Posts Tagged ‘conservatorship’

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.

Unreachable Joint Account Makes Applicant Ineligible for Medicaid

NOVEMBER 14, 2016 VOLUME 23 NUMBER 43
Paul (that’s not his real name) needed long-term care. His health and his mental capability had both declined, and he could no longer handle his personal affairs nor take care of himself.

Paul’s assets included a car (titled in his and his daughter’s names) and three Bank of America (its real name) bank accounts. Those assets put him over the $2,000 eligibility limit for Arizona’s version of the federal/state Medicaid program, the Arizona Long Term Care System (ALTCS).

One problem: Paul’s daughter had her name on the bank accounts and on the car. She had the car in her possession, in fact — and she refused to turn it over.

Before he became incapacitated Paul had signed a power of attorney naming his sister as his agent. She went to Bank of America to get control of Paul’s accounts so she could use the money to pay for his care — and ultimately get him eligible for ALTCS coverage. That’s when she learned about a Bank of America rule: both signers on a joint account are permitted access the account, but an agent under a power of attorney may not exercise that authority on behalf of one owner without the other’s consent.

In other words, Paul’s sister could not close the account, remove Paul’s daughter’s name from the account, or even withdraw money to pay for his care — unless his daughter signed a form letting her do that. And Paul’s daughter refused to sign.

Paul’s sister applied for ALTCS coverage on his behalf. Even though he had assets over the $2,000 limit, she argued that those assets were actually unavailable. ALTCS regulations permit applicants to become eligible when assets are unavailable, and Paul’s sister argued that the situation with Paul’s bank accounts was no different from real estate owned jointly with an uncooperative family member, for instance.

ALTCS disagreed. The agency determined that Paul could get access to his own account if his sister just initiated a court proceeding — a conservatorship of his estate. Consequently, ALTCS declined to grant him eligibility.

Paul appealed (through his sister, of course). The court considering the agreed with her, and ordered ALTCS to cover Paul’s care costs. ALTCS appealed from that decision.

The Arizona Court of Appeals last week issued its opinion in the case. It agreed with the ALTCS agency, ruling that Paul could have access to the account by having his sister initiate a conservatorship. As conservator, reasoned the appellate court, she could then withdraw money from the account for Paul’s care — and that made the whole account a countable, available resource. Paul’s ALTCS eligibility was denied.

The Court of Appeals acknowledged that there would be some cost and difficulty getting access to Paul’s money. That, though, was not enough to prevent counting the asset as available. “Any practical inconvenience or accessibility difficulties are not relevant to determining whether assets are to be counted,” ruled the judges. McGovern v. AHCCCS, November 8, 2016.

The decision in Paul’s case simply fails to deal with the practical realities facing Paul and people in his circumstances. The opinion does not make clear how large the joint accounts might have been (except that they obviously exceed $2,000), but the practical reality is that a conservatorship proceeding might well cost thousands of dollars — and could cost even more if Paul’s daughter simply objected. She, after all, would have a higher priority for appointment as conservator than his sister, and her side of the story about the accounts is simply unmentioned in the appellate decision.

Even if Paul’s sister was appointed as conservator, that does not guarantee that she could get access to the accounts. Bank of America might well insist on getting the joint owners’ consent to close an account, or make other changes in the account structure. Paul’s daughter, when faced with the likelihood of losing the accounts, might actually close them out; she would not be hamstrung by the Bank of America rule about powers of attorney, after all.

And Paul’s vehicle? As joint owner, his daughter has absolute right to possess and use the vehicle. Getting it back for Paul, or forcing his daughter to buy out his interest, would almost certainly cost more than the value of the vehicle — and might not be successful even after significant expenditures.

The outcome is especially odd since ALTCS easily recognizes that joint ownership creates problems for other kinds of assets. Joint tenancy real estate, owned with a family member? No problem — eligibility can be granted (though it is described as “conditional” eligibility, requiring the ALTCS recipient to make efforts to sell their fractional interest). But bank accounts — even small accounts worth far less than a piece of real estate — are treated differently. Or at least the bank accounts in Paul’s case were treated differently.

Another irony: Paul had actually died before his case even got to the appellate level. The dispute was about whether ALTCS would have to pay for the care he had already received — and (though the opinion does not clarify this point) it is likely that his care facility is the one left without recourse, not his sister and not his daughter.

Undue Influence and Limited Capacity Do Not Necessarily Justify Conservatorship

OCTOBER 31, 2016 VOLUME 23 NUMBER 41
In our legal practice, we frequently deal with individuals with limited capacity. Sometimes we speak of them being “incapacitated” or “incompetent.” Sometimes they are “disabled,” or qualify as “vulnerable adults,” or are subject to “undue influence.” But each of those terms means something specific, and some variations even do double duty (with two related but distinct meanings). A recent California case pointed out the confusion engendered when litigants rely on similar but different terms.

Aaron, a widower in his late 90s, lived alone after the death of his wife Barbara. He had no children of his own, though he and his wife had raised Barbara’s daughter Connie together after their marriage — when Connie was four. Aaron’s other nearest relatives were two nieces, Cynthia and Diane. He didn’t have much contact with Cynthia and Diane, though that might have been because his late wife had discouraged contact over the years they were together.

Connie was actively involved in overseeing Aaron’s care. She arranged for his doctor’s visits, went to his home at least twice a week to check on him, helped pay his bills and generally watched out for him. She was concerned about his ability to stay at home, and on several occasions she found herself summoning the local police to make welfare checks on her stepfather.

After Aaron fell in his home, refused treatment, and suffered a frightening seizure, he was diagnosed as having a subdural hematoma (from his fall). He spent some time in a hospital, but was anxious to return home. His physician noted that he had a poor score on the mental status exam administered in the hospital, and diagnosed him as having dementia. He was discharged to a nursing facility, with Connie’s help.

Aaron hated the nursing home, and the assisted living facility Connie helped move him to after that. He insisted that he could return to his own home. About this time, his nieces began to visit him, and they tried to assist. They disagreed with his placement, and niece Cynthia prepared a power of attorney for Aaron to sign, giving her authority over his personal and financial decisions. After he signed the document, he asked his attorney to write to Connie, asking her to return his keys and personal possessions so that he could return home.

Connie filed a petition for her own appointment as conservator of Aaron’s person and estate (California, confusingly, refers to guardianship of the person as conservatorship). While that proceeding was pending, Aaron went to his attorney’s office and changed his estate plan — instead of leaving everything to Connie, he would split his estate into three equal shares, with one each for Cynthia, Diane and Connie’s daughter.

The probate judge heard evidence in connection with Connie’s conservatorship petition, but denied her request. The judge found that Aaron was clearly subject to undue influence, and might lack testamentary capacity — but he didn’t need a conservator (of his person or his estate).

How could that be? Connie appealed, but the California Court of Appeals ruled that the probate judge was correct. At the time of the hearing on the conservatorship petition, according to the appellate court, Aaron was alert, oriented and able to describe his wishes. The fact that he might have been incapacitated when he signed the powers of attorney, or that he might have been subject to undue influence when he changed his estate plan, was not dispositive of the question of his capacity at the time of the conservatorship hearing. Furthermore, the mere fact of incapacity would not be enough; by the time of the trial Aaron had a live-in caregiver who could help him manage his daily needs, and that could support the probate judge’s determination that no conservator (especially of the person) would be necessary.

Aaron and his attorney also argued that Connie didn’t actually have any standing to file a court action in the first place. After all, she was his stepdaughter, and not even a blood relative. The Court of Appeals rejected that notion; any person with a legitimate interest in the welfare of a person of diminished capacity has the authority to initiate a conservatorship proceeding. Conservatorship of Mills, October 20, 2016.

So what do the various terms mean, and how are they different? “Capacity” (and “competence”) usually refers to the ability to make and communicate informed decisions. “Testamentary” capacity is a subcategory, and requires that the signer of a will must have an understanding of his or her relatives and assets, and the ability to form an intention to leave property in a specified manner. “Vulnerable adult” is a related term, but is used in most state laws to refer to a person whose capacity is diminished, and whose susceptibility to manipulation or abuse is therefore heightened. “Undue influence” can arise because of limited capacity, but refers to the actions of third persons which overpower the individual’s own decision-making ability. “Disability” is, perhaps, the least useful of the terms — attaching the term does not say much about an individual’s ability to make their own decisions, since disabilities can be slight or profound, physical or mental (or, of course, both), and subject to adaptive improvement in any case.

In Aaron’s case, it might well be that his amended estate plan will be found to have been invalid as a result of undue influence, and his new powers of attorney might be set aside on the same basis. He might even be found to have been a vulnerable adult and any transactions benefiting his nieces might be subject to challenge. But he apparently had the level of capacity necessary to make his own personal and financial decisions at the time of the hearing on the conservatorship petition.

As an aside, there’s another issue in Aaron’s court decision: the inappropriate reliance on scores obtained on short mental status examinations. Typically, medical practitioners ask a short series of questions (“What is the year?”, “Please repeat this phrase: ‘no ifs, ands or buts'” and the like) as a way of determining whether further inquiry should be made into dementia and capacity questions. Aaron variously scored 14, 18, 24 and 20 on 30-point tests administered by several interviewers, and both the probate court and the Court of Appeals seem to have thought that the results demonstrated his fluctuating capacity (and general improvement). Those scores are only suggestive of incapacity, and should be an indicator that further testing might be appropriate. There is no bright-line score for determining incapacity on the basis of those short examinations.

Public Fiduciary Offices in Arizona

SEPTEMBER 20, 2016 VOLUME 23 NUMBER 35
When an individual living in Arizona becomes incapacitated, or needs financial protection because of diminishing capacity, a family member, friend or private professional fiduciary might be appointed to act as guardian (of the person) or conservator (of the estate). But what if there is no one available to act, or if all the possible candidates are disqualified for some reason?

For over four decades Arizona counties have had a public official who can act as guardian and/or conservator when no one else is available. The Public Fiduciary is designated in each county by the Board of Supervisors, and runs an office (and staff) funded by the county. In addition to guardianship and conservatorship, the office also handles probate of decedent’s estates when no one else can be appointed.

A handful of other states have similar offices, though most handle guardianship only, conservatorship only, or probate only. Many states have similar agencies that can act as guardian or conservator for particular groups of people — typically veterans, or the developmentally disabled. Arizona’s unique experiment was to group all those functions together into one office, and to call it the Public Fiduciary.

Does that mean that Arizona’s Public Fiduciary offices are an inexpensive alternative for poor families who don’t want to incur the costs of initiating guardianship, conservatorship or probate? No. Public Fiduciary offices do not represent families — they file petitions for the office’s own appointment instead of appointment of family members. They also charge fees, meaning that they may or may not be less expensive than private fiduciaries and lawyers representing family members. Most importantly, they will not act when there are suitable family members available.

Arizona’s Public Fiduciary offices have been a very positive success (though there have been individual incidents of abuse by at least two different Public Fiduciaries). Generally speaking, the offices act when estates are small, legal problems are substantial, and/or family members have misbehaved. But there are no formal limitations on the kinds of cases the Public Fiduciary can get involved with, and (though the experience is different in each county) public fiduciaries tend to be the most experienced, most knowledgeable resource for guardianship, conservatorship and probate problems in most counties.

You can read more at the website of the Pima County Public Fiduciary (that’s the county in which all of Tucson is located). There is a separate — but usually similarly-run — office in each Arizona county. Note that, at least in Tucson, the office also handles other, related functions — chief among those is management of the county burial system for indigent decedents or those who die without locatable family.

We last wrote specifically about the Pima County Public Fiduciary in (and this amazes even us) 1994. To put that in context: the office is now more than twice as old as when we last highlighted them. A considerable amount has changed since that time: for one thing, the current Pima County Public Fiduciary (well, the Interim Public Fiduciary, anyway) is the first non-lawyer to hold the office in its 42-year history. Peter Santini has been a core staff member for two decades, and is a logical choice to handle that role. His predecessor retired recently, and the County is in the process of making a permanent selection.

One thing hasn’t really changed in over twenty years. You can still make a referral to the Pima County Public Fiduciary by calling their office and talking with an intake person on staff. Their phone number: 520-724-5454.  Remember, though, that they only handle Pima County cases; there’s no point in contacting them about Public Fiduciary matters in any of Arizona’s other 13 counties, or for similar cases in other jurisdictions.

If you thought about it a minute, you’d probably guess that the availability of an office like the Public Fiduciary would mean that there are fewer private-industry alternatives for similar work in Arizona. In fact, though, the experience is exactly the opposite. Despite a robust and effective Public Fiduciary system in Arizona, the private fiduciary industry is much more extensive, better-regulated and more professional than in many other states. That may be partly a result of good training — a large portion of the private fiduciary industry learned how to handle guardianships, conservatorships and probates while working in their local Public Fiduciary offices.

Probate Judge’s Unique Guardianship Orders Overturned

AUGUST 1, 2016 VOLUME 23 NUMBER 29
At Fleming & Curti, PLC, we handle a lot of guardianship and conservatorship proceedings. We even act as guardian (of the person) and/or conservator (of the estate) in some cases — particularly when family members are unavailable or unable to agree on the best course of action. But one thing we consistently maintain: if there is any reasonable way to avoid a guardianship or conservatorship proceeding, it should be explored first. Court proceedings are expensive, interfere with the autonomy of the subject of the proceedings, and seldom result in entirely happy outcomes.

The most common way to avoid guardianship and conservatorship, of course, is for a person to sign a durable power of attorney (two, actually — one for health care and another for financial authority) naming someone to act on behalf of the signer. When confronted with a preexisting power of attorney, probate judges normally will appoint a guardian or conservator. Of course, if the person named in a power of attorney is acting improperly, the court will not hesitate to intervene. But usually a valid power of attorney avoids the need for court proceedings.

Of course, some family disputes can be intense — and often over the oddest and smallest issues. Take, for example, the case of Hazel McNabb (not her real name), an 89-year-old Indiana woman with six children. Her family’s disagreements arose, and hardened, over what to do after Hazel’s home was damaged by a tornado in 2013. Two of her children thought the bathroom could be repaired and used after the storm; four children felt that her bathroom should be remodeled.

Almost a decade before, Hazel had signed health care and financial powers of attorney, naming son Patrick and daughter Molly as co-agents. It was Molly and Patrick who thought no remodeling was required, and the other four children (Michael, Bridget, Kevin and Gabrielle) complained that, in the aftermath, Molly had begun to isolate them from their mother and cut them out of the discussions about her care.

Believing that Hazel’s mental faculties were declining, and that Patrick and Molly could not be trusted to act in her best interests, Kevin filed a petition asking for appointment of the four children as co-guardians. The probate judge held a hearing, and fashioned an unusual order: the judge appointed all six children as co-guardians, each with specific, limited authority.

Under the probate judge’s order, Michael (a priest) was appointed as guardian over Hazel’s “spiritual needs and affairs.” Bridget, a hairstylist, was appointed guardian over Hazel’s “health care needs and hygiene” (and specifically instructed to ensure that her hair and nails were styled on a regular basis). Molly, who had been named in the power of attorney, was appointed as guardian over Hazel’s “personal” finances (what in Arizona we might call conservatorship — though the limitation to “personal” finances is confusing). Kevin and Patrick were appointed as co-guardians to handle Hazel’s “business ventures” (though the nature of those business ventures is not clear from the appellate court opinion). The probate judge also set out a schedule of visitation to make sure each child would have regular contact with Hazel.

At the same time he entered this complicated order, the probate judge instructed all Hazel’s children that they needed to work together, and to keep Hazel’s interests in mind at all times. He directed that they were all to consider Hazel’s “input and feelings concerning a specific issue before making a decision.”

One odd result from this order is based on Indiana’s law on guardianship: if a preexisting power of attorney is in place, a guardian has no authority over the items managed through the power of attorney unless the probate judge expressly orders revocation of the power of attorney. Since that was not done in Hazel’s case, it meant that Patrick and Molly, the two agents, would still have authority over all health care and financial decisions. Unsurprisingly, those two children declined to accept their appointments as, essentially, limited conservators of a portion (each) of Hazel’s property. Instead, they appealed the probate judge’s findings and order.

Molly and Patrick argued that Hazel was not, in fact, incapacitated at all — and if she was, no guardian was necessary because the power of attorney was working as she had intended. The Indiana Court of Appeals disagreed about the finding of incapacity, but agreed that the existence of the power of attorney might make the unusual guardianship order unnecessary.

According to the appellate court, when a power of attorney is in place it might be unnecessary to appoint a guardian at all. In fact, since the power of attorney was not revoked by the probate judge, the guardians really had no power — the agents named in the power of attorney held all the authority. While agreeing that Hazel was incapacitated, the Court of Appeals reversed the order appointing multiple guardians and remanded the case for the probate judge to reconsider whether there was any need for a guardianship at all. Guardianship of Morris, July 12, 2016.

The probate judge in Hazel’s case should probably be commended for his attempt to bring her family back to the table to discuss her care together. Nonetheless, consideration for her wishes should mean that the default outcome will be recognition of her power(s) of attorney — unless it can be shown that the agents are behaving inappropriately, or failing to act.

Would the same result occur in Arizona courts? Probably not — or at least not for the same reasons. Arizona does not have a law like the Indiana statute giving continuing priority to agents under a durable power of attorney. Instead, the relative authority between a guardian, conservator and agent under one or more powers of attorney are somewhat unsettled in Arizona law. A person is able to indicate their preference for who should be appointed as guardian or conservator, and in practice a power of attorney will usually avoid the need for court involvement — but there is less clarity about the legal status than in Indiana law.

Maine Guardianship Violates Uniform Jurisdiction Act

JULY 25, 2016 VOLUME 23 NUMBER 28
Before any guardianship or conservatorship action can be filed in a local court, the court must have jurisdiction over the person subjected to the proceeding. For many decades that had meant (more or less) that the person must be physically present in the state, and not much more. That began to change in 2007, with the proposal, and quick adoption in most states, of the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act (the UAGPPJA).

Arizona, for instance, adopted the UAGPPJA in 2010. It has now been adopted by 45 states (plus the District of Columbia and Puerto Rico); the holdout states are Florida, Kansas, Michigan, Texas and Wisconsin. The law is intended to address, among other things, the problem of interstate disputes among family members — and especially to prevent warring family members from gaining tactical advantage by moving incapacitated family members involuntarily to a new state before filing a court proceeding. It received much of its impetus from the celebrated case of Lillian Glasser, whose family and friends fought over where to file her guardianship proceeding. In that regard, it is mildly ironic that one of the remaining states not adopting the UAGPPJA is Texas, where half of Ms. Glasser’s disputed guardianship case played out. Ms. Glasser herself, incidentally, died in her Florida home in 2011 — in yet another one of the few states not yet adopting the UAGPPJA.

The UAGPPJA actually addresses other, more mundane issues, as well. It establishes a mechanism for transferring guardianship proceedings to a new state when the subject of the proceedings moves. It also makes it easier for guardians (and conservators) to establish their authority in states other than the one in which the proceedings are filed. All that should make management of guardianship easier — even across state lines.

Despite its adoption in almost every state, there is precious little case law interpreting the UAGPPJA. A recent case out of Maine adds to the interpretation of the law, and helps reinforce the principles that gave rise to its adoption.

What should happen, then, when a person who needs a guardian travels across state lines, and comes to the attention of the court in a state where they do not live? If they got to the new state by the acts of a family member seeking advantage, it seems easy to answer that the family member’s misbehavior should not be rewarded. But what if there was no misbehavior — and, indeed, no family member or friend involved?

That is the dilemma that faced the Maine probate court in the case of Henry Smith (not his real name). Henry had lived for years in California. After he had a stroke in 2012, he was partially paralyzed. In an apparent attempt to get back to his original hometown in Canada, he sold his house in California and traveled across the country. He spent time in Washington State, Arizona, New Mexico and Georgia before arriving in Maine one day in 2013.

Henry checked into a hotel in Portland, Maine, and asked the staff to help him with transfers from his wheelchair to bed and to the toilet. After they worked with him that first night, the hotel staff became concerned about his ability to take care of himself, and called the police.

Portland police visited Henry, decided he was unable to make his own decisions, and took him to the psychiatric unit at a local hospital. From there, Henry was involuntarily committed for mental health treatment and then released to an assisted living facility — but not before a guardianship proceeding was initiated.

Because Henry had no family, friends or even acquaintances in Maine, the probate court appointed the public guardian to manage Henry’s placement and care. The court did give Henry some autonomy to make at least some of his personal decisions, but the public guardian was ultimately in charge of where he would live, whether he could return to either Canada or California, and what medical care he would receive.

Henry appealed his guardianship, and the Maine Supreme Court agreed with his objections. The UAGPPJA, ruled the Court, allowed an emergency guardianship order in Maine, but only for a six-month period. Since the guardianship had by that time already been in place for almost two years, the UAGPPJA’s jurisdictional limitations had already been violated. The Court did give the public guardian forty-five more days to figure out where Henry should be cared for. Guardianship of Sanders, July 7, 2016.

Does that mean that Henry must be released by Maine to continue his travels toward Canada, regardless of how ill-advised that plan might be? Not necessarily. The UAGPPJA requires that a person’s “home state” should have priority to act — and that means that California (his original home) should be given the chance to take responsibility for Henry’s decision-making. But if California declines or refuses to act, Maine courts may once again have the authority to continue the guardianship.

By our count, this is just the third appellate decision relying on the UAGPPJA (the other two were in Arkansas in 2009, and Tennessee in 2013). It seems that the mere existence of the law has significantly reduced the abuses that seemed so widespread when we first wrote about Lillian Glasser’s case back in 2007.

Guardianship / Conservatorship Petition Backfires on Son Who Exploited Mother

MAY 2, 2016 VOLUME 23 NUMBER 17

When a litigant asks the court for particular relief, lawyers call the request a “prayer.” It isn’t always as spiritual or respectful as that sounds, but it does give us a chance to offer good generalized legal — and life — advice: be careful what you pray for.

Consider the family of Martha Young (not her real name). She had two children, son Donald and daughter Joanne. When Martha was in her early 90s, her ability to manage her own affairs had slipped somewhat, and Donald decided he needed to get legal authority to handle her affairs. He filed a petition for guardianship (of the person) and conservatorship (of the estate) in the Maricopa County (Phoenix) courts.

Donald immediately thought better of his prayer for relief, and dismissed the case before his mother or his sister had answered it. Still, Martha and her attorney filed a response — but rather than simply objecting to the guardianship and conservatorship, she alleged that Donald had stolen money from her, and had put the money he took into an account in his name alone. She alleged that she was a vulnerable adult under Arizona law, and asked that Donald be ordered to return her money.

The probate court ordered Donald to return the funds in question, and he appealed. The Arizona Court of Appeals reversed, finding that there was no jurisdiction in the probate court once Donald dismissed his initial petition. That looked like it might be the end of things.

Then Charles Schwab, where the account in question was held, filed a separate action with the court. The investment company said it knew about the allegations of theft and exploitation, and it didn’t want to turn the money over to the wrong person. Charles Schwab asked the court to tell it who should receive the balance of the account Donald had set up.

That got the issues back before the court. Donald insisted that his mother had given her half of a large parcel of land she had owned, and that when the land was sold (yielding $818,955.61), his mother had moved half of the net proceeds into an account in his name. With “her” half of the sale proceeds, she bought a home (leaving a small balance which, Donald insisted, she had voluntarily added to “his” half of the sale proceeds). After a number of transactions, the $150,000 of remaining funds found their way into the Charles Schwab account.

Meanwhile, it turned out that the bank where Donald had opened his account had filed a report with Adult Protective Services, expressing concern about the way Martha’s finances were being handled and her ability to protect herself. That report had led to an investigation but (apparently) no action to stop the use of funds or recover any of the money for Martha.

Here’s one of Donald’s problems: when he filed the guardianship and conservatorship petition against his mother, he listed the bank account as one of her assets. But the court ultimately ruled that, since the conservatorship matter had never been litigated, Donald could not be held to the position he took in the initial filing. Similarly, Martha’s claim could not be dismissed on statute of limitations grounds, since she had made a good-faith effort to recover her funds when she filed the petition in the guardianship and conservatorship action — even though it was ultimately dismissed by the Court of Appeals.

After a two-day trial, the judge ruled that Martha was a vulnerable adult (and had been for almost a decade), that Donald had acted as her de facto conservator throughout the banking and real estate transactions, and that the Charles Schwab account really belonged to Martha. The judge ordered Schwab to turn the money over to Martha’s estate (by the time of the court ruling she had died), and also imposed a judgment against Donald for attorney’s fees — another $92,000.

Donald appealed, arguing that Martha’s claims should have been dismissed because they were filed years after she knew or should have known to file her lawsuit. He also argued that he should not have to pay attorney’s fees to his mother’s estate, and that he had not been shown to have exploited his mother financially.

The Court of Appeals noted that the evidence had shown that Donald lived with his mother for years, that he had seriously reduced the value of her home property (five dumpsters of his trash was removed after her death and his eviction from the property), that Martha had weighed just 62 pounds when her daughter had her removed from Donald’s care, and that he had managed her affairs for at least five years before the litigation began. Donald had to admit that his mother had been unable to manage her own affairs for at least five years before his initial court filing — that was what he had alleged in that first petition seeking control of her affairs.

After review of all the evidence considered by the trial court, the Court of Appeals upheld the lower court’s rulings. The judgment against Donald — for return of all the funds in the Charles Schwab account plus over $100,000 in attorney’s fees and interest on those awards. The court also ordered Donald to pay attorney’s fees for the appeal, in an amount to be determined after his mother’s estate’s attorneys file fee affidavits with the court. Yamamoto v. Kercsmar & Feltus, April 19, 2016.

Not Every Confused Senior Needs a Guardian or Conservator

APRIL 11, 2016 VOLUME 23 NUMBER 14

It is unusual to see an appellate court decision overturning an order appointing a guardian (of the person) or conservator (of the estate). Judges tend to be protective about elderly people showing even a little evidence of mental decline — often to the point of paternalism. It was refreshing to read a Missouri Court of Appeals decision last month that reversed a probate judge’s appointment of a conservator.

The legal story of Dave Burbank (not his real name) began in his 83rd year. He had recently married Cathy, after the death of his wife of almost forty years. Though he was retired, Dave and Cathy lived on a farm in rural Missouri, and actively managed the farm. He had recently entered into a handshake arrangement with neighbors for the sale and lease of a piece of land, and he had signed health care powers of attorney naming the same neighbors as his agents.

When a complaint was filed with Missouri’s Adult Protective Services, they conducted an investigation. Among the things APS did was to arrange a visit with a nurse practitioner; she reported that Dave was unable to complete a “clock test” — when instructed to draw a clock face with the hands pointing to a designated time, he could not follow the instruction. Based on that, the nurse practitioner determined that Dave “lacked the ability to make sound decisions because he lacked the ability to show insight or communication clearly.”

At a court hearing some months later, the local probate judge found Dave to be incapacitated and disabled. The judge appointed Dave’s daughter and the local Public Administrator to be co-guardians and co-conservators, and also ordered that recent transactions entered into by Dave would be voided, and that his marriage to Cathy was invalid.

Dave moved for reconsideration, and four months after the initial proceedings the probate judge conducted a follow-up hearing. At that hearing, the Public Administrator testified that, now that she’d had a chance to meet Dave, she believed that he was able to manage his affairs. Cheryl seemed to be helping with Dave’s needs and care, and acting appropriately. In fact, according to the Public Administrator, the only real concern was what seemed to be the transactions entered into with the neighbors who had filed the original petition — she thought that their handshake deal seemed to take advantage of Dave.

A doctor who completed a more thorough medical evaluation than in the original proceedings agreed that Dave was friendly, cooperative, engaging and generally capable. It was true, the witnesses agreed, that he was losing some ability to recall recent events (and even seeing some long-term memory loss), and that he suffered from mild cognitive decline. But he could sign a new power of attorney, designating his wife (or someone) to help him with more complicated transactions.

According to the doctor evaluating Dave, it would be appropriate to consider a court-appointed conservator who could slow down any “sudden, rash or misdirected financial decisions” that he might be manipulated into undertaking. Based on that, and (presumably) on the natural tendency to be protective, the probate judge decided to modify the original order he had imposed. This time, he appointed Cheryl to serve as the sole conservator, with her authority limited to preventing any transfer of sale, transfer or conversion of real estate owned by Dave.

Still not satisfied with the reduced court intervention, Dave appealed. The Missouri Court of Appeals considered his argument that there had been insufficient evidence to impose even the limited conservatorship, and agreed. The probate court order was reversed, and the conservatorship ended.

The appellate court noted that a guardianship or conservatorship must be shown by “clear and convincing evidence,” a higher standard than the usual requirement for civil lawsuits. Considering all the testimony, and the fact that the initial proceedings were initiated by the very people who appeared to have taken business advantage of Dave, the appellate judges ruled that the record was “devoid of clear and convincing evidence” of his disability. In the Matter of Barnard, March 22, 2016.

Would Dave’s experience be the same, or similar, in Arizona courts? It might well be.

First, Arizona law is essentially similar to the appellate court’s description of Missouri’s law on guardianship and conservatorship. As in Missouri, the Arizona rules require proof by “clear and convincing evidence.” That’s higher than the “preponderance of the evidence” standard imposed on most civil lawsuits, though not as high a burden as the “beyond a reasonable doubt” standard applied in criminal cases.

Arizona also has an additional requirement before appointment of a guardian (of the person) can be considered: the court must specifically find that a person in Dave’s position would be unable to provide for their own food, shelter and necessities without the assistance or intervention of a guardian. That seems like it would have been difficult to show in Dave’s case, and that would probably mean no guardian would be appointed — but it would not prevent appointment of a conservator or limited conservator (of the estate).

It seems likely that, if an Arizona court appointed a guardian, conservator, or limited conservator for someone with a story similar to Dave’s, the appellate court in Arizona would (like the Missouri Court of Appeals) reverse the appointment. But would a probate judge in Arizona appoint a guardian or conservator in the first instance?

It’s hard to generalize, since probate judges vary widely in their experiences, resources and attitudes. We would hope that a Tucson (Pima County) probate judge would not have appointed a guardian, conservator or limited conservator on the basis of evidence as flimsy as that introduced in Dave’s initial and subsequent court proceedings. Judges, though, are often protective — and sometimes overprotective.

Our bottom line: we admire Dave for his persistence and his ability to object to even the limited conservatorship imposed on him. We are proud of him, and of the Missouri Court of Appeals.

Conservator Has Authority Over Property In Another State

FEBRUARY 15, 2016 VOLUME 23 NUMBER 7

We live in an increasingly mobile world. That assertion is hardly controversial. The reality that America’s patchwork of over fifty separate legal jurisdictions can make for confusion and conflict is well understood by lawyers and observers. A recent guardianship and conservatorship case involving two states (neither of them Arizona) illustrates how that confusion can play out.

Ben Marvel (not his real name) bought a house in Spokane, Washington, in 2001. He let his daughter Melinda live there with her kids, and he stayed in the home from time to time — he also lived part time in Idaho. In about 2007, he moved in with his daughter and her family full-time.

At about that time, Melinda sued Ben for allegedly concealing her late mother’s will and failing to transfer her assets as directed by that will. As a result of that litigation, Ben agreed to transfer the Spokane house to Melinda; he signed a quit claim deed to her in mid-2007, and the lawsuit was dismissed a few months later. Melinda did not immediately record the quit claim deed.

Meanwhile, Ben’s son initiated a conservatorship proceeding in Idaho, and the Idaho court determined that Ben was an Idaho resident, that he lacked capacity to make his own financial decisions, and that a professional fiduciary should be appointed. Because Ben’s assets were limited, the Idaho conservator was directed to “facilitate” a reverse mortgage on his home in Spokane.

The reverse mortgage was signed in October, 2007, and the conservator received funds that helped pay for Ben’s care. Meanwhile, a few months later, the Washington court (where Melinda’s lawsuit had been dismissed) signed a new order and judgment confirming that Melinda owned the Spokane property; that judgment indicated that it would be nunc pro tunc — that is, that it would be effective as of the original date on which the lawsuit had been dismissed.

Ben died in 2011, and the reverse mortgage became due. The bank granting the reverse mortgage ultimately initiated foreclosure proceedings, and Melinda objected that the house was hers, that Ben did not own any interest in it, and that the Idaho courts had no jurisdiction to authorize a reverse mortgage over Washington property anyway.

To clarify this confusing story, this timeline might be helpful (we’ve added a sprinkling of dates not included in the above narrative):

  • 2001: Ben purchases Spokane house
  • Early 2007: Ben moves into Spokane house with Melinda’s family; Melinda sues Ben
  • June 28, 2007: Ben signs quit claim deed conveying house to Melinda
  • August 22, 2007: Washington court dismisses Melinda’s lawsuit
  • August 27, 2007: Idaho court initially appoints conservator for Ben
  • October 22, 2007: Idaho court directs conservator to facilitate reverse mortgage
  • October 25, 2007: Idaho conservator signs reverse mortgage documents
  • Early 2008: Washington court files judgment finding house belongs to Melinda, dates it for August 22, 2007
  • 2008: Idaho conservatorship terminated; Washington conservatorship takes over
  • March 12, 2011: Ben dies
  • December 8, 2011: Melinda finally records the quit claim deed signed by Ben in 2007
  • 2012: bank initiates foreclosure on reverse mortgage

There are several legal questions posed by this confused history. Can any individual secure a reverse mortgage (or a conventional mortgage, for that matter) on property that they no longer own? Can the failure to record a deed, coupled with the failure to get the court to enter a judgment, permit someone who doesn’t really own property to encumber it? Is there some explanation for everyone’s actions in this scenario? All are interesting questions. But the legal issue that catches our eye is this: can an Idaho conservatorship court make any findings affecting real estate in Washington?

In general terms, real estate is subject to the jurisdiction of the courts where the property sits, and not other courts. In Ben’s case, however, the bank argued that his Idaho conservator had the authority to handle all of his property and finances — regardless of where they might be located. Melinda, on the other hand, challenged the very power of the Idaho court to approve, direct, or even facilitate a reverse mortgage on out-of-state property.

The trial court in Washington decided that the reverse mortgage was valid, and that the bank could foreclose on the loan. The Washington Court of Appeals reversed, finding that “the Idaho court lacked authority to authorize a conservator to encumber the Spokane residence.”

The case went on up to the Washington Supreme Court, which agreed with the trial judge. The Idaho conservatorship proceedings, it decided, were entitled to “full faith and credit” under the U.S. Constitution, and the Idaho courts had considered and decided the question about whether Ben resided in Idaho or Washington at the time its proceedings were initiated.

The Washington high court also decided that, while the Idaho courts would not have had authority to change ownership of the real property in Washington, they could enter orders that indirectly affected ownership of that property. As an analogy, the justices noted that an Idaho court could enter an order in a divorce proceeding that directed one spouse to sign a deed to Washington property; the court’s power over the individual would permit it to affect the real estate in another state.

Once the state’s high court decided that the Idaho conservatorship orders were valid and enforceable, the problem became whether to find the mortgage itself to be valid. Since the deed conveying the property to her had not been recorded, the bank had no reason to ask her if she claimed some interest in the property. The bank’s reliance on the record ownership and the authority of the Idaho conservator was sufficient to find the mortgage to be valid. Onewest Bank, FSB v. Erickson, February 4, 2016.

Mediation in Guardianship Proceeding Can Be Effective, But Raises Questions

FEBRUARY 8, 2016 VOLUME 23 NUMBER 6

Sometimes court proceedings are necessary in order to resolve differences of opinion — but almost everyone recognizes that it is good to seek resolution by a simple agreement when the parties can resolve their differences outside court. Mediation, for instance, is a great way to resolve many legal disputes. The parties to a lawsuit (or a potential lawsuit) meet with a professional mediator, and they discuss (either in separate sessions or, sometimes, in a common meeting) how they might work things out short of a court hearing. The result can be positive, and is almost always less expensive than a full court process. If a mediation has been handled particularly well, both parties (or all parties, for sometimes there are multiple positions being espoused) think they got less than they really wanted but more than they might have gotten if the case had gone to trial.

But what about guardianship (and conservatorship) proceedings? How can someone who is alleged to be incapacitated participate in mediation? Assuming the mediation is successful, how can someone who lacks legal capacity even agree to the settlement reached after mediation?

Because of the particular nature of guardianship and conservatorship proceedings, it can sometimes be impossible to enter into a meaningful mediation. One other problem: after a court hearing appointing a guardian or conservator, the legal fees of the petitioner (the family member or professional bringing the action) and the subject of the proceeding are both usually paid from the subject’s assets. But how will the cost of mediation be shared, and what incentive does everyone have to participate?

Notwithstanding these problems, guardianship mediation can and does work. At Fleming & Curti, PLC, for example, we frequently encourage mediation, whether we represent the family member petitioning, the family member objecting, or the subject of the proceedings. Mediation can result in a less-restrictive outcome (perhaps the subject of the proceedings could create a trust, or sign a power of attorney, for example), and gives the subject of the proceeding a much clearer voice in making decisions (as, for instance, when the subject objects to the proceedings — but particularly objects to the possible appointment of one family member).

But guardianship mediation still can be problematic. A recent Florida case showed why that can be.

Arnold Gabriel (not his real name) is a paranoid schizophrenic living in Florida with his aunt. He knows that he has mental health issues, but he thinks he gets along pretty well with the help of his aunt and his cousin, Linda Freeman. But Arnold’s brother Walter does not agree — he thinks that Arnold is at risk in the community, and that someone needs to be monitoring his condition and care at all times.

Walter filed a petition with the Florida courts seeking to be appointed as guardian of Arnold’s person — he hoped to be given authority to determine Arnold’s physical placement, and he thought Arnold probably needed to go to a state facility. Arnold disagreed, and so did cousin Linda. Linda filed a counter-petition, seeking to be appointed as guardian of both the person and property (what we in Arizona would call conservator) over Arnold. The Florida court set a hearing on the competing petitions.

Meanwhile, the three parties and their attorneys agreed to try mediation. They set a time and met with a mediator, and everyone agreed to try a less restrictive alternative. Walter’s petition for guardianship of the person, and Linda’s petition for guardianship of the person and property, would both be dismissed. Linda would act as Arnold’s agent for both medical and health decisions, and both she and Arnold would agree to share medical and financial information with Walter so that he could monitor his brother’s care and condition. They also agreed that Arnold would be re-evaluated by a neutral care manager every six months to see if his care needed to be reviewed. Arnold and Walter would agree to communicate better about Arnold’s status and condition.

Both Walter and Linda dismissed their respective petitions, and things appear to have gone well for about a year. Then Arnold decided not to share information with his brother, and filed a court proceeding seeking a determination that the agreement was void and unenforceable.

Arnold claimed that he had felt pressured to enter into the agreement out of fear that his only alternative was to be committed to a state mental facility. Besides, he and Linda argued, Arnold lacked the mental capacity necessary to enter into an enforceable agreement. One piece of evidence showing he lacked the necessary capacity: the court evaluation undertaken in connection with the initial guardianship petition had resulted in a determination that he lacked capacity.

The Florida trial judge granted Walter’s motion for summary judgment, ruling that the mediation agreement was enforceable and Arnold would need to live up to it. Furthermore, the court ordered that Arnold’s estate should bear the legal costs incurred by Walter in pursuing the guardianship and enforcing the settlement agreement.

The Florida Court of Appeals upheld the trial judge’s ruling. There was no legal impediment to Arnold entering into the agreement, reasoned the appellate judges, because there had not been any court finding that Arnold was incapacitated. The trial judge’s interpretation of the agreement — and the award of legal fees — made sense in the circumstances. Gort v. Gort, February 3, 2016.

The appellate court noted that there is an earlier Florida case — Jasser v. Saadeh (Fla. App. 2012) — that appears to support the exact opposite holding. In that case, the mediation agreement had included a provision that the subject of the proceeding would sign a trust, and the trustee would manage her finances. The problem with that, said the appellate court in this later case, was that (a) the subject’s condition was dementia, not schizophrenia, and was therefore more related to her capacity, and (b) the issue in that earlier case was capacity to sign a trust, not capacity to enter into a settlement agreement.

Candidly, though, those distinctions have to be seen as difficult to support — the real issue, we submit, is whether the courts can be comfortable with an allegedly incapacitated person signing a given settlement agreement. Our position: the law should be made clear that the courts should support non-judicial settlement, and mediation in these difficult, emotional cases should be encouraged.

©2017 Fleming & Curti, PLC