FEBRUARY 24, 1997 VOLUME 4, NUMBER 34
P.K.L., a disabled veteran, lived with his sister J.K.S. in Phoenix. The Arizona Veteran’s Service Commission had served as his guardian and conservator for twenty years when, in 1989, his sister petitioned the Maricopa County Superior Court for the removal of the AVSC and her own appointment.
The court-appointed visitor, when asked to evaluate J.K.S.’s suitability to serve as guardian and conservator, expressed concerns about her use of her brother’s substantial veteran’s disability check to subsidize her entire family’s living expenses. Nonetheless, all parties agreed that she could be appointed.
At the time of the appointment, Maricopa County Judge Morris Rozar also ordered that J.K.S. should give her brother $250 each week for his own uses and pay herself $2,000 per month for “room and board for and the reasonable care of P.K.L.” This arrangement continued for the next two years.
At the time of J.K.S.’s third annual court accounting, however, Maricopa County Superior Court Commissioner Ken Reeves raised several concerns about the expenditures of P.K.L.’s funds. First, he questioned whether the money was being paid for room and board alone (in which case the court’s investigator now opined that P.K.L. was not getting much for his $2,000 each month), or whether she was also paying herself for care of her brother. If, however, the monthly sum was being paid for care, Commissioner Reeves wanted to determine whether J.K.S. was properly reporting the receipt of income on her personal taxes, and whether the amount paid was appropriate for the care provided. He ordered J.K.S. to produce her tax returns.
Although she objected to the order, J.K.S. provided income tax information and a household budget for her brother and her own family. From that information, Commissioner Reeves determined that P.K.L.’s share of household expenses should be set at about $750 per month, and J.K.S. required to show what care she was providing for the remaining $1,250 each month. He also noted that J.K.S. was apparently receiving additional money from a family trust established by her (and P.K.L.’s) father, and that her attorney in the conservatorship proceeding was apparently the trustee of that trust. Commissioner Reeves entered orders expanding the scope of his inquiry into the trust’s administration.
Although the Commissioner’s order left open the question whether J.K.S. could establish that the $2,000 per month was an appropriate payment for her services and room and board combined, J.K.S. appealed his decision to the Arizona Court of Appeals. She argued that Commissioner Reeves had no jurisdiction to alter the earlier Order of Judge Rozar, or to inquire into the administration of the family trust. She also objected to Commissioner Reeves’ “threat” (as she characterized it) to report her to the IRS for failure to report her income.
The Court of Appeals rejected her arguments. They noted that Commissioner Reeves also served as a Judge pro tem (a status shared by Pima County Court Commissioners), and had authority to amend a Judge’s Order. They also noted that Commissioner/Judge Reeves was correctly interested in all of P.K.L.’s financial dealings, including the family trust, and that he had not “threatened” J.K.S. with the IRS, but only observed that he might have a duty to report. One victory for J.K.S.: the Court agreed that she should not be required to account in detail for her spending of funds paid to her for P.K.L.’s care other than room and board. In the Matter of the Estate of P.K.L., February 13, 1996.
Although the Court of Appeals decision was rendered in February, 1996, the Court withdrew it in August with a notation that a revised opinion would be forthcoming. Elder Law Issues will report on the new opinion when it is received.