| Volume 96 Number 8 |
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The People’s Lawyer’s Tip of the Day
If you buy something and the contract has a clause that says you agree to arbitrate, you will not be allowed to sue in court and must file your claim with an arbitrator.
Arbitration is often more expensive than a simple lawsuit, denies you the right to a jury trial or an appeal, is not bound by traditional rules of procedure, and often precludes you from filing or joining a class action.
To learn more about consumer arbitration,
Click here for more.
Elite Travelers Challenge Airline Fees
If you need to cancel or change a flight, chances are high that you'll face a stiff financial penalty. However, if the airline cancels on you, you shouldn't expect the same. The stance most airlines take on changes or cancellation is different from hotels. In fact, most hotels allow consumers to cancel or change reservations up to the day before, or even day of, the start of the reservation.
A group of frequent travelers, called Road Warriors, is fighting the charges. According to the Road Warriors, either the airlines need to start offering consumers compensation for cancellations they make, or stop charging consumers when they need to make changes of their own.
Representatives for the airline industry insist the charges are essential to remaining profitable. Without the policy, the airlines expect to lose $8 per traveler. The Road Warriors point to Southwest Airlines as an example of how it's done right. Unlike its competitors, Southwest allows travelers to make changes without penalty. With this example, the Road Warriors challenge whether other major airlines are operating under the appropriate business model to remain profitable while also maintaining consumer confidence.
Will airlines ever give consumers a way to make travel changes without penalty? How can the Road Warriors make a difference?
Click here for more.
Tax Audit Less Likely This Year
If you're worried about being audited this year, this may ease your nerves. Due to budget constraints, the Internal Revenue Service won't have the resources to audit as many people as it has in the past.
Since 2010, the IRS has lost almost $1 billion in funding and cut about 10,000 jobs. The budget consequences don't stop there. The agency has been forced to furlough workers for three days without pay.
Operating on a tight budget, the IRS is expected to conduct more audits by mail. These correspondence audits differ from field audits in that they aren't conducted in person, reducing travel and labor cost. With this year's budget $2 billion less than requested, audits will almost certainly be down on the whole.
Although audits are expected to be down, not everyone is off the hook. The wealthiest Americans and business owners will still face heightened attention.
What are you chances of being audited?
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Your Money
How is the value of your savings affected by inflation?
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For the Lawyers
Credit card fees are not unconstitutional.
The Ninth Circuit held that cardholders do not have a claim that fees imposed by the issuer violate substantive due process. The court noted that the jurisprudence developed to limit punitive damages in the tort context does not apply to contractual penalties, such as the credit card fees at issue.
Click here for more.