Archive for the ‘Newsletter’ Category

Fleming & Curti’s New YouTube Channel

FEBRUARY 13, 2017 VOLUME 24 NUMBER 7
Here at Fleming & Curti, PLC, we try to help people understand their legal concerns and how to solve problems. We really want to give useful information, and we believe that our work is easier when our clients are informed.

We are now ready to provide more information online, as well. This month we have begun to roll out our new YouTube channel, which you can find online at www.YouTube.com/c/ElderLaw. We now have a number of videos available, including answers to frequently asked questions and full-length legal seminars.

Frequently Asked Questions

How do I avoid probate? There are several strategies to reduce the likelihood that probate will be required.

What happens if I don’t make a will? Arizona has written a will for you, actually (and so have all the other states). Don’t thank them. They might have gotten it wrong.

How long does probate take? Spoiler alert: in Arizona it takes at least four months (except in rare cases).

Which is better — power of attorney or guardianship? It’s probably not really a question of which is better, but which is available in your facts.

What is “elder law,” anyway? At Fleming & Curti, we focus on estate planning, trust administration, guardianship, conservatorship and probate. Other “elder law” attorneys might have different practices.

What is special about Fleming & Curti? We’re pretty proud of our practice, our staff, our practice focus — even our pets. We’d like to convince you that our pride is justified.

Seminars

The ABLE Act in Arizona — last October we held an online seminar to explain how the Achieving a Better Life Experience (ABLE) Act is already working for Arizona residents. Since that seminar, new state programs have come on line every few weeks, but the information is still accurate and useful. Bottom line: there’s no need to wait.

Guardianship and Conservatorship in Arizona — this how-to session was hosted by the Pima Council on Aging in 2013, and we were pleased to participate. The program is intended to help people who file guardianship and conservatorship proceedings in Arizona (and especially in Tucson or Pima County) without hiring a lawyer.

Curated Material

We are also collecting related videos that we think are accurate, informative and well-done. You can see some of the best work of our friends from around the country in our curated playlist.

Feedback

OK — it’s not actually part of our YouTube channel, but we also want to know how you think we are doing. Especially if you are a client (and especially if you are a satisfied client), we’d love to have you share your experience. Want to review Fleming & Curti, PLC, or individual lawyers or staff? We make it easy: visit our Reviews page, click on “Write a Review” (near the top of the page) and follow the directions. We look forward to hearing from you.

Want to Make Sure Your Advance Directives Work? Talk to Your Family

FEBUARY 6, 2017 VOLUME 24 NUMBER 6
This week Fleming & Curti held another one of our periodic seminars for clients and the public. This one was different — rather than us lecturing on issues of elder law, we invited a guest speaker. Harriet Warshaw, Executive Director of The Conversation Project, led a lively discussion about health care directives, planning for how you want to live at the end of life, and how to talk with family members about your wishes.

From its headquarters in Boston, The Conversation Project seeks to spur families to talk about end-of-life wishes. Their clear message: it’s not enough to sign your living will, health care power of attorney and related documents — you need to let people know what you actually want.

Which people? It should be obvious that the person (or persons) named in your advance directives to make decisions for you need to know what those decisions should be. It might be less obvious, but is equally important, to let others know what you have signed, whom you have designated, and what care choices you want made.

That’s where The Conversation Project steps in — with guidance, worksheets, and conversation starters. Are you trying to figure out how to raise questions about end-of-life care with your children? Or, perhaps, with your parents? It can be difficult to approach the discussion, but it should be undertaken — and refreshed periodically (people’s life experiences, views and preferences do change over time).

One great tool for starting The Conversation: the Project’s “starter kit.” It is just what the name implies: a way to start the conversation. It’s free, easily downloaded, and available in a half-dozen languages.

Ms. Warshaw’s presentation included a number of important points:

  • The Conversation isn’t really about how you want to die — it’s about how you want to live your life for its last segment. What do you (or the person for whom you are making decisions) want to be surrounded by? For that matter, whom do you want to be at your side? Do you anticipate living out those last moments at home, or in a medical setting? According to Ms. Warshaw, about 70% of people say they want to die at home — but about 70% actually die somewhere else.
  • Talking with your children about your end-of-life wishes may seem hard, but starting The Conversation is really a gift you can give to them. You can relieve anxiety, absolve guilt and have a meaningful discussion about life, death, and what’s important to you — and to them.
  • While most of the people focusing on end-of-life planning may be older, young people should be thinking about the issues for themselves, as well. One of the things that can easily happen when a senior begins The Conversation is that a family can learn and discuss what they want for themselves, as well.

We all have our own stories, noted Ms. Warshaw. True to that sentiment, she shared hers — and in doing so she described how some people are good at starting The Conversation and others need prodding.

Our view: every adult should sign some combination of a living will (a document expressing your preferences) and a health care power of attorney (giving someone the authority to approve or refuse medical care on your behalf). That is the threshold consideration. But once those documents are signed, it is not enough to file them away. You need to talk with the person named as agent on your health care power of attorney, and actually discuss your wishes with him, her or them. You also should talk to other people in your life, even though they are not named — they are the ones who might derail your planning if they do not understand what you meant to do.

Most people should also think about advance directives for mental health care planning and planning for changes in their ability to drive. Some should even consider whether they want to take steps to prevent cardiopulmonary resuscitation, or artificial provision of food and fluids, or even antibiotics. And some will want to figure out how to make sure that every possible medical procedure is undertaken. Every person is different, and that’s one of the reasons why it’s so important to discuss your wishes with family, friends, medical providers, religious counselors and even helpful (or nosy) neighbors.

We love The Conversation Project. It is a great way to help encourage individuals to talk with their families about their wishes. It is also a great way to encourage family members to start The Conversation when they are likely to be the ones called on to make decisions for a parent or other loved one.

We enjoyed having our first guest presenter for “Trust School.” Our next session will be an opportunity for us to explain to clients, their family and invited guests what is actually involved in administering trusts and estates — not a sales session so much as an exploration of the mechanics of estate planning and the choices facing every client. That session will be in mid-April, and we’ll be sending out invitations to clients a couple weeks in advance.

Estate Tax Portability — What If the Executor Refuses to File?

JANUARY 30, 2017 VOLUME 24 NUMBER 5
We knew it would happen, and now it has. A surviving spouse has sued to force the administrator of the deceased spouse’s estate to file a federal estate tax return to perfect the “portability” election. Before we can tell you how it turned out, we’ll need to explain the controversy.

April Villarreal died last year. Her estate was not large enough to require a federal estate tax return (that is, she did not have more than $5.45 million, the 2016 estate tax exemption amount). She and her husband Charlie had a prenuptial agreement, which provided that her assets would all go to her children — Charlie would have no interest in her estate at all.

April did not leave a will, but based on the prenuptial agreement her son Richard filed for and secured appointment as administrator of her estate in the Oklahoma courts. Actually, there were various legal moves and counter-moves leading up to that appointment, but within a few months of April’s death Richard was clearly in charge of administering her probate estate, and it had become clear that Charlie had waived any interest in her estate.

Seven months after April’s death, and after Richard had indicated he had no intention to file a federal estate tax return, Charlie filed a petition asking the court to order Richard to file a return. Clearly there was no tax liability — so why was he insistent?

That’s easy. Most people know that a surviving spouse “inherits” the deceased spouse’s federal estate tax exemption amount — or at least to the extent that it has not been used. In other words, if April left (just to pick a number) one million dollars to her children, then Charlie could receive an additional $4.45 million exemption to reduce — and possibly eliminate — the estate tax liability on his own, later, death. But that transfer only works if the deceased spouse’s estate administrator files a federal estate tax return.

Why would Richard refuse to file a return? There would not be any tax due or paid, though there would be some costs — and significant work — involved in preparing the return itself. Filing the return would not benefit April’s own estate in any way.

Richard argued that the prenuptial agreement Charlie had signed before the couple’s 2006 marriage expressly waived any interest in April’s estate. That’s true, responded Charlie — but that doesn’t mean that a benefit that costs her estate nothing and would help him should simply be allowed to evaporate. Besides, the agreement was signed before the portability benefit even existed under federal law.

The estate tax benefit, by the way, is properly referred to as the “Deceased Spousal Unused Exclusion Amount” (or DSUEA). The federal law creating a DSUEA system does not permit the injured spouse to file their own version of an estate tax return — it must be filed by the estate’s administrator (or the person who would have been the administrator, in cases where no administration is required).

The Oklahoma probate court ordered Richard to file the return. Because much of the information on the return would actually come from Charlie, the court ordered him to cooperate and provide the necessary documentation within a short period. Because the return was technically due in only about two months, the judge also ordered Richard to seek an extension for filing the return. Charlie was ordered to pay for the return’s preparation.

Richard appealed. The Oklahoma Supreme Court considered the case very quickly, and rendered its opinion upholding the trial judge. The order directing Richard to file the estate tax return, and to make the election to preserve the DSUEA for Charlie, was approved. Given the time-sensitive nature of the issues, the entire process (from Charlie’s original motion to the Supreme Court ruling) was accomplished in just five months.

The Oklahoma Supreme Court ruling makes clear that the probate court has jurisdiction to decide questions about estate administration. The mere fact that the issue was really about federal filings, not state issues, did not mean that the state court had no authority. The existence of the prenuptial agreement — especially since the right to carry over unused tax exemptions didn’t even exist at the time of the agreement — did not prevent Charlie from making his request. Estate of Vose v. Lee, January 17, 2017.

There has been much discussion in the professional probate and estate planning community about just this question. Can a personal representative (what used to be called an executor) refuse to file a return just because they don’t want to, or out of spite, or because they don’t want to be bothered? The opinion in April’s case notes that the personal representative has a fiduciary duty to the beneficiaries of the estate — and that a spouse is a beneficiary even if all they receive from the estate is the DSUEA election.

April’s case presents the argument very concisely. It’s hard to see what possible objection there might be to filing the estate tax return, where Charlie is ordered to provide all the documentation and pay the costs. The only reason to refuse the election would be the intransigence of the deceased spouse’s children. Given the blended families so common today, it seems like similar circumstances will arise with some frequency.

Estate Planning is a Process, Not a Binder of Forms

JANUARY 23, 2017 VOLUME 24 NUMBER 4
There really is no question that it is important for almost every adult to have a will, and to consider signing both financial and health care powers of attorney. That is what we mean by “estate planning,” and it is important to go through the process of preparing those documents.

But that is not enough. There also are questions about beneficiary designations and other ownership arrangements. Some consideration should be given to whether a trust is necessary or important. And the whole process needs to be undertaken on a recurring basis. Signing your will is usually not the end of the process, and even when it is the whole thing needs to be reviewed again whenever you have major life changes.

Want a story that explains why you need to update your estate plan? Consider Robert Hendricks (not his real name) from Illinois. He was the father of two young sons. He and the mother of those two boys had recently undergone a difficult divorce. He wanted his sister to manage his estate, and to act as trustee for the benefit of his sons. He even signed a will making those changes — naming his sister as personal representative (executor), naming her as trustee for the boys’ benefit, and leaving his entire estate to the boys’ trusts.

Shortly after the divorce was finalized, Robert tragically took his own life. His sister initiated a probate proceeding, and his will was admitted to probate. But one of the Robert’s principal assets was his 401(k) plan, set up through his work. What would become of that retirement plan?

Robert’s 401(k) account simply did not name a beneficiary. In that case, would it pass to his estate, and thus to the trust for his sons? No, as it turns out.

Like many 401(k) plans, Robert’s spelled out what happens when no beneficiary is named. According to the plan’s summary documents, in that case the participant’s spouse would be the beneficiary, and if there was no spouse then the participant’s children would become beneficiaries. Since Robert’s divorce was final at the time of his death, that made his sons beneficiaries of his retirement plan.

Problem solved. That’s also what Robert’s will specified, right? Well, not quite. Robert’s will would have left all of his money in that trust, controlled by his sister. If his sons are the direct beneficiaries of his retirement plan, then their mother — Robert’s ex-wife — would have priority to manage the funds until the boys reached the age of majority.

Robert’s sister filed a petition with the probate court, asking to be named as the custodian of the retirement accounts for the benefit of the boys as specified in the will. The probate court agreed, and ordered the proceeds paid into accounts under Robert’s sister’s control. The boys’ mother objected, and appealed the decision.

The Illinois Court of Appeals disagreed, and overruled the probate court’s order. The appellate judges noted that Robert’s ex-wife, as the only parent of the two boys, had the clear priority to serve as conservator of their funds, or custodian of any money in a Uniform Transfer to Minors Act (UTMA) account, or in any other capacity.

Furthermore, the proceeds from Robert’s 401(k) were not within the control of the probate court, said the appellate judges. His will did not control where the proceeds went, since the summary plan documents themselves made clear that they went directly to the beneficiaries. The Court of Appeals directed the probate court to reverse its order and leave Robert’s sister out of the loop with regard to his retirement assets. Estate of Hintz, January 10, 2017.

Robert’s story is illustrative of a problem we see on a regular basis. If a client carefully considers his or her estate planning, and signs documents perfectly calculated to accomplish their goals, the inquiry (and, often, our task) is not completed. Beneficiary designations and titling arrangements can undo the best-laid plans. What’s worse: even if everything gets done, and done right, at the time of our office appointment, changes in documents, life arrangements or circumstances can undo the good work of careful estate planning.

All of that is why we ask a lot of questions about insurance beneficiaries, retirement arrangements, and financial account titling. That is also why we ask clients to come back and visit with us every five years or so — or, as in Robert’s case, when they get divorced, have children, get married, change employment arrangements or have other major life changes.

Estate planning is not a set of documents. It is a process, and it continues, morphs and develops over time.

Privacy Concerns Loom Large in Probate Court

JANUARY 16, 2017 VOLUME 24 NUMBER 3
Things change. This is our twenty-fourth year of publishing Elder Law Issues, and one thing we frankly didn’t think much about a quarter-century ago was privacy. Today it’s a big concern, and central to a lot of our thinking.

When Fleming & Curti, PLC, first formed in 1994, partners Tom Curti and Robert Fleming each already had nearly twenty years of professional practice. During those early years, we commonly included client’s Social Security numbers in estate planning documents, as did most practitioners. We all routinely provided detailed financial information in court filings — both in probate cases and in guardianship and conservatorship matters.

Yes, “identity theft” was an issue, even in the 1970s and 1980s. But most cases of identity theft in those days involved bad people looking for the names of people who had died in their teens, or even before, and applying for credit and entering into transactions using those names. Even if information was filed in the County courthouse, it was only theoretically vulnerable — few people knew how to get into court files, and one would have to physically travel to the courthouse to look up information. While nominally public, information filed in public records did not seem very vulnerable.

That is simply not the case any longer. Many county courts (not — yet — including the Pima County Superior Court in Tucson) have all of their court files available online. Regional and national aggregators — and even search engines — can list your name, or your parents’ names, for easy retrieval. Identity thieves can look up that information from the comfortable anonymity of their own computers, and from anywhere in the world.

At the same time, public information is generally, well, public. The community has a right to know who has been sued, who has brought suit, and who is involved in court cases. But how to balance that open disclosure with the need for privacy?

That’s the problem faced this month by the Maine Supreme Court — in a request by a single participant in the Maine guardianship/conservatorship system. “Emma” (not her real name — the Supreme Court itself agreed to “de-identify” Emma by giving her a false name) sought to have her financial records removed from the publicly available records. She alleged that the court was involved in disclosing her personal information, and that the practice should change. She also argued that removing the public information would be an appropriate accommodation under the Americans With Disabilities Act, and that failure to do so was discriminatory against individuals whose disabilities resulted in court-ordered guardianships and conservatorships.

The probate judge in Maine recognized that there was a legitimate concern. In an unusual request, he asked the state Supreme Court to tell him: should such records be completely hidden from view, referred to but not made available, summarized but not actually put online, or made completely available online?

The Maine Supreme Court punted. It observed that it might be appropriate to set a statewide rule, but not in an individual case. It ruled that Emma might well have a method of making her case, using her ADA argument. And, it reasoned, it wasn’t particularly good at giving general advice — its job was to decide individual cases, and not so much to review rules and procedures. They declined to answer the judge’s questions. Conservatorship of Emma, 2017 ME 1, January 5, 2017,

This problem faces every court, not just those in Maine. In Arizona, for instance, our Supreme Court has adopted extensive rules attempting to maintain privacy of items like Social Security numbers, bank records and balances, medical diagnoses and information. Today much of the contents of a guardianship or conservatorship file will be sealed, made available only on specific court order and then only to individuals who have some reasonable basis for getting access.

There are several other ironies in the Maine Supreme Court’s review of confidentiality. One involves Emma herself — though the Court changed her name, it left enough detail that it was frankly child’s play to look her up, learn her name and address, and the approximate value of her assets — without setting a foot in Maine. It took about fifteen minutes of online searching; we did not seek to learn anything about Emma, but only to see how easy it might actually be.

We sympathize with the Maine courts’ concern about how to balance information with privacy. We have been wrestling with the same problem in this weekly blog-based newsletter for several years. Regular readers will see that we, like the Court, anonymize names of litigants on a regular basis. We do that despite the reality that their names are usually public records (usually included in the name of the case itself — though not in Emma’s case). Why bother? At least we hope that a search for a grandmother or uncle by name will not list their legal troubles — and our newsletter article about them — at the top of the list. But in order to give readers the ability to follow up on the details of court opinions, we still have to include the name of the case.

It seems likely that the County court handling Emma’s case will continue to work on how to protect privacy issues. The judge who entered orders in her case — and who helped seal much of the public record about her — died in September last year. His elected successor: his wife, who presumably will have similar plans for protecting personal information in probate proceedings.

Why We Do What We Do

JANUARY 9, 2017 VOLUME 24 NUMBER 2
At Fleming & Curti, PLC, we represent seniors, people with disabilities and the family members who work with and support them. We also frequently act as trustee, agent, conservator or guardian for that population. It’s hard to capsulize exactly what we do, but if you ask any of us you’ll notice that we beam while attempting to characterize our work.

We have very good friends in California doing similar work at the Golden State Pooled Trust. The founder of that organization, attorney Stephen Dale from The Dale Law Firm in Pacheco, California (and his lovely wife Terri, who is instrumental in operation of the Trust), is a great friend and inspiration as well. He also does a very good job of capsulizing what we do, and why we do it.

Steve shared two stories about his trust beneficiaries this week. We think they perfectly explain the spark in our eyes when we explain our work, and we asked his permission to pass them along. See if they don’t make you think you want to work in this field, as well:

I want to share two stories with you that, for me, really bring home why we do this. One story is of triumph, the other is of hope.

So let me begin with the story of triumph. Mrs. B came to the Golden State Pooled Trust with a large settlement and our job was to keep her qualified for Medicaid because she lived in a skilled nursing facility. The first time I met her I visited her in the nursing home and my impression was that this was a woman who had completely lost interest in life — and the world seemed to have lost interest in her.

I asked Mrs. B what she would like me to do with the funds that would help her – and she pretty much was unresponsive. She hadn’t been out of bed in years without assistance and when I asked her if she would like to do things outside of the nursing home she rolled over away from me. I talked to the nursing staff who were caring and engaged to get their input – but there were limits on what they could do.

I called Sage Eldercare and I asked that a care manager be assigned to her and an assessment made about what could be done. They assigned Janeane to the case and through a series of thoughtful assessments Janeane had determined that she was probably capable of being ambulatory but needed more physical therapy than she was currently receiving.

Janeane began to implement a plan to fulfill that need and over time Mrs. B began to improve. She was asked again – what would she want to do other than stay in bed all day. Her answer: go to church.

Janeane secured private care staff to accompany her and off to church she went. Then her world expanded more, going shopping and occasionally going to excursions like the zoo. We at the Golden State Pooled Trust would get these wonderful progress reports, and we would pass them on to our board who loved each one.

The only harsh call I ever got from Mrs. B was once when her helper was late – and she wanted me to know she was a busy woman and needed to know when her helper would arrive so she could do some shopping. Was this really the shell of a woman I had met years earlier?

Mrs. B had been in decline for the past month, and sadly she passed away last week. As sad as her passing is, it fills my heart with joy and pride that her years under our care (primarily because of the actions of Sage and their staff) were made better and she lived a quality of life that would not have been possible but for their vigilance.

Now for the story of hope. Mr. F came to us recently and is a young man with many physical challenges and pretty much getting no services or oversight beyond his meager benefits. Mr. F got a modest settlement and is dependent on Supplemental Security Income and Medicaid and of course our job is to keep him qualified for benefits.

As often happens, we got off to a rocky start. His primary need beyond existing benefits is housing, and the first couple of weeks we made arrangements for short term housing which would be thwarted and cause our staff to have to bail him out of his situation to avoid having him literally be thrown out in the streets. He arranged for a room in what appeared to be a pretty unsafe part of his city, but it was unlikely this would be appropriate for the long term. Then he started making unbelievably inappropriate requests – and he was truly annoying me. This case was really going to be a challenge.

Clearly, we were not connecting – so I called ElderCare Services and arranged for a care manager to do an assessment and create a plan to get this under control. Brenda was assigned to the case, and she wanted a Golden State Pooled Trust staff member to go with her on the first assessment; reluctantly, I agreed.

So off they went to meet with Mr. F. and several hours later they returned. The report I received was that Mr. F is living in a place of incredible squalor – and that beyond the filth of his closet sized room, the entrance to his building is basically inaccessible for his physical needs. The other part of the report was that Mr. F was thankful for the visit, and appears to be committed to work with Brenda. Is it possible that we could do more than keep a roof over his head until the funds run out?

Though his settlement was significant, he doesn’t have unlimited funds. With the right guidance he is fully capable of becoming self-supporting someday, and graduating from the ranks of the lost and forgotten. I am so glad that we have Barbara on the job, and my expectation is that with her guidance we will find Mr. F a safe and appropriate place to live, and maybe we can get him connected a healthier community and set his life on a path that will change his life for the better before his funds run out.

We have many stories in our little pooled trust, and my hope is that we will have many more to come and the services we provide will continue indefinitely. Yes, our folks are almost universally difficult with challenges sometimes that are hard to understand until we dig below the surface.

Even so, Mrs. B’s personal effect on my life was to give me hope and pride in our staff, and our partners that include many care management agencies. For myself and all at the Golden State Pooled Mrs. B’s final years with us  has made our lives better. For Mr. F, we have an opportunity to change the trajectory of his life – how cool is that?

How cool, indeed.

Two Adult Adoptions Lead to Uncertain Inheritance Outcomes

JANUARY 2, 2017 VOLUME 24 NUMBER 1
You probably know that it’s possible — though state laws vary quite a bit — to adopt an adult. But have you given any thought to what effect the adoption might have on inheritance rights? That’s the sort of problem that gets lawyers (and judges) excited. Two recent appellate decisions for Iowa and Illinois address similar but different adult adoption conundrums.

In Iowa, Marian (we’re just going to use first names here — no disrespect intended) had two adult children, Russell and Marcia. Marian’s sister-in-law Janice had no children. Janice intended to leave her estate to Russell, but under Iowa law that would mean that he had to pay a tax on his inheritance, because he was not her child.

In order to avoid that inheritance tax, Janice adopted her nephew Russell after he became an adult. That worked just fine, and avoided any tax — but what about Russell’s relationship with his biological mother, Marian?

When Marian died in 2014, her will divided her estate between “my children, [Russell] and [Marcia], share and share alike.” But was Russell still Marian’s child? Marcia argued that her brother was really her former brother, and his adoption by Janice effectively disinherited him from her mother’s will.

The Iowa probate court was not impressed with the argument, and neither was the Iowa Supreme Court. Though the adult adoption severed the parent/child relationship between Marian and Russell, Marian’s will specifically named her children. According to the state’s high court, that created a presumption that she meant to include Russell even though he might have been adopted by someone else. Roll v. Newhall, December 23, 2016.

Meanwhile, the Illinois courts were faced with a flip-side problem when Betty adopted her step-son Ron. You see, Ron’s mother and father were divorced when he was three, and he was raised mostly by his mother. His father remarried and Ron did spend considerable time (particularly in high school) with his father and step-mother.

When Ron was 21, his step-mother Betty’s mother died, leaving a trust that would ultimately flow to Betty’s children. A year later Betty asked Ron if he would be willing to let her adopt him. Betty’s father later modified his own will to specifically disinherit Ron, but Betty’s mother’s trust was already in place.

When Betty died fifteen years later, her mother’s trust was set to benefit her children. Was Ron a child for purposes of that trust? That was the question facing the Iowa probate court.

Over the objections of Betty’s other relatives, the probate court determined that the adult adoption was effective. Ron would receive a share of his adopted grandmother’s trust. The Illinois Court of Appeals upheld that ruling.

The key question in Ron’s story was whether the adoption was a “subterfuge.” If the other heirs could show that Betty’s adoption of Ron was solely motivated by her desire to make him a descendant for purposes of her mother’s trust, then they might be able to challenge the adoption.

The other relatives pointed out that Ron was an adult when Betty adopted him, that the timing was suspect (coming just a year after Betty’s mother’s estate was opened), that Ron didn’t even tell his biological mother about the adoption until Betty’s later death, and that Ron himself had acknowledged that Betty was motivated to adopt him for “estate reasons.” On the other hand, evidence showed that Ron had spent considerable time with Betty and his father after they were married, that he lived nearby at the time of the adoption, and that Ron and Betty had a close, coninuing relationship for over thirty years. The effectiveness of the adoption was upheld. In re: Estate and Trust of Weidner, December 20, 2016.

Would the same cases be decided the same way in Arizona? Perhaps not.

First of all, adult adoptions in Arizona are sharply limited. Arizona’s statute on the subject, ARS section 14-8101, permits adult adoptions only when the person being adopted is:

  1. Over age 18 but no older than 21, and
  2. A stepchild, niece, nephew, cousin, grandchild or (sometimes) a foster child of the person adopting.

Under the second test, either Russell or Ron could have been adopted just as they were in Iowa and Illinois. But both of them were over age 21 when adopted, so those adoptions could not have been completed in Arizona.

Assuming, though, that the adoptions were effective in Iowa, Illinois or wherever concluded, Arizona would honor the other state’s (different) rules. If adoptive parents Marian or Betty had moved to Arizona after adopting Russell or Ron, the same legal problems might have arisen.

One other state law difference that might have made the outcome in Marian and Russell’s case: nothing in the adult adoption statutes in Arizona requires that the existing parental relationship be dissolved. Russell could presumably be his aunt Janice’s son AND his mother Marian’s son at the same time. Of course, this outcome is harder to test — Arizona does not have an inheritance tax like Iowa’s, and so it is difficult to think of why the story might play out in the same way.

Common-Law Marriage, Divorce and Probate, All In One Case

DECEMBER 19, 2016 VOLUME 23 NUMBER 47
Here’s a question we hear frequently: how long does a couple have to live together in order to be considered married? The answer in Arizona: until the wedding ceremony.

In other words, Arizona does not recognize “common-law” marriages. That strong, direct statement, however, masks a more complicated answer. Arizona, like every other state, will recognize a marriage that was validly established in another state — so if a couple living in, say, Oklahoma (which does recognize common-law marriages) meets that state’s requirement to be treated as validly married, and they then move to Arizona, they will be married under Arizona law, as well.

No state, however, has a concept of concept of common-law divorce. That is, a divorce must be granted by a court, and can not be established by the couple simply acting as if they were divorced. And no state recognizes bigamous marriages — so if a couple is already married (by common-law or by a formal state-recognized marriage), neither spouse can enter into another marriage, whether by common-law or regular ceremony.

Try telling all that to Rhonda Brown, an Oklahoma woman who seems to have a fairly fluid concept of marriage. She and Bobby Joe Brown were married in 1995, and they had three children together. After a few years of marriage, though, she told her husband that she could not continue to live with him if he did not stop sleeping with other women, and when he did not change, she moved out on her own.

Rhonda moved around Oklahoma and Kansas for several years. She had children by another man (they were removed from her care by the Kansas authorities). According to her testimony, she and Bobby Joe still saw one another occasionally.

At one point Rhonda even “married” another man — though she said she always thought of the second marriage as a “sham.” How did that happen? According to her, she and Jimmy had been long-time friends and had always agreed they would marry one another if it was necessary for one to help the other out. After Jimmy’s release from prison, his grandparents let him live with them and supported him, but told him he needed to get married. When Rhonda agreed to visit his grandparents and tell them that she and Jimmy were going to get married, his grandparents immediately called a minister and had the ceremony that same day. She never saw Jimmy again, she said.

Meanwhile, Bobby Joe had moved in with another woman, Ami. Although they never had a marriage ceremony, Ami said that they always acted as if they were married, and held themselves out as husband and wife. That’s the very definition of common-law marriage in most states where it is permitted — including Oklahoma. They even had two children together and, according to Ami, they were a married couple in almost every respect. One problem: Bobby Joe was still married to Rhonda.

Then, in 2013, Bobby Joe died in a motorcycle accident. Ami filed a petition with the local probate court, alleging that she was the surviving spouse and asking for appointment as personal representative of his estate. The probate judge approved her appointment as personal representative; Ami did not mention Rhonda or give her notice of the proceedings.

Rhonda ultimately learned about the probate of Bobby Joe’s estate, and sought to remove Ami as personal representative. She pointed out that she had priority for appointment as Bobby Joe’s legal spouse, and that she was one of the heirs of his estate. The probate court heard testimony about the complicated relationship — and then denied Rhonda’s claim to priority for appointment.

The Oklahoma Court of Appeals affirmed the probate court decision, and Rhonda asked the state Supreme Court to review the ruling. The Oklahoma Supreme Court also agreed that Rhonda should not be appointed to administer her husband’s estate.

It is important to note that the state courts did not find that Rhonda and Bobby Joe were divorced, or that Bobby Joe and Ami were validly married. The ruling was ultimately based on concepts of “estoppel” — Rhonda could not make the legal argument that she was married to Bobby Joe because she had participated in another marriage, even though she claimed that her second marriage was a sham. To be more precise, the ban against her asserting her status as surviving spouse might be said to be partly because she admitted to a sham marriage — the courts decided that she should not be permitted to argue two inconsistent things in two different state proceedings. Estate of Brown, November 1, 2016.

The decision in Bobby Joe’s probate appeal was not unanimous, by the way. Six of the nine Justices of the Oklahoma Supreme Court agreed that Rhonda should not be allowed to seek appointment as personal representative, while three argued that there had been no divorce and Rhonda was still entitled to handle Bobby Joe’s estate.

It is also worth noting that the Oklahoma courts did not decide that Rhonda was not Bobby Joe’s surviving spouse. Though she could not insist on her priority for appointment as personal representative, the state Supreme Court decision does not say that she is not entitled to a share of Bobby Joe’s estate. That argument might be made later, back in probate court. We’ll let you know if we hear about it.

Why do we care about common-law (and other fluid concepts of) marriage in Arizona, where only properly recorded marriages are valid? For two reasons: (1) people who move to Arizona from Oklahoma, Kansas, Montana — or one of the handful of other states which recognize common-law marriages — might bring their confused marital statuses with them, and (2) we are constantly both surprised and intrigued by the complicated ways people live their lives.

It has been more than a decade since we last reported on common-law marriages, incidentally. In our 2013 newsletter article on the subject, we reported that fifteen states then recognized some form of common-law marriage. Today that number is down to eleven, with some dispute as to the status in one or two of those.

Two Words (“The Individual”) Make a Big Difference

DECEMBER 12, 2016 VOLUME 23 NUMBER 46
Congress may be in a historic post-election lull, but the end of the year can sometimes see surprising, bipartisan progress. With passage by the U.S. Senate of the Special Needs Trust Fairness Act (a very small part of the 21st Century Cures Act) a significant change has been introduced into the world of special needs trusts. And it all comes down to the addition of two words: “the individual”. Let us explain.

Sometimes an individual with a disability will qualify for the Supplemental Security Income (SSI), Arizona Health Care Cost Containment System (AHCCCS) or Arizona Long Term Care System (ALTCS) programs, but not be able to receive benefits because their assets exceed the $2,000 limit generally applied for all of those programs. In that case, if the individual is under age 65, they might be able to establish a special needs trust and thereby qualify for benefits.

Actually, it’s not correct to say that they could establish a special needs trust. Until passage of the law last week, the special needs trust could only be established by the individual’s parent, grandparent or guardian — or by a court. A competent individual with a disability could not establish their own trust, and often had to go through a court proceeding (at considerable additional cost) before qualifying or re-qualifying for SSI or ALTCS.

The existing law (42 United States Code section 1396p(d)(4)(A)) said that such a trust could be established by “a parent, grandparent, legal guardian of the individual, or a court”. The Special Needs Trust Fairness Act amends that provision so that it permits establishment by “the individual, a parent, grandparent, legal guardian of the individual, or a court”.

The new law will become effective immediately upon President Obama’s signature, which is anticipated in the next few days. It will have no effect on existing trusts, since they will each have been established under the old law. It will, however, sweep away thousands of pages of qualifications, refinements and interpretations about whether a trust could be established by a parent who held a power of attorney, or whether an individual with a disability could file their own guardianship petition (or seek court approval of a trust in their own names).

This simple but powerful change was promoted by the Special Needs Alliance (two of the attorneys at Fleming & Curti, PLC, are members of that national group) and the National Academy of Elder Law Attorneys (all four of our attorneys are members). It has been a key component of legislative plans for the entire advocacy community. Its adoption is welcome news.

The change is just the latest in a series of incremental improvements in the eligibility rules for SSI, ALTCS/AHCCCS and other programs like public housing assistance. Among the changes: more logical (and consistent) treatment of special needs trust distributions among the different programs, creation of the ABLE Act (“Achieving a Better Life Experience” Act) program, allowing public benefits recipients to save more than the long-time $2,000 asset limitation for eligibility, and (partly as a result of the Affordable Care Act and its expanded Medicaid programs) increasing use of tax-based language in place of more peculiar Social Security Administration definitions.

One recent court case gives a good illustration of how this most recent change will benefit people with disabilities. A young South Dakota woman’s special needs trust, established by her parents (as required by the prior law), was invalidated largely because she had signed a power of attorney naming her parents as her agents. That, according to the Social Security interpretation, meant that they acted not as parents but as their daughter’s agents — making the trust defective. The new law should put an end to that type of game-playing.

There are still many individuals who will need a court to get involved to create a special needs trust. The new law, however, should make it easier — and considerably less expensive — to set up many special needs trusts.

Doctor’s Report to California DMV Does Not Violate Privacy Rights

DECEMBER 5, 2016 VOLUME 23 NUMBER 45
You might have wondered about this from time to time — we have, too. If a patient really shouldn’t be driving, is his or her doctor really able to write to the Motor Vehicle Division to report the patient’s condition? Wouldn’t that be a violation of the patient’s privacy rights?

A recent California case says no — the doctor is not liable for any breach of privacy, at least not under California law. The facts of that case are interesting, and instructive.

Mitch McIntyre (not his real name) was trying to establish that he was disabled, so that he could qualify for Social Security Disability payments. He visited several physicians over an almost ten-year period, but his primary care physician was Dr. Ann Kim. His diagnoses included diabetes and unspecified cognitive deficits.

During one office appointment, Mitch told Dr. Kim that he needed to renew his commercial driver’s license. He told her that he had applied to drive a school bus, and asked if she would “sign off” on his medical certification.

Over previous years, while he was working as a bus driver, Mitch had complained to Dr. Kim and other physicians that he didn’t want to “babysit” his passengers. He had confessed to his physicians that he didn’t always follow the routes specified by his employer — he preferred his own routes. On one occasion, he acknowledged, he had taken a group of children from San Diego, California, to Tijuana, Mexico — though that was not their actual destination.

But when Mitch told Dr. Kim that he was about to start driving school buses, that was too much for her. She called Mitch, told him that she wouldn’t be signing his medical certification form, and added that, in fact, she was considering sending a letter to alert the California DMV to her concerns about his impulsivity and poor judgment. Mitch told her that he did not want her communicating with the DMV at all, and that he did not agree with her reporting her concerns.

Dr. Kim thought about her dilemma for several weeks, and then wrote a letter to DMV. Her letter reported that Mitch “is functionally illiterate, lacks the capacity to set limits on himself and fails to understand the consequences of his behavior.” She added that Mitch’s problems appear to be “the result of mild congenital or developmental brain damage that has not only affected his cognitive skills but more importantly has impaired his judgment, impulse control, insight, forethought and ability to introspect.”

Mitch’s commercial and regular driver’s licenses were suspended almost immediately after the DMV received Dr. Kim’s letter. His employment was suspended, and he was ordered to get his licenses reinstated if he wanted to continue to drive buses. He managed to get his regular license restored quickly, but it took him three months to get his commercial license reinstated — though he did manage to do so. Because he failed to meet his employer’s deadline, however, he lost his bus-driving job.

Mitch then sued Dr. Kim and her employer, alleging that she had violated state privacy laws and the federal HIPAA (Health Insurance Portability and Accountability Act) law by disclosing his medical information to DMV. The defendants moved to dismiss Mitch’s complaint, arguing that they were permitted to give such information to the Department of Motor Vehicles. While the trial court did not immediately dismiss, it ultimately threw out Mitch’s case after he had put on evidence at his trial; the defendants were not even required to put on any case.

Mitch appealed to the California Court of Appeals, which affirmed the trial judge’s dismissal. Applying California’s version of the privacy laws, the appellate judges ruled that Dr. Kim’s disclosure was specifically authorized to report her concerns about Mitch’s ability to drive. According to the appellate court, California has a policy of encouraging people (including but not limited to physicians) to report the possibility of unsafe driving — and that supported Dr. Kim’s authority to disclose medical information for the limited purpose of calling Mitch’s ability to drive into question. McNair v. City and County of San Francisco, November 22, 2016.

Mitch and Dr. Kim, of course, were operating under California’s state law — and the national HIPAA rules. As the court acknowledged in its opinion, HIPAA does not give Mitch (or any other individual) any right to bring a breach-of-confidentiality suit against a medical provider. That means that state law will be the most important consideration in addressing similar claims.

Arizona has law that seems like it would resolve a dispute similar to Mitch’s (if it had been subject to Arizona law, that is). Arizona Revised Statutes section 28-3005 spells out that:

Notwithstanding the physician-patient, nurse-patient or psychologist-client confidentiality relationship, a physician, registered nurse practitioner or psychologist may voluntarily report a patient to the department who has a medical or psychological condition that in the opinion of the physician, registered nurse practitioner or psychologist could significantly impair the person’s ability to safely operate a motor vehicle.

In fact, the Arizona Motor Vehicle Division has a web page devoted to the forms and procedures for physicians — and any regular citizens — to report unsafe drivers or concerns about anyone’s ability to drive. Physicians are encouraged to use the form on the MVD website; other concerned citizens can download a form to make their own reports, as well.

©2017 Fleming & Curti, PLC