership at
will at the time of the transfer or entry of the charging order that
gave rise to the transfer.

C.

Limited partnerships.
1. Limited partnerships in Iowa are governed by the Uniform
Limited Partnership Act (Chapter 488 of the Iowa Code).
2. Section 488.102(13) defines a limited partnership as, except in
the phrases foreign limited partnership and foreign limited
liability limited partnership, as an entity, having one or more
general partners and one or more limited partners, which is
formed under this chapter by two or more persons or becomes
subject to this chapter under article 11 or section 488.1204,
subsection 1 or 2. The term includes a limited liability limited
partnership.
3. Limited partnerships are entities distinct from their partners.
4. To be formed, limited partnerships must file a written
Certificate of Limited Partnership with the Secretary of State,
with a required $100.00 filing fee.
5. Section 488.201 provides that Certificate of Limited Partnership
must include:
a.

The name.

b.

The street and mailing address of the initial

designated office and the name and street and
mailing address of the initial agent for service of
process.

c.

The name and the street and mailing address of each

general partner.

d.

Whether the limited partnership is a limited liability

limited partnership.

e.

Any additional information required by article 11.

6. SAMPLE CERTIFICATE OF LIMITED PARTNERSHIP.

7. Section 488.201 provides that a Certificate
Partnership may also contain any other matters.

of Limited

8. Section 488.201 further provides that if there has been

substantial compliance with subsection 1, subject to section
488.206, subsection 3, a limited partnership is formed when the
secretary of state files the Certificate of Limited Partnership. The
Secretary of State's filing of the Certificate is conclusive proof
that all conditions precedent to formation of the limited
partnership have been satisfied except in a proceeding by the
state to cancel or revoke the Certificate or involuntarily dissolve
the limited partnership.
9. The Certificate may be amended, but any amendments must be
filed with the Secretary of State, with a required fee of $100.00.
10. Limited partnerships must have both general partners and
limited partners.
11. The relationship of the parties is to be governed by a written
partnership agreement.
12. Partners can agree on management and control of limited
partnerships, but in the event the partners have no agreement
with respect to management and control, see Section 488.100.
13. Partners can agree of capital, but in the event that partners have
no agreement with respect to capital, see Section 488.110.
14. Partners can divide their profits and losses by agreement, but in
the event that partners have no agreement with respect to
profits and losses, see Sections 488.501 through 488.509.
15. Partners can agree on the transferability of ownership of limited
partnerships, but in the event that partners have no agreement
with respect to transferability, see Sections 488.701 through
488.704.
16. The key advantage to limited partnerships is that an obligation
of a limited partnership, whether in contract, tort, or otherwise,
is not the obligation of a limited partner. A limited partner is
not personally liable, directly or indirectly, by way of
contribution or otherwise, for an obligation of the limited
partnership solely by reason of being a limited partner, even if
the limited partner participates in the management and control
of the limited partnership.

17. A limited partner does not have the right or the power as a
limited partner to act for or bind limited partnerships.
18. Section 488.104
perpetual.

provides

that

limited

partnerships

are

19. Dissolved limited partnerships that have wound up business

may file a Statement of Termination with the Secretary of State.
20. SAMPLE STATEMENT OF TERMINATION.
21. With respect to non-judicial dissolution, Section 488.801
provides that limited partnerships are dissolved and their
activities must be wound up, only upon the occurrence of any of
the following:
a.

The happening of an event specified in the

partnership agreement.

b.

The consent of all general partners and of limited

partners owning a majority of the rights to receive
distributions as limited partners at the time the
consent is to be effective.

c.

After the dissociation of a person as a general partner,

upon occurrence of either of the following: 1. If the
limited partnership has at least one remaining general
partner, the consent to dissolve the limited
partnership given within ninety days after the
dissociation by partners owning a majority of the
rights to receive distributions as partners at the time
the consent is to be effective. 2. If the limited
partnership does not have a remaining general
partner, the passage of ninety days after the
dissociation, unless before the end of the period, all of
the following occur: (a) Consent to continue the
activities of the limited partnership and admit at least
one general partner is given by limited partners
owning a majority of the rights to receive
distributions as limited partners at the time the
consent is to be effective. (b) At least one person is

admitted as a general partner in accordance with the

consent.
d.

The passage of ninety days after the dissociation of

the limited partnership's last limited partner, unless
before the end of the period the limited partnership
admits at least one limited partner.

e.

The signing and filing of a declaration of dissolution

by the secretary of state under section 488.809,
subsection 3.

22. Limited partnerships must file Biennial Reports during oddnumbered years following the calendar year in which formed or
authorized to transact business in Iowa. There is a filing fee for
the Biennial Report, which varies based on whether it is done
electronically or in hard copy.

10

D.

Limited liability partnerships.

1. Limited liability partnerships in Iowa are governed by the Iowa
Uniform Partnership Act (Chapter 486A of the Iowa Code).
2. Section 486A.101 definition: a partnership that has filed a
statement of qualification under section 486A.1001 and does not
have a similar statement in effect in any other jurisdiction.
3. Section 486A.1001 provides that 1. A partnership may become
a limited liability partnership pursuant to this section. 2. The
terms and conditions on which a partnership becomes a limited
liability partnership must be approved by the vote necessary to
amend the partnership agreement except, in the case of a
partnership agreement that expressly considers obligations to
contribute to the partnership, by the vote necessary to amend
those provisions. 3. After the approval required by subsection 2,
a partnership may become a limited liability partnership by
filing a statement of qualification.
4. The Statement of Qualification must contain:
a.

The name;

b.

The street address of the partnership's chief executive

office and, if different, the street address of an office
in this state, if any;

c.

The address of a registered office and the name and

address of a registered agent for service of process in
this state, which the partnership is required to
maintain as provided in section 486A.1211;

d.

A statement that the partnership elects to be a limited

liability partnership; and

e.

A deferred effective date, if any.

5. SAMPLE STATEMENT OF QUALIFICATION.

6. Section 486A.1001 also provides that the Statement of
Qualification shall be executed by one or more partners

11

authorized to execute the Statement of Qualification on behalf

of the partnership.
7. The status of a partnership as a limited liability partnership is
effective on the later of the filing of the Statement of
Qualification or a date specified in the Statement of
Qualification, and payment of a $50.00 fee for the filing of a
Statement of Qualification.
8. The Statement of Qualification may be amended, but any
amendments must be filed with the Secretary of State, with
payment of a fee of $20.00.
9. Section 486A.1001 further provides that the status remains
effective, regardless of changes in the partnership, until the
Statement of Qualification is canceled pursuant to section
486A.105, subsection 4.
10. The key advantage to a limited liability partnership is that all
partners, whether general or limited, are provided with fullshield liability.
11. The relationship of the parties is to be governed by a written
partnership agreement.
12. Partners can agree on management and control of limited
liability partnerships, but in the event that partners have no
agreement with respect to management and control, see Section
486A.401(6).
13. Partners can agree on capital, but in the event that partners have
no agreement with respect to capital, see Section 486A.204.
14. Partners can divide their profits and losses by agreement, but in
the event that partners have no agreement with respect to
profits and losses, see Section 486A.401(2).
15. Partners can agree on the transferability of ownership of limited
liability partnerships, but in the event that partners have no
agreement with respect to transferability, see Section 486A.503.
16. Limited liability partnerships are governed by many of the
same provisions that govern general partnerships, but

12

remember that they do not share the liability characteristics of

general partnerships or limited partnerships.
17. Section 486A.306 provides in relevant part that 3. An
obligation of a partnership incurred while the partnership is a
limited liability partnership, whether arising in contract, tort, or
otherwise, is solely the obligation of the partnership. A partner
is not personally liable, directly or indirectly, by way of
contribution or otherwise, for such an obligation solely by
reason of being or so acting as a partner. This subsection applies
notwithstanding anything inconsistent in the partnership
agreement that existed immediately before the vote required to
become a limited liability partnership under section 486A.1001,
subsection 2.
18. Partners can agree on the duration of limited liability
partnerships. They can be cancelled by filing a Statement of
Cancellation of Qualification and payment of a $20.00 filing fee.
19. SAMPLE
STATEMENT
QUALIFICATION.

OF

CANCELLATION

OF

20. With respect to dissolution, Section 486A.801 also provides that:

A partnership is dissolved, and its business must be wound
up, only upon the occurrence of any of the following events: 1.
In a partnership at will, the partnership's having notice from a
partner, other than a partner who is dissociated under section
486A.601, subsections 2 through 10, of that partner's express
will to withdraw as a partner, or on a later date specified by the
partner. 2. In a partnership for a definite term or particular
undertaking if any of the following occur or are present: a. The
expiration of ninety days after a partner's dissociation by death
or otherwise under section 486A.601, subsections 6 through 10,
or wrongful dissociation under section 486A.602, subsection 2,
unless before that time a majority in interest of the remaining
partners, including partners who have rightfully dissociated
pursuant to section 486A.602, subsection 2, paragraph b,
subparagraph (1), agree to continue the partnership. b. The
express will of all of the partners to wind up the partnership
business. c. The expiration of the term or the completion of the
undertaking. 3. An event agreed to in the partnership
agreement resulting in the winding up of the partnership
business. 4. An event that makes it unlawful for all or

13

substantially all of the business of the partnership to be

continued, but a cure of illegality within ninety days after notice
to the partnership of the event is effective retroactively to the
date of the event for purposes of this section. 5. On application
by a partner, a judicial determination that concludes any of the
following: a. The economic purpose of the partnership is likely
to be unreasonably frustrated. b. Another partner has engaged
in conduct relating to the partnership business which makes it
not reasonably practicable to carry on the business in
partnership with that partner. c. It is not otherwise reasonably
practicable to carry on the partnership business in conformity
with the partnership agreement. 6. On application by a
transferee of a partner's transferable interest, a judicial
determination that it is equitable to wind up the partnership
business at any of the following times: a. After the expiration of
the term or completion of the undertaking, if the partnership
was for a definite term or particular undertaking at the time of
the transfer or entry of the charging order that gave rise to the
transfer. b. At any time, if the partnership was a partnership at
will at the time of the transfer or entry of the charging order that
gave rise to the transfer.
21. There is no Biennial Report or reporting requirement required
for limited liability partnerships.

14

E.

For profit corporations.

1. For profit corporations in Iowa are governed by the Iowa
Business Corporation Act (Chapter 490 of the Iowa Code).
2. Section 490.140(5) definition: a domestic corporation for profit,
which is not a foreign corporation, incorporated under or
subject to this chapter.
3. For profit corporations are an association of individuals with
powers and liabilities independent of its shareholders.
4. For profit corporations are separate entities from the individuals
who control, operate and own them.
5. They own their assets and owe their debts. Shareholders are
protected from individual losses, save for the value of their
investment.
6. They are managed by boards of directors that are typically
elected by the shareholders of the for profit corporations.
7. They are governed by Articles of Incorporation and Bylaws.
8. SAMPLE ARTICLES OF INCORPORATION.
9. For profit corporations are formed by adopting and filing of
Articles of Incorporation with the Secretary of State of Iowa and
the payment of a $50.00 filing fee.
10. Section 490.202 provides that Articles of Incorporation must
include:
a.

A corporate name for the corporation that satisfies the

requirements of section 490.401.

b.

The number of shares the corporation is authorized to

issue.

c.

The street address of the corporation's initial

registered office and the name of its initial registered
agent at that office.

15

d.

The name and address of each incorporator.

11. Amendments to Articles of Incorporation may be made, but

must be filed with the Secretary of State, with the payment of a
$50.00 filing fee.
12. Bylaws are not filed with the Secretary of State and may be
amended as needed.
13. For profit corporations generally take one of two general forms:
a.

Closely held for profit corporations.

b.

Publicly held for profit corporations.

14. For profit corporations generally take one of two tax structures:
a.

Subchapter S.

b.

Subchapter C.

15. Corporations typically are perpetual.

16. The key disadvantage of for profit corporations is that they are
subject to double taxation.
17. Section 490.801 provides that generally each corporation must
have a board of directors. All corporate powers shall be
exercised by or under the authority of, and the business and
affairs of the corporation managed by or under the direction of,
its board of directors, subject to any limitation set forth in the
articles of incorporation, or in an agreement authorized under
section 490.732.
18. Section 490.623 provides that capital is governed by the Articles
of Incorporation, but in the event the Articles of Incorporation
do not address capital, Section 490.623 provides a default.
19. Section 490.640 provides that profits and losses are governed by
the Articles of Incorporation, but in the event the Articles of
Incorporation do not address profits and losses, Section 490.640
provides a default.

16

20. Shares of for profit corporations are generally freely

transferable. Any transfer is subject to any restrictions set forth
in for profit corporations Articles of Incorporation. See Section
490.627.
21. The liability of shareholders of for profit corporations is
addressed by Section 490.622. Generally, a purchaser from a for
profit corporation or a shareholder is not liable.
22. The liability of directors of for profit corporations is addressed
by Section 490.831.
23. The liability of officers of for profit corporations is addressed by
Section 490.842.
24. For profit corporation must file Biennial Reports during evennumbered years following the calendar year in which they were
formed in Iowa. There is a filing fee for the Biennial Report,
which varies based on whether it is done electronically or in
hard copy.
25. For profit corporations may dissolve by filing Articles of
Dissolution with the Secretary of State. Section 490.1420
provides for administrative dissolution and Section 490.1430
provides for judicial dissolution.
26. SAMPLE ARTICLES OF DISSOLUTION.

17

F.

Professional corporations.
1. Professional corporations are governed in Iowa by the
Professional Corporation Act (Chapter 496C of the Iowa Code).
2. Section 496C.2 defines professional corporations as a
corporation subject to the Professional Corporations Act, except
a foreign professional corporation.
3. Professional corporations must be formed for the sole purpose
of rendering professional services and may only be formed by
certain defined professionals.
4. Professional corporations
Incorporation and Bylaws.

are

governed

by

Articles

of

5. Professionals include many more professions than may be

readily apparent.
6. Professional corporations do not protect professionals against
their own negligence.
7. They do protect professionals against the negligence of
professional associates, which can supplement protection
provided by malpractice insurance.
8. Professional corporations are formed by adopting and the filing
of Articles of Incorporation with the Secretary of State, and
payment of a filing fee of $50.00.
9. Generally, the Articles of Incorporation must include the same
elements as required with for profit corporations.
a. The corporate name,
b. The number of shares the professional corporation is
authorized to issue,
c. The street address of the professional corporations initial
registered office and the name of its initial registered
agent at that office; and
d. The name and address of each incorporator.
10. The name shall contain the words professional corporation or
the abbreviation P.C.

18

11. Amendments to Articles of Incorporation may be made, but

must be filed with the Secretary of State of Iowa, with the
payment of a filing fee of $50.00.
12. Bylaws are not filed with the Secretary of State and can be
amended as needed.
13. Professional corporations typically are perpetual.
14. Generally each professional corporation must have a board of
directors. Section 496C.16 provides that all directors of a
professional corporation and all officers of a professional
corporation, except assistant officers, shall at all times be
individuals who are licensed to practice in this state a
profession, or a lawful combination of professions pursuant to
section 496C.4, which the corporation is authorized to practice.
15. Section 496C.10 provides that capital is governed by the Articles
of Incorporation, but in the event the Articles of Incorporation
do not address capital, Section 496C.10 provides a default.
16. Section 496C.3 provides that profits and losses are governed by
the Articles of Incorporation, but in the event the Articles of
Incorporation do not address profits and losses, Section 496C.3
provides a default.
17. Section 496C.11 provides that transfers of ownership are
governed by the Articles of Incorporation, but in the event the
Articles of Incorporation do not address transfer of ownership,
Section 496C.11 provides a default.
18. Section 496C.9 provides that liability is governed by the Articles
of Incorporation, but in the event the Articles of Incorporation
do not address liability, Section 496C.9 provides that the
liability of the shareholders of professional corporations, as
shareholders, shall be limited in the same manner and to the
same extent as in the case of a corporation organized under the
Iowa Business Corporation Act, set forth in Chapter 490.
19. Professional corporations must file Biennial Reports during
even-numbered years following the calendar year in which they
were formed or authorized to transact business in Iowa. There is

19

a filing fee for the Biennial Report, which varies based on

whether it is done electronically or in hard copy.
20. With respect to dissolution, Section 496C.19 provides that
violation of any provision of this chapter by a professional
corporation or any of its shareholders, directors, or officers shall
be cause for its involuntary dissolution, or liquidation of its
assets and business by the district court, as provided in the Iowa
Business Corporation Act. Upon the death of the last remaining
shareholder of a professional corporation, or whenever the last
remaining shareholder is not licensed or ceases to be licensed to
practice in this state a profession which the corporation is
authorized to practice, or whenever any person other than the
shareholder of record becomes entitled to have all shares of the
last remaining shareholder of the corporation transferred into
that person's name or to exercise voting rights, except as a
proxy, with respect to such shares, the corporation shall not
practice any profession and it shall either be promptly dissolved
or shall promptly elect to adopt the provisions of the Iowa
business corporation Act, as provided in section 490.1701(2).
However, if prior to such dissolution all outstanding shares of
the corporation are acquired by one or more persons licensed to
practice in this state a profession which the corporation is
authorized to practice, the corporation need not be dissolved
and may practice the profession as provided in this chapter.

20

G.

Limited liability companies.

1. Limited liability companies are governed in Iowa by the
Revised Uniform Limited Liability Company Act (Chapter
489 of the Iowa Code).
2. Section 489.102(10) definition: except in the phrase
foreign limited liability company, [means] an entity
formed under this chapter.
3. Limited liability companies are an
associations with one or more members.

unincorporated

4. Section 489.104 provides that limited liability companies are

entities distinct from their members.
5. Section 489.304 provides that with respect to liability: 1. For
debts, obligations, or other liabilities of a limited liability
company, whether arising in contract, tort, or otherwise all
of the following apply: a. They are solely the debts,
obligations, or other liabilities of the company. b. They do
not become the debts, obligations, or other liabilities of a
member or manager solely by reason of the member acting
as a member or manager acting as a manager. 2. The failure
of a limited liability company to observe any particular
formalities relating to the exercise of its powers or
management of its activities is not a ground for imposing
liability on the members or managers for the debts,
obligations, or other liabilities of the company.
6. Limited liability companies are formed by filing a Certificate
of Organization with the Secretary of State, with a $50.00
filing fee.
7. SAMPLE CERTIFICATE OF ORGANIZATION.
8. The relationship of the parties is to be governed by an
Operating Agreement.
9. SAMPLE OPERATING AGREEMENT.

21

10. The Certificate of Organization may be amended, but

amendments must be filed with the Secretary of State, with a
filing fee of $50.00.
11. The Certificate of Organization must contain:
a.

The name;

b.

The street address of the initial registered office and

the name of the initial registered agent for service of
process on the company; and

c.

The Certificate of Organization must be signed by an

organizer of the limited liability company.

12. Section 489.104 provides that limited liability companies

have perpetual duration.
13. The ultimate advantages to limited liability companies are
that like for profit corporations, limited liability companies
owners are not generally liable for obligations of limited
liability companies, but unlike for profit corporations,
limited liability companies enjoy pass-through taxation, not
double taxation.
14. Partners can agree on management and control of limited
liability companies. In the absence of such agreement, see
Section 489.110.
15. Members can agree on the transferability of ownership of
limited liability companies. In the absence of such
agreement, see Section 489.502.
16. Members can agree to dissolve limited liability companies.
They can be dissolved by filing a Statement of Dissolution,
with a $5.00 filing fee.
17. SAMPLE STATEMENT OF DISSOLUTION.
18. With respect to dissolution, Section 489.701 provides that 1.
A limited liability company is dissolved, and its activities
must be wound up, upon the occurrence of any of the
following: a. An event or circumstance that the operating

22

agreement states causes dissolution. b. The consent of all the

members. c. Once the company has at least one member, the
passage of ninety consecutive days during which the
company has no members. d. On application by a member,
the entry by a district court of an order dissolving the
company on the grounds that any of the following applies:
(1) The conduct of all or substantially all of the company's
activities is unlawful. (2) It is not reasonably practicable to
carry on the company's activities in conformity with the
certificate of organization and the operating agreement. e.
On application by a member or transferee, the entry by a
district court of an order dissolving the company on the
grounds that the managers or those members in control of
the company have done any of the following: (1) Have acted,
are acting, or will act in a manner that is illegal or
fraudulent. (2) Have acted or are acting in a manner that is
oppressive and was, is, or will be directly harmful to the
applicant. 2. In a proceeding brought under subsection 1,
paragraph e, the court may order a remedy other than
dissolution.
19. Limited liability companies must file Biennial Reports
during odd-numbered years following the calendar year in
which they were organized. There is a filing fee for the
Biennial Report, which varies based on whether it is done
electronically or in hard copy.

23

III.

Nonprofit entities.
A.

Nonprofit corporations.
1. Nonprofit corporations are governed in Iowa by the Revised
Iowa Nonprofit Corporation Act (Chapter 504 of the Iowa
Code).
2. Section 504.141 defines a corporation under the Revised
Iowa Nonprofit Corporation Act as a public benefit, mutual
benefit, or religious corporation.
a.

Mutual benefit nonprofits are neither public benefit

nor religious and may be clubs, fraternal
organizations and homeowners associations.

b.

Public benefit nonprofits are exempt under 501(c)(3)

of the Internal Revenue Code.

c.

Religious.

3. Nonprofit corporations are an association of individuals

with independent powers and liabilities.
4. They are separate entities from the individuals who control
and operate them.
5. They own their assets and owe their debts.
6. They are managed by boards of directors that are typically
elected by the for nonprofit corporations members or
boards of directors.
7. They are governed by their Articles of Incorporation and
Bylaws.
8. Nonprofit corporations are formed by adopting and filing of
Articles of Incorporation with the Secretary of State, with
payment of a $20.00 filing fee.
9. SAMPLE ARTICLES OF INCORPORATION.

24

10. Section 504.202 provides that Articles of Incorporation must

include:
a.

A name;

b.

The address of the nonprofit corporation's initial

registered office and the name of its initial registered
agent at that office;

c.

The name and address of each incorporator;

d.

Whether the nonprofit corporation will

members. A nonprofit corporation incorporated
to January 1, 2005, may state whether it will
members in either the articles of incorporation
the corporate bylaws; and

e.

For corporations incorporated after January 1, 2005,

provisions not inconsistent with law regarding the
distribution of assets on dissolution.

11. Section 504.202 also provides

Incorporation may set forth:

that

the

have
prior
have
or in

Articles

of

a.

The purpose for which the nonprofit corporation is

organized, which may be, either alone or in
combination with other purposes, the transaction of
any lawful activity.

b.

The names and addresses of the individuals who are

to serve as the initial directors.

c.

Provisions not inconsistent with law regarding all of

the following:
1.) Managing and regulating the affairs of the
nonprofit corporation;
2.) Defining, limiting, and regulating the powers of
the nonprofit corporation, its board of directors,
and members, or any class of members; or
3.) The characteristics,
qualifications, rights,
limitations, and obligations attaching to each or
any class of members.

25

d.

A provision eliminating or limiting the liability of a

director to the nonprofit corporation or its members
for money damages for any action taken, or any
failure to take any action, as a director, except liability
for any of the following:
1.) The amount of a financial benefit received by a
director to which the director is not entitled;
2.) An intentional infliction of harm on the
nonprofit corporation or its members;
3.) A violation of section 504.835; or
4.) An intentional violation of criminal law.
A provision set forth in the articles of incorporation
pursuant to this paragraph shall not eliminate or limit
the liability of a director for an act or omission that
occurs prior to the date when the provision becomes
effective. The absence of a provision eliminating or
limiting the liability of a director pursuant to this
paragraph shall not affect the applicability of section
504.901.

e.

A provision permitting or requiring a nonprofit

corporation to indemnify a director for liability, as
defined in section 504.851, subsection 5, to a person
for any action taken, or any failure to take any action,
as a director except liability for any of the following:
1.) Receipt of a financial benefit to which the person
is not entitled;
2.) Intentional infliction of harm on the nonprofit
corporation or its members;
3.) A violation of section 504.835 or
4.) Intentional violation of criminal law.

f.

Any provision that under this chapter is required or

permitted to be set forth in the bylaws.

12. Amendments to the Articles of Incorporation may be made,

but must be filed with the Secretary of State of Iowa, with a
required filing fee of $10.00.

26

13. Bylaws are not filed with the Secretary of State and can be
amended as needed.
14. SAMPLE BYLAWS.
15. Nonprofit corporations are not always tax-exempt
organizations, but tax-exempt organizations are always
nonprofit corporations, trusts or associations.
16. To become a tax-exempt organization, an entity must file
Form 1023 or 1024 with the Internal Revenue Service.
17. If an entity obtains tax-exempt status, it will have an
ongoing annual reporting requirement (Form 990).
18. Nonprofit corporations must file Biennial Reports during
odd-numbered years following the calendar year in which
they were formed in Iowa. There is no filing fee due with the
Biennial Report.

27

B.

Unincorporated nonprofit associations.

1. Unincorporated nonprofit associations are governed in Iowa
by the Revised Uniform Unincorporated Nonprofit
Association Act (Chapter 501B of the Iowa Code).
2. The Revised Uniform Unincorporated Nonprofit Association
Act (RUUNAA) governs the operation in Iowa of all
unincorporated nonprofit associations formed or operating
in Iowa. It also provides that unless the unincorporated
nonprofit associations governing principles specify a
different jurisdiction, the law of the jurisdiction in which the
unincorporated nonprofit association has its main place of
activities governs the internal affairs of the unincorporated
nonprofit association.
4. Unincorporated nonprofit associations are defined as legal
entities distinct from their members and managers.
5. Unincorporated nonprofit associations are perpetual unless
their governing principles provide otherwise.
6. Unincorporated nonprofit associations may acquire, hold,
encumber or transfer in their names, an interest in real or
personal property. They may also be a beneficiary or a trust
or contract, a legatee or a devisee.
7. Any debts arising in contract, tort or otherwise are solely the
debt, obligation or other liability of the unincorporated
nonprofit association. Such debts do not become the debts of
a member, manager, employee or volunteer solely because
of their actions as a member, manager, employee or
volunteer. Members, managers, employees or volunteers are
not personally liable for any action taken or failure to act in
the discharge of his or her duties except for:
a.

The amount of any financial benefit to which the

person is not entitled;

b.

An intentional infliction of harm on the

unincorporated nonprofit association or the members;

c.

An intentional violation of criminal law; or

28

d.

Improper distributions.

8.

Unincorporated nonprofit associations may sue or be sued.

9.

Unless it provides otherwise in its governing principles, an

unincorporated nonprofit association must have member
approval to do any of the following:
a.

Admit, suspend, dismiss or expel a member;

b.

Select or dismiss a manager;

c.

Adopt, amend or repeal the governing principles;

d.

Sell, lease, exchange or otherwise dispose of all, or

substantially all, of the unincorporated nonprofit
associations property, with or without the
unincorporated nonprofit associations goodwill,
outside the ordinary course of its activities;

e.

Dissolve or merge;

f.

Undertake any other act outside the ordinary course

of the unincorporated nonprofit associations
activities; or

g.

Determine the policy and purposes

unincorporated nonprofit association.

of

the

10.

Governing principles may deal with suspension, dismissal

or expulsion of members. If no such governing principle
applies, a member may be suspended, dismissed or expelled
by a vote of the members.

11.

Governing principles may also deal with resignation and in

their absence a member may resign at any time.

12.

Memberships are non-transferable.

13.

Unless the governing principles apply otherwise, all of the

following apply with respect to the selection of managers:

29

a.

Only members may select manager(s).

b.

A manager may be a member or non-member.

c.

If no manager is selected, all members are managers.

d.

Each manager has equal rights in the management of

the unincorporated nonprofit associations activities.

e.

All matters relating to the unincorporated nonprofit

associations activities shall be decided by the
managers except for matters reserved for approval by
members.

f.

A difference among managers is decided by a

majority of the managers.

14.

Managers owe to the unincorporated nonprofit association

and its members the fiduciary duties of loyalty and care.

15.

Members do not have a fiduciary duty to unincorporated

nonprofit associations or other members solely by being a
member.

16.

Members who are managers then, have different duties than

their fellow members.

17.

Managers shall manage the unincorporated nonprofit

association in good faith, in a manner the manager
reasonably believes to be in the best interests of the
unincorporated nonprofit association, and with such care,
including reasonable inquiry, as a prudent person would
reasonably exercise in a similar position and under similar
circumstances. A manager may rely in good faith upon any
opinion, report, statement or other information provided by
another person that the manager reasonably believes is a
competent and reliable source for the information. Managers
that make business judgments in good faith satisfy the
duties of loyalty and care if:
a.

The manager is not interested, directly or indirectly,

in the subject of the business judgment and is
otherwise able to exercise independent judgment.

30

b.

The manager is informed with respect to the subject

of the business judgment to the extent the manager
reasonably believes to be appropriate under the
circumstances.

c.

The managers believes that the business judgment is

in the best interest of the unincorporated nonprofit
association and in accordance with its purposes.

18.

Members shall discharge the duties to the unincorporated

nonprofit association and other members, and exercise any
rights under the Iowa Code consistent with the governing
principles of the unincorporated nonprofit association and
the obligation of good faith and fair dealing.

19.

Distributions are prohibited but compensation

reimbursement are generally permitted.

20.

Winding up and termination of an unincorporated nonprofit

association requires:

and

a.

All known debts and liabilities must be paid or

provided for.

b.

Any property subject to a condition requiring return

to the person designated by the donor must be
transferred to that person.

c.

Any property subject to a trust must be distributed in

accordance with the trust agreement.

d.

Any remaining property must be distributed as

required by law, in accordance with the governing
principles or in their absence, to the members per
capita or as they direct.

e.

If neither law nor governing principles apply, then

pursuant to Chapter 556.

31

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

TRANSACTIONAL TRACK
Real Estate

1:30 p.m.- 2:45 p.m.

Presented by
Matthew J. Hektoen
Simmons Perrine Moyer Bergman PLC
115 Third Street SE, Suite 1200
Cedar Rapids, IA 52401
Phone: 319-366-7641

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

SOME BASICS REGARDING REAL ESTATE TRANSACTIONS

IN IOWA
MATTHEW J. HEKTOEN
SIMMONS PERRINE MOYER BERGMAN PLC
I.

PURCHASE AGREEMENT.
A.

Role of the Attorney.

The purchase agreement establishes and locks in the key terms of the real estate transaction. These terms include purchase price, dates of closing and possession, contingencies, description of real property conveyed, description of personal property included or excluded, responsibility for insuring the property, and a number of other provisions. Unfortunately, all too
often purchase agreements are drafted by inexperienced persons. Real estate transactions are
usually the most important business transactions in which people engage, and, therefore, the purchase agreement should be prepared with great care, preferably by an attorney or experienced
realtor and reviewed by the parties attorneys. This procedure is often not followed.
1.

Are you the realtor too?

Before drafting a purchase agreement, confirm whether client has a realtor. If

not, expanded representation is required. Failure to provide any of the information below can result in a court-ordered rescission of the contract.
a.

For ALL residential transactions Iowa Code Section 558A.2 provides that [a] person interested in
transferring real propertyshall deliver a written disclosure
statement to a person interested in being transferred the real
property. The disclosure statement must be delivered prior to
either the transferor making a written offer for the transfer of the
real property, or accepting a written offer for the
transfer of real
property.

b.

For Residential Installment Sales Contracts (Four or more sales in

a calendar year) In addition to Iowa Code Section 558A.2 disclosure, contract seller
must provide information set forth in Iowa Code Section 558.70
(taxes, assessed value, amortization schedule plus much more).
This information must be provided at least seven (7) days prior to
the execution of the installments contract.

B.

c.

Lead Based Paint Disclosure and Protecting your Family from

Lead Based Paint Brochure.

d.

Radon Disclosure.

Typical Forms.
1.

Iowa State Bar Association Iowa Docs Forms.

a.

Residential Purchase Agreement.

Iowa Docs form 152. See Appendix A.

b.

Offer to Buy Real Estate and Acceptance

Iowa Docs form 153. See Appendix B.

c.

Residential Property Seller Disclosure Statement.

Iowa Docs form 155. See Appendix C.

d.

Lead-Based Paint Disclosure Sales (for dwellings built prior to

1978).
Iowa Docs form 156. See Appendix D.

2.

Typical Realtor Form.

a.

Iowa City Area Association of Realtors Purchase Agreement.

See Appendix E.

b.
3.

Others.
a.

C.

Compare with Iowa Docs Residential Purchase Agreement.

Suggestion - Make your own form, the ISBA forms work well in
so far as they go, but that isnt far. Additional benefit that use of
your own agreement leads clients away from the idea that real
estate is a commodity to be dealt with by standardized forms.

Items of Note in Purchase Agreement.

1.

Examples of Common Contingency Clauses Include the Following:

a.

Sale of Buyers Existing Property.

b.

Financing Contingency.
Be careful not to give buyers an option to purchase as opposed to
an obligation to purchase.

c.

Inspections.
Inspections such as termite inspection, well tests, radon tests, septic system tests, building inspections.

2.

When to Request a Survey.

See Iowa Docs form 152 (paragraph 9). Buyers rarely are willing to spend the
money necessary to survey property unless required by the lender. It would be
prudent to request a survey when boundaries are unclear, potential encroachments
may exist, or adequacy of access to public roads is not apparent.
3.

Disclosure Issues.

Chapter 558A of the Code requires sellers to make a good-faith disclosure relating
to the condition and important characteristics of the property. See Appendix C.
4.

Septic System.

Any property with a building serviced by a septic system must have that system
inspected prior to closing and the inspection attached to the groundwater hazard
statement filed with the warranty deed UNLESS an exemption applies. Failure to
address in a timely fashion will result in a delayed closing and upset clients.

II.

TITLE EXAMINATION (Buyers Attorney).

A.

Purpose of Preliminary Title Opinion.

The purpose of the preliminary title opinion is to provide information to the buyers and
buyers lender, if applicable, reporting on the merchantability of title to the real estate and
warning them as to matters that they should, themselves, verify or ascertain. Your clients, the buyers, and lender, if applicable, will rely upon your title opinion. You are responsible to do it correctly.
1.
Opine as to merchantability of title and draw buyers attention to items of
concern or interest based on Iowa law and Iowa State Bar Association Title
Standards. See iowabar.org for free copy to all ISBA members.

2.
Provide requirements to satisfy any objections, existing liens or encumbrances. This can be in the form of statements of objection or requirements that
the seller comply with the relevant ISBA Title Standard.
3.
B.

Identify items with potential to be a lien or encumbrance.

Preliminary Title Opinion Contents.

1.

Preliminary Items. Sample Opinion. See Appendix H.

a.

Identify recipients of opinion.

Lending institution, buyers, others, if for Lending institution
ensure that you indicate opinion is for Loan Purposes Only.
Addressees are the parties that are entitled to rely on the opinion so
be aware.

b.

Identify abstractor with most recent certified entry.

c.

Identify total number of entries in the abstract.

d.

Set forth date and time of last entry.

e.

Location (county, state) and full legal description based on the last
caption in the abstract.

f.

Opinion of examiner regarding current titleholder(s) and merchantability of title.

g.

Identify persons (clients) in whom title will be held.

h.

Subject to the following objections and comments.

List each objection or comment separately. Lenders love simplicity and organization.

2.

Unpaid or Unreleased Mortgages.

a.

Unsatisfied mortgages.
You should refer to unsatisfied mortgages by entry number and set
forth holder of mortgage, date of mortgage, and date and location
of mortgage recording. Lenders also like references to the amount
secured by the mortgage.

b.

This item, if unsatisfied, could constitute a lien on the property.

c.

3.

Require documentation of satisfaction of mortgage, including release of mortgage from lending institution.

Unpaid Real Estate Taxes.

Unpaid real estate taxes that are not delinquent should be included in a title opinion, as should the period and year for which taxes have not been
paid, and the amount owed. It is appropriate to include the language No
other taxes show as a lien when such is the case.

4.

5.

Existing Covenants, Easements, and Restrictions.

a.

Indicate whether comments are intended to be exhaustive or not.

b.

Direct buyers to confirm existence of homeowners association and

its rules and membership requirements.

c.

Direct buyers to verify there are no existing and unpaid association

assessments. Unpaid assessments may be a lien on the real estate.

d.

Attach copies of existing association agreements and subdividers

agreements noting any obligations therein. Depending on the municipality, you may or may not be able to secure a release of obligations to construct public improvements.

e.

Note the existence and scope of any protective covenants and restrictions. See Iowa Code 614.24.

f.

The particular zone of the real estate and use or restrictions in that
zone.

g.

Any judgments or other liens on the property.

h.

Noteworthy platting and subdivision documents should be attached

to opinions

Access.
a.

6.

Review plat to confirm legal access exists. In no plat exists (ie. ag.
land) or if you cant determine whether legal access exists, you
should not as such in the opinion.

Method of Examination.
a.

Who has title? - 40 year chain.

b.
C.

Encumbrances and Miscellaneous.

Coverage of Preliminary Title Opinion Carve Out Clauses.

1.
Attorneys should take care to provide appropriate carve out clauses in any
preliminary title opinion, including:

D.

III.

a.

The limitations of the title opinion.

b.

Hazards of conducting a closing without an attorney or real estate

professional.

c.

Admonition for clients to obtain through independent knowledge

or investigation matters affecting the title not included in the abstract.

d.

Parties in possession not recorded as record title holders.

e.

Public improvements that have been ordered but not assessed.

f.

Recent unpaid claims for materials or labor.

g.

Recent unpaid utility bills.

Post-Closing Requirements Final Title Opinion

1.

Buyers to obtain an update to the abstract of title for the time period in between the date of continuation and through the date of closing.

2.

Information contained in the abstract should be the limited scope of an

attorneys opinion.

3.

Purpose is to show that title has been transferred, liens and encumbrances
noted in the preliminary opinion have been released and that new mortgage holder, if any, has first lien on the real estate.

TRANSFER DOCUMENTS (Sellers Attorney).

A.

Deed
1.

Type of Deed (warranty, special warranty, quit claim, court officer, trustee, deed without warranty).

2.

Grantor clause (marital status; authorized persons of corporation).

3.

4.

IV.

Grantee clause
a.

Joint Tenancy

b.

Tenants in Common

c.

Marital Status

d.

Life estate or other partial interests

Legal description of property transferred, and subject to any limitations.

B.

Declaration of Value

C.

Groundwater Hazard Statement

1.

This form is particularly critical for real estate in rural or county areas.

2.

It is recommended to have transferor fill out in advance.

3.

Be sure to pay close attention to the time-of-transfer requirements for private sewage disposal systems (septic tanks). It may need to be inspected
in advance of closing, or special provisions made for its later inspection
and payment of repairs. See Residential Purchase Agreement paragraph
21.

TITLE GUARANTY.

Iowa Docs does not have formal title insurance, as other states do. Iowa, however, does
have Title Guaranty, which provides title protection for real estate in the state. Title Guaranty
now allows attorneys registered with Title Guaranty to issue Commitments (from the preliminary
title opinions), Certificates (from the final title opinions), and Endorsements (additional areas of
coverage). Each of these usually carries with it a fee or premium. Increasingly, lenders are requiring that attorneys representing buyers be qualified to issue these Title Guaranty Commitments, Certificates and Endorsements.
A.

B.

Commitment (See Appendix F)

1.

Schedule A shows the titleholder, borrower, lender, owners coverage, and

lenders coverage.

2.

Schedule B shows the limitations, liens and encumbrances that must be released before closing.

Certificate (See Appendix G)

C.

V.

1.

Shows new titleholder and other documents recorded post-closing such as

mortgage, mortgage release and deed. Also shows endorsements and limitations of coverage.

2.

Can be done after four months even if abstract is not updated.

Refinancing
1.

Form 900 is issued for title commitments for a refinance. It is a short

(usually one-page) form showing pertinent title information and avoids a
full review of an updated abstract.

2.

Form 901 is issued for title certificates for a refinance post-closing.

Again, it is a shortened version of the continuation of the abstract and final
title opinion.

CLOSINGS.
A.

Sale Closings

1.
Role - The closing agent is to be in control of the closing process, to make
sure the process is completed, and completed properly. The CA owes a fiduciary duty to all parties to the transaction.
2.
Basics - Follow the lenders closing instructions, if any, comply with the
terms of the contract and comply with any obligations of Iowa Title Guaranty. Collecting payoff
statements from mortgagees and ensuring that closing proceeds are wired appropriately.
3.

Prepare closing statements and 1099 reporting

4.

Handle recordation and follow-up

5.
Order day of closing search to confirm no issues affecting title arose between date of last certification of the abstract and the date of closing.
B.

Leases
1.

Negotiation and drafting

2.

Arm's length 3rd parties and between related parties

3.

Re residential, commercial, municipal, mobile home and mobile home

park and farm real estate

4.

C.

D.

E.

Be familiar with Linn Co and Johnson Co rent rates and market

conditions for farmland, commercial, office and residential space

Landlord -Tenant
1.

Rent collection

2.

Forcible entry and detainer actions

3.

Other lease breach remedy actions

4.

Tenants rights

5.

Re residential, commercial, municipal, mobile home and mobile home

park and farm real estate

6.

Farm lease terminations

Land Use and Zoning

1.

Annexations (proceedings - voluntary, involuntary, applicant rep and

opposition

2.

Re-zoning proceedings

3.

Platting proceedings

4.

Zoning enforcement proceedings (and defense of same)

5.

Ag land restrictions and rules (Chapter 9H)

6.

Familiar with CR, Marion, Hiawatha, North Liberty, Coralville, Iowa

City and other adjacent municipalities master plans in general

7.

Know the relevant state, county and city officials and offices

8.

TIF districts, other tax abatement and economic development aspects

re real estate

9.

Including contract clauses and issues for buyers, sellers and lenders re
such financing involved in deals

10.

Be familiar with Iowa Code Chapter 9H restrictions on entity

ownership of agricultural land and planning techniques re same

Development

1.

Platting, Subdivision Mechanics and Law, Planned Unit

Developments

2.

Engineering basics

3.

Condominium Regimes including drafting declarations

4.

Homeowners Associations
a.

5.

Restrictive Covenants drafting, use, enforcement and defense of

enforcement

6.

See above re Land Use and Zoning - including TIF districts etc

7.

Choice of entity re development, acquisition and operation of real

estate investments
a.

F.

Articles, bylaws, developer transitions, operation and

governance etc

including basic formation of corporations (C and S), LLCs,

partnerships (general, limited and limited liability)

8.

Know developers in each community served, including ownership and

managers in particular also who represents them if we dont

9.

Know ownership, reputation, specialties and operations managers of

major architectural, engineering and construction companies and
contractors in our market area.

Construction Law
1.

Construction contracts
a.

Re residential, commercial, municipal, mobile home and

mobile home park and farm real estate

2.

Architectural Service Contracts

3.

Building Contractor and sub-contractor agreements

4.

Mechanics Liens, and foreclosure of same, also defense of same and

Lien Waivers

5.

G.

H.

Know ownership, reputation, specialties and operations managers of

major architectural, engineering and construction companies and
contractors in our market area

Environmental Law
1.

Federal and state statutory knowledge

2.

Issues to be addressed in all contracts and conveyancing described

above

3.

Civil and Criminal enforcement and defense against enforcement

4.

Familiar with all Brownfield legislation clean-up programs, superfund

principles, and "stuff in general" regarding underground fuel and
other tanks, leaks, waterway pollution and related matters

5.

Engineering basics re use of consultants re Phase I and other levels of

inspections and reviews know leading environmental consulting
firms, their general reputations and specialties and key personnel
within them.

Real Estate Finance

1.

Mortgages - drafting, negotiation, releases etc

2.

Foreclosures and Forfeiture proceedings

a.

I.

Bidding strategy, conduct of the proceedings etc

3.

UCC as it affects real estate (fixture filings etc)

4.

Lender and Contract Seller Issues in federal bankruptcy cases

Taxation
1.

Property tax - know all calculation methods, rates and state, county
and city exemptions and credits

2.

Property tax appeals

3.

General income tax knowledge re developers etc such as building

depreciation permitted, personal vs real property definitions etc

4.

Sale of Residence tax rules, capital gain exclusions rules etc

5.

1031 exchanges, deferred etc - handle from start to finish

6.

General choice of entity and form of organization tax matters re real

property investment syndications, joint ventures etc

APPENDIX A
Residential Purchase Agreement

THE IOWA STATE BAR ASSOCIATION

Official Form No. 152

FOR THE LEGAL EFFECT OF THE USE OF

THIS FORM, CONSULT YOUR LAWYER

RESIDENTIAL PURCHASE AGREEMENT

_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ (SELLERS)
The undersigned BUYERS hereby offer to buy and the undersigned SELLERS by their acceptance agree to sell the
real property situated in
, Iowa, locally known as - - - - - - - - , , - - , - - , - , - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - a n d legally described as:

together with any easements and appurtenant servient estates, but subject to any reasonable easements of record
for public utilities or roads, any zoning restrictions, customary restrictive covenants and mineral reservations of
record, if any, herein referred to as the "Property," upon the following terms and conditions provided BUYERS, on
possession, are permitted to use the Property for residential purposes:
1. PURCHASE PRICE.
shall be as follows:

The Purchase Price shall be $ - - - - - - - - - - and the method of payment

$
with this offer to be deposited upon acceptance of this offer and held in trust by
--,--::--::----:---::--:---::- as earnest money to be delivered to the SELLERS upon performance of SELLERS'
obligations and satisfaction of BUYERS' contingencies, if any; and the balance of the Purchase Price:
(a) in cash at the time of closing with adjustment for closing costs to be added or deducted from this
amount. This Agreement is not contingent upon BUYERS obtaining such funds.
(b) upon the terms specified in alternative
of the Financing Addendum to
Residential Purchase Agreement as initialed and attached hereto and incorporated herein.
2. REAL ESTATE TAXES.
A. SELLERS shall pay all real estate taxes that are due and payable as of the date of possession and
constitute a lien against the Property, including any unpaid real estate taxes for any prior years.
B. SELLERS shall pay their prorated share, based upon the date of possession, of the real estate taxes for
the fiscal year in which possession is given (ending June 30, ___ ) due and payable in the subsequent fiscal
year (commencing July 1, ___ ).
BUYERS shall be given a credit for such proration at closing (unless this agreement is for an installment
contract) based upon the last known actual net real estate taxes payable according to public record. However, if
such taxes are based upon a partial assessment of the present property improvements or a changed tax
classification as of the date of possession, such proration shall be based on the current millage rate, the assessed
value, legislative tax rollbacks and real estate tax exemptions that will actually be applicable as shown by the
Assessor's Records on the date of possession.
C. BUYERS shall pay all subsequent real estate taxes.
3. SPECIAL ASSESSMENTS.
A. SELLERS shall pay in full all special assessments which are a lien on the Property as of the date of
acceptance:-:-::-:-::--:------:----,---=
B. If "A" is stricken, then SELLERS shall pay all installments of special assessments which are a lien on
the Property and, if not paid, would become delinquent during the calendar year this offer is accepted, and all prior
@The Iowa Slate Bar Association 2009
IOWAOOCS

Residl!ntal Purchase Agreaml!nt

Revised June 2009

installments thereof.
C. All charges for solid waste removal, sewage and maintenance that are attributable to SELLERS' possession,
including those for which assessments arise after closing, shall be paid by SELLERS.
D. Any preliminary or deficiency assessment which cannot be discharged by payment shall be paid by SELLERS
through an escrow account with sufficient funds to pay such Hens when payable, with any unused funds returned to
SELLERS.
E. BUYERS shall pay all other special assessments.
4. RISK OF LOSS AND INSURANCE. SELLERS shall bear the risk of loss or damage to the Property prior to closing or
possession, whichever first occurs. SELLERS agree to maintain existing insurance and BUYERS may purchase additional
insurance. In the event of substantial damage or destruction prior to closing, this Agreement shall be null and void; provided,
however, BUYERS shall have the option to complete the closing and receive insurance proceeds regardless of the extent of
damages. The property shall be deemed substantially damaged or destroyed if it cannot be restored to its present condition
on or before the closing date.
5. POSSESSION AND CLOSING. If BUYERS timely perform all obligations, possession of the Property shall be delivered
to BUYERS on
, and any adjustments of rent, insurance, taxes, interest and all charges
attributable to the SELLERS' possession shall be made as of the date of possession. Closing shall occur after approval of
title by buyers' attorney and vacation of the Property by SELLERS, but prior to possession by BUYERS. SELLERS agree to
permit BUYERS to inspect the Property within
hours prior to closing to assure that the premises are in the condition
required by this Agreement. If possession is given on a day other than closing, the parties shall make a separate agreement
with adjustments as of the date of possession. This transaction shall be considered closed {upon the filing of title transfer
documents) (upon the delivery of the title transfer documents to BUYERS) and receipt of all funds then due at closing from
BUYERS under the Agreement.
6. FIXTURES. Included with the Property shall be all fixtures that integrally belong to, are specifically adapted to or are a
part of the real estate, whether attached or detached, such as: attached wall-to-wall carpeting, built-in appliances, light
fixtures (including light bulbs), water softeners (except rentals), shutters, shades, rods, blinds, venetian blinds, awnings,
storm windows, storm doors, screens, television antennas (including satellite dishes), air conditioning equipment (except
window type), door chimes, automatic garage door openers, electrical service cables, attached mirrors, fencing, gates,
attached shelving, bushes, trees, shrubs and plants. Also included shall be the following:

The following items shall not be included:

7. CONDITION OF PROPERTY.
A. The property as of the date of this Agreement including buildings, grounds, and all improvements will be
preserved by the SELLERS in its present condition until possession, ordinary wear and tear excepted.
B. Within
days after the acceptance of this Agreement BUYERS may, at their sole expense, have the
property inspected by a person or persons of their choice to determine if there are any structural, mechanical, plumbing,
electrical, environmental, or other deficiencies. Within this same period, the BUYERS may notify in writing the SELLERS of
any deficiency. The SELLERS shall immediately notify the BUYERS in writing of what steps, if any, the SELLERS will take to
correct any deficiencies before closing. The BUYERS shall then immediately in writing notify the SELLERS that (1) such
steps are acceptable, in which case this Agreement, as so modified, shall be binding upon all parties; or (2) that such steps
are not acceptable, in which case this Agreement shall be null and void, and any earnest money shall be returned to
BUYERS.
C. If "B" is deleted, BUYERS acknowledge that they have made a satisfactory inspection of the Property and are
purchasing the Property in its existing condition.
D. NEW CONSTRUCTION: If the improvements on the subject property are under construction or are to be
constructed, this Agreement shall be subject to approval of plans and specifications by the parties within
days of
acceptance of this Agreement. New construction shall have the warranties implied by law, those specifically made by
suppliers of materials/appliances, and those specifically tendered by the contractor.

-2-

8. ABSTRACT AND TITLE. SELLERS, at their expense, shall promptly obtain an abstract of title to the Property continued
through the date of acceptance of this Agreement,
, and deliver it to BUYERS' attorney for
examination. It shall show merchantable title in SELLERS in conformity with this Agreement, Iowa law, and Title Standards of
the Iowa State Bar Association. The SELLERS shall make every reasonable effort to promptly perfect title. If closing is
delayed due to SELLERS' inability to provide marketable title, this Agreement shall continue in force and effect until either
party rescinds the Agreement after giving ten days written notice to the other party. The abstract shall become the property of
BUYERS when the purchase price is paid in full. SELLERS shall pay the costs of any additional abstracting and title work
due to any act or omission of SELLERS, including transfers by or the death of SELLERS or their assignees.
9. SURVEY.
BUYERS may, at BUYERS' expense prior to closing, have the property surveyed and certified by a
Registered Land Surveyor. If the survey shows any encroachment on the Property or if any improvements located on the
Property encroach on lands of others, the encroachments shall be treated as a title defect. If the survey is required under
Chapter 354, SELLERS shall pay the cost thereof.

10. ENVIRONMENTAL MATTERS.

(a) SELLERS warrant to the best of their knowledge and belief that there are no abandoned wells, solid waste
disposal sites, hazardous wastes or substances, or underground storage tanks located on the Property, the Property does
not contain levels of radon gas, asbestos or urea-formaldehyde foam insulation which require remediation under current
governmental standards, and SELLERS have done nothing to contaminate the Property with hazardous wastes or
substances. SELLERS warrant that the Property is not subject to any local, state, or federal judicial or administrative action,
investigation or order, as the case may be, regarding wells, solid waste disposal sites, hazardous wastes or substances, or
underground storage tanks. SELLERS shall also provide BUYERS with a properly executed GROUNDWATER HAZARD
STATEMENT showing no wells, private burial sites, solid waste disposal sites, private sewage disposal system, hazardous
waste and underground storage tanks an the Property unless disclosed here: - - - - - - - - - - - - - - - (b) BUYERS may at their expense, within
days after the date of acceptance, obtain a report from a
qualified engineer or other person qualified to analyze the existence or nature of any hazardous materials, substances,
conditions or wastes located on the Property. In the event any hazardous materials, substances, conditions or wastes are
discovered on the Property, BUYERS' obligation hereunder shall be contingent upon the removal of such materials,
substances, conditions or wastes or other resolution of the matter reasonably satisfactory to BUYERS. However, in the event
SELLERS are required to expend any sum in excess of $
to remove any hazardous materials,
substances, conditions or wastes, SELLERS shall have the option to cancel this transaction and refund to BUYER all
Earnest Money paid and declare this Agreement null and void. The expense of any inspection shall be paid by BUYERS. The
expense of any action necessary to remove or otherwise make safe any hazardous material, substance, conditions or waste
shall be paid by SELLERS, subject to SELLERS' right to cancel this transacf1on as provided above.

11.
DEED.
Upon payment of the purchase price, SELLERS shall convey the Property to BUYERS by
_ _ _ _ _ _ _ _ _ _ _ _ _ _ deed, free and clear of all liens, restrictions, and encumbrances except as provided in
this Agreement. General warranties of title shall extend to the time of delivery of the deed excepting liens or encumbrances
suffered or penmitted by BUYERS.
12. JOINT TENANCY IN PROCEEDS AND IN REAL ESTATE. If SELLERS, immediately preceding acceptance of the
offer, hold title to the Property in joint tenancy with full right of survivorship, and the jo'1nt tenancy is not later destroyed by
operation of law or by acts of the SELLERS, then the proceeds of this sale, and any continuing or recaptured rights of
SELLERS in the Property, shall belong to SELLERS as joint tenants with full rights of survivorship and not as tenants in
common; and BUYERS in the event of the death of any SELLER, agree to pay any balance of the price due SELLERS under
this contract to the surviving SELLERS and to accept a deed from the surviving SELLERS consistent with Paragraph 15.

13. JOINDER BY SELLER'S SPOUSE. SELLER'S spouse, if not a title holder immediately preceding acceptance, executes
this agreement only for the purpose of relinquishing all rights of dower, homestead and distributive share or in compliance
with Section 561.13 of the Code of Iowa and agrees to execute the deed or real estate contract far this purpose.
14. STATEMENT AS TO LIENS. If BUYERS intend to assume or take subject to a lien on the Property, SELLERS shall
furnish BUYERS with a written statement prior to closing from the holder of such lien, showing the correct balance due.
15. USE OF PURCHASE PRICE.

At time of settlement, funds of the purchase price may be used to pay taxes and other
- 3-

liens and to acquire outstanding interests, if any, of others.

16. APPROVAL OF COURT. If the Property is an asset of an estate, trust or conservatorship, this Agreement is contingent
upon Court approval unless declared unnecessary by BUYERS' attorney. If the sale of the Property is subject to court
approval, the fiduciary shall promptly submit lhis Agreement for such approval. If this Agreement is not so approved by
________________ either party may declare this Agreement null and void, and all payments made hereunder
shall be returned to BUYERS.
17. REMEDIES OF THE PARTIES.
A. If BUYERS fail to timely perform this Agreement, SELLERS may forfeit it as provided in the Iowa Code (Chapter
656), and all payments made shall be forfeited; or, at SELLERS' option, upon thirty days written notice of intention to
accelerate the payment of the entire balance because of BUYERS' default (during which thirty days the default is not
corrected), SELLERS may declare the entire balance immediately due and payable. Thereafter this agreement may be
foreclosed in equity and the Court may appoint a receiver.
B. If SELLERS fail to timely perform this Agreement, BUYERS have the right to have all payments made returned to
them.
C. BUYERS and SELLERS are also entitled to utilize any and all other remedies or actions at law or in equity
available to them and shall be entitled to obtain judgment for costs and attorney fees as permitted by law.
18. NOTICE. Any notice under this Agreement shall be in writing and be deemed served when it is delivered by personal
delivery or by certified mail return receipt requested, addressed to the parties at the address given below.
19. CERTIFICATION. Buyers and Sellers each certify that they are not acting, directly or indirectly, for or on behalf of any
person, group, entity or nation named by any Executive Order or the United States Treasury Department as a terrorist,
"Specially Designated National and Blocked Person" or any other banned or blocked person, entity, nation or transaction
pursuant to any law, order, rule or regulation that is enforced or administered by the Office of Foreign Assets Control; and are
not engaged in this transaction, directly or indirectly on behalf of, any such person, group, entity or nation. Each party hereby
agrees to defend, indemnify and hold harmless the other party from and against any and all claims, damages, losses, risks,
liabilities and expenses (including attorney's fees and costs) arising from or related to my breach of the foregoing
certification.
20. GENERAL PROVISIONS. In the performance of each part of this Agreement, time shall be of the essence. Failure to
promptly assert rights herein shall not, however, be a waiver of such rights or a waiver of any existing or subsequent default.
This Agreement shall apply to and bind the successors in interest of the parties. This Agreement shall survive the closing.
Paragraph headings are for convenience of reference and shall not limit or affect the meaning of this Agreement. Words and
phrases herein shall be construed as in the singular or plural number, and as masculine, feminine or neuter gender
according to the context.
21. INSPECTION OF PRIVATE SEWAGE DISPOSAL SYSTEM. Delete inappropriate alternatives below. If no deletions are
made, the provisions set forth in Paragraph A shall be deemed selected.
A. Seller represents and warrants to Buyer that the Property is not served by a private sewage disposal system,
and there are no known private sewage disposal systems on the property.
B. The Property is served by a private sewage disposal system, or there is a private sewage disposal system on
the Property. Seller and Buyer agree to the provision selected in the attached Addendum for Inspection of
Private Sewage Disposal System.
C. Seller and Buyer agree that this transaction IS exempt from the time of transfer inspection requirements by
reason that _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

-4-

22. ADDITIONAL PROVISIONS: (check if applicable)

A. SALE OF BUYERS' PROPERTY. This Agreement is contingent upon the sale and setllement of the BUYERS'
property locally known as

on or before

- - - - - - - - - If setllement has not been made by this date, the SELLERS may rescind this Agreement by
giving notice to BUYERS that unless sale and setllement of BUYERS' property is made within five (5) business days of
such notice, then this Agreement shall be null and void. Unless SELLERS give such written notice, this Agreement shall
remain valid until the sale of BUYERS' property.
SELLERS reseNe the right to continue to offer the Property for sale. Should SELLERS receive another offer which
days from the delivery of written notice to waive the "contingency of
they desire to accept, BUYERS shall have
sale." Notice from the BUYERS to the SELLERS, removing the contingency of sale, shall be timely delivered to the
SELLERS along with reasonable assurance that BUYERS can complete the purchase without the sale of the property
referenced above.
If BUYERS do timely remove such contingency, this Agreement will remain in full force end effect (but without being
contingent on the sale of BUYERS' property). If BUYERS do not timely remove such contingency, SELLERS will
immediately return to BUYERS all earnest money paid, this Agreement will be of no further force and effect, and neither
party will have any further obligation to the other hereunder.
B. TERMITE INSPECTION.
at their expense shall have the Property inspected for termites or other
wood destroying insects by a licensed pest inspector prior to closing. If active infestation or damage due to prior
infestation is discovered, SELLERS shall have the option of either having the Property treated for infestation by a
licensed pest exterminator and having any damage repaired to the BUYERS' satisfaction or, declaring this Agreement
null and void and returning all earnest money to BUYERS. This provision shall not apply to fences, trees, shrubs or
outbuildings other then garages. BUYERS may accept the property in its existing condition without such treatment or
repairs.
_C. WELL TEST. SELLERS, at SELLERS' expense, shall provide BUYERS, within

days after acceptance of this

offer, a report issued by the county health department, or a qualified testing service, indicating the location of any well on
the Property and that water from each well (1) is safe for its intended use and (2) is in sufficient quantity for its intended
use. If BUYERS receive an unsatisfactory report, the basis for which cannot be resolved between BUYERS and

SELLERS within
days of receipt thereof, then upon written notice from BUYERS to SELLERS, this agreement
shall be null and void and all earnest money paid shall be returned immediately to BUYERS.
D. RADON TEST. Within

days after the date of acceptance of this offer, SELLERS, at their expense, shall

have the property tested for the presence of Radon gas by a qualified professional and shall provide the written results
of such test to BUYERS within the same time period. If said results reveal the presence of Radon in the Property at a

level greater than 4.0 pCi/L and SELLERS do not agree to remediate the Property at SELLERS' expense such that the
Radon levels in the Property are reduced to a level below 4.0 pCi/L, then BUYERS shall have the option to terminate
this agreement, in which case all earnest money shall be returned to BUYERS and this Agreement shall be of no further
force or effect.

E. NO REAL ESTATE AGENT OR BROKER. Neither party has used the seNices of a real estate agent or broker in
connection with this transaction. Each party agrees to indemnify and save harmless the other party from and against all
claims, costs, liabilities and expense (including court costs and reasonable attorney's fees) incurred by the other party as
a result of a breach of this representation, which shall survive closing.

F. OWNERS' ASSOCIATION. If the property is subject to control by an association of owners, this Agreement is
contingent upon the timely satisfaction or waiver of those conditions set forth on the Owners' Association Addendum
attached hereto and by this reference made a part hereof. Buyers may, before closing and no later than
days
after receipt of all responsive documents, elect to cancel this Agreement by written notice of cancellation to Sellers. If
Buyers elect to so cancel this Agreement, then this Agreement shall be null and void and the earnest money paid by
Buyers shall be refunded. In the event Buyers do not timely notify Sellers of cancellation, this Agreement shall be
binding and remain in full force and effect.

G. OTHER: Attach Addendum.

- 5-

ACCEPTANCE. When accepted, this Agreement shall become a binding contract. If not accepted and
delivered to BUYERS on or before the
, this Agreement shall be null
and void and all payments made shall be returned immediately to BUYERS.
Accepted--------------

Dated _ _ _ _ _ _ _ _ _ _ _ _ __

SELLERS

BUYERS

SS#:

SS#:

SELLERS

BUYERS

SS#:

SS#:

Address

Address

Telephone

Telephone

- 6-

INITIAL IF

FINANCING ADDENDUM TO RESIDENTIAL PURCHASE AGREEMENT

APPLICABLE:

BUYERS

SELLERS

A. NEW MORTGAGE: This Agreement is contingent upon the BUYERS obtaining a commitment in writing for a - - - - - - mortgage for not more than _ _ % of the purchase price with note interest at _ _ % or less with a term of no less than _ _ years.
BUYERS agree to pay all customary loan costs. The SELLERS agree to pay a discount and/or origination fee, if required, of _ _ %, or
less, of the new mortgage obtained by the BUYERS. BUYERS agree upon acceptance of this offer to immediately make application for
such mortgage with a lender and to make their best effort to obtain a mortgage commitment as above provided.
If BUYERS have not obtained a written commitment or loan denial on or before
, then SELLERS may rescind
this Agreement by giving written notice to the BUYERS that if a mortgage commitment has not been obtained within 5 business days of
receipt of such notice then this Agreement shall be null and void. If SELLERS do not choose to give such written notice, then this
Agreement shall remain valid until the BUYERS have obtained a mortgage commitment or a denial.
In addition to the proceeds of the aforementioned mortgage, the BUYERS shall pay the balance of the purchase price in cash at the
time of closing with adjustment for closing costs to be added or deducted from this amount.
B. ASSUMPTION OF MORTGAGE OR CONTRACT: The BUYERS shall pay a portion of the purchase price by assuming and agreeing
to pay the mortgage or contract currently on this property with an approximate balance of$. _________ with principal and

BUYERS

interest payments of approximately $-,---------- with current interest of _ _%. SELLERS shall pay interest to the date of
possession. If consent of the holder of such mortgage or contract is required then this Agreement is contingent upon such consent. The
BUYERS agree in good faith to make their best effort to promptly obtain such consent and to pay all expenses and assumption fees
related thereto. If BUYERS have not procured such consent on or b e f o r e - - - - - - - - - - - - ' then SELLERS may rescind
this Agreement by giving written notice to the BUYERS stating that if such consent is not obtained within 5 working days of the receipt of

SELLERS

such notice, then this Agreement shall be null and void. All payments due prior to and including the date of closing are to be paid by the
SELLERS.

The balance of the purchase price shall be paid in cash at the time of closing with adjustment for closing costs to be added or
deducted from this amount. If the SELLERS have an escrow account in relation to such mortgage or contract, such account shall be
brought current and BUYERS shall (check one):
_Purchase such escrow account and the balance of SELLERS' tax obligation under paragraphs 2 and 3, if any, shall be credited to
BUYERS at the time of closing.
_Assume said escrow account in lieu of SELLERS' tax obligations and tax prorations, in which event Paragraphs 2 and 3 herein shall
not apply.
_This Agreement (is) (is not) contingent upon SELLERS' release from liability on the mortgage/contract being assumed.
The mortgage/contract being assumed (does) (does not} provide for a variable interest rate.
The mortgage/contract being assumed (does) (does not) contain a balloon payment. Date of balloon, if any:

BUYERS

SELLERS

C. CONTRACT: BUYERS and SELLERS will execute a real estate installment contract with a balance due in the amount of
$
on the form of The Iowa State Bar Association in which BUYERS agree to pay monthly payments of
$
, including principal and interest at the rate of _ _ %, until the unpaid principal balance, together with accrued
interest. is paid in full, or until the amount due is reduced to the amount of the mortgage now or hereinafter placed on the property by
SELLERS, at which time SELLERS shall deliver to BUYERS a warranty deed. Interest shall commence on the date of possession and
the first monthly payment shall be 30 days after the date of possession unless otherwise mutually agreed by the parties.
The balance of the purchase price is to be paid in cash at the time of closing, with SELLERS adjustment for closing costs to be added
or deducted from this amount. If SELLERS now have or hereafter place a mortgage(s) on the property, such mortgage(s) may not
exceed the real estate contract balance, and the interest rate and amortization thereof shall be no more onerous than the interest rate
and amortization on the real estate contract. This Agreement is contingent upon the SELLERS' lender's approval, if required.
This contract (shall) {shall not) have a balloon payment. Date of balloon, if any: _ _ _ _ _ _ _ __
This contract (shall) (shall not) allow BUYERS to prepay all or any part of the principal without penalty;
This contract (shall) (shall not) be due and payable in full upon sale or assignment by the BUYERS;
This contract (shall) (shall not) require 1/12 of the annual insurance premium and taxes be paid to SELLERS with the monthly payments
into an escrow fund established by SELLERS. SELLERS shall use these funds to pay real estate taxes and insurance prior to their
delinquency. The parties shall review and make adjustments in the escrow account during the term of the real estate installment contract.
In the event that tax payments are not escrowed, Sellers shall pay all real estate tax installments, or portions thereof, for taxes
that accrue prior to possession. BUYERS shall pay all real estate tax installments, or portions thereof, for taxes that accrue after the date
of possession. The parties shall pay the installments for which they are responsible as they become due and prior to delinquency.
D.

OTHER: Attach Addendum.

Owners' Association Addendum to Residential Purchase Agreement

1. If the Property is subject to the provisions of a townhome, condominium, subdivision, cooperative or other homeowners'
association or declaration, Sellers shall furnish to Buyers within
days from the date of acceptance by Sellers
complete, current and accurate copies of the following:
A. A copy of the declaration (other than the plats);
B. A copy of the by-laws of the association;
C. A copy of the rules and regulations of the association;
D. A certificate from the Association containing:
A statement disclosing the effect on the proposed conveyance of any right of first refusal or other restraint on the
free alienability of the unit;
A statement of the amount of the monthly common expense assessment and any unpaid common expense or
special assessment currently due and payable from the selling unit owner;
A statement of any other fees payable by the unit owner to the association;
The current operating budget of the association, including details concerning the amount of the reserve fund for
repair and replacement and its intended use, or a statement that there is no reserve fund;
A statement of any capital expenditures approved by the association planned at the time of conveyance which
are not reflected in the current operating budget included in the certificate.
The most recent prepared balance sheet and income and expense statement, if any, of the association.
A statement of any judgments against the association and the existence of any pending suits to which the
association is a party.
A statement generally describing insurance policies provided for the benefit of the unit owners and that the
policies are available for inspection stating the location at which they are available.
A statement as to whether the association has knowledge that any alteration or improvement to the unit or to the
limited common elements assigned to the unit violates any provision of the declaration, by-laws, or rules or
regulations.
A statement as to whether the association has knowledge of any violation of health or building codes with
respect to the unit, the limited common elements assigned to the unit, or any other portion of the property
managed by the Association.
A description of any recreat'1onal or other facilities which are to be used by the unit owners or maintained by
them or the association, and a statement as to whether or not they are to be a part of the common
elements.
E. A statement by Sellers as to whether Sellers have knowledge:
That any alteration to the unit or to the limited common elements assigned to the unit violates any provision of
the declaration, by-laws, or rules and regulations.
Of any violation of health or building codes with respect to the unit or the limited common elements assigned to
the unit.
Buyers may, before closing and no later than _ _ days after receipt of said documents, elect to cancel this Agreement by
written notice of cancellation to Sellers. If Buyers elect to so cancel this Agreement, then this Agreement shall become null
and void and the earnest money paid by Buyers shall be refunded. In the event Buyers do not so notify Sellers of
cancellation, this Agreement shall be binding and remain in full force and effect.
2. If the declaration, articles of incorporation, or by-laws require that this Agreement or the Buyers be approved by the Board
of Directors (or other governing body) of the owners association or if any right of first refusal or comparable right exists, then
this Agreement is made expressly contingent upon such approval, or upon a waiver of such right, given in writing. Sellers
shall promptly give any such required notice, VJith a copy to Buyers, and shall diligently pursue any required approval. In the
event such approval is not granted or waived prior to
or closing, this Agreement shall be
null and void and all earnest money paid by the Buyers shall be refunded.
3. Sellers warrant that all monthly owners' association dues will be paid current as of the date of closing. Buyers
acknowledge that the present fee due to the owners' association is $
per :c:c:-c=-:-:cc---:- Periodic fees,
special assessments and other operating charges shall be adjusted to the date of settlement. No adjustment will be made for
any capital reserves.

Addendum for
Inspection of Private Sewage Disposal System
Buyer and Seller agree on the following initialed alternative to comply with the time of transfer
inspection of private sewage disposal systems:
There is a private sewage disposal system on this Property which serves the Property. Seller has obtained
or shall obtain at Seller's expense within _ _ days a certified inspector's report which documents the
condition of the private sewage disposal system, that it is of sufficient capacity to serve the Property, that
the continued use of the system is permitted, and whether any modifications are required to conform to
standards adopted by the Department of Natural Resources. Seller shall attach the inspection report to the
Groundwater Hazard Statement to be filed at closing.

If Seller receives an unsatisfactory report, the basis of which cannot be resolved between Buyer and Seller
days of delivery of a copy to Buyer, then upon written notice from Buyer to Seller, this
agreement shall be null and void and all earnest money paid hereunder shall be returned immediately to
Buyer.

within _

There is a private sewage disposal system on this Property. Weather or other temporary physical
conditions prevent the certified inspection of the private sewage disposal system from being conducted.
Buyer shall execute a binding acknowledgment with the County Board of Health to conduct a cert'1fied
inspection of the private sewage disposal system at the earliest practicable time and to be responsible for
any required modifications to the private sewage disposal system as identified by the certified inspection.
Buyer shall attach a copy of the binding acknowledgment to the Groundwater Hazard Statement to be filed
at closing. When the inspection is completed, an amended Groundwater Hazard Statement shall be filed
with the certified inspection and shall include the document numbers of both the real estate transfer
document and the original Groundwater Hazard Statement
Seller agrees at closing to deposit the sum of$

Dollars into escrow with .-:-c,.-cc,.,--:-c--;

z:=:-:=;-::-=--::-c==::c:c:-=:;-::-=-::::-== ("Escrow Agent") to reimburse Buyer for expenses incurred

for the cost of the inspection and any required modifications to the private disposal system. Escrow Agent
shall pay to Buyer, up to the amount held in escrow, amounts for required modifications after any such
modifications are completed and upon submission to Escrow Agent of a detailed invoice. If no
modifications are required, the entire escrow account shall be returned to Seller. Any funds remaining in
the escrow account after any required modifications shall be returned to Seller. Seller shall not be
responsible for any cost in excess of the escrow deposit.

There is a private sewage disposal system on this Property. The building to which the sewage disposal
system is connected will be demolished without being occupied. Buyer shall execute a binding
acknowledgement with the county board of health to demolish the building within an agreed upon f1me
period. Buyer shall attach a copy of the binding acknowledgement to the Groundwater Hazard Statement
to be filed at closing.
There is a private sewage disposal system on this Property. The private sewage disposal system has
been installed within the past two years pursuant to permit n u m b e r - - - - - - - - - - - - - - -

APPENDIXB
Offer to Buy Real Estate and Acceptance

THE IOWA STATE BAR ASSOCIATION

Official Form No. 153

FOR THE l.EGAI. EFFECT OF THE USE OF

THIS FORM, CONSUl. T YOUR LAWYER

,,'~

I"\

'?

'

. Dl . OFFER TO BUY REAL ESTATE AND ACCEPTANCE

t5'

1)

0~

&oci..xt\

TO:

1.

REAL ESTATE DESCRIPTION.

described as follows:

The Buyers offer to buy real estate in

, Sellers:
Counly, Iowa,

with any easements and appurtenant servient estates, but subject to the following: a. any zoning and other
ordinances; b. any covenants of record; c. any easements of record for public utilities, roads and highways, and d.
(consider: liens, mineral rights; other easements; interests of others.)
designated the Real Estate; provided Buyers, on possession, are permitted to make the following use of the Real
Estate:
, payable at
County, Iowa, as
2. PRICE. The purchase price shall be $
follows:

3.

REAL ESTATE TAXES. Sellers shall pay

and any unpaid real estate taxes payable in prior years. Buyers shall pay all subsequent real estate taxes. Any
proration of real estate taxes on the Real Estate shall be based upon such taxes for the year currently payable
unless the parties state otherwise.
4. SPECIAL ASSESSMENTS.
A. Sellers shall pay all special assessments which are a lien on the Real Estate as of the date of
acceptance of this offer.
B. If A. IS STRICKEN, then Sellers shall pay all installments of special assessments which are a lien on
the Real Estate and, if not paid, would become delinquent during the calendar year this offer is
accepted, and all prior installments thereof.
C. All other special assessments shall be paid by Buyers.
5. RISK OF LOSS AND INSURANCE. Risk of loss prior to Seller's delivery of possession of the Real Estate to
Buyers shall be as follows:
A. All risk of loss shall remain with Sellers until possession of the Real Estate shall be delivered to
Buyers.
B. IF A. IS STRICKEN, Sellers shall maintain $
of fire, windstorm and extended coverage
insurance on the Real Estate until possession is given to Buyers and shall promptly secure
endorsements to the appropriate insurance policies naming Buyers as additional insureds as their
interests may appear. Risk of loss from such insured hazards shall be on Buyers after Sellers have
performed under this paragraph and notified Buyers of such performance. Buyers, if they desire, may
obtain additional insurance to cover such risk.
6. CARE AND MAINTENANCE. The Real Estate shall be preserved in its present condition and delivered intact
at the time possession is delivered to Buyers, provided, however, if 5.a. is stricken and there is loss or destruction of
all or any part of the Real Estate from causes covered by the insurance maintained by Sellers, Buyers agree to
accept such damaged or destroyed Real Estate together with such insurance proceeds in lieu of the Real Estate in
its present condition and Sellers shall not be required to repair or replace same.
@The Iowa Slate Bar Association 2009
IOWAOOCS

153 Offer to Buy Real Estate and Acceptance

RevJsed June 2009

POSSESSION. If Buyers timely perform all obligations, possession of the Real Estate shall be delivered to
Buyers on - - - - - - - - - - - - - ' with any adjustments of rent, insurance, and interest to be made
as of the date of transfer of possession.
8. FIXTURES. All property thai integrally belongs to or is part of the Real Estate, whelher attached or detached,
such as light fixtures, shades, rods, blinds, awnings, windows, storm doors, screens, plumbing fixtures, water
heaters, water softeners, automatic heating equipment, air conditioning equipment, wall to wall carpeting, built-in
items and electrical service cable, outside television towers and antenna, fencing, gates and landscaping shall be
considered a part of Real Estate and included in the sale except (consider: rental items.)

7.

9. USE OF PURCHASE PRICE. At time of setllement, funds of the purchase price may be used to pay taxes
and other liens and to acquire outstanding interests, if any, of others.
10. ABSTRACT AND TITLE. Sellers, at their expense, shall promptly obtain an abstract of tille to the Real Estate
continued through the date of acceptance of this offer, and deliver it to Buyers for examination. It shall show
merchantable title in Sellers in conformity with this agreement, Iowa law and Title Standards of the Iowa State Bar
Association. The abstract shall become the property of the Buyers when the purchase price is paid in full. Sellers
shall pay the costs of any additional abstracting and title work due to any act or omisslon of Sellers, including
transfers by or the death of Sellers or their assignees.
11. DEED.
Upon payment of the purchase price, Sellers shall convey the Real Estate to Buyers or their
deed, free and clear of all liens, restrictions, and encumbrances
assignees, by
except as provided in 1 a. through 1 .d. Any general warranties of title shall extend only to the time of acceptance of
this offer, with special warranties as to acts of Sellers continuing up to time of delivery of the deed.
12. JOINT TENANCY IN PROCEEDS AND IN REAL ESTATE. If Sellers, immediately preceding acceptance of
this offer, hold title to the Real Estate in joint tenancy with full right of survivorship, and the joint tenancy is not later
destroyed by operation of law or by acts of the Sellers, then the proceeds of this sale, and any continuing or
recaptured rights of Sellers in the Real Estate, shall belong to Sellers as joint tenants with full rights of survivorship
and not as tenants in common; and Buyers, in the event of the death of either Seller, agree to pay any balance of
the price due Sellers under this contract to the surviving Seller and to accept a deed from the surviving Seller
consistent with paragraph 11.
13. JOINDER BY SELLER'S SPOUSE. Seller's spouse, if not a tilleholder immediately preceding acceptance of
this offer, executes this contract only for the purpose of relinquishing all rights of dower, homestead and distributive
shares or in compliance with Section 561.13 of the Iowa Code and agrees to execute the deed or real estate
contract for this purpose.
14. TIME IS OF THE ESSENCE. Time is of the essence in this contract
15. REMEDIES OF THE PARTIES
A. If Buyers fail to timely perform this contract, Sellers may forfeit it as provided in the Iowa Code, and all
payments made shall be forfeited or, at Seller's option, upon thirty days written notice of intention to
accelerate the payment of the entire balance because of such failure (during which thirty days such
failure is not corrected} Sellers may declare the entire balance immediately due and payable.
Thereafter this contract may be foreclosed in equity and the Court may appoint a receiver.
B. If Sellers fail to timely perform this contract, Buyers have the right to have all payments made returned
to them.
C. Buyers and Sellers also are entitled to utilize any and all other remedies or actions at law or in equity
available to them and shall be entitled to obtain judgment for costs and attorney fees as permitted by
law.
16. STATEMENT AS TO LIENS. If Buyers intend to assume or take subject to a lien on the Real Estate, Sellers
shall furnish Buyers with a written statement from the holder of such lien, showing the correct balance due.
17. SUBSEQUENT CONTRACT. Any real estate contract executed in performance of this contract shall be on a
form of the Iowa State Bar Association.
If lhe sale of the Real Estate is subject to Court approval, the fiduciary shall
18. APPROVAL OF COURT.
promptly submit this contract for such approval. If this contract is not so approved, it shall be void.
This contract shall apply to and bind the
19. CONTRACT BINDING ON SUCCESSORS IN INTEREST.
successors in interest of the parties.

-2-

20. CONSTRUCTION.

Words and phrases shall be construed as in the singular or plural number, and as

masculine, feminine or neuter gender, according to the context.

21. CERTIFICATION. Buyers and Sellers each certify that they are not acting, directly or indirectly, for or on behalf
of any person, group, entity or nation named by any Executive Order or the United States Treasury Department as a
terrorist, "Specially Designated National and Blocked Person" or any other banned or blocked person, entity, nation
or transaction pursuant to any law, order, rule or regulation that is enforced or administered by the Office of Foreign
Assets Control; and are not engaged in this transaction, directly or indirectly on behalf of, any such person, group,

entity or nation. Each party hereby agrees to defend, indemnify and hold harmless the other party from and against
any and all claims, damages, losses, risks, liabilities and expenses (including attorney's fees and costs) arising from
or related to my breach of the foregoing certification.

22. TIME FOR ACCEPTANCE. If this offer is not accepted by Sellers on or before
it shall become
void and all payments shall be repaid to the Buyers.
23. INSPECTION OF PRIVATE SEWAGE DISPOSAL SYSTEM. Delete inappropriate alternatives below. If no
deletions are made, the provisions set forth in Paragraph A shall be deemed selected.
A. Seller represents and warrants to Buyer that the Property is not served by a private sewage
disposal system, and there are no known private sewage disposal systems on the property.
B. The Property is served by a private sewage disposal system, or there is a private sewage
disposal system on the Property. Seller and Buyer agree to the provision selected in the attached
Addendum for Inspection of Private Sewage Disposal System.
C. Seller and Buyer agree that this transaction IS exempt from the time of transfer inspection
requirements by reason that _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _.

24. OTHER PROVISIONS.

Dated:-----------------

Buyer

Buyer

THIS OFFER IS A C C E P T E D - - - - - - - - - - - - - - - -

Seller

Spouse

Seller

Spouse

-3 -

Addendum for

Inspection of Private Sewage Disposal System

Buyer and Seller agree on the following initialed alternative to comply with the time of transfer
inspection of private sewage disposal systems:
There is a private sewage disposal system on this Property which serves the Property. Seller has obtained
or shall obtain at Seller's expense within _ _ days a certified inspector's report which documents the
condition of the private sewage disposal system, that it is of sufficient capacity to serve the Property, that
the continued use of the system is permitted, and whether any modifications are required to conform to
standards adopted by the Department of Natural Resources. Seller shall attach the inspection report to the
Groundwater Hazard Statement to be filed at closing.
If Seller receives an unsatisfactory report, the basis of which cannot be resolved between Buyer and Seller
within _
days of delivery of a copy to Buyer, then upon written notice from Buyer to Seller, this
agreement shall be null and void and all earnest money paid hereunder shall be returned immediately to
Buyer.
There is a private sewage disposal system on this Property. Weather or other temporary physical
conditions prevent the certified inspection of the private sewage disposal system from being conducted.
Buyer shall execute a binding acknowledgment with the County Board of Health to conduct a certified
inspection of the private sewage disposal system at the earliest practicable time and to be responsible for
any required modifications to the private sewage disposal system as identified by the certified inspection.
Buyer shall attach a copy of the binding acknowledgment to the Groundwater Hazard Statement to be filed
at closing. When the inspection is completed, an amended Groundwater Hazard Statement shall be filed
with the certified inspection and shall include the document numbers of both the real estate transfer
document and the original Groundwater Hazard Statement
Seller agrees at closing to deposit the sum of$

Dollars into escrow with---,-----,

.,---,---;-;-;;--,-,,-,-.,-=--:------,----, ("Escrow Agent") to reimburse Buyer for expenses incurred

for the cost of the inspection and any required modifications to the private disposal system. Escrow Agent
shall pay to Buyer, up to the amount held in escrow, amounts for required modifications after any such
modifications are completed and upon submission to Escrow Agent of a detailed invoice. If no
modifications are required, the entire escrow account shall be returned to Seller. Any funds remaining in
the escrow account after any required modifications shall be returned to Seller. Seller shall not be
responsible for any cost in excess of the escrow deposit.
There is a private sewage disposal system on this Property. The building to which the sewage disposal
system is connected will be demolished without being occupied. Buyer shall execute a binding
acknowledgement with the county board of health to demolish the building within an agreed upon time
period. Buyer shall attach a copy of the binding acknowledgement to the Groundwater Hazard Statement
to be filed at closing.
There is a private sewage disposal system on this Property. The private sewage disposal system has
been installed within the past Wto years pursuant to permit n u m b e r - - - - - - - - - - - - - - -

APPEND/XC
Residential Property Seller
Disclosure Statement

THE IOWA STATE BAR ASSOCIATION

Official Form No.155

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~~('

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FOR THE LEGAl. EFFECT OF THE USE OF

THIS FORM, CONSUl. T YOUR LAWYER

RESIDENTIAL PROPERTY SELLER

DISCLOSURE STATEMENT

SbC'Ii'>\'\

Property Address:
PURPOSE:
Use this statement to disclose information as required by Iowa Code chapter 558A. This law requires certain sellers of
residential property that includes at least one and no more than four dwelling units to disclose information about the
property to be sold. The following disclosures are made by the Seller(s) and not by any agent acting on behalf of the
Seller(s).
INSTRUCTIONS TO SELLER(S):
A.

Seller(s) must complete this statement. Respond to all questions, or attach reports allowed
by Iowa Code section 558A.4(2);

B.

Disclose all known conditions materially affecting this property;

c.

If an item does not apply to this property, indicate it is not applicable (NIA);

D.

Disclose information in good faith and make a reasonable effort to ascertain the required information. If the required
information is unknown or is unavailable following a reasonable effort, use an approximation of the information, or

E.

indicate that the information is unknown (UNK). All approximations must be identified as approximations (AP).
Additional pages may be attached as needed:

F.

Keep a copy of this statement with your other important papers.

DISCLOSURES:

1.

Basement/Foundation: Any known water or other problems?

Any known repairs?
If yes, date of repairs/replacement:

2.

Roof: Any known problems?

Any known repairs?
If yes, date of repairs/replacement:

3.

Well and Pump: Any known problems?

Circle response:
Yes
Yes

No

N/A

No

N/A

UNK
UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Sewer Systems: Any known problems?

Yes

No

N/A

UNK

Any known repairs?

Yes

No

N/A

UNK

Any known repairs?

If yes, date of repairs/replacement:
Any known water tests?
If yes, date of last report:
and results:
4.

Septic Tanks/Drain Fields: Any known problems?

Location of tank:
Date tank last cleaned:

5.

If yes, date of repairs/replacement:

6.

7.

Heating System(s): Any known problems?

Yes

No

N/A

UNK

Any known repairs?

If yes, date of repairs/replacement:

Yes

No

N/A

UNK

Central Cooling System(s): Any known problems?

Any known repairs?

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

If yes, date of repairs/replacement:

8.

Plumbing System(s): Any known problems?

Any known repairs?
If yes, date of repairs/replacement:

The Iowa Stale Bar Association 2000

IOWAOOCS

156 RESIDENTIAl. SELLER DISCLOSURE STATEMENT

Revised December 2009

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

If yes, date of last report:

and results:

Yes

No

N/A

UNK

13.

Lead-Based Paint: Any known to be present in structure?

Yes

No

N/A

UNK

14.

Flood Plain: Do you know if the property is located in a flood plain?

Yes

No

N/A

UNK

Electrical System(s): Any known problems?

Any known repairs?

9.

If yes, date of repairs/replacement:

10.

Pest Infestation (e.g., termites, carpenter ants): Any known problems?

If yes, date(s) of treatment:
Any known structural damage?
If yes, date of repairs/replacement:
Any known inspections?
If yes, date of last report:
and results:

11.

Asbestos: Any known to be present in the structure?

If yes, explain:

12.

Radon: Any known tests for the presence of radon gas?

If yes, what is the flood plan designation:

15.

Zoning: Do you know the zoning classification of the property?

If yes, what is the zoning classification:

Yes

No

N/A

UNK

16.

Covenants: Is the property subject to restrictive covenants?

If yes, attach a copy or state where a true, current copy of the covenants can be obtained.:

Yes

No

N/A

UNK

17.

Shared or Co-Owned Features: Any features of the property known to be shared in

common with adjoining landowners, such as walls, fences, roads, and driveways whose use
or maintenance responsibility may have an effect on the prope11y?

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Yes

No

N/A

UNK

Any known "common areas" such as pools, tennis courts, walkways, or other areas
co-owned with others, or a Homeowner's Association which has any authority over the
property?
18.

Physical Problems: Any known settling, flooding, drainage or grading problems?

19.

Structural Damage: Any known structural damage?

20.

See attached Disclosure of Information on Lead-Based Paint and/or Lead- Based Hazard
and the attached pamphlet, Protect Your Family from Lead in Your Home.

You MUST explain any "YES" response(s) above. Use the back of this statement or additional sheets as necessary. If reports
are attached, identify the reports and the questions to which they pertain.

SELLER(S) DISCLOSURE:
Seller(s) discloses the information regarding this property based on information known or reasonably
available to the Seller{s). The Seller(s) has owned the property since
The Seller(s) certifies that as of the
date signed this information is true and accurate to the best of my/our knowledge.

Seller(s) acknowledges requirement that Buyer(s) be provided with the "Iowa Radon Home-Buyers and Sellers Fact Sheet"
prepared by the Iowa Department of Public Health.

Seller-----------------

Seller-----------------

Date: - - - - - -

Date: - - - - - -

BUYER(S) ACKNOWLEDGEMENT:
Buyer(s) acknowledges receipt of a copy of this Disclosure Statement. This Disclosure Statement is not intended to be
a warranty or to substitute for any inspection the Buyer(s) may wish to obtain.
Buyer(s) acknowledges receipt of the "Iowa Radon Home-Buyers and Sellers Fact Sheet" prepared by the Iowa
Department of Public Health.

Buyer _________________________________

Buyer ____________________________________

Date:

Date:

APPENDIXD
Lead-Based Paint Disclosure - Sales

THE IOWA STATE BAR ASSOCIATION

Official Form No.1 56

r~~
g
. lSi w~.

FOR THE LEGAL EFFECT OF THE USE OF

THIS FORM, CONSULT YOUR LAWYER

LEAD-BASED PAINT DISCLOSURE- SALES

\~:ibcr,...:f)0..;-

Property Address or Legal Description:

Lead warning Statement

Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such
property may present exposure to lead from lead-based paint that may place young children at risk of developing lead poisoning. Lead
poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence
quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The seller of
any interest in residential real property is required to provide the buyer with any information on lead-based paint hazards from risk
assessments or inspections in the seller's possession and notify the buyer of any known lead-based paint hazards. A risk assessment
or inspection for possible lead-based paint hazards is recommended prior to purchase.
Seller's Disclosure
(a)

(b)

Presence of lead-based paint and/or lead-based paint hazards (check (i) or (ii) below):
(i)

Known lead-based paint and/or lead-based paint hazards are present in the housing
(explain).

(ii)

Seller has no knowledge of lead-based paint and/or lead-based paint hazards in the housing.

Records and reports available to the Seller (check (i) or (ii) below):
(i)
Seller has provided the purchaser with all available records and reports pertaining to lead-based paint andfor
lead-based paint hazards in the housing (list documents below).
(ii)

Seller has no reports or records pertaining to lead-based paint and/or lead-based paint hazards in the
housing.

Buyer's Acknowledgment (Initial)

_ _ _ By execution of this disclosure, Buyer acknowledges receipt of copies of all information listed above including receipt of the
pamphlet, Protect Your Family from Lead in Your Home.
This agreement is contingent upon a risk assessment or inspection of the Property for the presence of lead-based paint and/or
lead-based paint hazards at the Buyer's expense until 5 p.m. on the
day of
[lnserl date 10 days after contract ratification or a date mutually agreed upon]. (Intact lead-based paint that is in good condition is not
necessarily a hazard. See the EPA pamphlet Protect Your Family From Lead in Your Home for more information). This contingency will
terminate at the above predetermined deadline unless the Buyer (or Buyer's agent) delivers to the Seller (or Seller's agent) a written contract
addendum listing together with a copy of the inspection and/or risk assessment report. The Seller may, at the Seller's option, within
days after delivery of the addendum, elect in writing whether to correct the condition(s) prior to closing. If the Seller will correct the condition,
the Seller shall furnish the Buyer with certification from a risk assessor or inspector demonstrating that the condition has been remedied
before the date of closing. If the Seller does not elect to make the repairs, or if the Seller makes a counter-offer, the Buyer shall have
days to respond to the counter-offer to remove this contingency and take the property in "as is" condition or this
Agreement shall become void. The Buyer may remove this contingency at any time without cause.
Buyer hereby waives this contingency. (initial).
Agent's Acknowledgement (initial).
Agent has informed the Seller of the Seller's obligations under 42 U.S.C. 4852d and is aware of Agent's responsibility to
ensure compliance.
Certification of Accuracy
The following parties have reviewed the information above and certify, to the best of their knowledge, that the information they have
provided is true and accurate.

SELLER

Date

BUYER

Date

SELLER

Date

BUYER

Date

AGENT

Date

AGENT

Date

The Iowa Stale Bar Association 2007

!OWADOCS

Form 156 Lead-Based Paint Disclosure- Sales

Revised September 2007

APPENDIXE
Iowa City Area Association ofRealtors
Purchase Agreement

m.

RESIDENTIAL REAL ESTATE PURCHASE AGREEMENT

REAlTOR'"

This form approved by the lo;Na City Area Association of REALTORS

Date of Agreement _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 20_ __

TO------------------------------------------------------------------'------------------(SELLERS:),
1.

REAL ESTATE DESCRIPTION. The undersigned BUYERS hereby offer to buy real estate in _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

County, Iowa, locally known as:---~----~-------------------------------

and FOLLOWING THE LEGAL DESCRIPTION CONTAINED IN THE TITLE DOCUMENT BY WHICH THE SELLER RECEIVED TITLE TO THE
PROPERTY, SUBJECT TO APPROVAL OF BUYER'S ATTORNEY, or describelj as follows:

wilh any improvements located there on, easements of record and appurtenant servient estates, and subject to the following: {a) any zoning and other
ordinances; {b) any covenants of record; (c) any easements of recoro for public utilrties, roads and highways; and (d) _:_ _ _ _ _ _ __
(conslder: liens, other easements, interests of others) designated the Real Estate; provided BUYERS, on possession, ara permitted

to make the follcrwing

use of the Real E s t a t e = - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Ditapplicable, see HOMEOWNERS ASSOCIATION/CONDOMINIUMASSOCIATIONICO.MMON INTEREST COMMUNITY ADDENDUM (HOA).

2.

PURCHASE PRICE. The Purchase Price ~hall be $

and the method of payment shall be as follows:$-----------~--with this offer to bB deposited upon acceptance of this offer, in the trust account ofr_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
to be delivered to fi:le SELLERS upon Performance of SELLERS' obligations and satisfaction of BUYERS' contingencies, if any, and the balance of the
purchase price as ~esignated below.

Select (A) (B) and/or (C) or (D)

ADNEW MORTGAGE: Check 0(CONV)0(FHA) orO (VA)
This Purchase Agreement is contingent upon the BUYERS obtaining a written commitment for a first real estate mortgage for _ _ _% of the
Purchase price with interest an the promissory note secured thereby of not more tlian
% amortized ov~r a term of not less than _ _ __
years. BUYERS agree to pay no more than _ _ _% for loan origination fees and points,
years, with a ballqon due dats of not less than
and to pay in addition all other customary loan costs. BUYERS agree upon acceptance of this offer to immediately make application for such mortgage
with a commercial mortgage lender and to exercise, good falth efforts to obtain a mortgage commitment as 'above provided. Upon receiving written loen
commitment, (supported by the lender's reqUired appraisal), BUYERS shall release this contingenCy in writing. If BLiYERS have not de~vered a written
financing contingency relea$e containfng the above tetms, or terms acceptable to BUYERS on or before
__
.
A.M.
P.M.
Noon ) either SELLERS BUYERS may declare this PurchaSe Agreement null and void and all payments made
at
(
hereunder shall be returned. BUYERS shall pay the balance of the purchase price at the time of the clos!ng by combination of BUYERS' personal
funds and the net mortgage proceeds.

D
c. D OTHER RNANCING TERMS:

B.

CASH: BUYERS will pay the balance of the purchase price in cash at the ttme of closing. This Purchase Agreement is not contingent upon
BUYERS obtaining such funds.

D.

3.

If a Mortgage Assumption, Installment contmct Assumption, or Installment contract Sale, see attached addendum.

POSSESSION. If BUYERS timely perform all obligations, possession for the Real Estate shall be delivered to BUYERS on
20

-c;=======:cc'

with any fl.djustments of rent taxe-s, iTu;urnnca, interest, and other applicable matters to ba mad a as cf the date oft-ansfer of pussession.
Closing of the tra"nsaction shall occur after approval of title and vacation of the premises by the SELLERS, in the condition ready for BUYERS'
possession. Possession shall not be delivered to the BUYERS until completion of the dosing, which shall mean delivery to the BUYERS of all title
transfer documents and receipt of the purchase price funds then due from BUY!;RS. If by mutual agreement the parties select a different possession
or closing date, they shall execute a separate agreement seHing forth the terms thereof.
4.

REAL ESTATE TAXES. SELLERS shall pay all real estate taxes which arn due anti payable and constitute a lien against the above described Real
Estate and any unpaid rea! estate taxes for any prior years. Except for the tax proration hereinafter set forth, BUYERS shall pay all subsequent real
and payable in the
estate faXes. SELLERS shall also pay a prorated share of the real estate taxes for the "fiscal year ending June 30, 20
based upon one of the following formulas: Select (A) (B) or {C).
fiscal year commencing July 1, 20
A.
Net taxes payable In the current fiscal year in which possession is given to BUYERS. (Do not select this alternative if the current year's
taxes ate based upon a vacant lot or partial construction assessment.)
Net taxes pald in the current fiscal year of possession (
plus/
minus)
%thereof.
B.
C.
An amount calculated based upon the assessed valuation, legislative tax rollback, and real estate-tax exemptions that will actually be
applicable to and used (or the calculation of taxes payable in the fiscal year commencing July 1 . 20
If, at the time of closing, the tax
rate is not certified, then the most current, certified tax rate shall be used.

0
0
0

5.

SPECIAL ASSESSMENTS. Select: (A) or (B)

A.

B.

0
0

SELLERS shall pay an special assessments which are a lien on the Real Estate as of the date of closing.
SELLERS shall pay all installments of special assessments which are a lien on the Real Estate and, If not paid, would become delinquent
during the calendar year this offer ls accepted, and all prtor installments thereof. All other special assessments shall be paid by BUYERS.

Buyers' Initials-------- Seller's Initials>_ _ _ _ _ _ _ _ Acknowledge they have read this page.

~ fmmsimplicity
fonns.m<~<Orm!e.f.,.ny.

Page 1 of4

6.

FIXTURES. All prOperty that Integrally belongs to or Is part of the Real Estate, whether attached or detached, such as light ffxtures, shades, rods,
blinds, automatic garage door openers and transmitter units, all drapery rods and cu~in rods, awnings, windows, stonn doors, screens, plumbing
fiXtures, water heaters, water softeners {unless water softener Is rental), automatic heating equipment, air conditioning equipment. wall~to-wan
carpeting, mirrors attached to walls or doors, fireplace screen and grate, attached barbecue grills, weather vane, all buHt~in kitchen appliances. built-in
Items and electrical service cable, outside television towers and antenna, fencing, gates and landscaping shall be considered a part of Real Estate
and also jncludlng the f o l l o w i n g : - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

Each of the above Included items is a fixture that integrally belongs to or is a part of th.e Real Estate. In the event any of the above items are
characterized as personal property, such personal property items are not considered a part of the ~eal Estate and shall be transferred with no
monetarY value, free and clear of all liens and encumbrances. The following items shall be excluded:
7.

8.
9.

OEED. Upon payment of the purchase price, SELLERS shall convey the ~eaf Estate to BUYERS or their assignees, by ""'""::-::~;-;:;.---;=c:::-=-:c:cc.
--=-:-==-:--::--;-Deed, free and clear of all liens, restrictions, and el"!cumbran~s except as provided in 1(a) through 1(d). Any general
warranties of tiDe shall extend only to the time of acceptance of this offer, with special warranties as to acts of SELLERS continulrig up to time of
"!1elivery of the ?eed.
TIME IS OF THE ESSENCE. Tim~ is of the essence In this contract
CONDITION OF PROPERTY.
A. . The property as of the dale of this Purchase Agreement fncludlng buildings, grounds, and all Improvements will be preserved by the
SELLERS in its present Condition until possession, ordinary wear and tear excepted. Tile SELLERS warrant that the heating, electrical plumbing,
and air conditioning systems, well (if app!icable) and all included applianCes will whether subject to ln.spectlon set forth hereinafter or not, be In
good working order and condition as of the date of delivery of possession. In determining whether or not the warranted systems are in good
working condition and. for the purpose of inspecting the property as outlined in Paragraph 98 (1) of this Purchase Agreement, working condition
shall be defined as operating In a manner In which the item was designed to operate.
B.

The BUYERS must choose one of the following alternatives relative to the condition and quality of the property:
1)
By.
. . OAM/0 PM on
, 20______, the BUYERS may, at their sole expense, have the property inspected by a
person or persons of their choice, including but not limited to a qualified home inspector, contractor(s), engineer(s), or other such
professlonal(s)~ to determine If there are major deficiencies in the FOLLOWING MAJOR COMPONENTS of the Real ESlate: central
heating system, central cooling system, plumbing system, well and weli water (if applicable), electricalsystem, roof, wa.lls, ceilings, floors,
foundation and basement. SEUERS and BUYERS acknowledge that the property may have imperfect cosmetic conditions that do not
affect the working cOndition of the item and are not considered major deficiencies, including, but not limited to, broken seals In windows;
minor tears, worn spots. or discoloration of floor coverings, \"Jallpapor, or window treatments; nail holes, scratches, dents, scrapes, or
chips In ceilings, walls, floors; and/or surface cracks in driveways or patios. Failure to meet present construction standards and code
requirements Is not considered a deficiency in the property unless it is new construction, or unless that failure produces a condition which
creates an unreasonable danger o~ risk to the property or fo if:s occupants. By the samo data, BUYERS must notify the SELLERS in
writing of any MAJOR deficiencies for which they are requesting remedies. The notification must be accompanied by a copy of a written
inspection report from a qualified Inspector identifying the deficiencies. SELLERS shall, within FIVE (5) calendar days after receipt of
BUYERS' notlftcatron, notify the BUYERS In writing either that (1) SELLERS agree to remedy th~ deflclencles as requested by BUYERS,
in which case this Purchase Agreement as so modified shall be binding on all parties, or (2) SELLERS do not agree to the remedy request
in whole or in part and offer a counter pi:Qposal to BUYERS. Upon recelpt of said counter propoSal from SELLERS, the BUYERS shall
have FIVE (5} days in which to accept the SELLERS' counter proposal by signing It, or to notify the SELLERS in writing that such steps
are not acceptable, in which case, either SELLERS or BUYERS may declare this offer null and void, anc:l any eamest money shall be
returned to BUYERS. IN THE ABSENCE OF WRITTEN NOTICE OF ANY DEFICIENCY FROM BUYERS, OR, IF BUYERS FAIL TO
RESPOND TO THE SELLERS COUNTER PROPOSAL, WITHIN THE TIME SPECIFIED HEREIN, Ti-llS PROVISION SHALL BE
DEEMED WAIVED BY PARTIES AND THIS PURCHASE AGREEMENT SHALL REMAIN IN FUL FORCE AND EFFECT. IF THE
SELLERS FAIL TO RESPOND TO THE BUYERS' REMEDY REQUEST WITHIN THE TIME SPECIFIED HEREIN, BUYERS MAY
DECLARE THE OFFER NULL AND VOID AND ALL EARNEST MONEY SHALL BE RETURNED.

____ 0

2)

BUYERS acknowledge that they have been advised of their right of property Inspection and have declined to make said

lniti;;~!s

C.

Inspection.
The BUYERS must choose one of the following alternatives relative to the presence of radon in the hoine:
1)
By
.
OAM/0 PM on
20_ _ , the Buyers may, attheirsoleexpense, have the property tested for the
presence of radon gas.
Such test shall be conducted by an Iowa Certified Radon Specialist Seller agrees to sign documents required for the test to be completed
and agrees to cooperate with the specialist in canying ~ut the test Sy the same date, BUYERS must notify SELLER in writing of any radon
in excess of ___ pCJ/L. The notification shall be accompanied by a copy of the written radon report. The cost of mitigation, if necessary,
shall be negotiated within the timo frames and remedies fn paragraph 9B(1).

DBUYERS acknowledge that they have been advised of their right to conduct a radon test and have declined to order

2)
Initials
D.

said test.

Septic System to be Inspected and Repaired Oves

No~ Not Applicable Iowa Code 4558.172 mandates the inspection of septic

systems, unless exempt, pr'1or to the transfer of property. If applicable see the attached Septic System Inspection and Repair Addendum.
E.

The BUYERS shall be permitted access to the property prior to possession or clOsing, whichever is sooner, in order to detennine that there
have been no changes In the condition of the property except those mutually agreed upon and that it Is ready for BUYERS' possession. At the
time of closing or possession, whichever occurs sooner, BUYERS will accept property in its present condition without further warranties or
guarantees by SELLERS or BROKER concerning the condition of the property. This, however, shall not relieve the SELLERS of any liability
for any oondition(s} that is (are) defined as latent defect(s) or any express written warranties contained in this Purchase Agreement or other
written agreement between the parties; nor shall this paragraph relieve the SeUers of any liabi!ity for any implied warranty applicable under
Iowa law.

Buyers' Initials,_ _ _ _ _ _ _ _ Seller's Initials,_ _ _ _ _ _ _ _ Acknowledge they have read this page.

~ formsimplicity
f<>,m>.miKio>lmpi;J.fir>lll)<

Paga2of4

The Inspection of any part of the property not covered In 98(1 )-orthe remedy of any condition not addressed- in 98(1), including but not
limited to cosmetic conditions that the BUYERS require ~hall be addressed In Paragraph 27 of this Purchase Agreement.
10. WOOD DESTROYING INSECT INSPECTION. Select (A) or (B)
A. Osy
D AMID PM on
20___, BUYERS may, at B~RS' expense, have the property Inspected for termites or other

F.

wood destroying insects by a licensed Pest lnspeor. If active lnfesta11on or damage due to prior Infestation Is discOvered, SELLERS shall have
the option of either having the property treated tor Infestation by a HcenSed Pest Exterminator and having any damage repaired to the BUYERS'
satisfaction, or declaring this Purchase Agreement void. This provision shall not apply to feilces, trees, shrubs, or out buildings other than
garages. BUYERS may accept the property in its existing condition without such treatment or repairs. IF BUYERS ARE OBTAINING VA
FINANCING, THEN THE COST OF THE TERMITE INSPECTION SHALL BE BORNE BY THE SELLERS.
B.
Initials

0BUYERS. acknowledge that they have been advised of their right of a pest inspection and have declined to make said Inspection
unless required by lending Institution at which th:ne said inspection would be at BUYERS' eXpense and the BUYER will have the
same rights as under paragraph 10A if active infestation or damage d_ue to prior infestation Is discovered.

11. INSURANCE. SELLERS shall beat the risk of loss or damage to the property prior to closing or possession, whichever first occurs. SELLERS agree
to maintain existing Insurance and BUYERS may purchase additional Insurance. In the event of substantial damage or destruction prior to closing, this
Purchase Agreement shall be null and void, unless otherwise agreed by 1he parties. The property shall be deemed substantially damaged or
destroyed if it cannot be restored to its present condition on or before the closing date; provided, however, BuYERS shall have the option to complete
the closing and receive insurance proceeds regardless qf the extent of damages.

12. USE OF PURCHASE PRICE. At time of settlement, funds of the purchase price may be used to pay taxes and other liens and to acquire .outstanding
interests, If any, of others.

13. ABSTRACT AND TITLE. SELLERS,

at

their expense, shall prompUy obtain an abstract of title to the Real Estate continued through the
date of acceptance of this offer, and deliver it to BUYERS for examination. It shall show merchantable title In SELLERS' names in conformity
with this Purchase Agreement, Iowa law, and Title Standards of the Iowa State Bar Association. The abstract shall become the property of
the BUYERS When the purchase prloe Is paid in fulL SELLERS shall pay the costs of any additional abstracting and title work due to any act
or omission of SELLERS, including transfers by or the death of SELLERS or thetr assignees. If, at the time of closing there remain
unresolved title objections. the parties agree to escrow froni the sale proceeds a sufficient amount to protect the BUYERS' inter-ests until
said' objections are corrected, allowing a reasonable time for the corrections of said objections; provided, however, that if the commercial
mortgage lender of the BUYERS will not make the mortgage funds available with such escrow, the provisions for escrow for title defects
shall not be applicable.

14. JOINT TENANCY IN PROCEEDS AN.D IN REAL ESTATE. If SB...LERS, immediately preceding acceptance of the offer, hol.d title to the Real ;state
In joint tenancy with full right of survivorship, and the joint tenancy is not later destroyed by operation of law or by acts of the SELLERS, then the
proceeds of this sale. 3nd continuing or recaptured rights of SELLERS in the Real Estate, shall belong to ?ELLERS as joint tenants with full right of
survivorship and not as tenants in common; and BUYERS, in the event of the death of either SELLER, agree to pay any balance of the price due
SELLERS under this contract to the sutvfving SELLER and to accept a deed from the surviving SELLER consistent with paragraph 7.

15. JOINOER. aY SELLER'S SPOUSE. SELLER'S spouse, if not a Iitle holder immediately preceding acceptance of this offer, execute~ this contract
only far the purpose of relinquishing of all rights of dower, homestead and distributive stiare or in compliance with Section 561.13 of the Iowa Code
and agrees to execute the deed or real estate contract for this purpose.

16.

REMEDIES OF THE PARTIES.

A
H BUYERS fall to timely perform this contract, SELLERS may forfeit it as provided in the Iowa Code, and all payments made shall be forfeited or,
at SELLERS' option, upon Thirty (30) days written notice of infention to accelerate the payment of the entire balance t)ecause of such failure
(dlling which thirty days such fa-Ilure Is not corrected) SELLERS may declare the entire balance immediately due and payable. Thereafter this
contract may be foreclosed In equity and the COurt may appoint a receiver.
B.
C.

If SELLERS fail to timely perfonn this contract, BUYERS have the right to have all payments made returned to them.
BUYERS and SELLERS also are entitled to utilize any and all other remedies or actions at law or In equity available to them and shall be entitled
to obtain judgment for costs and attorney fees as permitted by law.

D.

In the event the BUYERS fail to perform their obligations hereunder and the SELLERS successfuUy forfeit any payments made under this
contract, upon receipt by SELLERS, the SELLERS shall pay Broker one-half of the forfeited payment, said one-half not to exceed lhe total
commission due to the Broker. In the event the SELLERS fail to perfonn SB-LERS' obligations under this contract when required to do so,
SELLERS shall pay to 13roker the Broker's commission in the amount set forth in the SELLERS' Listing Agreement with the SEU.ERS' Broker

17. STATEMENT AS TO UENS. If BUYERS intend to assume or take subject to a lien on the Real Estate, SELLERS shall furnish BUYERS with a
written statement prior to closing from the holder of sur:::h lien, showing the correct balance due.
18. APPROVAL OF COURT. If the sale of the Real Estate is subject to Court approval, the fiduciary shall promptly submit this contract for such
approval. If this contract is not so approved by the
day of
20
either party may declare
this contract nu11 and void, a~d all payments made hereunder shall be returned to BUYERS.
19. CONTRACT BINDING ON SUCCESSORS IN INTEREST. lhiS contract shall apply to and bind the successor.s In Interest of the parties.

20. CONSTRUCTION. Words and phrasas shall be construed as ln the singular or plural number, and as masculine, feminine or neuter gender,
according to context.
21. SURVEY AND SQUARE FOOTAGE REPRESENTATION. The BUYERS may, within _ _ days of acceptance of offer, have the property surveyed
at their expense. If the survey, certified by a Registered Land Surveyor, sHows any encroachment on said property or if any Improvements lor:::ated on
the subject property encroach on lands of others, such ericroachments shall be treated as a title defect. Assuming a representation far square footage
has been made, BUYERS understand and agree that said representation is only an approximation of the eXact number of square feet the property
contains. The BUYERS have the right to obtain lheir own measurement of square footage.
22. AGENCY DISCLOSURE. The Llsting and Selling Agents/Brokers ars agents of the parties hereto as outlined below, and their fiduciary dutles of
loyalty and faithfulness are owed to the party they represent. However, they must treat the other party with honesty and fairness.

Buyers' Initials-------- Seller's Initials,_ _ _ _ _ _ _ _ Acknowledge they have read this page.

~ formsimplicity

Page 3 of4

The SELLERS in thh; transaction are represented by:

-------------------------------~------{AgentJBrokerage Names)
E-mail: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _- ' - -

Fax: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

The BUYERS in this transaction are represented by:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ( A g e n t / B r o k e r a g e Names)

E~mail:
Fax:----~-------------------If Agent (including Appointed Agency) and/or Brokerage (Including Consensual Dual Agency) Names are shown as representing both parties, a
detailed explanation of representation shall be attached. Further, the BUYERS and SELLERS acknowledge that prior to signing this Purchase
Agreement that thelnespective Listing or Sel!ing Agent made a written disclosure of type of repres~ntation being provided.
23. RESIOE:NTIAL _,ROPERTY SELLER DISCLOSURE STATEMENT.
The Buyer(s} acknowledge receipt of the Residential Property Seller
Disclosure Statement prior to executing this Purchase Agreement A copy of the Residential Property Seller Disclosure Statement is attached to the
Purchase Agreement.
Not Applicable

24. NOTICE. Any notice. required under this Purchase Agreement shall be in writing and shall be deemeg effective If to BUYERS when physical delivery
Is received by BUYERS or by BUYERS' Agent, and effoot.ive to SELLERS when physical delivery is received by SELLERS or SELLERS' Agent.
Physical delivery may be either by personal delivery or upon the date of the posting of said notice posted by Certifi~ Mail. As an alternative to
physical da!ivery, any signed document or written notice may be delivered to the respective principal's agent, as set forth In Paragraph 22 herein, in
electronic form by facsimile or e-mail. The facsimile or e-mail delivery confinnation shod! constitute notice of delivery. Documents with original
signatures shall be provided, by the agent, to their principal.

FQrfueSELLERS: ______________________________________~-

Addre~=-------------------------------------------------For~eBUYERS: ______~------------------------------------Address: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
25. REPRESENTATIONS. It Is understood that no representations made by the agent in the negotiation of this sale are being relied upon unless
incorporateil herein or endorsed in writing.
26. COUNTER PARTS CLAUSE. All partie3 agree to be bound to this contract even if every party does not sign on one original, as long as each copy
thai is signed is identical to every other signed copy.

27. OTHER PROVISIONS.

28. TIME FOR ACCEPTANCE. IF this offer is not accepted by SElLERS on

20
at
A.M.
P.M.
NOon) It shall become void and all payments sha-~ll-.:bccec:re:::p:-:a:;:id"lo,-o;1h:-:e:-;B;;;Uc;Y'"ER=s00.~.--~
---~ - - - - - - -

(D

-THIS IS A LEGAL, BINDING CONTRACT. IF NOT UNDERSTOOD, SEEK COMPETENT LEGAL ADVICE-
T!"!e undersigned have read and agreed to tho terms and conditions of this- purchase agreement.

DATED:~------------------- 20. _ _ _ _ _ _ , at ____________ (0AM. 0

BUYER {PRINl]

BUYER (PRINl]

BUYER (SIGNATURE)

BUYER(SIGNATURE)

This offer is accepted.:_- - - - - - - - - - - - - 2Q._________ al _ _ _ _ _ _ (

SELLER (PRINl]

SELLER (PRINT]

SELLER (SIGNATURE}

SELLER (SIGNATURE)

A.M.,

For information only.

The Seller(s) acknowledge receipt of ths offer--:::-=.,-----:---:-----,.-.,-:-:-(DATE)
(TIME)
(INITIALS)

~ fmmsimplicity

P.M. 0

Noon).

P.M.).

Page 4 of 4 Revision Date: 4111

APPENDIXF
Title Guaranty Commitment

SetlalNo. Cwl000553

Commitment for Title Guaranty

The TJtlo Guaranty Divi$oo Q[(he Towil Fins~ Au!hwity, _Weio_l;!~l(rl tbtl _Di_vi$-{Qn_, fo.r ~ W!!W!>bk-.;.~klil~tioo., (;OOlllliWtll i~~ it$-TitkG~antyCutlfkatq -or CMifiea~ ~~ idcn1ifled in Sclw4ule A, ht mvot oftlw P~ C'lllarnnt(i namtd in SdtoduleA, asowtwf wfrlQft;Si!ig>oo or~ ~e oriJlt.i!MMinthi land ~001 or referrodto in Sclwdule A,. upon Nl-YffloCntofthe prem_iu.nw 3114 ~r_ge; and
t:OO'Ipl~~- with 1M! R~!fllmt:onU; all subje~u, tl!4! vrov.WOJ!$ ofScl!il:d-1li~A a,M:B andW.t!LCl CQJt_d-i11QM oftl;isCOO!fl!itm~t.
n~ C'olruni lmllnt sltt~11 be \l-ffirctiw ooly wl!en tlw.lOOtti\'( of tlro- P~<l C'tllflrel~~i M<f tJw. Arw.wnt of Co'<'(! rng.Q comrflitt4 fM l~av(l bouJ
:insc.rt-ed in Scll(!duk! A bytlw Divis-irm -or by a DivitiionPa:ttkipsnt.

Alllbbility MdubH:vtiQJI ~-tl!i$; QJ.n1JUit.riE!:JrtsAAII e~~-e an9'E_nni@l:;; &ill. (9) m\i!rthla(t.;g~ ttw [iff(!ctive ~u OJWlwfi ttw C"rtiftPii\'i rn'
Ccttitlcat:lsco.nllnittcd forsliall iuuc, wbidtevtt fiut<Xems, pmvidod -that faHIUC- to issuc-tltd:::Crtille~~~ or Ca1ificaw i> not tltc fault ortw
Oiv~ioo.

IN WJ.TNES!Ii WHEREOF, -tJl<' Title Guaranty Diviiii)ft, MiscausOO lhis Orunitnwnt m be sisnM and smlad:ii~its:Jmm(! by its duly
;l!utl!mi~do-Hl!m; by dircq.Joo ()fit$ 81{4, to() tmne bl!!-dln$ wlw:A "ffill1~ffijptllty lt$ Difo;:1W, "(jfby af,!lvi.siooPi!aticiJOOt.

By

x,ri 'd Ol"

l..l)yd W. 01);1~ J>lrl!('t(lr

tli;!;t.;.;l0imlll4
~(!li)

OJ,MMll"M;e.li'OC).o (:.l!I005Jl

DA.tl! JU;VJSEftJiiOil25,1.()}? il! Ot.411;3i AM

ilo.~'lllil;;r~~,J"l~~"""'""""~~~~~~~~~!'rl!!!:.~,....hnl;ft!q~'JI~

15

Coud !Hom;

2.

Tf~ ~~-l ('I'U3f8ntQq.tJJill-fJ o.r~quircd ~~ klwwli!d,gli! ofsny~f11ct,

lilln_, mct!mhr~Q-, :,1dv~ c4im e>r o1h;;!fm$~;Ufer;t!ng

-dl<t! Oltta'k! mintcre&1 ofmoltg3&i!tll~f(l)n ro"nradby 111,\s Comml1!n11nt oth>er than th001-thov.n lnSclwdula 'B IICfC~)r. :find $11:!'111 fail to
diocloro Ml<lhkMwlodg<:10 tlti DivklM in \lltitlng, 1llc- Divlsloosfu'IR be relitvtd from llilbiliJ foranyl<m orda:lnsg1! ttm~.lting frrun
\'11\Y $.'t of ocll~c M>fnooto 4!,-q.cxbW.t 1M- Divi$\00 i!!lpr4j\14inl by fl1ilur~;~-19i() tlbo;:lO;jll}>i-~_b lmow\qd,gQ. _lf tlll;lp:f~ ~Mt~d
sll:all disCI OS(! :o-uch knowledge totlw- DM$km, or if t1t,e Divi!ion 0'\loornisc- acqujrw oc'll!all:.nowlcda(l-of ~my:>-uehdf'ix:,~ lien,
t1Wu.nWoran<;lC, ~llfl>~ d;i'!im Qf o~wr mattlr, tl1.; :OMskm at its optioo. lfl;)y amJndScl~<:<lulc ll ofll~ CQWJnitJntnt ar;.cotdin,gly, but
~!cl~a_,~\t shall Itotrelil!'Wl Qt.:!. Divkioo -rtnmliabJlity J11'W\Ql!;i.ly iru;tm:ed VU-~~t &l- para.sraph3 aftl~-~-e CQlJditiQJ_~

J.

Li~iliiY oftllil Divl$'\<mundi!rtb,ls C<Mnnlitm~ S!all be on\ytotlw na4Pr~dGuanm\ll:l an4 SU(b}'t4rties: ilw;lu4if 'I100<!f tlw
finitioo ofGl!:!IJMlt~;ed in1lw- (MJ;l QfC:ertificaw-w Certificates ~Qmmittcd f'WM\i only for aetu.a\ hs-$: -incuTro4 in relian~~ J~u~n iii
undc!t.aking in g,{)OO fait'b {:11) to c()Jnply with:t~:ftquiremen1$1K!!'co{; or (b) tQ ~l~nhw~ ~~ti0l.\tl$ll'>Wnh'S~~Ie:a, ~>r(c) b
t~equira orcr~~e: tbeasta1ol)-o_rmte~t orm_Q_rt~~llwreo.neoVCJed by tll~ Olmm\tmol).n_t In nocvtntsW;!IJ such li~;~bUJty-cxi;e\'d 1!1(!
antuunt$-Ud.<rl inScllt!dulil A for tloo Catiflcam or Certifit'<liasc-ommitled fOTand S~J~Ch Uahility i&subjoattotlw guar111l.tooinjl;J"ovi<>ions
s:nd Q:mditil)lW\\fl,d th;:! F.,)lclu~imw from Co't"<mg~ of flw form ()fCertiflcatc or ('.-'!rtlficalil~><:~lm-itted 191' in fa~ oft!~ P~
GuarM1Wedwliiclutftl hf($.y bw~tcd by f(!fC.f(lfi(: and ~(!mAd<: a pan QfthisConun1tnwtlt I!>X~t.u o:x~ymodifi:ed hcrd~

4,

Tills Commit.m:::nt.\ga -cootnt::tto i~OJtiHlltnmo Ti'illl Gu.lJaJity CCrtit1cat!san6lsoot :an allltmctoftltle or a r~port of tlw oonditlrui
oftitle. AJ,lyacti~mvr a~;~ or rl$1~t!J of ootiQJl d~ttl~ ~~d. G'!lamn_1<1~ fllilyi~w or lll<'~Y Wing ~~~ainsttft.e Divi~t 'f!fisins out
-oftlw ktahlsoftlP! ti'ilo; to-tlw cstata or lnk'llitm- tlt(! $t:ltus-of-tJremw~g_e-th:crooocm'"ll'dby thii: Coonmitn~ntmnstb<l ~~d i)n and
are su-bjoct to tlw provisions: oftl1is C--ornmitJmnt,
THJc GtHU'llJlty

A Divi.<~ie1oftlw lowaFinance; Autll\'llity

R00-4J2-7:UO
20[5 Crm.ndAv~tmc

D.:sMoiM!;>, lov.~SQ3U
www.{.,.,w~fi-M~~Mutl!'<)fjty_g<W

U)MMIJMF.'<J ~-"C. 100011)

DATil !Rmo'N.D:Iijiill25.2007 M00<4::1~ AM

NOJF.o'fllo.~~..,nr,!:~!&Qc~~oW4ul!!!ro~....,i:nmt~~~~-

16

j\__

Commitment Form Schedule A

Title Guaranty
.>. r>;;l~"'U C:[Tl-F k...IA rti.O.J.X:< ~_1/T(In~"i'f

r~~~._;t~~s:r~; if~,i;;; .:1;;r1

co:;;i;i;;;:;;ii

Committnent Nutnbcr~ 01000553

Borro\\!(,YBuyers(s), For Referenco l'llrposes Only: John J. Title and Kri M. Tide
Address~ For Reference Purpos.li Only: 8304 Win.,ton Avenue, Urbandale. TA
fift\lctive Pate: June 01,2007 at 08:00:00 PM
1. -CerfiOrnN or f'mUUrntts tn he !ssmd

(a)
(b)

Own,~r

f'frtfllrats

1- &Qtler <)'MtoJ~a!

Prtmn:wd fpvrrnqg AmnnuJ FUr Nnmhm

IA)Hn Numtwr

S220,000.00
$200,000.00

Propoied Ouar.antecd:

Bank of the West itssucecs:&.ffS- and/or assigns. JolulStou.. lA

{e)

'WdM' Cnti0aU

S2-0~000,00

P:rUJH:tscd (i uarautecd:
Bank o-fth~ West its Sl,K;OCSOOf.S Md/nr flSsi:gns~Johnston~ lA
2, The: e.dufe mlnten~&t ln t11e -Lund dcserihNI or referred tn In tbts Cmnmltn:wnt is afe.e shnJilc {.if uti~,.
i!!p~ity same)~

FeeSirnple
.3. Title t-o tlie

L~tlitc

or interest in :mld Land

fj

ut th-e I:m~elivi" lbte herrofv,ested In:

Joe Titleholder nnd Jane Titkholder

Note: The Divl'lion doos not JlUfllQrt to guarantee whether the abcwe pru1iea hold title as joint tenant-; with -full
rlghJ.<J nf!JurvivQfSh!p nnd. oot tiS teMnUJ tn wmmon or as w_mm4 meom_ll)(}u.
4. The Land refernd to- h1 Ulls Commltmc-nt:b deiel'lhcd as ronuws:

l..ot261n tWrthwest (.Uuntry Ctub Manor. PW.t4" an Official Hat,. nzyw included in and forming a pm1 of the City

ofl.lrban&lle, l'<>lk (\>unty, Iowa.

l'"'l"""d John T.,t
By Typc:d 1\'nmc:

TestLawfh1:n
i\fmnbcr Nu:m-c

Signaturi" afManb.m

200 E. Orand Ave.~ Suite 350

Des Moines" lA

50309

{1\lutllug A-ddi'CS!!)

(Cliy~

(ZIJ>)

17

State}

Commitment Form Schedule B

Commitment Number:

C~I000553

L SClledute B ofthe Certlficn.teQr Certiticates to be issued will contain the folf-o,ving five Standard Exceptions !ltld
tUned belo-w -as- exceptions 6~ etc,t unless th;;: $atUC are disposed of to thi!! $.atlsfaction of th~ Divis: ion:

c;~ther matter.!~

I .. Any right or claim ofn party in possession not shown by the Publte Reoord$.
2. Notwithstandi.llg tbe ~rantee_ing clauses of this GuaraiJty, the Div~Ion ck;es nQt a~rantee ngaiwt any
encrrnu;hn-.ent; ei\ClUl\btMCe, violation.. varia_tion, or ad\erse ci'rcumstanoe af.lbctfng lhe title that woukl be disclosed
by an accurate mtd complete land survey <lfthe Lund.
J, Any e<t$ement or claim of easement_. not shown by the l'tthlk: :Records.

4. My liett or :right to a Uon, for s.:enrkcs, labor or material heretofore or hereafter furni~d. ]J_nposed. by law a1ld oot
shown by the Public Reoor&.

5 . 'Notwitll.standi11g the gllilrmlte.eins clauses ofthis Guaranty. the Dl ~rision doe.<J not gu!lfillttee 11ga inst taxes or special
whieh ~.c. not shown as existft1_g: liens by the Pubtie Reoollds.

n.<J~ssmenU!

6. Detects, iicn.,;;, e.t~umbrrutees~ adverse cW.in"t& or other mattet!h if any~ created, fust appearing In tl~ Public Recordsor attaching :suh:sequent to the Effective Date but prior to the date the Proposed Guaranteed acquires for value of
~ thee.~tatc or i_ntQ!'e$ or Mortgage tlwroon cover~ by this Commiunent

7. Payment of the fuH oomideratiou to. or for the aocountof,_ the grantors Qr mortg_ugors.
8. 111~ lien ofth~ tax-S f('the July 1_. 2006 -JuneJQ, 2007 ti{!Ca_l year and th~eafte~;. with the tirst halfdue on
Seil!emher t, 2007 (delinquent :after September 30~ 2001) and the scoo-nd l~lf due Qfi M1U'Ch 1. 200-8 {de-linquent nfter
J14!l:rc}J .Jl~ 201lS), N<m~ tl,Q-W 4ue-nnd p.nyflblc.
9-.l'.ior!gage.s~ l'e.!ltriction.-<~. eru;ements

or any other lien or eucumbrru:we on or defect in the Title to the property a~

followoS:

a) Mortgage in favort)f(;entraf Stnte Uank ted April I. 2-00~_. filed April 41 2005 in .Book23400, at P.age 55,. to

secure ~u indebtedness of$34-tOOO.OO

b)!Yiorlgage In favor of_U.S.&nk,NA.datedAprill~2005~filed Aprii 4, 200$ ln 'OQ.ok23400,at FageS9, tn~ecure

-au ludcbrednea!! of;S U,OOCLOO.

d) FhH(s) .m~ In th~ Polk County, IQ\\'{1~ Recorder's Oftlec. hlctudh~g easement$. building setback&. re.stric-tiQru;,.
re.servatk;-_ns, an4 notatkw.

18

APPENDIXG
Title Guaranty Certificate

Lender Form Title Guaranty Certificate

Any)lm:li;~of claltn and any -otbi!r Qotl~ or lj~t~ntl):l\t in wrftll!g
rtqulWd to be ji1Yt!U tlac D:Wiii(Jll u:mllll' tlils:Ct!rtifkat~ Ull!S-1 bl,l ~'\-X'D
to the Dlvlslmt at tfw i!.ddr(!5.~durwn lu S~ion17"Qftlu! CmuJitlQns.

Cuvmcd Risks
SUBJECT TO THEBXCLUSIONS FROM COVBRAGE, TilE!: EXCEPT_IONS FltOM COVEMGECONTATNEPIN
OC'HBPUU~ B, Al\'P TIIBtONPlTIONS, tltil Titk! GU4rantYPivi~km oft!!<! Itm'.'l FirnlllO,l At!tl!Mity {th;:! 'Divil>ioo''), &11aJOOW~, a:;: Qf
Dan! -MCC11ifieaM:m<f. totlwextcntS1.3tcd lnCwltrodRJs-ks ll, 13, and I4, aikrDat! ofCertificaw, a&almt l~ortbmage, 11Gh1Xttm'ing
lht: AnYl'unt ofCoV1:1ag(l, .s-mulntor lncmwdby fw Guannti:OO by rea-se-n of:
l. TiQt!~ng vested otl!Cf-tl!Jl!~llj~dinScl~dl!.14A,
2. Auy-deWCtl11 orllen f.lfCIK':lllllhf>\IICeontlw T1dc-. TltisCovcrod Risk irlclUOObut is:notlimite(ltQ~;"t'l'iolfll"l!?ll",gal11:'!1li'$< from:
{;fl)

A~f(!~ in '!11<!-Ti_t_lc cauw4by!

r~w. fr$).<;1, ~ 1nfl~We, du.f~. lfiC9nt~cn-.--y, i~ty orlm~~i-oo:
failur~ of any pcrsooor Bntity to have authori2>i!da transfer u:r.!~W:ya!tCc;
a dc.,.u:m-cnt l!fff>.-"1ing Title not ~ly Cf!:!~ :e>;rolrted, wlf.l~~ scal.;d, aci:Jwv;.'kdgl, l'LOWizod ordclivtroi~
failure-to petfrum tl!4Waati neae&S:ar.yto crestc a dr:o.ttncnt byc!ll:ctronlc moons autllori:rod by taw;

(1)

(ii)
(iii)

(jv)
(v)
t\i)

:;t d<!clmtlilllt G>t'Cutcd

umfura fal>:Hied, m:.pirodor~>U~~ invalid JXIVi'eft>f f!l.t9n~y;

a (!ioqjmlt notp~dyfiled, rOJ41 or-b:~,d!!x;t in~ Pllblic Rlo:rdii~bulin.g ftriluro topt~lfOffilU~ca~;b: by

dretmk fl"ealllii autlthoodby law; o-r

{Vii) a (tl!f(!t:tiv'!'!ju<):ic~l Qff){ifnfnh~trE!tlw pmwding.

(b) Tll'I!1J;;!JJ;Of N~l cM-!'!f-q: ~~ w- ~mUlti irntml ootl~ Title by a

gQl<'tJ:~~~ au'!hor!ty~-w ~}\'lb\e., blJ.ttmpai!.t

viohtkm:, Y<sriatirm, Qr s;iv.e~ circwm:U~n_oo affetin:gthe TiQll-tl!M Vil(lUJdbe discle;:'11 by a~

a:~E l!n4compk!tc lwh-lt_!Yt:!Yo~Joft.l.~ I..!!!J\4. 'fJy::. ftfm "J}~menf' iw:-luotWSce~~ of l)Xi.$ti_ng ~OVJtm$:
].:).c~t:i!don ~ 1...\nd&nt:o adjoln!ng lil.!14, a@ ;;:w;:IOOc]iflW\-1$0fitO thD:Lm;l o(existins in'!pJO~_nw.flt$l~t~ ooa:d_};)inin-g land.
3. UrulliYlwtablc THI_I).
4. )l.<qigb.t Q-f~Cl%1 10 ~ fu:ml t~'!..Wld.
:S. 'ft~ V~_latioo oraUOt-cetoontQfany l:;m", ordirum~. fl"'11lit, ()1$i)Vt;:JOOlllQ'I!!] Je-:,!!.ul.nitl<U(in~ht4iJ11!: ~ rel"'-ins: ~ bt!.Utlirtg ~
Z()ll.jng) rsfi!ltift& 1"CSUl!'ltiug, prohibiti~}g' OTTdfiti!l_g t.1:
(~)
tlw o;:~JJ.(:'}., u.w or enjoymmt oftl!q ~nd;
(b)
tlte-dwoc'klf, dim~tsi(MtlQf lo.:;atiQn ofan_y i~I~-J~Y:rtn:lJ\1 em tOO on the Land~
{c)

AJ~YCl!Cf~llf!_e_rn, CJ!OOI\~ttOC-,

{c)

the subdivisirm .ofland; Of

(d)

~vimJlm_\13) ~tioo

if~ Mti;;e, ~-ibi-n$ '!:'!11--Y p:s,rt ~>f1l~ _Ulwi, i~rcoordOO

ooly totl].e ro~.tentoflhe violation--orenfutcGil\11\t

ilk tl~C- Pllhli~< fulC<lids ~tins Wf~ tll~ vioh::ri!Qfi Qf intcntioo ~ ~fWa!, b.t

re~ttd

to intllatootioo.
An enfuro('JmmtfKltien dOl\ tlM!"C_J~:cr..;:lrro Qfa s:owmmtntal polkeJmWnot covered by C(l.vered RiskS If a ~K>tiQe oftlw
tn~n:envmt~ction, dtstlbing MY part of11M Lll,ld, isNo.1f~ in tlto<-P11blie fWoords, tmt -only hltn-e.mwn.t of~ C!lfor~~rn.
mfcn-cd tolnthatnotka
1. Tile-~~"" Qftlwr1sl!_~ of l;lmhwntdQmlllilt if$11ol:iw oftJK!> .uerd)e, ~Cf:ibill$ M_Y jwt of~Kl_Lol!nd, isrooonlOO ill tlto Pill>H.::
'R>loords\
11.
Any ~ins: by a p-enu1_wnta1 ~ U!G!t ~ ~r~d~nd is b-indinson t1V!rigllts (l.ffi pwcJ!:$~ WfY"t!!JW witho~t.Knowkldg:~.
9.
TJ~ invalidity mw~oeniOf~~bilityoftlwlknoftlw \mmtlkcl Mu~~-v,pont.l~ Titllh Thk Cffi."(l{CdRiri:: in.elt!:diesl>trt~&f\Ot
lim.itOOto t:Ov-ero_ge B:!!f!iJWt IW$ fromanyoftJw. fuUuwjngin:tpairb~gt: :liei'!: oftlw C'--rttaftln~t'd. M111tg.a1.-e:
(a)
fro.g'CJY, fraud, u~-~nt1~c, dq:r~ i!I~1~t<!llo/, ill@~ty orim)*$~ic;.n.:
(b)
t.aihlfC! ofany per$0-:nar Em.ity toJ13vc .:mtOOofi~da ttansfIM'J.:unvcyance;
(c)
ilw Gtwantood Mor!WiJli! oot bdngproply Cll!atcd, cx.oout<.\'1, witnew!(i. wal-ed, ~llldg_cd, t~<Jtarlzcd or Uvcrc.i;
{d)
fidlme ~Q Jl'Cffomt ~ ~W nmary~o ~m:a doornncnt i_ry'-cJ.,1ctfoniC meaMi!i\!.UlmiZ<d by law;
(c)
~ do<,--w~um:t ~~UU;d Ufilkra &mtic4, expil,\l:(lm- Gthcfw~ hP1'11id )l()V>'I;'f<lfattomBy;
(0
l:l ~t ootPJ'Orlrly filed, rm~J Qr l~ iut!JZ _f'lmU~- R~ofd!i in<:ludh\{1 ad lure. tqr..etf~1 tl~ .,.-:$ by~l"-"1rv.<il

ft.

(g)

10.

tlll!1ill$ mrtlt6fi~i,lb-y 1;:sw; or

{l~lit41vc-Pi~b-1
n1ini~Wivc prooling.

~- J.s:ct

of prlOOty-of tlw-lienf>ftloo ~!dMOtW!sa upo:ntloo Titk-QWf any oiJoor liM(lf m.cumhlaltec.

(llXOfrJt.'Il! N(k 1..:1 Ol!Ul,l

21

1L

Til~ lad; ofpri-oJityofllw lhmoftOO G\wantoedMort~~gc u~~ TJ!.kl:

as; troattlly fuT each and C'luy ad'f211Cq ofproceeds: of tOO l031l fttr<d by t}L(l

(a)

Guar.mtccd Mt"ll~ g(! OVi!f any SW.\ItoJY lien

foJ rervi~~. l~'IM)r. Qlffi{!~li$\ ll!fl$iog fwm coostrllctiJI Qfan inlj)lQV(':Wentru \\'Qflt ~atldt() lh~ L.an4 wJtui 1}\.lJ
~~lproV\'mcnt orwmk is cit.hef:

(i)

(H)

f Of~.fl;mtenc~ 04\'l'if~fi>:N Da~ ofCcrtificm; Qf

f\)1'_; cmnlf!l!~d, w w.tltimKd ~r Dsto of Certitka~ iftlw ooJ~ ~ finanecd, htwl!<l-l:! m in1..a1t,
byp~ocoeeilloftlte ban S4auo:l by !ltc (ftl;al'antdMru~g<! 1l~at th:c GtmmltllOO lta1iifldvanccd oris obllgat!d on J:Mtc
~tracted
tn~cti

of'C(!Jtjfi~ tQ~dVMCii; and

DY(.11h(! licnoftt~ty a;;scssmctk'ti fi'ff.ttrrothnpwwm<!IJ:I>:~ COOi'ltmctkm oroomplct.cd a1 O.UofC~tiiiColte,

Tho:! invalklity or1uwnfurcesbility of an.y-am1,g:nmmt of the Ct'UUlill1el!d Mortgage, provided ttKl a~ig;nment i~~Jwm.n in Schedule A,
ortlw ft~iluro of dill as;s:ignmcntil@WJiill Sclwdul~-A 1Q vQ>."tti{lll 1.1- the Gu$rm~tw<lMQ.It~se b1 tltc named ~~t-eeda~g.~li!C
froe and dtrqfalllie~.
The ~~lnity, ~fcbility, bck ofpdwity-Ofa'<"Oidiln~ D[tl~li~oftl~ QuarantcedMr>rtSl!&~llpon t1w Tille~
(a)
r~lting from the-IM)i~<:c in wltolc-orinp~ut, or fiomli coll'ff. ortkr sm>vidin:g1in'!lhWMltive Je_mOOy, of any tfflnSf or all
O'f3llYp31tffitllt! tille to .or any intt:1ll-st in the LandQCcu.rrin;g prior t(Jtlw ~ctiOOllre.llting. llle-llllll of the- Quaranto:d
Ml)t1gaJ!,e ~till${! tl~ t"lw ili~fil:-r ~ti'IIJ.Wdfl frau4u1it orj)Nft!Jentia:l t{ll.mf ~ f@tal ~~Y. $.61@
inrolvcflCY, or s.imjl-41" cf\'di'l.m$ .cl$1\tf J;m~ DT
(b)
!>~ thcG1wa:ntwd M~ge c~~t~ a~cfcrt;ntial t_f$f!$fef ~r f.1!~1 OOolcrupty, $tate ins"Qh"i!n~x. ar ~i!ar
cw-dill?-rs'risl\li lmot'$ byJe~ Qfthe fi!iJQ:rCofM~ofd.lngin 'dw NblicReoord$:
(b)

12.

1:3.

(i)

14.

~OOtlm-tJy,or

(H) inimp.;i.Jt notic~"fiU>i1~We~ tq.;l!pu:rel~f fflo "'~~Qo! t1> ~jml~ntQf )fl;"fl o;"Ndi~,
AJ~yd<):(i!(-1 in qrJkn 6f(!1WUml>fill~ll ontl~ Titic-'Qr o*cr ml'llt~ri~ludl;!d in Cov;ffl'd Risl:s 1 tltim!g'h t3 tl!81l~ lx'cn croatd 01
attacllt'dorl~ttsbtll:U fikdor ttcrutfud :in -tl~e Public Ro-oordssub.roqllenttoD,ll.t~ i"lfCerttfkfita :!lndprlor tro tht-ft!oordin;g of-tlli!

0!-antceilM"mtgaWJ in tl~e Public Recorda

OJvNC\1! wHl alwpay lllq-~ attQnw;~'ffNS, SJidi!X})CI)l!q,s i.l14llitcd i.n:d:c(~ o.fany m.atti11'-~Jtoo!}:;tjl}li~tb; thii Ceitifie~1c, but
~nly Wtlw ~tentl)JOVid. itJfM CWI.J:~ie)l\,1:,
In Wi'blt!ss Whooc; 111~ Titk Ollafa111;Y :Olvl$)n 11$S: <"41.\tWrlthis Ct!rtificate lOhll $-igd ~14 seakldln -its M"!ll~ by its .duly 3ltthwi'l<'d()ffit:er,
by di~~i<Jn(lf jcy BIN!I"d, to b-orw bin4ins;wl~couutcrs-igncdby its Oi~toror by a Diviiion _Partk:l_pa,W:.
T.l~e

Titlt! Gual'1tnfy Dlvlsltm

Ry

Xavd \.; OJ.

Ll)yd W, OJ!:lf!, I'Hrcct1lr

22

r<:.xchulons Jrum Caver.age

11w WllowingmaUI.'.rliarc e:qm:s:sly oexcludcd from die o?ov;;:rn;ge ofill!s Certlfic.r~~ @1\dtl~ Division will twlfl@YlQ$S Of dal.lC, .P(f.i$,
~ fcts, Qr C><JI<!IISC$ tll8t ar~s:c bywawn -of.
I.
(a) Any law, mdinarn::(!, pi!'ffilit, or 8iMmnwnUI regulation (indudins thoto rehtins tobuildingandmnlng) .re~Uicting, tcgula1illS.
jlf()biblting, t)ff(lbting tQ!
(i)
i!wQeCilp3fi<."Y, me, 6ft'n~'1ll(!UtofUw Und;
(ii)
tl~ cl~~r. dimcu.,.-[MS, orloe->rtlof any lmpnwcmi!Uf cn!~d M tltt' Und;
(iii) m.e sub4iviskln ()fJ!I!\4~ m-

2.
3.

(lv) ~vlrf>luncau.al prmcctllm-;

o-r the off(cl -of t(llyv!oJM[oo()ftlt<CS(> l~s, cndl~s orgQWfl~WUttal rcglllatiOO$, Thb; E>:clusloo !(a) ~not lt'KNiltYor limit
41~ CQVet:age prqv~41 nn<k-fCo>ror(l([ Ri~ll:: S.
{b)
My SO\'"'t!f~l~lillcprtVi'Cf. Thhi -,ED::ci\ISitm-l{b) .ol:sttnodlfY ol).f\itnitthc ~we~ prQv~d\Wklr Cnvef(d RWt-6.
Ri;&li'l$-ofl!mill!l~<t~'\ilin_, Thls ElldwdoCl!l\e~llotmMiiY orlhrtlttlw rovt'!BgC-pTQV[dt':d!WfurCowr\'.<'l Risk 7 or ft
Ocf-ccts.1ien.t, l'lliUtnlmi!we.r>, adv~ <llaims or otll\!f msttm:
(,1)
e~"M suffet. 3$$1<rwd, OfiB$!-od 1o- bytM-C'"llli1ffln~\'d Oaimant;
(b)
nat K:uown to the Di..-is:iou, not waooic-d lntlw P-u-blic Roc.onhat DatcQfCcttifJaaro-, but Known totlt!l G\tflf$11tcc:d Claim&~lt wid
notdisd~ in Wiitiu,s:to ill,~ Dfvisiooby theGuaant~dClaimant priortotlw da\e tlt<! GuaiWl-Wed Clsim;;l;nt bec3l'(W a
C'rU.arantood lUI!(blrthis Ccrtifie&W;
(c:)
msulting:inno Joss-or d:alna,ge to -ilw Gtw'iantoo:i Claimant;
(d)
ett~lti!)g: orqeet~ s~~nt tQ :oaro QfC~ttifil;l!!l.~ (l~'>W!Wl;!:r, th~ ~ nm mo-Ji!Yor limlt -illl:l t'Q'\''Im!S~ piQ'\'idOO uru!cr
CQv.1JcdRkt II, l3 or t4); or
(!:!)
re.wlting in10ffOf dama.gl:! tl13twoul:l not have been Slli1ahu:d iftltc <iu2JMteM Clollimant 11*1 )Uidv.aln<: "fur t]t(!G'!Wantd
MQJig<~Se.

~-

lillt11foteeaNlity of tiw Ht~1 of tlwGu4'JnmtQC!d Mottsa$~bi!CI.I1.1.,~ oftW: Inability or fo!'!lltm' of a: t?ttl't~&f to C<JnliiY wlth appUe!ibla
doin,!Hmsinesq];'IWIHl{tlac-~IIJ wl~.CN tlw- IAOO iss-it~.
hwalidhyW' Ufl(\ltfoo:ttability Inwl1.0k or in part oft@ licnqftJw Qua~('(] Mt)fJai!g<:- tl!$ali~ oq.t~;~ftl<ll trm~~ ~i~f(! l)y

6.

1l~e G~i\0000: MM~~allll11l=Wscd "!lpo!HI$t!1Y ()f3!\)' ~<!rtxllt pro-k~th>MrtlutM&kmdin:gl:rtW.

Atlychdm_, by~oo oft1to mlooof f~;):N\ ~'kruptty, ~11: inrolvqw.;;y, qrsimii~W crOOi~' risll-Wl~w$_, tl~ tl~t.r~t_km

4-.

(f~~lna;11~ ~~~~of-the

l;l{b) Qftlti!iC~rtifi~.
Any Ul!n outM Titl-e formal elita~ UIX!l$OUiiiSirs:smentsim~by so~JJ.RUllltal-au!l!Olity$J!dCft1i:d:()I-3tbdlhl:Slxltw!OO-nlliW-of
('".l}rtifiQl1illi!RdtJ!t! ~-m-ro~di!\g Qf1'!w-0W!f:;~n-t~ M@S:~in the Pu"H~R-q.c(l.Jds., Tbis B>;t;1usion&esoot nXll!Y QfHmjtth<:-oow,re,s4 pwvkWd ~f OwerW R!:* 1!{b).
(b)

1_

Gt!anmlec4 Mortgag:(!, t\':

!I_ fmtAA!-ktntcoo-vq~4! ()f ffll_\Ml1.oott:ran,~or, or

a plilft\f>mtial-tr.n~Wr foranyroom1 ootsWt!-d in Covw-00 Risk

(fl)

C-tmditlam
L

~Ori!~

ot1 ~"''"

(viii)
(k)

~~~~~ ... &'l~{'Ji!<tifio.lA<~"ln:

(il)
~.!\~.;.~"~~':. 'lk-l)!rn~...,...,4h$.;h::6,d~/>.,1!1i om;y~
$>:'!li.;a~},~;r._t.c.;,-~~s ... a..r.io..r~c~~.
"l}.,JeDfCeo~iib.z~ 'J'be-&!~& .... 6:d<Ui"llr.JeofC<rtifi;~&'"il
S;:W;.~A.

(o)

"lf.W.i_if";/>.~;QI!p;<l!-~f'IA~~Huii:l;dlh>\111fu-~........,..y,t;llf

(,;,)

~i;qh<e!t<~IL~<d.
~lllrt'; ~(iWJIU~~I'.II!!~iD$-;l~le-J...

(i'

l~~HI'i'Xi~"4.b;>:b<;:~:

(A)

~Jdnlibrl~~q~

(<I}

~r~~~~l.;.poe~~~~

~'I'm~
t.;>lit.e~i~P.l~4by~~111l M~~~b)y

b\T~.!.;>r~~~~;,f!;ly~~~M~liti~(AitillQ!!'..;i~~db

e,b)

~~~li:IM'i~~4i~~

''l~~r.f-: 'Jh!~p;i!>'lii!Oal=dby.U~~Moo!P

b;I~~~:U,.~<;Iby!<l~m<l).~~~d~~-,l!Mif

~~e~~r~3cy,'I!X~p!~~~~'IW.9i!
""~P~.. ihlpro1rW~Qf!l~&o lt(c}of

$$ >;'k>'tipQ~t~S'4}~-QI'~ tt.. ~ ~~!>!li; be~ ,.f:

{i)
~.:~omor..uof~pm.:ij'llldi~dl<l" ...~~CmlfiJII.l;
(:II)

~::::of~p-Wj'lllditoit~Q>!d~tolh!J:-af

('IH)

tbe-"~lka~llh~smt&-~l<IM~~Qf

{U)

{(,")

lmd!hitlbe-G\:il;e.c~~A:4~~1la~~~~
ldva~llll:h~"C..mriom'l"ll.Dd<lfl4-~ofiU"~~

We~QC~~

{v}

~~uw~~~l!fl>;:sQ.-.i.sllm-wr~,;~:e

{D}

(v.ii}

g,J<Xe;liOI!;(<)Il(l~..._dby~~mllpr,

~il>t~~.;t'!i.~l"i!~~ooc;
-'=~~iQ~~d!:l::<tlby~o;;m~~~~~~

khd<:>f'&Jk}-;

(E}

~$~byl!IW;

(..,;)

~e~~;
ih.>~r~&ltiiyM.:IMI:".;oo,il!.}l"1he''tc~~r..:~"fflb;-~~~i~~~E.::""-'

tl;a"~~~~~~~~$~~~~r~do;Jl'*br
~~~l>:~trw;~~l.l-wJ

~!ififiC~~Jefur~~uf&.ud~Uw~'lf'ln;j:e
o::<:>r;ll!ll!:ll;:c.~i"!'!~~t.;>I~~(Jr!<l"".Jt.;>~

{iv)

~v.o=rofb~~J>.'l4eJ>;h9if:>:~-~a
........:~'~TQ~m_-.rl:i'M~f>'110ef!Q
~o!!l!i!:ll'O'A"M~l~~t:..r:i!li0"111la.:r;:~o:r

~.e~Me~Qff;:r:ecl~lEdll.ey~r~~uf~~~~u;

k~odVilr.o>~~dli:lm_.Oi.'lmpliww-ll-iihh'iniwio

J;mUoec-ohGI.>I:iWt~d~a~dd\~
'll'i~""'")'lln'Aofl1\2wl~Wle-~if,..,P~
~\"l~~1~;
(l}
iflb:lll~!hlc~mldlip:;..;c.;.j&,er

~)' '*~~ ~lh p.M!e~~.,.~

~:tkllea~tk~of-lfl:!i:uof:Ze~!i!d
McPi'="~~koo~!kt'iof~~'=-.:.rirUu$E~

Q'ill!it!d by 1:hl! ~~ Clwm:.!~!t!d,.

23

(:2)
(1)

ifhzr~~'llt4>1l)'O'IUI:lilile-<mni:!d
~.~
ifiU&n~Ya<i!"llo~Q'IIo:M!b}i!nWfifu!.l=d

_,

ate~poe>l'bk,tbe-hl.ih of01~b!l'.:g:~~

5,

( ..)

P....tityof!U -~~~~d, p:Qlid::d ~

;:d'f~~"Jttiiy>lMUmtMd(i;.u.zillitod.n
Mw.b>lly>((llwit.)'q~p.:lli!:i!~Qf

(J')

Z)'~I!MG"""')'Qf~!!lq'Jily$.11i'i~l'l
~!"!'~~ato~C<~!'!o:i

~jll\)i!kJilbil'fzd'!rill Mi!pql~fOHof>D)'O!f-.w~

'f1le-

Jli~\\'iiJil.:tpaf4lJ)'f<>:~~t:;<;:f'~~i~dt>)'~

(b)

~IDV.l:<:f~llW'.ud~by.iGCert.ili!JIA!.

()_:ar-~!n~~f~of~~<JJ~Se.'lm.:'1llih>l'liill~M~
!l(ll!!'i''1-fiiJ'W!~brililC~l-.
'The-niiti!;CIIb<dl~lbe-l:l&b'.,.U ~otiifio;:ar.;a i~<;:1~ ~ll'b::d'i!l
&ul('Q'J'<>fi~~~,: ~"'"'c;t,~.;;~MW~olt~
~~o;ii."<lw~~~ll9(:i;.'f!JY~kd'Qo>t<i>Jtbit:;-w~mif~
IIC($1)'CG'&~Jec.;l~l~'fil~~~lleD.:.fli:.!-(lwmM!~

(l)
(g)

~dCllimJ!It'; AOI:llllrA!:O'.fockimh.;!~~

''c.\ld~}.~gf"!~~~y:&~r:l&6Hllf<!.~4of
$;~A-

()>u.-o:d.

(11)

;;~1~~w"J:~'li";AP:Uollb!.;r1:1.~~p;ti;'e
kr.;m,l~wr.ctbbilnl)'bcim~toaO>.Oll.!lltll:.:db)--~

f(nnl;oflhi$tP:lll!llii;._~o;E~:k~f.il!kli~fQ~
<b>IWA~ei '1'1.\e- ~n.'iiecfitcmrl#m~b:lll u:o!Wu-ll&umoo.<if

cyrdJrm.ge.

~k~.""' p.:l~ w i9F'*'!'ml Hlb;:~looo: .:or.o:!alr.l~{l:/ Ze

~l'~h=-&w~ Qllla:~e\.W41$l!Wimp:n~~~~!!l!

"l.d"~ 'l...,'LtbJ&;~dh&;:~tA,or.daffiudiM~m1>fs

m:b)~o~~~~~~l~- ~~~~~1<9'1 i;;.;l~

:;,,-;io ;t;o- ;w.; ~i~ il~ .;of ~~.-...;;;to;;~><&:;-.,..,.,~ l4:4~ g-*'~..-,!

b)'Mi"Ccrtlfklf.i!.

(])

t~

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boJl~~He:;,.~llrllC~u:e~i!iiWII:!q;iir.st~Dn-i;h!.iD

~~ ... Qf~f-x~&f~ll-f~Jly-'l~'i<Xpt<X!!<!dba:ll!ldqay
~!1,.&4~~~~"1<":~~DM;imtM-rlgt.i:!Q.'IIl

~w;e.;.;;~de-f~i'>!l!i.!-~~w~11\!.i-'4~~
dthtto~,ii'li!;;~d-~5IJMof!lii.!-G~ee~-br!tol~~
\li~&:>~~~~byb!Dn~t~('~mrt.:W,gi~f:lhi<;~

~k:ko;:~H! ~o;>~<$~lQ'IOI.o~lJIJ}.frof

Cfid:fi~fi'!U~i~r.g~th.-er.W;:~'~
~Wnal{t'~'ii>JI'-'W~nb-~'dbeu.d~XM'il.-~

e~~~~Mll ~i~'b~~1 ~~ii'-~1;1\I)Z..~~~

I'I~";~';Oi!-~~~<XIl*l'l>i'l'IZ~\Jo;b!;>l
~<!l;~~~f'!'!lq~o:l~~.r4(ii}ill"rpy~r~l~<:tt~
i&~~"a;ofli\.eUI\>kb!.miJk:~~~.yo.:&!~ll:)e$~

Wilh.,.~a::~q~~~~1f<J),~Jo;oR~~~$<ill!llw~
~!'i\llpr~U;;t~fil~~~~JW~~do_fi,~~
l.Ei!ill;l;l2;~

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llill;il'l}::=t~d!;'Wm:.;.tl;.~;:.~t;:

(it)

~Ed,n~~eo~~i:dbye-b::~m!lli!l$:t~redby

{k}

p-!1\--i;koa QfdJ~ C~rdfio;o,~ lflt.: Dh.1oii-;Q

~e~~i::;; ~~mib'lhh ~tloa,jl~&lwdi~.

,;.;-p.;~t.)'!bii!;~D;-~IJ;I~J)ll..i!ijg;trrfi!JpiiEl'i.>:!~l>:ip~tll
ilfbll&t~byaC>.l'lirt.m'mmpo:tl!at~ul~ll!dil
<"~i'-"'"'!51}" rc!!li!M!~ ~ dght, ill ii~ !'<?~ ~6:-a. 1\l-'lp;.')ll ;my~~~

~P-y~b)w.I~Jh:~Qfcb;Q~~:\\RrJthS!.!:6.*-A,J~

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m~IITh}'ll, blloe(i, 'll'll)"W'ml~fll.'ll}-.;,tctilil ~l!>;l'!rnodifyo;r

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~IDly .;4'-..'111!.~ ~"!JY

ofmPCI'l! !d'ftl;;tb.J ~ 'fi'.le

(i)

Di!Orl.i ~b-6.!iwi;:tri.re- ~~l(;-'bl<t.cl

{1)

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~n~,iklialofUG~dMm~911a~~m~.;o-~

{m)

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oabe-'J'i~.;.ra.~p:U.-e~rQ!Il&et'k.urolfl"d~~&k

~oZII~.t lf!k~i~JCC1:4i:lo4byt&.cf<il~o;>f~
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~m_6o;q.

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(b)

~~'!)\~QfbkO:~~~~~ b~e-~of-~~~o-~C~~e
Df.nwl)hQ~~d~nc~.:el)f~Thll}t.)'~~~doo-l!-ll>;o"

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wlo&n..tb&e- LeJ, w bills Qll ~O;r. 91!wr>:d by P'.1cli<l~>" ~

!ii.Kh~ble-dm~hY!dJ>ll).::e;~~)'~~~dt.y~~~

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~~.~~iii;.~~~~\~"A~r
b=rlng !ldW'.:-~f~ ..... '!ft.;~D!}teaf~nili;.)~ Jl:qj liN~ perodll
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J\__

Lender Form Schedule A

Title Guaranty
!o. 11-..UX>>J <:r !H lOo'M t .N~!O." ~UTIIr.~'f{

i~.:;:;;~r~;gi;;iio;;:~ -;i;;,,J" c~.v;;;i;;;;,:;;.

Certificate No.:
Lo;mNo.:

lr.I000553
789456123

Amount of Coverage~
1~

1\'umc ufGuatnnleed:

Eankofthe West its suc:oo:~sorsattdlorassigtUl, Johnston, IA

2. The estate m tntcl'CSt tn the Lnnd thnt I!! i!ntumbetcd by the Gumantced M.m1guge fss fee stmple ('lfotl.et\
!lpc-elty snmc}:

Fee Simple
3. Title ls vested in:

John J. Title nnd Krt;; M. Tftle. hu..;;OOnd and wife~ -as joint tenants w.lth full right$ ofsurvivorship and not U..'J tenant'!
.in common.
4~

Tit.c iiu.nt'IUik'Cd Mortgage-,. and ihl-assignme.nts~ if any, me deserHwd ns -ronnws:

Mortgnge in tl~e amount ofSJ3S,OOO.OO dated Juoo lO, 2001, tiled June 10,2007, in Book 23400, at Pa;go 456 of
tile l'olk County, Iowa, Recorder's Offire. given by John J. Thle and Kris M. Title, hu.lmnd nnd wlfe, to !lank of

rho w.,.t.

5, The Lsud t.cfl!l't'ed toln thhl CerUJkate h

d~cdbed

as fuUows:

Lot2f, in Northv.<est Country Cluh Manor, Plat 4, .an OfiieUd Plat. now included in and forming a.pa11 of the City
-OfUrbnndale~ Pulk Co-unty~ lown.
6. Thls Cetmcate lnetrrr)l}r.atcs tho:llC-('ndnrsemcnts Hsted bduw:

F.Jwiromncnta:l.Protection Lien (ALTA -B. I ~06-)

LocatiOn- Re;sldential (ALTA 22--06)
F..tldor.scment Against Loss.-Uen
Endorsemenl Against Loss-Uen

P~ed ~k~hn~T~~~.'~-------------------
D)' Typed Name

Test Lu.w l'inn

!'\lember Name

Sfgnatul'C of Mem!)d'

200 E, Orand Ave,_,_ Suite 350

Des Moines, lA

(Mnlllng Add1ess)

50309
(Zip)

27

Lender Form Schedule B

Certificate Number: L-1(}(){)553

Exc_ept-tons _Fr-om Covetage

Schedule B- Part I
11lis Certif~eate does not guarantee against to_;;s ot 'llunage (and the Divl.sion wm notpny C%"1:SI attomeys' fees- or
expell.~C$) that ari3e

by r.Son of:

(Qr the July ls 2006 ]l;li"W 30. 200111scat yeur und t~ftcr. with the firm- hnttdue on
Se!>tember I, 2007 (dolillque!lt ntler September 30, 2007) and the seoond halfdue on March I, 200R (delinquentatler
Mnrch31~200S), None nnw due and pay!!ble.

I. The iien of the taxel!

2. Ordimuwcs.and regulatio_I\S fbr the City ofUrbnndale and County of Polk, row a:.

3. Piat(s) filed in the Polk Ci!unty~ lowo:, Reeorder's Oft1oo, tuctuding ati easement~ buUdlng setbncks1 restricli~
reservations a:nd notations,
4-. Declnration.~~ cov-enants, rc.stric;:tionsf ll.:jementst reservatk>tUi, right$ and optkms 11:1-ed of record in Polk CouutyJ

Town; Reoorr's Otlice,

5. Uti1ity En~n-.en_t in fllVQf Q.t'MidAnlericafi Enttgy i1Wd July I. 2002 in Book 2249il, -at Jl.nge 245,

6. RC$trictive

Covenants_fi~ Fehruazy 5-,2-000 ln D-ook

lZ(}();I),at Page 234,_and ns amen,<Ied tromtinw tQ tfine.

1. 1-lortgagc in favor of Central Sta_te Dank dated April If 2005, filed Ap-ril4~ 100$ in Book 23400. at Page .55, to
~,recure an itldttedne..<~S Qf$34.000.00
8. Niort-guge in favor ofU"'" B-ank, N:A. dated Aprit 1, 2005~ ftted Aprit 4~ 2005 in Book 23400;-at P4lge 89, to secure

-nn ind<,ibtd!lt;:SS ofS-11,000.00.

Schedule B- Part li
l:n addition to the matters set -fOrth in Prut r of this Schedule~ the titre is subjectto the followlng tnattei'lJ and the
Div~ion guarilnt:s ~gninst IOO$ or damage sustained hl the C\'oent that they are not subofdit(atc tQ the lien ofthe
-Guaranteed Mortgage;
Jvkml}!lg.e in the amount ofS~~o.ooo,oo dated Ju:t;W; 10, 2007, filed J-Ufle 10,. 20071 to Book 23400, at P~e 465 of the
1\ltk County_~ lt!wa.~ R~order'g Office, given by John 1. tit1emld Krfs M. Title~ hW~band and wif~ tQ Batlk of the
West.

End ot' Schedule B,. P!li1'S [and 11.

28

Signature nrMember

29

Appendix H
Title Opinion Sample

ATTORNEYS
Robert E. Konchar
Darrel A. Morf
J. Scott Bogguss
James E. Shipman
Stephen J. Holtman2
Iris E. Muchmore
Philip D. Brooks
James A. Gerk
Roger W. Stone
Kevin J. Visser
Randal J. Scholer
William S. Vernon

Kathleen A. Kleiman1
Thomas D. Wolle
Paul P. Morf
Philip A. Burian1
Christine L. Conover
David J. Zylstra3,4
Thomas N. DeBoom
Jason M. Steffens
Mark J. Herzberger
Matthew J. Adam
Robert S. Hatala
Amanda M. DAmico

Eric W. Lam
David W. Kubicek
Matthew J. Brandes
Michael McDonough9
James M. Peters
Mark H. Ogden
Mark A. Roberts
Chad M. VonKampen
Gregory G. Williams
Nicolas AbouAssaly
Allison M. Heffern
Lynn W. Hartman

Jacob R. Koller
Brian J. Fagan
Abbe M. Stensland
Kyle W. Wilcox6
Jeffrey A. Stone
Matthew J. Hektoen1
Christopher J. Voci5,7, 10
Dawn M. Gibson
Susan H. Willey8
Carrie L. Thompson
Travis J. Schroeder
Paul D. Gamez

Charles J. Krogmeier
Laura E. Seaton
Chad D. Brakhahn
Lisa A. Stephenson
Travis M. Cavanaugh
Allison R. Slager
Jeffrey K. Rosencrants

COUNSEL
Larry G. Gutz2
Richard G. Hileman, Jr.

OF COUNSEL
Stephen C. Nelson
James R. Snyder

RETIRED
William A. Bergman

REGISTERED PATENT
ATTORNEYS
Gregory G. Williams
Christopher J. Voci5,7,10
Carrie L. Thompson

Writers Email: Mhektoen@simmonsperrine.com

Reply to Cedar Rapids office

December 11, 2012

INSERT CLIENT ADDRESS

RE: Preliminary Title Opinion
Property Address: ______________
Abstract No. 15376

Dear Sir or Madam:

I have examined the abstract of title for the real estate described as:

Parcels C and E, Part of the SW of the NW of Section 29, T88N, R4W of the Fifth
P.M., Delaware County, Iowa according to the plat recorded in Book 7 Plats, Page 43;
also that real estate lying generally north of Parcel E, running to the water front of
Lake Delhi and then at right angles extending to the middle of Lake Delhi; and also
that real estate lying generally North and West of Parcel C, running to the water
front of Lake Delhi and then at right angles extending to the middle of Lake Delhi

as last certified by Delaware County Abstract Company under the date of December 3, 2012 at 8:00
a.m. The abstract of title consists of two parts with Part I containing entries I through 191 and Part
II containing entries 192 through 247.

TITLE

I find legal title to the real estate to be in:


________________________

under a Court Office Deed shown at entry 211 filed September 13, 2001 in Book 2001, Page 3302 in
the records of the Delaware County, Iowa Recorder.

Legal title to the real estate is subject to the following limitations:




www.simmonsperrine.com

115 Third Street SE, Suite 1200, Cedar Rapids, Iowa 52401 Telephone

319 3667641 Fax 319 3661917

City Center Square, 1100 5th Street, Suite 205, Coralville, Iowa 52241 Telephone 319 3541019 Fax 319 3541760

Also licensed to practice in: 1 Illinois 2 Wisconsin 3 Missouri 4 Kansas 5 New York 6 Minnesota 7 Michigan 8 California 9 Nebraska 10 Texas

Simmons Perrine Moyer Bergman PLC

October 27, 2013
Page 2

DESCRIPTION

1.
Entry 185 shows a Plat of Survey for Parcel C, Parcel D and Parcel E filed September
17, 1993 in Book 7, Plats, Page 43 of the records of the Delaware County, Iowa Recorder. Entry 194
shows a Plat of Survey filed December 14, 1993 in Book 7, Plats, Page 57 of the records of the
Delaware County, Iowa Recorder. Copies of both Plats of Survey have been attached for your
reference.

MORTGAGES


2.
Entry 243 shows an OpenEnd Mortgage by Peck Excavating Corporation to
Community Savings Bank filed October 30, 2006 in Book 2006, Page 3865 of the records of the
Delaware County, Iowa Recorder. The Mortgage secures credit in the amount of $350,000.00,
contains a due on transfer clause and other provisions affecting the rights of the parties.
Arrangements should be made for the release of this mortgage prior to closing.

EASEMENTS


3.
Entry 9 shows a Warranty Deed by the then titleholders of the lake bed to
Interstate Power Company, which Warranty Deed reserved to the grantors thereof the perpetual
use of the premises conveyed, which is not overflowed by the construction and maintenance of a
dam by the grantee, its successors or assigns. This perpetual use right is now owned by the
Rocky Nook Association, Inc. pursuant to a Real Estate Contract shown at entry 205 recorded May
24, 2000 in Book 2000, Page 1566 in the records of the Delaware County, Iowa Recorder.


4.
Entry 14 shows an Easement Indenture to Interstate Power Company filed February
11, 1927 in Book 59, L.D., Page 583584 of the records of the Delaware County, Iowa Recorder. A
copy is attached for your reference.


5.
Entry 15 shows an Easement Indenture to Interstate Power Company filed February
11, 1927 in Book 59, L.D., Page 584585 of the records of the Delaware County, Iowa Recorder. A
copy is attached for your reference.


6.
Entry 30 shows an Easement for Public Highway to County of Delaware filed June 2,
1964 in Book 84, L.D. Page 25 of the records of the Delaware County, Iowa Recorder. A copy is
attached for your reference.


7.
Entry 35 shows a Plat showing a road easement filed August 25, 1969 in Book 2,
Plats, Page 177 of the records of the Delaware County, Iowa Recorder.


8.
Entry 202 shows a Quiet Title Action in Case No. EQCV 3556 First v. Maxfield in
which it was established by order of the Court that Clifford K. First has access an Easement across
Parcel C to the thenexisting 3 dock spaces on Parcel E and to his docks west of Parcel E.

WELL AGREEMENT


9.
Entry 188 shows a Water Access and Use Agreement filed September 21, 1993 in
Book 4, Misc. Page 98 of the records of the Delaware County, Iowa Recorder. A copy is attached for
your reference. While not a replacement for your thorough review of this document, I draw
particular attention to Section 5, which section sets forth certain access rights and docking

Simmons Perrine Moyer Bergman PLC

October 27, 2013
Page 3

privileges for the owner of Parcel D of the SW NW adjacent to the real estate under
examination .


10.
Entry 213 shows a Well Agreement filed October 24, 2001 in Book 2001, Page 3810
of the records of the Delaware County, Iowa Recorder. A copy is attached for your reference.

MISCELLANEOUS


11.
Entries 223, 226 and 228 show Quiet Title Case No. EQCV005477 wherein it was
decreed by the Delaware County District Court that the Rocky Nook Association adversely
possessed a portion of the embankment adjacent to the Lake Delhi Dam structure. Copies of these
entries are attached for your reference.


12.
Entry 246 shows Delaware County Ordinance #34 Floodplain Management
Ordinance adopted September 13, 2010 by the Delaware County Board of Supervisors and filed
December 13, 2010 in Book 2010, Page 4030, and rerecorded December 23, 2010 in Book 2010,
Page 4191, which provides for flood hazard areas of Delaware County, Iowa and provisions
applying to said land.


13.
You should confirm that your intended use of the real estate conforms with the
current zoning ordinances of the Town of Delhi of Delaware County, Iowa.

14.
You should confirm that there are no matters affecting title from December 3, 2012
at 5:00 p.m. up to the date and hour of the closing.

TAXES


15. Entry 247 states the all taxes are paid, except as hereinafter shown:


Real Estate: Fiscal 20112012 payable 20122013 paid balance $518.00;

Personal: None

Special Assessments: None

* Special Assessments only shown if available on the Iowa State County Treasurers
Association website; refer to the Delaware County Treasurer for information regarding ten
year or other multiyear special assessments, including total payments due since those
amounts are unavailable on the ISCTA website.

GENERAL

This opinion is expressly limited to matters shown in the abstract covering the period up to
the date of certification. No opinion is expressed as to matters not shown in the abstract which
might affect title to the real estate, among which are the following:

a
Mechanics liens for services rendered or materials furnished on the premises since liens
need not be filed until 90 days after the completion of the work or the materials have been
furnished;
b
rights of persons in possession;
c
all public assessments ordered but which have not become a matter of record in the county
courthouse;

Simmons Perrine Moyer Bergman PLC

October 27, 2013
Page 4


d
e

f
g

h
i
j
k

forged or fraudulent contracts, deeds or other instruments affecting title;

any transfers, the substance and subject of which may be attacked as a fraudulent
conveyance within the meaning of the Federal Bankruptcy Code or Iowa law;
any defects of title which may be revealed by an accurate survey;
any state of facts which might be revealed by physical inspection or soil test of the property,
including but not limited to diseased trees, location of driveways, easements, fences, hedges,
drainage ditches, and an encroachment of buildings which may have set the boundary lines
of the property;
zoning or other ordinances of the municipality or county;
any flood plain regulations, encroachment limits or flood plain zoning as established by the
Iowa Natural Resources Council;
any security interests in fixtures attached to the real estate of which notice may be given by
a financing statement that has not been filed of record;
the presence of hazardous substances, pollutants, contaminants, solid wastes, hazardous
wastes, and other environmentally regulated activities, including those substances defined
to be hazardous in Chapter 42 of the United States Code, Section 9601 14 and Chapter
455B of the Iowa Code, which could require a purchaser, owner or lender to incur liability
or remedial actions or other cleanup; and
any delinquent sewer, water and garbage fees that may be assessed by various cities.

You are advised to inform yourself of these matters by independent investigation.

You should determine whether any solid waste, hazardous substances, pollutants, above or
below ground storage tanks, drainage wells, water wells, land fill sites or other environmentally
regulated conditions exist on the property. Such conditions are not ordinarily shown in the
abstract, but they may result in injunctions, fines, required cleanup, or other remedial action under
federal, state, or local laws. These laws may impose liens against the property and personal liability
against the owner, even though the owner did nothing to create the condition, and acquired the
property without knowing about it.

You may purchase additional protection of your interest in the real estate through an
owners or lenders title guaranty certificate issued by the Title Guaranty Division of the Iowa
Finance Authority and purchased through our firm. A Title Guaranty Certificate provides certain
protection of your interest in the property which exceeds the protection available through this
opinion. If you are interested in such a Certificate or have questions concerning such Certificates,
please contact me.


You are advised that if the real estate uses a sewage disposal system, you may be
subject to Iowa Department of Natural Resources rules. These rules typically require all such
systems be inspected for compliance upon a transfer of ownership. You should determine for
yourself if the proposed real estate transfer is subject to these requirements. If so, you should
be certain they are met, since failure to meet them may prevent the recording of the deed or
contract.

Simmons Perrine Moyer Bergman PLC

October 27, 2013
Page 5

You should confirm with the abstracter prior to closing that no additional matters, liens or
encumbrances have been recorded or filed since the date of the last extension that would affect title
to the property.

Respectfully submitted,
SIMMONS PERRINE MOYER BERGMAN, PLC

MHT:gl:encl.

Matthew J. Hektoen
Iowa Title Guaranty
Member #10102

Appendix I
Warranty Deed Package

Prepared by/Return to: Matthew J. Hektoen, Simmons Perrine Moyer Bergman PLC, 115 Third St. SE, Suite 1200, Cedar
Rapids, IA 52401, PHONE (319) 366-7641 FAX (319) 366-1917

Address tax statement to: ______________________________________________________

WARRANTY DEED
For the consideration of One Dollar ($1.00) and other valuable consideration,
_________________________, LLC, an Iowa limited liability company, does hereby transfer and convey to
_________________________________, LLC, an Iowa limited liability company, the following described real
estate situated in Linn County, Iowa:
___________________________________________________, subject to covenants, restrictions
and easements of record
Grantor is a manager-managed LLC, this conveyance is made in the ordinary course of business and the
undersigned has full authority to execute this Warranty Deed. Grantor does hereby covenant with grantee, and
successors in interest, that grantor holds the real estate by title in fee simple; that grantor has the good and lawful
authority to sell and convey the real estate; that the real estate is free and clear of all liens and encumbrances
except as may be above stated; and grantor covenants to warrant and defend the real estate against the lawful
claims of all persons except as may be above stated and except as to any liens or encumbrances created or
suffered to be created by the acts or defaults of the Grantee.
Words and phrases herein, including acknowledgment hereof, shall be construed as in the singular or
plural number, and as masculine or feminine gender, according to the context.
Dated this _____ day of October, 2013.
_______________________________, LLC,
an Iowa limited liability company

_______________________________________
________________, Manager
STATE OF IOWA, LINN COUNTY ss:
This instrument was acknowledged before me on this _____ day of October, 2013 by ____________, as
Manager of ________________________, LLC, an Iowa limited liability company.

Notary Public in and for said State

My Commission Expires:_________________________

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

TRANSACTIONAL TRACK
Estate Planning

2:45 p.m.- 3:45 p.m.

Presented by
Janice Kerkove
Bradley & Riley
2007 First Ave. SE
Cedar Rapids, IA 52406
Phone: 319-861-8763

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

NUTS & BOLTS OF

ESTATE PLANNING

October 30, 2014

Janice J. Kerkove
jkerkove@bradleyriley.com
Copyright 2014 Bradley & Riley PC - All rights reserved.

Nuts&BoltsofEstatePlanning

NUTS & BOLTS OF

ESTATE PLANNING

October 30, 2014

Janice J. Kerkove
jkerkove@bradleyriley.com
Copyright 2014 Bradley & Riley PC - All rights reserved.

ESTATE PLANNING
ITS MORE THAN JUST A WILL

Last Will & Testament

Revocable Trust (optional)
Asset Titling
Beneficiary Designations
Financial Power of Attorney
Medical Power of Attorney
Living Will
Declaration re: Last Remains
BRADLEY & RILEY PC
ATTORNEYS AND COUNSELORS
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CREATE A GOOD DATA SHEET

Personal information for clients & their children
Identify any beneficiaries with special issues
Identify children vs. step-children

Financial information
How is the asset titled?
Is there a beneficiary designation?

Identify who is to fill various fiduciary roles

BRADLEY & RILEY PC
ATTORNEYS AND COUNSELORS
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CREATE A GOOD DATA SHEET

Any obligations under a prenuptial agreement?

Any obligations under a dissolution decree?
Any significant future inheritances?
Is there genetic reproductive material in storage?
Do they want to give someone control over their
digital assets?

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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FEDERAL ESTATE TAXES

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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FEDERAL ESTATE TAX ISSUES

Internal Revenue Code 2001 2801
Federal estate taxes based on value of estate

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FEDERAL ESTATE TAX ISSUES

Federal estate tax exemption currently $5.34 million
(2014) for each taxpayer, indexed for inflation
Federal estate tax exemption not used at first death
can be transferred to surviving spouse
Requires timely filing of Federal 706 Estate Tax Return

Large gifts made during lifetime decrease the federal

estate tax exemption available at death

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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IOWA INHERITANCE TAXES

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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IOWA INHERITANCE TAX ISSUES

Iowa Code Chapter 450
Taxes based on the relationship between decedent &
recipient & based on the value of Iowa assets
received by the recipient
Gross estates of less than $25,000 exempt from
Iowa inheritance taxes

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IOWA INHERITANCE TAX ISSUES

Lineal descendants & lineal ascendants exempt
Brother, sister, daughter-in-law, son-in-law subject
to tax starting at 5% and ending at 10% marginal
rate
Niece, nephew, other relatives, friends subject to tax
starting at 10% and ending at 15% marginal rate
Step-children are exempt, step-grandchildren are
not exempt from Iowa inheritance taxes

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IOWA INHERITANCE TAX ISSUES

Certain assets are exempt from Iowa inheritance tax
Life insurance paid to a named beneficiary (not estate)
IRA & qualified plan assets paid to a named beneficiary
who is subject to income tax
Non-Iowa assets

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ATTORNEYS AND COUNSELORS
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IOWA RESIDENT WITH REAL ESTATE

HOLDINGS IN OTHER STATES
At least 15 states have decoupled from federal estate
tax system
In those states, the state death tax exemption is fixed at an
amount that is lower than the current federal estate tax
exemption
Minnesota, Illinois, Indiana, New York are a few of the
states that have decoupled

Iowa and at least 5 other states have inheritance

taxes

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WILLS VS. REVOCABLE TRUSTS

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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WHAT TYPE OF DOCUMENT?

Should clients primary method of distributing assets be

a Will or Revocable Trust?
Will administration governed by Iowa Probate Code 633
Trust administration governed by Iowa Trust Code 633A

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ATTORNEYS AND COUNSELORS
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WILL

Cheaper to draft
Probate is required

Will & Asset information part of

public record

Does not take effect until death

REVOCABLE TRUST

Code establishes 2% Atty/Exec Fees

Court Costs

Bad for businesses that may need to

be sold as part of the proceeding

Need separate POA to deal with
incompetency issues
Can be difficult to obtain
involuntary accounting from POA

Court oversees process

Extensive case law as precedent

More expensive to draft & fund

No probate required if all assets in
trust or have beneficiary designation
at time of grantors death
Code establishes reasonable fee for
Atty/Exec
No Court Costs

Maintains privacy of affairs

Easier transition for management of
affairs if client becomes incapacitated
Easier to obtain involuntary
accounting from Trustee than POA

Court involvement can be invoked if

necessary
Limited case law as precedent
Still need a Will

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WILL VS. REVOCABLE TRUST

Cost Benefit Analysis
Will the increased cost of drafting & funding a trust be
justified by the decreased costs of administration after the
clients death?

Probate required in every state client has real estate

Timeshares are sometimes treated as real estate interest
Mineral interests (oil/gas) usually treated as real estate
interest

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PROVISIONS OF LW&T
Revoke prior Wills
Identify beneficiaries
Outline plan of distribution of assets
Outline plan for payment of administration expenses
& taxes
Designate fiduciaries
Draft for proper execution of the document

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IDENTIFY BENEFICIARIES
List next of kin
Does the client want the list of beneficiaries to
include beneficiaries born after execution?
Does the client want the list of beneficiaries to
include adopted children?
Does the client want to exclude any beneficiaries?
If yes, make that clear in the document

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OUTLINE PLAN OF DISTRIBUTION

Tangible personal property
Include option to leave separate writing
Include a plan for resolving disputes
Authorize Executor to donate/destroy items

Special bequests

Charities any limitations on how used?

Godchild, Special Friends, Grandchildren
Digital assets
Genetic materials in storage

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ATTORNEYS AND COUNSELORS
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OUTLINE PLAN OF DISTRIBUTION

RESIDUARY ESTATE IF SURV. SPOUSE
Distribute outright to surviving spouse?
Hold in credit shelter trust for surviving spouse?
Who is Trustee?
What are distribution standards?
Can distributions be made to any other beneficiaries?

Hold in marital trust for surviving spouse?

Who is Trustee?
IRS requires mandatory distribution of net income to spouse
IRS requires that spouse be given right to turn non-income producing
property into income-producing property
Client decides on principal distribution standards for spouse
IRS mandates no one else is entitled to principal during spouses
lifetime

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ATTORNEYS AND COUNSELORS
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OUTLINE PLAN OF DISTRIBUTION

RESIDUARY ESTATE NO SURV. SPOUSE
Distributed equally or some other percentage?
What happens if beneficiary dies?
Balance to surviving members of group?
Balance to lineal descendants?
Per stirpes vs. per capita

Trust for any beneficiaries who may be minors at the

time of inheritance
Trusts for any beneficiaries who have special issues

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OUTLINE PLAN FOR PAYMENT OF

ADMINISTRATION EXPENSES
Consider liquidity issues
Does the probate estate have sufficient liquid assets to pay
mortgage, utilities, property taxes, attorney fees, executor
fees, appraisal costs, funeral expenses, court costs, and
other expenses of administration?
Should a portion of life insurance be paid to estate to
provide necessary funds?

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ATTORNEYS AND COUNSELORS
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OUTLINE PLAN FOR PAYMENT OF

ADMINISTRATION EXPENSES
Who should be charged with administration
expenses?
Default rule is administration expenses paid by residuary
unless document states otherwise
Residuary share vs. equitable allocation

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ATTORNEYS AND COUNSELORS
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OUTLINE PLAN FOR PAYMENT OF

DEATH TAXES
Who pays federal estate taxes
Default rules is tax paid by residuary share unless
document states otherwise
Residuary vs. equitable allocation
Charities not subject to federal estate tax
Surviving spouse usually not subject to federal estate tax (if
document properly drafted)

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OUTLINE PLAN FOR PAYMENT OF

DEATH TAXES
Who pays Iowa inheritance taxes
Default rule is beneficiary pays unless document states
otherwise
If Estate pays, adjustment required to gross up beneficiarys
share for inheritance taxes paid by Estate

Residuary vs. equitable allocation

What if beneficiary receiving non-probate asset?
What is beneficiary is receiving non-liquidate asset (real estate)?

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DESIGNATE FIDUCIARIES
Guardians for minor children
Special considerations if naming married couples

Trustees for any trusts created under LW&T

Specify powers granted to Trustees

Executor of LW&T
Waiver of bond?
Power of sale?
Authority over digital assets?

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DRAFT FOR PROPER EXECUTION

Client & two disinterested witnesses sign in the
presence of each other
Client, two disinterested witnesses, and notary sign
Self-Proving Affidavit
If no self-proving affidavit, must find at least one of the
witnesses after date of death
If unable to find witnesses, then client died intestate

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Nuts&BoltsofEstatePlanning

WHERE WILL ORIGINAL BE STORED?

Very difficult to admit Will to probate if original
document cannot be found
Law presumes that Will was revoked
Can only admit copy if presumption can be overcome

Keep record of where client will be storing original

Lock box at __________ branch of ________ bank
Fireproof safe at office
Gun safe at home

Generally do not have clients deposit with Clerk of Court

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TITLING OF ASSETS

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TITLING ASSETS
JOINT TENANCY

Joint tenancy with rights of survivorship vs. tenants

in common ownership
Joint tenancy ownership with rights of survivorship
overrides terms of Will or Trust
Assets pass directly to the surviving joint tenant and are
never under the control of the Executor or Trustee

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Nuts&BoltsofEstatePlanning

TITLING OF ASSETS
JOINT TENANCY

If married couple has no federal estate tax concerns,

assets can be held in joint tenancy to avoid probate
at first spouses death
If not a married couple or if there are federal estate
tax concerns, joint tenancy ownership is not
recommended

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TITLING OF ASSETS
JOINT TENANCY WITH NON-SPOUSE
Beware of titling assets jointly with non-spouses
Joint owner has immediate access to the joint
tenancy accounts does not require clients
permission to withdraw funds
Asset becomes subject to claims from their creditors,
ex-spouse, etc.
Asset automatically passes to surviving joint tenant there is no legal obligation for joint tenant to share
proceeds with other intended beneficiaries
Can increase income tax liability when assets are
sold in the future
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BENEFICIARY DESIGNATIONS

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BENEFICIARY DESIGNATIONS
Typically on Life Insurance, IRAs, 401(k)s,
annuities, 403(b)s, etc
In Iowa (and most other states), the beneficiary
designation overrides terms of Will or Trust
Need to look at contract closely to determine what
happens if the beneficiary predeceases client
Be sure beneficiary designation complements plan of
distribution under Will or Trust

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BENEFICIARY DESIGNATIONS
ESTATE AS THE BENEFICIARY
Provides liquid assets for payment of debts and
expenses
Provides funding for credit shelter trust if other
assets are not sufficient
May allow creditors to access proceeds
May subject proceeds to Iowa Inheritance Tax
May be included in calculating court costs, attorney
fees, etc.
May be adverse income tax consequences

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BENEFICIARY DESIGNATIONS
SPOUSE AS BENEFICIARY
Under old Iowa law, ex-spouse received proceeds if
beneficiary designation was not changed after the
divorce
Iowa law now nullifies ex-spouse and ex-spouses family
members as beneficiaries after a divorce
Only applies to non-ERISA assets
Must follow the appropriate notification procedures in Iowa
Code 598.20A before funds are paid out

Assets received by spouse under beneficiary

designation/joint tenancy do not count against spouses
right to claim 1/3 of estate Iowa Code 633.238
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BENEFICIARY DESIGNATIONS
MULTIPLE CHILDREN AS BENES
Important to determine what happens if a child
predeceases the owner
Default plan rules usually call for distribution to the
surviving children
Most clients prefer that lineal descendants of
deceased child take which requires adding of per
stirpes language to the designation

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BENEFICIARY DESIGNATIONS
TAX DEFERRED ASSETS
Beneficiary designations on IRAs or qualified plans
should be properly drafted to provide beneficiary
with flexibility to obtain maximum deferral/stretch
for income tax purposes
If client has charitable bequests, consider making
the charities the beneficiaries of tax-deferred
accounts as the charities will not pay income tax

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BENEFICIARY DESIGNATIONS
POD/TOD
POD designations used on bank accounts
TOD designations used on brokerage accounts,
savings bonds or stock Iowa Code Chapter 633D
Cannot be used in Iowa for real estate holdings
Designates beneficiary who is to receive asset upon
death of owner - designation is revocable
Beneficiary has no rights to asset until clients death

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BENEFICIARY DESIGNATIONS
POD/TOD
Asset passes to designee outside of probate
Beneficiary has no obligation to share with other
intended beneficiaries
Beneficiary may not be required to use funds for
funeral, burial, taxes, or other administration
expenses
If most assets pass by joint tenancy ownership or
beneficiary designation, then no assets available for
personal representative to pay administration
expenses, including carrying costs of real estate, etc.

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FINANCIAL POWER OF ATTORNEY

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FINANCIAL POWER OF ATTORNEY

Designates Attorney-in-Fact to control assets and
pay bills if client becomes incapacitated or needs
assistance due to physical limitations.
Avoids time and expense of court proceedings to
establish and administer conservatorship.
Help client choose carefully! Attorney-in-Fact has
substantial power and limited supervision.

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Iowa Uniform Power of Attorney Act (IUPOA)

Replaces existing Iowa Code Chapter 633B

Enacted as Senate File 2168
Signed by the Governor on April 10, 2014
Effective July 1, 2014

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FINANCIAL POWER OF ATTORNEY

Purpose of Uniform POA Act
Provide comprehensive guidelines for creation and use of
Powers of Attorney.
Prevent and address potential abuses of Powers of
Attorney.
Has currently been adopted in 15 states.

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FINANCIAL POWER OF ATTORNEY

Non-Applicability of IUPOA
Acts completed by the Agent prior to July 1, 2014.
Powers of Attorney coupled with an interest of the agent in
the transaction that is the subject of the power (i.e.
Limited POA given for the benefit of a creditor).
Healthcare Power of Attorney.
Proxy or other delegation of voting rights or management
rights with respect to an entity.
Power created on a form prescribed by government,
governmental subdivision, governmental agency for a
governmental purpose.
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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Applicability of IUPOA
Applies to all Financial POAs created on or after July 1,
2014.
Applies to all judicial proceedings concerning a power of
attorney commenced on or after July 1, 2014.

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FINANCIAL POWER OF ATTORNEY

Applicability to prior documents/proceedings
Generally applies to POAs created before July 1, 2014,
unless otherwise provided in the Act. But see Iowa Code
633B.107, the meaning and effect of a POA created before
July 1, 2014, is to be interpreted under the law that was in
effect at the time the POA was created
Generally applies to judicial proceedings commenced
before July 1, 2014, unless court finds that application of
the IUPOA would substantially interfere with conducting
the proceedings or the rights of interested persons.

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FINANCIAL POWER OF ATTORNEY

Validity of Documents under IUPOA
POAs executed on or after July 1, 2014, are valid if
executed in compliance with IUPOA.
Must be notarized

POAs executed before July 1, 2014, are valid if execution

complied with state law in effect at the time of execution.
Notarization was not required, but commonly practiced

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Old Iowa POA Law
Very little statutory law in Iowa.
Agent referred to as Attorney-in-Fact.
Document contained a laundry list of transactions Agent
was authorized to transact.
Notarization was typically used, but not required.
Iowa Bar Form was typically used, but not required.
Affidavit procedure used for agent to verify their authority.

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FINANCIAL POWER OF ATTORNEY

New Iowa UPOA Law
Now have comprehensive statutory law in Iowa.
Agent now referred to as Agent.
Comments to the Uniform Act and cases decided in other states
who have adopted the Uniform Act will be helpful guidance.
Laundry list of transactions no longer required, refer to the
statute to confirm Agents authority.
Notarization is now required.
Certification procedure now used for Agent to verify their
authority.

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FINANCIAL POWER OF ATTORNEY

Agent can be granted General Authority by:
Granting Agent general authority to do all acts that
principal could do pursuant to Iowa Code 633B.201
Incorporating by reference the provisions set forth in
633B.204 - 633B.217
Providing detailed itemization of the authority granted

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Grant of General Authority includes:

633B.204 Real Property.

633B.205 Tangible Personal Property.
633B.206 Stocks and Bonds.
633B.207 Commodities and Options.
633B.208 Banks & Other Financial Institutions.
633B.209 Operation of Entity or Business.
633B.210 Insurance & Annuities.

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FINANCIAL POWER OF ATTORNEY

Grant of General Authority includes:
633B.211 Estates, Trusts & Other Beneficial Interests.
633B.212 Claims & Litigation.
633B.213 Personal & Family Maintenance.
633B.214 Governmental Benefits, Civil & Military Service
Benefits.
633B.215 Retirement Benefits.
633B.216 Taxes.
633B.217 Gifts.

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FINANCIAL POWER OF ATTORNEY

Grant of General Authority not sufficient for all
transactions.
Agent may not perform certain transactions, as set
forth in Iowa Code 633B.201 unless:
POA expressly grants the authority
Exercise of such authority is not prohibited by another
statute, agreement or instrument

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Specific Authority expressly required for the following:
Create, amend, revoke, terminate Revocable Trust.
Make a gift in excess of federal annual exclusion amount.
Create or change rights of survivorship.
Create or change beneficiary designation.
Delegate authority granted under POA.
Waive principals right to joint and survivor annuity.
Exercise fiduciary powers that principal has authority to
delegate.
Disclaim property, including a power of appointment.

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FINANCIAL POWER OF ATTORNEY

Even if Specific Authority expressly granted, an
agent who is not closely related to the principal may
not directly or indirectly create in the agent an
interest in the principals property by gift, right or
survivorship, beneficiary designation, disclaimer, or
otherwise

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FINANCIAL POWER OF ATTORNEY

Powers of Co-Agents
Under old Iowa law, Co-Agents required to act in concert
unless document specifically specified otherwise.
Under UIPOA, majority of Co-Agents are authorized to act
on behalf of principal unless document specifies otherwise

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Nomination of Guardian & Conservator
Under old Iowa law, nomination of Guardian &
Conservator was completed through separate standby
Petitions.
Under new IUPOA, standby Guardians and Conservators
may also be nominated in the Financial Power of Attorney
document.

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FINANCIAL POWER OF ATTORNEY

Accounting of Agents Acts
Under old Iowa law, accounting could only be obtained by
principal, principals conservator or personal representative.
Under IUPOA 633B.114(8), accounting can be requested by
principal, principals conservator, another fiduciary acting for
principal, a governmental agency having authority to protect
welfare of principal, personal representative of deceased
principal.
Clients often to choose to name additional parties (i.e. children
of principal) who are entitled to request an accounting

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FINANCIAL POWER OF ATTORNEY

Invoking Judicial Intervention
Under old Iowa law, judicial intervention could only be
obtained by principal, principals conservator or personal
representative.
Under IUPOA 633B.116, there is an extensive laundry list
of interested persons who have authority to invoke court
jurisdiction to construe a power of attorney or review an
agents conduct

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Nuts&BoltsofEstatePlanning

FINANCIAL POWER OF ATTORNEY

Iowa Statutory Financial Power of Attorney Form can be
found at 633B.301 and on Iowa Docs
Statutory form is not popular with practitioners and will likely
be revised in the future
Statutory form does not lend itself to automated generation of
documents
Statutory form should only be used in very simple situations

Agents Certification Form can be found at 633B.302 .

These forms are not mandatory and may be revised as
necessary.
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LIVING WILL

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LIVING WILL
Life-Sustaining Procedures Act
Iowa Code Chapter 144A

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LIVING WILL
Executed at any time by a competent adult.
Document must either be notarized or witnessed by
two adults.
Becomes effective if patient is in terminal condition
and is unable to make their own medical decisions.
Provides directions on use or withdrawal of lifesustaining procedures.
May be revoked at any time, without regard to
mental or physical condition.

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LIVING WILL
Definition of Terminal Condition
Incurable or irreversible condition that, without
administration of life-sustaining procedures, will, in the
opinion of the attending physician, result in death within a
relatively short period of time.
State of permanent unconsciousness from which, to a
reasonable degree of medical certainty, there can be no
recovery.

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LIVING WILL
Definition of Life-Sustaining Procedures
Any medical procedure, treatment, or intervention,
including resuscitation, which utilizes mechanical or
artificial means to sustain, restore or supplant a
spontaneous vital function, and when applied to a patient
in a terminal condition, would only serve to prolong the
dying process.

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Nuts&BoltsofEstatePlanning

LIVING WILL
Witnesses to Living Will
Signed by 2 adult witnesses in the presence of each other
and the declarant.
At least one witness must be unrelated (not a relative by
blood, marriage, or adoption within the third degree of
consanguinity).
Attending physician and employees of the attending
physician cannot serve as witness.

Prefer use of notary instead of 2 witnesses to avoid

increased chance of litigation.

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LIVING WILL
Applicability of Living Will
Attending physician concludes that patient is in a terminal
condition.
Diagnosis is confirmed by another physician.
Notation is made in medical record that Living Will is now
applicable.
Effectiveness delayed if patient is pregnant with fetus that
could develop to point of live birth with continued
application of life-sustaining procedures.

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LIVING WILL
Old Living Will
Definition of life-sustaining procedures changed on April
23, 1992.
After that date, definition of life-sustaining procedures
includes hydration and nutrition administered through IV
or NG tube.
Living Will documents signed prior to April 23, 1992, do
not allow the withdrawal of food and water provided
through artificial means.

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Nuts&BoltsofEstatePlanning

WHAT IF NO LIVING WILL?

No presumption for or against life-sustaining
procedures based on failure to execute Living Will.
Must be consultation and written agreement
between attending physician and alternate decision
makers who must be guided by the express or
implied intentions of patient.
If legal guardian has been appointed for the patient,
court order is required prior to withdrawal of lifesustaining procedures.
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IF NO LIVING WILL
ALTERNATE DECISION MAKERS
1st: Person designated under health care POA.
2nd: Legal guardian of patient.
3rd: Spouse of patient.
4th: Adult children (majority of children who are
reasonably available for consultation).
5th: Parents of patient.
6th: Adult siblings of patient.

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MEDICAL POWER OF ATTORNEY

DURABLE POA FOR HEALTH CARE

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Nuts&BoltsofEstatePlanning

MEDICAL POWER OF ATTORNEY

DURABLE POA FOR HEALTH CARE
Iowa Code Chapter 144B

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MEDICAL POWER OF ATTORNEY

Designates another person as agent to make health
care decisions when patient is no longer able to
make those decisions on their own.
Takes effect when patient can no longer make their
own medical decisions.
Covers more situations than Living Will.
Can be revoked at any time, without regard to
mental or physical condition.

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MEDICAL POWER OF ATTORNEY

Requirements for Validity:

Written designation.
Explicitly authorizes agent to make health care decisions.
Notarized or signed by 2 witnesses.
Same witness limitations as described for Living Will.

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Nuts&BoltsofEstatePlanning

MEDICAL POWER OF ATTORNEY

Ineligible Decision Makers under Medical POA:
Attending physician cannot serve as agent.
Employee of the attending physician cannot serve as
agent, unless the individual is related to patient by blood,
marriage, or adoption within the 3rd degree of
consanguinity.

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MEDICAL POWER OF ATTORNEY

Legal Effect of Designation:
Designated agent has authority to make decisions if
principal is unable, in the judgment of attending
physician, to make their own health care decision.
Designated agent has duty to act in accordance with
desires of the patient as expressed in the Medical POA or
otherwise made known to agent at any time.

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MEDICAL POWER OF ATTORNEY

Legal Effect of Designation:
If patients desires are unknown, agent has duty to act in
the best interests of the patient, taking into account the
patients overall medical condition and prognosis.
Agent can be removed if district court determines that
agent is acting contrary to wishes of the patient.
If patient has Living Will and Medical POA, provisions of
Living Will take priority.

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RELATED MEDICAL DOCUMENTS

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MEDICAL DIRECTIVES
Optional document that supplements the Medical
Power of Attorney and Living Will.
Provides specific instructions to Agent regarding
medical decisions to be made under specific
circumstances.
Client should complete with input of personal
physician.

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DNR ORDERS
Iowa Code Chapter 144D
Do Not Resuscitate Orders (DNR) orders can only be
completed by or for individuals who are determined
to be near the end of life.
DNR Orders must be completed with the assistance
of physician.
Attorneys cannot draft DNR Orders.

Iowa law has provisions allowing DNR Orders to be

portable between facilities.

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Nuts&BoltsofEstatePlanning

DISPOSITION OF LAST REMAINS

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DISPOSITION OF LAST REMAINS

Iowa Code Chapter 144C
Iowa Final Disposition Act
Applies to all deaths occurring on or after July 1, 2008 and
to all declarations executed on or after that date.
Gives an individual the ability to designate who will be in
charge of making funeral and burial decisions for the
individual following his or her death.

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DISPOSITION OF LAST REMAINS

Order of Priority for Decision Makers:

Designee (then alternate designee) in declaration;

Surviving spouse (provided not legally separated);
Surviving adult children (majority rules);
Surviving parents;
Surviving adult grandchildren (majority rules);
Surviving adult siblings (majority rules);

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DISPOSITION OF LAST REMAINS

Order of Priority for Decision Makers:
Surviving grandparents (majority rules);
Persons in next degree of kinship under rules of intestate
succession (majority rules);
Person who represents that he/she knows the decedents
identity and who signs an affidavit verifying decedents
identity and assuming responsibility/expense;
County medical examiner (if responsible for remains).

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DISPOSITION OF LAST REMAINS

Designee(s) jump to front of the line.
Designee has obligation to act in good faith and in a
manner that is reasonable under the circumstances.
Default decision makers apparently have no
obligation to act in good faith and in a manner that
is reasonable under the circumstances
See In re Estate of Whalen, 827 NW2d 184 (Iowa
Supreme Court 2013).

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DISPOSITION OF LAST REMAINS

Reasonable under the circumstances means
consideration of what is appropriate in relation to the
Decedents:
Finances;
Cultural or family customs; and
Religious or spiritual beliefs.

Reasonable under the circumstances also may include,

but is not limited to, consideration of the Decedents:
Preneed funeral, burial, or cremation plan; and
Known or reasonably ascertainable creditors.

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DISPOSITION OF LAST REMAINS

Requirements for Valid Designation:
Must be in written form that substantially complies with
language in Chapter 144C.6;
Must be contained in or attached to a durable power of
attorney for health care;
Must be dated and signed by declarant; and
Must be witnessed by 2 individuals or notarized.

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DISPOSITION OF LAST REMAINS

Declaration MAY include
The location of an agreement for prearranged funeral services
or funeral merchandise;
Cemetery lots owned by or reserved for the declarant; and
Special instructions regarding organ donation.

Declaration CAN NOT include:

Directives for final disposition of the declarants remains (i.e. I
want to be cremated and ashes spread in the Pacific Ocean); nor
Arrangements for ceremonies planned after the declarants
death.

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THANK

YOU

Follow up questions can be directed to Janice Kerkove at

jkerkove@bradleyriley.com or (319) 861-8763.

Cedar Rapids
2007 First Avenue SE
PO Box 2804
Cedar Rapids, Iowa 52406
Ph: 319.363.0101
Fax: 319.363.9824

Iowa City
Tower Place
One South Gilbert
Iowa City, Iowa 52240
Ph: 319.466.1511
Fax: 319.358.5560

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ESTATE PLANNING
ITS MORE THAN JUST A WILL

Last Will & Testament

Revocable Trust (optional)
Asset Titling
Beneficiary Designations
Financial Power of Attorney
Medical Power of Attorney
Living Will
Declaration re: Last Remains
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CREATE A GOOD DATA SHEET

Personal information for clients & their children
Identify any beneficiaries with special issues
Identify children vs. step-children

Financial information
How is the asset titled?
Is there a beneficiary designation?

Identify who is to fill various fiduciary roles

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CREATE A GOOD DATA SHEET

Any obligations under a prenuptial agreement?

Any obligations under a dissolution decree?
Any significant future inheritances?
Is there genetic reproductive material in storage?
Do they want to give someone control over their
digital assets?

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FEDERAL ESTATE TAXES

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FEDERAL ESTATE TAX ISSUES

Internal Revenue Code 2001 2801
Federal estate taxes based on value of estate

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FEDERAL ESTATE TAX ISSUES

Federal estate tax exemption currently $5.34 million
(2014) for each taxpayer, indexed for inflation
Federal estate tax exemption not used at first death
can be transferred to surviving spouse
Requires timely filing of Federal 706 Estate Tax Return

Large gifts made during lifetime decrease the federal

estate tax exemption available at death

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IOWA INHERITANCE TAXES

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IOWA INHERITANCE TAX ISSUES

Iowa Code Chapter 450
Taxes based on the relationship between decedent &
recipient & based on the value of Iowa assets
received by the recipient
Gross estates of less than $25,000 exempt from
Iowa inheritance taxes

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IOWA INHERITANCE TAX ISSUES

Lineal descendants & lineal ascendants exempt
Brother, sister, daughter-in-law, son-in-law subject
to tax starting at 5% and ending at 10% marginal
rate
Niece, nephew, other relatives, friends subject to tax
starting at 10% and ending at 15% marginal rate
Step-children are exempt, step-grandchildren are
not exempt from Iowa inheritance taxes

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IOWA INHERITANCE TAX ISSUES

Certain assets are exempt from Iowa inheritance tax
Life insurance paid to a named beneficiary (not estate)
IRA & qualified plan assets paid to a named beneficiary
who is subject to income tax
Non-Iowa assets

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IOWA RESIDENT WITH REAL ESTATE

HOLDINGS IN OTHER STATES
At least 15 states have decoupled from federal estate
tax system
In those states, the state death tax exemption is fixed at an
amount that is lower than the current federal estate tax
exemption
Minnesota, Illinois, Indiana, New York are a few of the
states that have decoupled

Iowa and at least 5 other states have inheritance

taxes

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WILLS VS. REVOCABLE TRUSTS

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WHAT TYPE OF DOCUMENT?

Should clients primary method of distributing assets be

a Will or Revocable Trust?
Will administration governed by Iowa Probate Code 633
Trust administration governed by Iowa Trust Code 633A

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WILL

Cheaper to draft
Probate is required

REVOCABLE TRUST

Code establishes 2% Atty/Exec Fees

Court Costs

Will & Asset information part of

public record
Bad for businesses that may need to

be sold as part of the proceeding

Does not take effect until death

Need separate POA to deal with
incompetency issues
Can be difficult to obtain
involuntary accounting from POA

Court oversees process

Extensive case law as precedent

More expensive to draft & fund

No probate required if all assets in
trust or have beneficiary designation
at time of grantors death
Code establishes reasonable fee for
Atty/Exec
No Court Costs

Maintains privacy of affairs

Easier transition for management of
affairs if client becomes incapacitated
Easier to obtain involuntary
accounting from Trustee than POA

Court involvement can be invoked if

necessary
Limited case law as precedent
Still need a Will

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WILL VS. REVOCABLE TRUST

Cost Benefit Analysis
Will the increased cost of drafting & funding a trust be
justified by the decreased costs of administration after the
clients death?

Probate required in every state client has real estate

Timeshares are sometimes treated as real estate interest
Mineral interests (oil/gas) usually treated as real estate
interest

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PROVISIONS OF LW&T
Revoke prior Wills
Identify beneficiaries
Outline plan of distribution of assets
Outline plan for payment of administration expenses
& taxes
Designate fiduciaries
Draft for proper execution of the document

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IDENTIFY BENEFICIARIES
List next of kin
Does the client want the list of beneficiaries to
include beneficiaries born after execution?
Does the client want the list of beneficiaries to
include adopted children?
Does the client want to exclude any beneficiaries?
If yes, make that clear in the document

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OUTLINE PLAN OF DISTRIBUTION

Tangible personal property
Include option to leave separate writing
Include a plan for resolving disputes
Authorize Executor to donate/destroy items

Special bequests

Charities any limitations on how used?

Godchild, Special Friends, Grandchildren
Digital assets
Genetic materials in storage

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OUTLINE PLAN OF DISTRIBUTION

RESIDUARY ESTATE IF SURV. SPOUSE
Distribute outright to surviving spouse?
Hold in credit shelter trust for surviving spouse?
Who is Trustee?
What are distribution standards?
Can distributions be made to any other beneficiaries?

Hold in marital trust for surviving spouse?

Who is Trustee?
IRS requires mandatory distribution of net income to spouse
IRS requires that spouse be given right to turn non-income producing
property into income-producing property
Client decides on principal distribution standards for spouse
IRS mandates no one else is entitled to principal during spouses
lifetime

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OUTLINE PLAN OF DISTRIBUTION

RESIDUARY ESTATE NO SURV. SPOUSE
Distributed equally or some other percentage?
What happens if beneficiary dies?
Balance to surviving members of group?
Balance to lineal descendants?
Per stirpes vs. per capita

Trust for any beneficiaries who may be minors at the

time of inheritance
Trusts for any beneficiaries who have special issues

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OUTLINE PLAN FOR PAYMENT OF

ADMINISTRATION EXPENSES
Consider liquidity issues
Does the probate estate have sufficient liquid assets to pay
mortgage, utilities, property taxes, attorney fees, executor
fees, appraisal costs, funeral expenses, court costs, and
other expenses of administration?
Should a portion of life insurance be paid to estate to
provide necessary funds?

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OUTLINE PLAN FOR PAYMENT OF

ADMINISTRATION EXPENSES
Who should be charged with administration
expenses?
Default rule is administration expenses paid by residuary
unless document states otherwise
Residuary share vs. equitable allocation

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OUTLINE PLAN FOR PAYMENT OF

DEATH TAXES
Who pays federal estate taxes
Default rules is tax paid by residuary share unless
document states otherwise
Residuary vs. equitable allocation
Charities not subject to federal estate tax
Surviving spouse usually not subject to federal estate tax (if
document properly drafted)

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OUTLINE PLAN FOR PAYMENT OF

DEATH TAXES
Who pays Iowa inheritance taxes
Default rule is beneficiary pays unless document states
otherwise
If Estate pays, adjustment required to gross up beneficiarys
share for inheritance taxes paid by Estate

Residuary vs. equitable allocation

What if beneficiary receiving non-probate asset?
What is beneficiary is receiving non-liquidate asset (real estate)?

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DESIGNATE FIDUCIARIES
Guardians for minor children
Special considerations if naming married couples

Trustees for any trusts created under LW&T

Specify powers granted to Trustees

Executor of LW&T
Waiver of bond?
Power of sale?
Authority over digital assets?

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DRAFT FOR PROPER EXECUTION

Client & two disinterested witnesses sign in the
presence of each other
Client, two disinterested witnesses, and notary sign
Self-Proving Affidavit
If no self-proving affidavit, must find at least one of the
witnesses after date of death
If unable to find witnesses, then client died intestate

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WHERE WILL ORIGINAL BE STORED?

Very difficult to admit Will to probate if original
document cannot be found
Law presumes that Will was revoked
Can only admit copy if presumption can be overcome

Keep record of where client will be storing original

Lock box at __________ branch of ________ bank
Fireproof safe at office
Gun safe at home

Generally do not have clients deposit with Clerk of Court

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TITLING OF ASSETS

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TITLING ASSETS
JOINT TENANCY

Joint tenancy with rights of survivorship vs. tenants

in common ownership
Joint tenancy ownership with rights of survivorship
overrides terms of Will or Trust
Assets pass directly to the surviving joint tenant and are
never under the control of the Executor or Trustee

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TITLING OF ASSETS
JOINT TENANCY

If married couple has no federal estate tax concerns,

assets can be held in joint tenancy to avoid probate
at first spouses death
If not a married couple or if there are federal estate
tax concerns, joint tenancy ownership is not
recommended

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TITLING OF ASSETS
JOINT TENANCY WITH NON-SPOUSE
Beware of titling assets jointly with non-spouses
Joint owner has immediate access to the joint
tenancy accounts does not require clients
permission to withdraw funds
Asset becomes subject to claims from their creditors,
ex-spouse, etc.
Asset automatically passes to surviving joint tenant there is no legal obligation for joint tenant to share
proceeds with other intended beneficiaries
Can increase income tax liability when assets are
sold in the future
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BENEFICIARY DESIGNATIONS

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BENEFICIARY DESIGNATIONS
Typically on Life Insurance, IRAs, 401(k)s,
annuities, 403(b)s, etc
In Iowa (and most other states), the beneficiary
designation overrides terms of Will or Trust
Need to look at contract closely to determine what
happens if the beneficiary predeceases client
Be sure beneficiary designation complements plan of
distribution under Will or Trust

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BENEFICIARY DESIGNATIONS
ESTATE AS THE BENEFICIARY
Provides liquid assets for payment of debts and
expenses
Provides funding for credit shelter trust if other
assets are not sufficient
May allow creditors to access proceeds
May subject proceeds to Iowa Inheritance Tax
May be included in calculating court costs, attorney
fees, etc.
May be adverse income tax consequences

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BENEFICIARY DESIGNATIONS
SPOUSE AS BENEFICIARY
Under old Iowa law, ex-spouse received proceeds if
beneficiary designation was not changed after the
divorce
Iowa law now nullifies ex-spouse and ex-spouses family
members as beneficiaries after a divorce
Only applies to non-ERISA assets
Must follow the appropriate notification procedures in Iowa
Code 598.20A before funds are paid out

Assets received by spouse under beneficiary

designation/joint tenancy do not count against spouses
right to claim 1/3 of estate Iowa Code 633.238
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BENEFICIARY DESIGNATIONS
MULTIPLE CHILDREN AS BENES
Important to determine what happens if a child
predeceases the owner
Default plan rules usually call for distribution to the
surviving children
Most clients prefer that lineal descendants of
deceased child take which requires adding of per
stirpes language to the designation

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BENEFICIARY DESIGNATIONS
TAX DEFERRED ASSETS
Beneficiary designations on IRAs or qualified plans
should be properly drafted to provide beneficiary
with flexibility to obtain maximum deferral/stretch
for income tax purposes
If client has charitable bequests, consider making
the charities the beneficiaries of tax-deferred
accounts as the charities will not pay income tax

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BENEFICIARY DESIGNATIONS
POD/TOD
POD designations used on bank accounts
TOD designations used on brokerage accounts,
savings bonds or stock Iowa Code Chapter 633D
Cannot be used in Iowa for real estate holdings
Designates beneficiary who is to receive asset upon
death of owner - designation is revocable
Beneficiary has no rights to asset until clients death

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BENEFICIARY DESIGNATIONS
POD/TOD
Asset passes to designee outside of probate
Beneficiary has no obligation to share with other
intended beneficiaries
Beneficiary may not be required to use funds for
funeral, burial, taxes, or other administration
expenses
If most assets pass by joint tenancy ownership or
beneficiary designation, then no assets available for
personal representative to pay administration
expenses, including carrying costs of real estate, etc.

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FINANCIAL POWER OF ATTORNEY

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FINANCIAL POWER OF ATTORNEY

Designates Attorney-in-Fact to control assets and
pay bills if client becomes incapacitated or needs
assistance due to physical limitations.
Avoids time and expense of court proceedings to
establish and administer conservatorship.
Help client choose carefully! Attorney-in-Fact has
substantial power and limited supervision.

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FINANCIAL POWER OF ATTORNEY

Iowa Uniform Power of Attorney Act (IUPOA)

Replaces existing Iowa Code Chapter 633B

Enacted as Senate File 2168
Signed by the Governor on April 10, 2014
Effective July 1, 2014

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FINANCIAL POWER OF ATTORNEY

Purpose of Uniform POA Act
Provide comprehensive guidelines for creation and use of
Powers of Attorney.
Prevent and address potential abuses of Powers of
Attorney.
Has currently been adopted in 15 states.

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FINANCIAL POWER OF ATTORNEY

Non-Applicability of IUPOA
Acts completed by the Agent prior to July 1, 2014.
Powers of Attorney coupled with an interest of the agent in
the transaction that is the subject of the power (i.e.
Limited POA given for the benefit of a creditor).
Healthcare Power of Attorney.
Proxy or other delegation of voting rights or management
rights with respect to an entity.
Power created on a form prescribed by government,
governmental subdivision, governmental agency for a
governmental purpose.
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FINANCIAL POWER OF ATTORNEY

Applicability of IUPOA
Applies to all Financial POAs created on or after July 1,
2014.
Applies to all judicial proceedings concerning a power of
attorney commenced on or after July 1, 2014.

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FINANCIAL POWER OF ATTORNEY

Applicability to prior documents/proceedings
Generally applies to POAs created before July 1, 2014,
unless otherwise provided in the Act. But see Iowa Code
633B.107, the meaning and effect of a POA created before
July 1, 2014, is to be interpreted under the law that was in
effect at the time the POA was created
Generally applies to judicial proceedings commenced
before July 1, 2014, unless court finds that application of
the IUPOA would substantially interfere with conducting
the proceedings or the rights of interested persons.

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FINANCIAL POWER OF ATTORNEY

Validity of Documents under IUPOA
POAs executed on or after July 1, 2014, are valid if
executed in compliance with IUPOA.
Must be notarized

POAs executed before July 1, 2014, are valid if execution

complied with state law in effect at the time of execution.
Notarization was not required, but commonly practiced

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FINANCIAL POWER OF ATTORNEY

Old Iowa POA Law
Very little statutory law in Iowa.
Agent referred to as Attorney-in-Fact.
Document contained a laundry list of transactions Agent
was authorized to transact.
Notarization was typically used, but not required.
Iowa Bar Form was typically used, but not required.
Affidavit procedure used for agent to verify their authority.

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FINANCIAL POWER OF ATTORNEY

New Iowa UPOA Law
Now have comprehensive statutory law in Iowa.
Agent now referred to as Agent.
Comments to the Uniform Act and cases decided in other states
who have adopted the Uniform Act will be helpful guidance.
Laundry list of transactions no longer required, refer to the
statute to confirm Agents authority.
Notarization is now required.
Certification procedure now used for Agent to verify their
authority.

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FINANCIAL POWER OF ATTORNEY

Agent can be granted General Authority by:
Granting Agent general authority to do all acts that
principal could do pursuant to Iowa Code 633B.201
Incorporating by reference the provisions set forth in
633B.204 - 633B.217
Providing detailed itemization of the authority granted

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FINANCIAL POWER OF ATTORNEY

Grant of General Authority includes:

633B.204 Real Property.

633B.205 Tangible Personal Property.
633B.206 Stocks and Bonds.
633B.207 Commodities and Options.
633B.208 Banks & Other Financial Institutions.
633B.209 Operation of Entity or Business.
633B.210 Insurance & Annuities.

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FINANCIAL POWER OF ATTORNEY

Grant of General Authority includes:
633B.211 Estates, Trusts & Other Beneficial Interests.
633B.212 Claims & Litigation.
633B.213 Personal & Family Maintenance.
633B.214 Governmental Benefits, Civil & Military Service
Benefits.
633B.215 Retirement Benefits.
633B.216 Taxes.
633B.217 Gifts.

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FINANCIAL POWER OF ATTORNEY

Grant of General Authority not sufficient for all
transactions.
Agent may not perform certain transactions, as set
forth in Iowa Code 633B.201 unless:
POA expressly grants the authority
Exercise of such authority is not prohibited by another
statute, agreement or instrument

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FINANCIAL POWER OF ATTORNEY

Specific Authority expressly required for the following:
Create, amend, revoke, terminate Revocable Trust.
Make a gift in excess of federal annual exclusion amount.
Create or change rights of survivorship.
Create or change beneficiary designation.
Delegate authority granted under POA.
Waive principals right to joint and survivor annuity.
Exercise fiduciary powers that principal has authority to
delegate.
Disclaim property, including a power of appointment.

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FINANCIAL POWER OF ATTORNEY

Even if Specific Authority expressly granted, an
agent who is not closely related to the principal may
not directly or indirectly create in the agent an
interest in the principals property by gift, right or
survivorship, beneficiary designation, disclaimer, or
otherwise

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FINANCIAL POWER OF ATTORNEY

Powers of Co-Agents
Under old Iowa law, Co-Agents required to act in concert
unless document specifically specified otherwise.
Under UIPOA, majority of Co-Agents are authorized to act
on behalf of principal unless document specifies otherwise

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FINANCIAL POWER OF ATTORNEY

Nomination of Guardian & Conservator
Under old Iowa law, nomination of Guardian &
Conservator was completed through separate standby
Petitions.
Under new IUPOA, standby Guardians and Conservators
may also be nominated in the Financial Power of Attorney
document.

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FINANCIAL POWER OF ATTORNEY

Accounting of Agents Acts
Under old Iowa law, accounting could only be obtained by
principal, principals conservator or personal representative.
Under IUPOA 633B.114(8), accounting can be requested by
principal, principals conservator, another fiduciary acting for
principal, a governmental agency having authority to protect
welfare of principal, personal representative of deceased
principal.
Clients often to choose to name additional parties (i.e. children
of principal) who are entitled to request an accounting

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FINANCIAL POWER OF ATTORNEY

Invoking Judicial Intervention
Under old Iowa law, judicial intervention could only be
obtained by principal, principals conservator or personal
representative.
Under IUPOA 633B.116, there is an extensive laundry list
of interested persons who have authority to invoke court
jurisdiction to construe a power of attorney or review an
agents conduct

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FINANCIAL POWER OF ATTORNEY

Iowa Statutory Financial Power of Attorney Form can be
found at 633B.301 and on Iowa Docs
Statutory form is not popular with practitioners and will likely
be revised in the future
Statutory form does not lend itself to automated generation of
documents
Statutory form should only be used in very simple situations

Agents Certification Form can be found at 633B.302 .

These forms are not mandatory and may be revised as
necessary.
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LIVING WILL

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LIVING WILL
Life-Sustaining Procedures Act
Iowa Code Chapter 144A

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LIVING WILL
Executed at any time by a competent adult.
Document must either be notarized or witnessed by
two adults.
Becomes effective if patient is in terminal condition
and is unable to make their own medical decisions.
Provides directions on use or withdrawal of lifesustaining procedures.
May be revoked at any time, without regard to
mental or physical condition.

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LIVING WILL
Definition of Terminal Condition
Incurable or irreversible condition that, without
administration of life-sustaining procedures, will, in the
opinion of the attending physician, result in death within a
relatively short period of time.
State of permanent unconsciousness from which, to a
reasonable degree of medical certainty, there can be no
recovery.

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LIVING WILL
Definition of Life-Sustaining Procedures
Any medical procedure, treatment, or intervention,
including resuscitation, which utilizes mechanical or
artificial means to sustain, restore or supplant a
spontaneous vital function, and when applied to a patient
in a terminal condition, would only serve to prolong the
dying process.

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LIVING WILL
Witnesses to Living Will
Signed by 2 adult witnesses in the presence of each other
and the declarant.
At least one witness must be unrelated (not a relative by
blood, marriage, or adoption within the third degree of
consanguinity).
Attending physician and employees of the attending
physician cannot serve as witness.

Prefer use of notary instead of 2 witnesses to avoid

increased chance of litigation.

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LIVING WILL
Applicability of Living Will
Attending physician concludes that patient is in a terminal
condition.
Diagnosis is confirmed by another physician.
Notation is made in medical record that Living Will is now
applicable.
Effectiveness delayed if patient is pregnant with fetus that
could develop to point of live birth with continued
application of life-sustaining procedures.

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LIVING WILL
Old Living Will
Definition of life-sustaining procedures changed on April
23, 1992.
After that date, definition of life-sustaining procedures
includes hydration and nutrition administered through IV
or NG tube.
Living Will documents signed prior to April 23, 1992, do
not allow the withdrawal of food and water provided
through artificial means.

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WHAT IF NO LIVING WILL?

No presumption for or against life-sustaining
procedures based on failure to execute Living Will.
Must be consultation and written agreement
between attending physician and alternate decision
makers who must be guided by the express or
implied intentions of patient.
If legal guardian has been appointed for the patient,
court order is required prior to withdrawal of lifesustaining procedures.
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IF NO LIVING WILL
ALTERNATE DECISION MAKERS
1st: Person designated under health care POA.
2nd: Legal guardian of patient.
3rd: Spouse of patient.
4th: Adult children (majority of children who are
reasonably available for consultation).
5th: Parents of patient.
6th: Adult siblings of patient.

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MEDICAL POWER OF ATTORNEY

DURABLE POA FOR HEALTH CARE

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MEDICAL POWER OF ATTORNEY

DURABLE POA FOR HEALTH CARE
Iowa Code Chapter 144B

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MEDICAL POWER OF ATTORNEY

Designates another person as agent to make health
care decisions when patient is no longer able to
make those decisions on their own.
Takes effect when patient can no longer make their
own medical decisions.
Covers more situations than Living Will.
Can be revoked at any time, without regard to
mental or physical condition.

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MEDICAL POWER OF ATTORNEY

Requirements for Validity:

Written designation.
Explicitly authorizes agent to make health care decisions.
Notarized or signed by 2 witnesses.
Same witness limitations as described for Living Will.

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MEDICAL POWER OF ATTORNEY

Ineligible Decision Makers under Medical POA:
Attending physician cannot serve as agent.
Employee of the attending physician cannot serve as
agent, unless the individual is related to patient by blood,
marriage, or adoption within the 3rd degree of
consanguinity.

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MEDICAL POWER OF ATTORNEY

Legal Effect of Designation:
Designated agent has authority to make decisions if
principal is unable, in the judgment of attending
physician, to make their own health care decision.
Designated agent has duty to act in accordance with
desires of the patient as expressed in the Medical POA or
otherwise made known to agent at any time.

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MEDICAL POWER OF ATTORNEY

Legal Effect of Designation:
If patients desires are unknown, agent has duty to act in
the best interests of the patient, taking into account the
patients overall medical condition and prognosis.
Agent can be removed if district court determines that
agent is acting contrary to wishes of the patient.
If patient has Living Will and Medical POA, provisions of
Living Will take priority.

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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RELATED MEDICAL DOCUMENTS

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ATTORNEYS AND COUNSELORS
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MEDICAL DIRECTIVES
Optional document that supplements the Medical
Power of Attorney and Living Will.
Provides specific instructions to Agent regarding
medical decisions to be made under specific
circumstances.
Client should complete with input of personal
physician.

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ATTORNEYS AND COUNSELORS
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DNR ORDERS
Iowa Code Chapter 144D
Do Not Resuscitate Orders (DNR) orders can only be
completed by or for individuals who are determined
to be near the end of life.
DNR Orders must be completed with the assistance
of physician.
Attorneys cannot draft DNR Orders.

Iowa law has provisions allowing DNR Orders to be

portable between facilities.

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ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
www.bradleyriley.com

DISPOSITION OF LAST REMAINS

Iowa Code Chapter 144C
Iowa Final Disposition Act
Applies to all deaths occurring on or after July 1, 2008 and
to all declarations executed on or after that date.
Gives an individual the ability to designate who will be in
charge of making funeral and burial decisions for the
individual following his or her death.

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ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

Order of Priority for Decision Makers:

Designee (then alternate designee) in declaration;

Surviving spouse (provided not legally separated);
Surviving adult children (majority rules);
Surviving parents;
Surviving adult grandchildren (majority rules);
Surviving adult siblings (majority rules);

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DISPOSITION OF LAST REMAINS

Order of Priority for Decision Makers:
Surviving grandparents (majority rules);
Persons in next degree of kinship under rules of intestate
succession (majority rules);
Person who represents that he/she knows the decedents
identity and who signs an affidavit verifying decedents
identity and assuming responsibility/expense;
County medical examiner (if responsible for remains).

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ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

Designee(s) jump to front of the line.
Designee has obligation to act in good faith and in a
manner that is reasonable under the circumstances.
Default decision makers apparently have no
obligation to act in good faith and in a manner that
is reasonable under the circumstances
See In re Estate of Whalen, 827 NW2d 184 (Iowa
Supreme Court 2013).

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ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

Reasonable under the circumstances means
consideration of what is appropriate in relation to the
Decedents:
Finances;
Cultural or family customs; and
Religious or spiritual beliefs.

Reasonable under the circumstances also may include,

but is not limited to, consideration of the Decedents:
Preneed funeral, burial, or cremation plan; and
Known or reasonably ascertainable creditors.

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

Requirements for Valid Designation:
Must be in written form that substantially complies with
language in Chapter 144C.6;
Must be contained in or attached to a durable power of
attorney for health care;
Must be dated and signed by declarant; and
Must be witnessed by 2 individuals or notarized.

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ATTORNEYS AND COUNSELORS
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DISPOSITION OF LAST REMAINS

Declaration MAY include
The location of an agreement for prearranged funeral services
or funeral merchandise;
Cemetery lots owned by or reserved for the declarant; and
Special instructions regarding organ donation.

Declaration CAN NOT include:

Directives for final disposition of the declarants remains (i.e. I
want to be cremated and ashes spread in the Pacific Ocean); nor
Arrangements for ceremonies planned after the declarants
death.

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
www.bradleyriley.com

THANK

YOU

Follow up questions can be directed to Janice Kerkove at

jkerkove@bradleyriley.com or (319) 861-8763.

Cedar Rapids
2007 First Avenue SE
PO Box 2804
Cedar Rapids, Iowa 52406
Ph: 319.363.0101
Fax: 319.363.9824

Iowa City
Tower Place
One South Gilbert
Iowa City, Iowa 52240
Ph: 319.466.1511
Fax: 319.358.5560

BRADLEY & RILEY PC

ATTORNEYS AND COUNSELORS
www.bradleyriley.com

2014
2014 Nuts
Nuts &
& Bolts
Bolts Seminar
Seminar
Coralville
Coralville

TRANSACTIONAL TRACK
Securities

4:00 p.m.- 5:00 p.m.

Presented by
William Daly
Shuttleworth & Ingersoll, P.L.C.
115 3rd Street SE, Suite 500
Cedar Rapids, IA 52401
Phone: (319) 365-9461

THURSDAY,
THURSDAY, OCTOBER
OCTOBER 30,
30, 2014
2014

Nuts & Bolts Seminar

Securities Law Outline
William J. Daly
I.

Roadmap of Discussion:
a. Terminology Discussion
b. Federal Securities Registration Exemptions
c. State Registration Exemptions
d. Crowdfunding
e. Disclosure and Anti-Fraud Requirements
f.

A review of the documents used in Private Offerings

g. Applying the Laws to Practice: Practical Implications to consider

II.

Terminology Discussion
a. What is an Accredited Investor?
i. Individual

Any director, executive officer, or general partner of the issuer of the securities being
offered or sold, or any director, executive officer, or general partner of a general
partner of that issuer.

Any natural person whose individual net worth, or joint net worth with that person's
spouse, exceeds $1,000,000.

Dont include a persons primary residence as an asset in calculating net worth.

Dont include indebtedness securing a persons primary residence (up to the fair
market value) as a liability in calculating net worth.

Any natural person who had an individual income in excess of $200,000 in each of
the two most recent years or joint income with that person's spouse in excess of
$300,000 in each of those years and has a reasonable expectation of reaching the
same income level in the current year.

ii. Non-Individual (Not a complete list)

Bank, Savings and Loan Association, Registered Investment Company, etc

Any organization described in section 501(c)(3) of the Internal Revenue Code,

corporation, Massachusetts or similar business trust, or partnership, not formed for
the specific purpose of acquiring the securities offered, with total assets in excess of
$5,000,000.

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |2

Any trust, with total assets in excess of $5,000,000, not formed for the specific
purpose of acquiring the securities offered, whose purchase is directed by a
sophisticated person.

Any entity in which all of the equity owners are accredited investors.

b. What is a Security?
i. A Security is defined by The Securities Act of 1933 (the Securities Act) as:

III.

Any note, stock, treasury stock, security future, security swap bond, debenture,
evidence of indebtedness, certificate of interest or participation in any profit-sharing
agreement, collateral-trust certificate, preorganization certificate or subscription,
transferable share, investment contract, voting-trust certificate, certificate of deposit
for a security, fractional undivided interest in oil, gas, or other mineral rights, any
put, call, straddle, option, or privilege on any security, certificate of deposit, or group
or index of securities (including any interest therein or based on the value thereof), or
any put, call, straddle, option, or privilege entered into on a national securities
exchange relating to foreign currency, or, in general, any interest or instrument
commonly known as a "security", or any certificate of interest or participation in,
temporary or interim certificate for, receipt for, guarantee of, or warrant or right to
subscribe to or purchase, any of the foregoing.

Federal Securities Law Exemptions

a. Requirement of Registration:
i. The Securities Act requires that all transactions involving the sale of securities must be
registered with the SEC except those that meet an exemption from registration
b. The Private Placement Exemption - Section 4(a)(2) of the Securities Act
i. Exemption Provided:

Exempts from Securities Registration requirements, transactions not involving any

public offering.

ii. Determination of Exemption:

Public offering is not defined by the statute and case law is very fact dependent and
somewhat subjective.

Relying on a Regulation D safe harbor reduces risk for the company issuing the
securities.

iii. Factors in Determining Exemption:

SEC Guidance states that the following factors help determine whether there is a
public offering:

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |3

Number of Offerees (looking at number of persons solicited, not ultimate number of

purchasers)

Relationship of Offerees to each other and the Issuer

Number of Units offered

Size of Offering

Manner of Offering

Whether purchasers are acquiring for investment or as a conduit to a larger pool of

investors

Period of Retention the longer the period of retention, the more persuasive the
argument that resale is not at variance with the original investment intent

iv. Purchaser Qualification:

No requirement for accredited investors, in interpreting Section 4(a)(2), courts and

the SEC have stated that the purchasers should be sophisticated investors that are able
to evaluate the risks and merits of the investment or they should be able to bear the
investments economic risk.

c. Regulation D Rule 504

i. Aggregate Offering Amount: Cannot exceed $1 million in any 12 month period
ii. Purchaser Restrictions: Can sell to an unlimited number of purchasers and to non-accredited
investors
iii. General Solicitation and Advertisement:

Allowed if company is registering the offering in a state

Prohibited if company is conducting a private offering

iv. Disclosure Requirements: No line-item disclosure is required but must meet the anti-fraud
disclosure requirements of Rule 10b-5 (to be discussed later).
v. State Exemption Implications: Must find applicable exemption in each state where the
securities are sold.
vi. Company is required to file Form D with the SEC within 15 days of first sale.
vii. Practical Application: Relying on Rule 504 may be useful for companies at the seed round
that may want to include friends and family that do not qualify as accredited investors.
However, companies need to work with legal counsel to ensure they effectively plan for
future rounds and mitigate against potential integration issues.
d. Regulation D Rule 505

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |4
i. Aggregate Offering Amount: Cannot exceed $5 million in 12 month period before the start of
and during the offering.

$5M limit is for securities offered and not sold

ii. Purchaser Restrictions: Can sell to an unlimited number of accredited investors and up to 35
non-accredited investors
iii. General Solicitation and Advertisement: Prohibited
iv. Disclosure Requirements: Line-item disclosure is required if sales are made to any nonaccredited investors and general anti-fraud disclosure requirements of Rule 10b-5 (to be
discussed later) apply.
v. State Exemption Implications: Must find applicable exemption in each state where the
securities are sold.
vi. Company is required to file Form D with the SEC within 15 days of first sale.
vii. Practical Application: Because of the offer limit and the restrictions of selling to nonaccredited investors, Rule 505 is rarely used by start-up companies. Companies would rather
rely on Rule 504 and limit their raise, or rely on Rule 506 and use federal pre-emption to
qualify at the state level. However, if a company does not need federal preemption at the state
level, and wants to raise under $5 million, Rule 505 is beneficial because it does not have the
sophisticated purchaser requirement found in Rule 506.
e. Regulation D Rule 506
i. Description of Rule 506 Offer Requirements:

Aggregate Offering Amount: Unlimited

Purchaser Restrictions: Company may sell to an unlimited number of accredited

investors and up to 35 non-accredited investors.

All non-accredited non-accredited investors, either alone or with a purchaser

representative, must be sophisticated, meaning they must have sufficient
knowledge and experience in financial and business matters to make them
capable of evaluating the merits and risks of the prospective investment.

General Solicitation and Advertisement: Prohibited under Rule 506(b) and allowed
under Rule 506(c).

Disclosure Requirements: Line-item disclosure is required if sales are made to any

non-accredited investors and general anti-fraud disclosure requirements of Rule 10b5 (to be discussed later) apply.

State Exemption Implications: Preempts state blue sky laws so if a company utilizes a
Rule 506 exemption, it simply files a notice filing in each applicable state that it sold
the security (New York is an exception though).

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |5

Company is required to file Form D with the SEC within 15 days of first sale.

ii. Additional Bad Actor Requirements for Rule 506 Offerings:

No company can rely on Rule 506(b) or 506(c) if the issuer or any other Covered
Person is a Bad Actor, meaning such person has had a Disqualifying Event.

Therefore, to determine whether there are any Bad Actors, the issuing company
must exercise reasonable care to determine if any Covered Persons have had a
Disqualifying Event.

By making a factual inquiry from each Covered Person, the issuer is presumed to
have exercised reasonable care, therefore the issuer should get bad actor certifications
from all Covered Persons, which include the following persons:

f.

the issuing company

directors, general partners, and managing members of the issuer

executive officers of the issuer, and other officers of the issuers that
participate in the offering

20 percent beneficial owners of the issuer (calculated on the basis of total

voting power)

promoters connected to the issuer

for pooled investment fund issuers, the funds investment manager and its
principals, and

persons compensated for soliciting investors, including their directors,

general partners and managing members.

A Disqualifying Event, broadly speaking refers to certain (i) criminal convictions,

(ii) court injunctions and restraining orders, (iii) final orders of certain state and
federal regulators, (iv) SEC disciplinary orders, (v) SEC cease-and-desist orders, (vi)
SEC stop orders and orders suspending the Regulation A exemption, (vii) Suspension
or expulsion from membership in a self-regulatory organization (SRO), and (viii)
U.S. Postal Service false representation orders.

Regulation D Rule 506(b)

i. Rule 506(b), as currently drafted, is Rule 506 that was in existence prior to the JOBS Act
implementation.
ii. Relation to Section 4(2)(a) Exemption:

More objective offering exemption than relying on Rule 4(2)(a)

If Rule 506(b) exemption is found to be invalid, the company can use Section 4(2)(a)
as a back-up exemption at the federal level

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |6
iii. General Solicitation and Advertisement:

If a company relies on a Rule 506(b) exemption, general solicitation and

advertisement are prohibited.

SEC rules provide that general solicitation and general advertising include:
i. Making any advertisement or communication in any publication or
by broadcast or television or radio;
ii. Soliciting funds at any seminar or meeting who attendees have been
invited by general solicitation or advertising.

Additionally, when enforcing the prohibition of general solicitation, the SEC

has stressed the importance of the existence and substance of a pre-existing
relationship between the issuing company and investors.

Practical Application: Before making pitches or solicitations to a group of

potential investors, speak with your securities counsel to discuss the factual
situation.

iv. In Rule 506(b) offerings, investors self-certify that they are Accredited Investors

Usually this is done in the Subscription Agreement or in Investor Questionnaires

g. Regulation D Rule 506(c)

i. If a company wishes to use general solicitation and general advertisement, they can do so
under Rule 506(c), but to do so all purchasers must be Accredited Investors.
ii. Enhanced Accredited Investor Verification Requirements: Rules 506(c) requires the issuing
companies to take reasonable steps to verify the accredited investor status of each purchase
(self-certification is not enough)

Reasonable steps depends on the nature of the purchaser and the type of accredited
investor;

the amount and type of information that the issuer has about the purchaser; and

the nature of the offering, such as the manner in which the purchaser was solicited.

iii. Methods to Verify Accredited Investor Status: Rule 506(c) provides a non-exclusive list of
approved methods to verify accredited investor status of purchasers, which includes:

Verification Based on Income: Reviewing copies of any IRS form that reports
income, such as Form W-2, Form 1099, Schedule K-1 of Form 1065, and a filed
Form 1040. Investor should also provide statement certifying that the investor
expects this income level in the current year.

Verification Based on Net Worth: Reviewing bank statements, brokerage statements,

other statements of securities holdings, certificates of deposit and/or tax assessments
and appraisal reports issued by third parties in order to verify assets, a consumer

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |7
report from at least one of the nationwide consumer reporting agencies to verify
liabilities and obtains a written representation that all liabilities necessary to make a
net worth determination have been disclosed.

IV.

Verification Through Third-Party: Obtaining a written confirmation from a brokerdealer, a registered investment advisor, a licensed attorney or a CPA that such person
has taken reasonable steps to verify that the purchaser is an accredited investor within
the prior 3 months and determined that such purchaser is an accredited investor.

Verification Based on Past Relationship: If the purchaser has previously purchased

securities in the issuers past Rule 506(b) offerings, a certification from the purchaser
that such person is an accredited investor.

State Level Exemptions (Blue Sky)

a. Rule 506 Coordinating Exemption Applies to All States
i. As discussed above, if a company relies on Rule 506, it will file a Form D with the SEC
within 15 days of first sale and then file a copy of the SEC filed Form D in each applicable
state along with the applicable.
ii. Some states also require Form U-2 Consent to Service of Process
b. Self-Executing Exemptions vary from state to state, therefore if a company is raising capital in
numerous states and will not rely on Rule 506, each states law must be researched to determine
whether an applicable exemption applies to that companys securities offering.
c. Iowa
i. Limited Offering Exemption (Iowa Code 502.202(14))

35 or less Iowa residents purchase the security during any twelve consecutive months

No general solicitation or advertisement is made

No commission or remuneration is paid to a person, other than a broker dealer, for

soliciting a prospective purchaser in Iowa

Issuer reasonably believes all purchasers are purchasing for investment and not for
resale

ii. Specified Investors (Iowa Code 502.202(13) and Iowa Reg. 191-50.88(502))

V.

Transactions where the purchasers are:

Directors, executive officers, or general partners

Accredited Investors

Venture or Seed Capital Companies these are venture/seed funds that have
been in existence for more than 5 years and have assets that exceed $250,000

Crowdfunding:
Shuttleworth & Ingersoll, P.L.C.
115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |8
a. Proposed Federal Rules issued on October 23, 2013:
i. Limitation on Offering Size -- Issuer may issue up to $1 million in any continuous 12-month
period
ii. Individual Investor Limitation -- Investors are limited in the amounts they can invest
depending on their income and net worth
iii. Limits on Advertising Issuers are limited in the information they can provide in the
advertisement and are generally only allowed to provide the following:

Name of the issuer and that it is conducting an offering;

Name of the intermediary facilitating the offering;

The amount and nature of the securities offered, their price, and the closing date;

Contact information of the issuer and a description of the issuers business.

iv. Intermediary Requirements Must be conducted through registered broker dealer or

registered funding portal
v. Disclosure Requirements Issuer has specific disclosure requirements it must file with the
SEC and make available to investors (which includes audited financial statements if it is
raising more than $500,000).
vi. Transfer Restrictions Securities sold using crowdfunding cannot be sold for a period of one
year following the date of purchase except to certain purchasers.
vii. Reporting Requirements The disclosure requirements placed on the issuer are on-going in
nature.
b. State Responses:
i. States have begun to pass and adopt their own crowdfunding laws.
ii. Iowa has not yet done this but Wisconsin and Michigan have.
VI.

Disclosure & Anti-Fraud Requirements

a. Federal and State
i. Rule 10b-5 (Federal) and Iowa Code (Sec. 502.501) provide that it is unlawful for any
person, in connection with the purchase or sale of any security, to:

Employ any device, scheme, or artifice to defraud,

Make any untrue statement of a material fact or to omit to state a material fact
necessary in order to make the statements made, in the light of the circumstances
under which they were made, not misleading, or

Engage in any act, practice, or course of business which operates or would operate as
a fraud or deceit upon any person

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

Page |9
VII.

Private Offering Documents:

a. Subscription Agreement and Investor Questionnaire
i. Purchaser provides factual information about themselves, their accredited investor status, and
their primary residence.
ii. Purchaser subscribes to making the investment and is usually a binding agreement from the
purchaser to buy the security.
iii. Purchaser will make certain representations and warranties to the company stating, among
other things:

Accredited investor status;

That they are purchasing for investment, their own account, and that they understand
the securities are restricted;

That all information they have asked for has been provided to them, that they have
had the ability to ask questions regarding the business of the company and the
financial affairs of the company and they have had access to any and all information
they have requested;

Their state of residency (for state securities law exemption purposes); and

That they understand the investment is speculative, that they can bear the risk of
losing the investment, and that they have the requisite knowledge and experience to
make the investment.

iv. This is the document where the Company can protect itself from future claims regarding
information provided and the status of the investor
b. Offering Memorandum or Private Placement Memorandum
i. Provides detailed information regarding the following:

Terms of the current offering

Details the pricing of the offering, the amount of securities offered, and other
relevant facts

The companys business, its market, and competitors

Current capitalization of the company

Risk Factors relating to investing in the company

These risk factors will be at a larger economic level and also specific risks
that may effect that company because of where it is located or the industry it
is in.

Regulatory matters that may effect the company

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

P a g e | 10

Financial information relating to the company

Information regarding the management of the company

c. Other Documents
i. Stock/Unit Purchase Agreement
ii. Other investor rights/protection agreements as may be agreed upon between the company and
the investors.
VIII.

Practical Implications
a. Factors to consider in selecting an exemption:
i. Amount of capital being raised.
ii. Whether investors are accredited or non-accredited
iii. How fundraising will be conducted
iv. Number of states where investors reside
b. Determining whether to use general solicitation:
i. Loss of Back-Up Exemptions:

Once a general solicitation or advertisement is made, the company loses the

flexibility of relying on Section 4(2)(a) as a back-up exemption and potentially using
Rule 504 if it wanted to include non-accredited investors and the offering was less
than $1 million.

ii. Enhanced Administrative Requirements on Investors and Company:

Company is required to verify accredited investor status or hire a third-party to

provide the verification

Investors must understand that they will have to provide information to the company
or the third-party so the verification can be done.

iii. Potential Exposure to More Investors and More Funds:

The company may have exposure to more investors and a larger capital raise then
they could have previously had through a Rule 506(b) offering.

iv. Practical Application: The use of general solicitation and general advertisement will depend
on each situation and facts each company encounters. However, before going down the
506(c) route, companies should be aware that it is a significant line to cross and should
consult counsel to determine the potential negatives of such a route.
c. Allowing Non-Accredited Investors
i. Negatives:

Cannot use 506(c) exemption

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

P a g e | 11

Require line item disclosure requirements if relying on Rule 506(b) or 505

ii. Rule 504 exemption may be an option but have to work within Rule 504 restrictions.

Limited to $1 million cap per 12 month period

Need to plan future rounds strategically because raising capital within 6 months of
closing may integrate with 504 round

iii. If using Rule 506(b), purchaser must verify sophistication, which may require a purchaser
representative
iv. Practical Application: Companies that are raising from friends and family may often raise
from non-accredited investors. This is okay, but the company still needs to ensure it has
proper securities law exemptions both at the federal and state levels.
d. How to Satisfy Disclosure Requirements
i. Do not make untrue statements
ii. Provide all material information regarding the company because failure to provide such
information can be misleading to the investor
iii. Practical Application:

Not all offerings need full offering memorandums, but a company needs to ensure it
is providing adequate information to its investors so they can make informed
investment decisions. Similarly, when the company provides information regarding
the company (e.g., by providing a business plan), it should also provide risk factors
specifically disclosing to the investor the risks of investing in the company.

e. Integrating Securities Offerings:

i. What is Integration?

If a company conducts simultaneous offerings or offerings within a short period of

time, they risk having the offerings integrated.

ii. Why Should a Company Care About Integration?

Imagine a company raised $750,000 in April of 2014 relying on a Rule 504

exemption and in August of 2014, that same company closed a different round of
$750,000 relying on Rule 506(b). If those are integrated together, the following
ramifications could arise:

The company would be over the $1 million Rule 504 cap for its earlier
exemption, so that exemption may no longer be valid

If the company sold to non-accredited investors who were not sophisticated

or did not get sufficient disclosure in the Rule 504 offering, that would
violate the Rule 506(b) requirements and the Rule 506(b) exemption may not
be valid.

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com

October 21, 2014

P a g e | 12
iii. Factors That Determine Integration:

Whether the offerings are part of a single plan of financing;

Whether the offerings involve issuance of the same class of security;

Whether the offerings are made at or about the same time;

Whether the same type of consideration is to be received; and

Whether the offerings are for the same general purpose

iv. Integration Safe Harbors:

SEC has adopted safe harbor exemptions that offerings made more than six months
before or six months after a Regulation D offering will not be integrated

However, companies need to be sure that they stop raising funds during this 6-month
period because if a company is consistently making offerings, this safe harbor may
not apply.

v. Practical Application: Analyzing whether rounds of funding will be integrated is fact

specific, however, a company is better served providing its attorney full disclosure on long it
intends to go before its next round and how long of a runway it thinks its current round will
last.
f.

Failing to Comply With Securities Law Exemptions or Anti-Fraud Rules - Potential Ramifications:
i.

Investment Rescission

Company would offer each investor the right to rescind the purchase of securities and
the company would return to the investors their investment

ii. Civil Liability for Anti-Fraud Violations

Company may be liable to purchaser for the amount paid, less any income received,
plus costs and attorneys fees in recovering the amounts.

Executive Officers may also be liable for company liabilities.

iii. Criminal Liability for Anti-Fraud Violations

Company and principals may have criminal penalties for failing to disclose material
facts or making untrue statements of material facts.

Shuttleworth & Ingersoll, P.L.C.

115 3rd Street SE, Suite 500 Cedar Rapids, IA 52401 PO Box 2107 Cedar Rapids, IA 52406-2107
ph (319) 365-9461 fax (319) 365-8443 www.shuttleworthlaw.com