Posts Tagged ‘vulnerable adults’

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.

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.

Exploitation of a Vulnerable Adult, or Not? You Judge

NOVEMBER 16, 2015 VOLUME 22 NUMBER 42

This week we’re going to ask you to be the judge. We’re going to tell you a story, then give you a moment to decide what you think should be the outcome of a lawsuit. Once you’ve decided, we’ll tell you what actually happened in the courts. Ready?

Diego Ramirez (not his real name) was 80 years old when his wife died. Shortly thereafter he moved in with his daughter and son-in-law.

Diego was a Spanish immigrant, and spoke no English. He was having trouble handling his finances, and his daughter and son-in-law helped him. They also provided care for him — first in their home, and later in the nursing home where he moved when he was unable to stay at home any longer.

The care they provided for Diego was complete — they made doctor’s appointments (Diego had a heart condition as well as his increasing confusion), transported him to medical appointments, administered his medications, took him on social and recreational outings, and even took care of his dog. Diego’s daughter actually quit her job to take care of her father (though she was able to return to work part-time and, eventually, full-time).

Shortly after Diego arrived in their home, his daughter and son-in-law arranged to sell his house. His daughter located an attorney, made an appointment and took Diego to visit the attorney. The attorney helped complete the sale of the home, and prepared a power of attorney document for Diego to sign. The power of attorney gave his daughter and son-in-law authority to manage his finances, and to conclude the sale of his home.

The daughter and son-in-law used some of the proceeds from that sale to improve their own home, adding rooms for Diego and doing some other work that needed to be done. They did not add Diego to the title on their home; when they later sold the home, the took the proceeds and bought a new home in their own names.

Diego had a private pension and Social Security. His daughter and son-in-law deposited the monthly checks in their own account and used the proceeds — along with their own income and savings — to take care of the entire household, including themselves and Diego. In other words, they did not keep separate accounts for Diego, and could not show exactly how his income had been spent after the fact. They handled Diego’s savings in the same way, using his funds to keep the entire household operating.

According to the daughter and son-in-law, Diego knew how his funds were being used. They said that he had agreed with them that they could use his funds so long as he lived with them and they were providing the care he needed.

After this relationship continued for ten years, Diego died. One of his sons successfully sought appointment as personal representative of his estate, and sued the daughter and son-in-law for return of the funds they had allegedly exploited from Diego while he was a vulnerable adult. The daughter and son-in-law responded that the reasonable value of their services on his behalf exceeded what they had received, and that if anything his estate owed them money.

The probate court held a one-day hearing on the allegations of exploitation of a vulnerable adult. From the recitation of facts we’ve provided (taken from the later Court of Appeals decision, by the way), can you tell how the court ruled? Did Diego’s daughter and son-in-law take funds from him improperly? Were they entitled to additional fees for the ten years of care they provided?

Think about it a minute before you move on. What would you decide?

The probate judge decided that Diego was a vulnerable adult, that his daughter and son-in-law acted as if they had been his conservator (though they were never appointed by any court), and that they had commingled his assets and income with their own. They enriched themselves with his assets, and they were unable to provide any meaningful accounting of the funds they had used. They were found liable for a breach of their fiduciary duty and a violation of the Arizona statutes on exploitation of a vulnerable adult, and they were ordered to repay his estate $15,527.26 — plus an additional $35,000 in attorney’s fees incurred by the estate.

The Arizona Court of Appeals upheld that ruling, agreeing with the probate judge that Diego was a vulnerable adult, that the daughter and son-in-law improperly commingled assets, and that they had violated the exploitation statutes. Of some interest to the appellate court was the provision of the Arizona law that anyone in the daughter and son-in-law’s position must use the vulnerable adult’s assets solely for the benefit of the vulnerable adult.

The existence of the power of attorney did not improve the daughter and son-in-law’s position. Nor did the agreement that Diego could live with them and that they would provide care. Neither of those authorized the daughter and son-in-law to commingle assets or take Diego’s funds for their own benefit. Rodriguez v. Graca, November 3, 2015.

Let us assume for a moment that Diego in fact wanted to turn over most of his assets and income in return for a home and the care required to allow him to live there as long as possible. What could he (or his daughter and son-in-law) have done in order to make that arrangement possible?

First, a clear (and, preferably, written) understanding should have been reached. It probably would have been helpful to discuss that arrangement with Diego’s other children, so they could talk with Diego about it at the time. It also would have been important for the daughter and son-in-law to maintain clear records, showing how much of Diego’s money was needed to care for him, and how they spent the funds. That could have included time records as well as financial details.

A final word of advice: do not enter into these kinds of arrangements lightly. It is very difficult to establish the reasonableness of the agreement years later, with the vulnerable adult no longer available to explain what they had in mind at the time. Recognize that the senior’s needs — and ability to supervise or negotiate — will probably change over time, and perhaps over a short period of time.

Oh, and how did you do as the judge?

Exploitation of Vulnerable Senior Leads to Disinheritance

JANUARY 27, 2014 VOLUME 21 NUMBER 4

Arizona has a relatively strong statute dealing with exploitation of vulnerable adults. An exploiter can be charged criminally, and might receive a longer sentence or larger fine because of the victim’s vulnerability. But the strongest part of the Arizona law is probably the provision that lets the victim — or the victim’s heirs — pursue a civil judgment against the exploiter.

That was what Hazel Kaplan (not her real name) did. Her uncle Paul was a widower, living alone in Lake Havasu City, Arizona. Paul’s estate plan included a trust naming Hazel as successor trustee, and leaving his estate to her and two other nieces. Hazel regularly visited with uncle Paul, and helped him to pay his bills. When Paul’s wife had died, it was Hazel who had been there to help make funeral arrangements and help Paul with the transition.

Then, in 2001, Karen moved in as a caretaker. Paul, an immigrant, had located her through the immigrant community in the eastern U.S., and she moved to Arizona to live with him, oversee his medications, drive him to appointments, feed and bathe him — even monitor his care, change his catheter and clean up after he suffered a heart attack in 2006. Karen was his only caretaker (other than one nurse who visited after his heart attack) from her arrival in 2001 until Paul’s death in 2008.

Paul’s accountant prepared four amendments to Paul’s trust between 2006 and 2008. Over the course of those amendments, Hazel’s share of the estate and her appointment as successor trustee were both removed — caretaker Karen and her son were named as trustees and Karen as the beneficiary of Paul’s entire estate.

Three months before his death, Paul visited his bank in the company of Karen and her son. He withdrew $200,000 and opened two accounts with the proceeds. One account was in Karen’s name with her son as co-owner; the other account named Paul himself and Karen’s son as co-owners. Two months later Karen closed out the account her name was on, and used the proceeds to buy a house in Delaware, where she had lived before moving in with Paul. The house had been a bank foreclosure, and Karen’s daughter was the real estate agent in the transaction. She did not put Paul’s name — or his trust’s — on the title. She sold the property immediately after Paul’s death for a significant gain, and kept the proceeds.

After Paul’s death, niece Hazel started a probate proceeding and a lawsuit against Karen and her son. She alleged that both had violated Arizona’s vulnerable adult statute, and asked for the return of everything either of them had received from Paul or his estate.

After a two-day trial, the probate judge ruled that Karen and her son had, indeed, exploited a vulnerable adult. He ruled that the trust amendments were invalid, and that Karen and her son forfeited any right to inherit any portion of Paul’s estate or trust as a result of their exploitation.

The Arizona Court of Appeals considered the evidence and arguments, and upheld the probate judge’s ruling. One key question: was Paul a vulnerable adult?

Several witnesses (including the accountant who prepared trust changes, the bankers who handled the transfer of money from Paul’s name to his exploiters’ names, and Karen and her son) all testified that he was mentally alert. His doctor testified that he was very passive and suggestible, and niece Hazel testified that Paul was very susceptible to others — particularly to women. The appellate court noted that the probate judge had been in a better position to judge the believability of each witness, but noted that the accountant and the bankers had a vested interest in testifying that Paul had been able to give them direction. Besides, said the appellate judges, mental impairment is not required for an adult to be “vulnerable” under Arizona law — physical disabilities and resultant reliance on caretakers can make the patient vulnerable to manipulation.

The result? Paul was a vulnerable adult, Karen and her son owed him a duty not to take advantage of him, and their acts exploited him — especially when they were involved in getting $200,000 transferred to them before Paul’s death. Oh, and Karen was ordered to pay Hazel’s legal fees for the appeal, too. Kousoulas v. Marinis, January 7, 2014.

Does Hazel’s lawsuit stand for the proposition that any caretaker who receives the estate of the person they cared for is necessarily an exploiter? No, but the relationship inherent in a caretaker/patient relationship is certainly subject to exploitation, and gifts to caretakers will always be suspect. The evidence that Karen kept Hazel from visiting her uncle, and that she and her son were involved in changing his estate plan (though they did not go into the room with the accountant when Paul signed trust changes) both weighed heavily against them.

If Paul had hired an attorney to handle his estate planning, rather than entrusting it to his accountant, would things have been different? Possibly — an attorney would likely have been more attuned to the importance of separating out the possibility of exploitation and (if it was clear that Paul genuinely wanted to leave his estate to his caretaker) documenting the evidence of Paul’s wishes. But the probate judge noted, and experienced lawyers usually realize, that it is difficult to assure that a client’s choices are not being changed by suggestions from caretakers — especially full-time, live-in caretakers, who have such a strong opportunity to develop a relationship based on dependency. That is, in fact, why there can be a presumption of undue influence when a change is made in favor of someone who has a fiduciary relationship with a vulnerable adult.

Reporting Abuse, Neglect or Exploitation of Vulnerable Adults

DECEMBER 23, 2013 VOLUME 20 NUMBER 48

As people live longer and the elderly population increases, so does the likelihood of abuse, neglect and exploitation of vulnerable adults. Lawyers, accountants, doctors, nurses, caretakers, bankers — indeed, any professional — faces a growing probability that at some point they will be confronted with the issue of whether to report suspected abuse, neglect or exploitation. For lawyers, especially, the ethical requirement that client confidences be maintained can complicate the problem.

There were over 1,600 allegations of abuse, neglect or exploitation of vulnerable adults reported in Pima County, Arizona (the Tucson area) last year. Surprisingly, fewer than 1% of these were reported by legal professionals. Arizona law imposes an affirmative duty on attorneys to report suspected exploitation of a vulnerable adult to the authorities. Arizona Revised Statutes § 46-454(b) requires any attorney who is responsible for preparing the tax records of a vulnerable adult, or responsible for any “action concerning the use or preservation of the vulnerable adult’s property and who, in the course of fulfilling that responsibility, discovers a reasonable basis to believe that exploitation of the adult’s property has occurred or that abuse or neglect of the adult has occurred shall immediately report or cause reports to be made …”

Keep in mind that an individual does not have to be “elderly” to be a vulnerable adult. Any adult who is unable to protect himself or herself from abuse, neglect or exploitation by others because of a physical or mental impairment is a vulnerable adult. The definition of vulnerable adult is broad and so are the types of abuse and exploitation that the statute is intended to cover. Financial exploitation of vulnerable adults occurs with alarming frequency and in many cases goes unreported because the victim may not be aware of the ways in which he or she is being exploited.

Reports of suspected abuse can be made to the City Police, County Sheriff or (statewide) Adult Protective Services. The Pima County Public Fiduciary also handles cases of suspected financial exploitation. Even if suspected abuse is later found to be unsubstantiated, there are no penalties for good faith reporting. Any attorney who makes a report in good faith is likely to have some civil and/or criminal immunity from liability. You can make a report anonymously, however, the law requires that the report be made immediately, otherwise you may be found guilty of a class 1 misdemeanor.

So, you may be reading this and thinking: “how can I uphold my duty of confidentiality to my client if I suspect that he or she may be a victim of abuse, neglect or exploitation?” How is it possible to balance this ethical duty when reporting of suspected abuse is mandatory? In Arizona, you will not breach your duty of confidentiality if you reveal only information to the extent you believe is necessary to comply with a law that requires the disclosure of such information.

Arizona’s version of the ethical rules governing lawyers provides specific guidance to attorneys in cases where an attorney believes that his or her client of diminished capacity is at “risk of substantial physical, financial or other harm unless action is taken and cannot adequately act in the client’s own interest.” In these specific cases, an attorney may take “reasonably necessary protective action,” including consulting with individuals or entities who may be able to protect a client with diminished capacity.  In taking any protective action, among other considerations, an attorney may be guided by the client’s best interests or the wishes and values of the client.

Pima County (and Arizona) is home to a growing number of seniors and vulnerable adults. As we consider the ways our practices can build a healthy community, we must remember the duty of advocacy we owe our clients. If you suspect a case of abuse is occurring and feel unsure about your duty to report, then reach out to one of our colleagues who specialize in professional responsibility or call the Arizona State Bar Ethics Hotline.

What about lawyers practicing in other jurisdictions? State laws vary — many states have mandatory reporting requirements but quite a few of them either do not extend to, or specifically exempt, lawyers from coverage. The ethical rules permitting disclosure when the client is at risk, however, have been adopted in substantially similar form in almost every state.

What about other professionals? Arizona’s mandatory reporting law is very clear: doctors and other medical providers are covered as to reporting abuse, neglect and exploitation, and accountants and tax preparers are covered as to reporting exploitation. Other states vary, with some focusing on medical providers and others on social workers and government officials. If you work with seniors and/or adults with diminished capacity, you should check into your state laws regarding mandatory reporting of abuse, neglect and/or exploitation.

“Grandma, it’s me and I need your help.” Don’t Be Fooled By This Scam

APRIL 2, 2012 VOLUME 19 NUMBER 13
We have been hearing lately about a scam that targets seniors. You get a telephone call from a number you don’t recognize. When you answer, the person on the other line says: “Grandma, it’s me, and I need your help.” You learn that your grandchild has been detained by the police in another country – Mexico, or maybe somewhere in the Caribbean. Something about an auto accident, perhaps, and unfamiliar laws in the foreign country. Your grandchild needs you to wire him or her money to pay for bail.

Significantly, the grandchild pleads with you not to notify his or her parents, because they’ll be angry. If you note that the grandchild’s voice sounds different, he or she will say that the police broke his or her nose during the course of the arrest. If you ask for a phone number, so you can call back, you’re told that this is an outgoing number at the police station and it’s not possible to call back. There’s no way to contact your grandchild again. You are instructed to go quickly to the bank, withdraw an amount that is usually slightly less than $5,000.00 (any more will attract the government’s attention) and arrange for a wire transfer.

If you have grandchildren you probably love them dearly. We suspect that if you got a call from a grandkid in trouble, you’d spring into action. Any questions you might have about the truthfulness of what you’re being told would be superseded by the stress and anxiety of learning that your grandchild was in serious trouble and needed your help urgently.

We know of several instances lately of our clients (or the parents or other family members of our clients) being targeted by this kind of scam. In one case, the grandmother was at Walmart attempting to wire funds when the store clerk alerted her that this was likely a scam and that she should call the grandchild, or his parent, before wiring any money. In another instance, the scam was discovered earlier in the process because the grandmother was known to her family by a nickname, and not as “Grandma.”  She was immediately suspicious.  But, worryingly, in that case, the person on the other end of the line identified herself using the actual name of a real granddaughter.

Of course it is despicable of scammers to play on a grandparent’s love for their grandchildren. Worse yet, they frighten and alarm their elderly victims. Please, if someone tries to spur you to action by playing on your fears, stop, take a deep breath, and apply a little skepticism before you proceed any further.

Other than health skepticism, what can you do to protect yourself? If this happens to you, ask your caller to recall a pet’s name, or a family vacation spot, or something that only your actual grandchild would know. Be cautious, however — the sophistication of scammers has increased as private details become widely available on the internet. In one case, for example, police reported that the caller knew that the victim they were calling had an identical twin, and even that the victim was two minutes younger than her sister.

What if this happens to a family member? If money has been wired, immediately contact the transfer company. If it has already been picked up it is too late, but even if the money is gone at least the authorities will have one more piece of data to stop future scams and maybe even locate your scammer. Contact the FBI or its Internet Crime Complaint Center to file a report. Unofficial agencies like the Better Business Bureau also track scam information and may be able to make other suggestions.

Worried that something like this might happen to a vulnerable senior in your family? Start by locking down their internet vulnerability — scammers often use e-mail malware to collect information about potential victims. Make sure your family member’s internet use is protected. Caution them about social media — trusting seniors might be inclined to share too much sensitive and personal information online.

Make sure your family member knows to contact you before succumbing to a scammer’s pleas for confidentiality. Maybe you even want to adopt a family code word to signal that any caller is truly a family member. Please don’t inject unnecessary fear into your family member’s life, but make sure they have sufficient skepticism and the comfort to contact you or another family member no matter what a scammer might tell them.

Want to familiarize yourself with the kinds of scams working across the internet and through your neighborhood? Check out the Better Business Bureau’s “Scam Aggregator.” It might amaze, alarm and inform you all at the same time.

Physical Limitations Can Lead to “Vulnerable Adult” Finding

MARCH 12, 2012 VOLUME 19 NUMBER 10
Georgia Griffin (not her real name) moved from Kansas to Arizona in 1997. She lived in her own townhome in Sun City West, a retirement community northwest of Phoenix, until 2001, when she moved in next door to her daughter Barbara, who lived in Scottsdale.

Georgia’s story was fairly typical: she had lived at home independently until, at age 90, her physical ailments made it difficult for her to get along without help. The move to be next to her daughter was occasioned by her daughter’s concern that she was at risk living alone. One particular concern: after Georgia fell in her home, she worried that if she were to fall again she might not be able to get up, even to summon help.

After Georgia’s initial move to Arizona, daughter Barbara helped her with her banking, filling out checks and making transfers and withdrawals. She was a joint tenant with her mother on some accounts; several were changed from joint tenancy to “payable on death” (POD) to Barbara at some point. Meanwhile, Georgia’s other daughter Elizabeth was less involved — though she also lived nearby.

Shortly before Georgia’s move to be next door to Barbara, Barbara had purchased six condominium units in the complex where she lived. In fact, Georgia’s move was into one of those units. Elizabeth would later argue that the money for those purchases came from their mother’s accounts.

After Georgia’s death in 2003, Elizabeth initiated a probate proceeding and was appointed as personal representative of Georgia’s estate. She then filed an action against Barbara, alleging that Barbara had taken advantage of Georgia while she was a “vulnerable adult” — an important term under Arizona’s law protecting seniors and those with disabilities.

After a five-day trial, she convinced the judge that Georgia was vulnerable, that Barbara had held a position of trust with their mother, and that she violated that trust by using Georgia’s money to purchase her condominium units. The judge entered a judgment for $179,518.51 against Barbara, and imposed a constructive trust on five of the condominium units (ordering that they could be sold to satisfy the judgment). The judge also ruled that Barbara had forfeited any right to inherit from her mother’s estate; the judge did not impose treble damages against Barbara, which was an option available at the time (the Arizona legislature has since reduced the maximum penalty to double the amount of the basic judgment, though that would not have made any difference in this case).

The Arizona Court of Appeals upheld the judgment. The key question raised by Barbara on appeal: how could the trial court have found Georgia was “vulnerable” when the evidence indicated she was fully competent? Can vulnerability be based solely on evidence of physical limitations?

The short answer: yes. The appellate judges ruled that vulnerability for purposes of Arizona’s exploitation statute can be predicated solely on physical impairments if, as a result of the impairments, the victim is unable to protect herself from the exploiter. Mental impairment is not necessarily required. In this case, according to the court, Georgia’s “diminished vision and hearing could also have made her more susceptible to exploitation, as they could make her less aware of her surroundings and the circumstances of any transactions in which she became involved, thereby making her less able to protect herself if targeted for exploitation.”

That is not to say that every transaction Georgia might enter into would be suspect. “A vulnerable adult may still have the capacity to transfer property,” according to the judges. In fact, Georgia had transferred her original townhome to Elizabeth and the family home in Kansas to Barbara; those transfers did not necessarily amount to exploitation.

There is a second interesting holding in the appellate decision, though it is perhaps less far-reaching in its scope. After the trial was over, and while one of Barbara’s sons was packing up his belongings to move out of the condominium he lived in (and which would now be sold), he said he discovered old letters written by Georgia. Those letters related how Georgia was helping Barbara and her husband purchase several condominiums so that they would have income when they retired. Barbara moved to reopen the trial to introduce those letters, but the trial judge refused.

That refusal was not error, according to the Court of Appeals. There was insufficient evidence that the letters could have been found by diligent search before the trial. More importantly, the letters would not likely have changed the outcome. Why not? Because Barbara’s (and her husband’s) defense throughout the trial had been not that Georgia permitted the use of her money but that none of her money was involved in purchasing the condominiums. The letters would therefore have run counter to their core argument. In re Estate of Gorsik, April 12, 2012.

There are several footnotes worth mentioning in discussion of the appeal in Georgia’s case. First, the decision is a “Memorandum Decision.” That means that, though the appellate court laid out its reasoning and legal arguments, the decision is not “published” and therefore can not (at least not usually) be cited as precedent in other, similar cases. It is in the nature of lawyers and judges to make and keep records, so one irony about unpublished (memorandum) decisions is that they are published,  can be read by anyone who wants to take the time to look for them, and are often cited as at least some evidence of the inclinations of appellate courts.

Another small irony: even as Georgia’s case was working its way through the courts, the Arizona legislature has been busy weakening the protections afforded to victims of abuse, neglect and exploitation. First, as noted above, was the reduction of “treble damages” awards to “double damages.” That, as it turned out, had no direct effect on Georgia’s case, since the trial judge decided that extra damages should not be awarded — but it does make such cases less attractive to lawyers with experience in exploitation cases, and it reduces the likelihood that any given case will be initiated in the future. Since then, the legislature has continued to push at the margins of abuse, neglect and exploitation cases; there is a bill pending even now that would eliminate the availability of an award of attorneys fees to the successful party in cases involving vulnerable adults.

Why would the legislature want to eliminate protections for vulnerable adult victims? Probably because some abuse, neglect and exploitation cases are filed against nursing homes, long-term care homes and medical providers, and they tend to have legislators’ attention. Vulnerable adults, by contrast, have a very poor lobbying record.

What is the Value of a Senior’s Life?

SEPTEMBER 6, 2010 VOLUME 17 NUMBER 28
The question addressed in a ruling last month by the Arizona Court of Appeals seems provocative. In a lawsuit based on the Arizona law prohibiting abuse, neglect or exploitation of vulnerable adults, does the very life of the abused senior have any intrinsic value? The Court’s answer: perhaps, but the lawsuit can not recover damages for the loss of that life.

Mary Winn died about a month after being admitted to Plaza Healthcare, a Scottsdale, Arizona, nursing home, in 1999. Four years later her husband George Winn filed a lawsuit against Plaza, alleging that it had violated Mrs. Winn’s rights under Arizona’s Adult Protective Services Act. Under the APSA, a vulnerable adult who has been abused, neglected or exploited may recover damages suffered as a result of that abuse, neglect or exploitation. Mr. Winn argued (on behalf of his wife’s estate) that he should be able to recover on behalf of his late wife, and that she would have been entitled to actual damages for the loss of her life, as well as punitive damages.

Not so, argued the nursing home. Mrs. Winn obviously could never have collected damages for her own death, and her estate’s recovery was limited to what she could have recovered. In fact, the estate’s possible recovery was less than her damages, since any claim for pain and suffering she experienced at the end of her life ended with her death. With no actual damages to recover, her estate could not seek punitive damages.

Mrs. Winn’s estate argued that her life had some “intrinsic” value, and that it should be recoverable. The estate conceded that she was elderly and ill when she arrived at Plaza Healthcare, and that she could not be expected to earn a salary given her age and condition. But, insisted the estate’s lawyers, a human life has some inherent value.

The trial court agreed with the nursing home, and limited the estate’s proof to just actual damages. After an informal arbitration proceeding (the estate conceded that the remaining damages were less than $50,000, and therefore subject to mandatory arbitration rules) a judgment against was entered in favor of Plaza Healthcare.

The Arizona Court of Appeals reviewed the trial court’s ruling and agreed. There is no cause of action under the vulnerable adults statute, ruled the appellate judges, for the “intrinsic or inherent value” of a deceased claimant’s life. Mrs. Winn’s estate — and her husband — recovers nothing from Plaza Healthcare. Estate of Winn v. Plaza Healthcare, Inc., August 10, 2010.

To be fair, the appellate court did not rule that there is no value to the life of an elderly, disabled and vulnerable senior. All the ruling says is that there is no right to recover under the Arizona Adult Protective Services Act for the loss of life itself.

Does that mean that Mr. Winn had no claim for his wife’s alleged mistreatment? Not necessarily — he might have been able to file his lawsuit on his own behalf if he had acted more quickly. By the time he filed it had been more than four years since his wife’s death — too late for any wrongful death action but not too late for a viable lawsuit under the Adult Protective Services Act, which had a much longer statute of limitations.

There is another interesting footnote to the Winn case. Last month’s decision from the Court of Appeals is not the first time Mrs. Winn and her estate have been before Arizona appellate judges. In fact, her case had been appealed twice before — once in 2006/2007, and again a year later. The first trip through the appellate system involved the trial judge’s dismissal — ultimately reversed by the Arizona Supreme Court — on the basis that a probate proceeding filed more than two years after the decedent’s death did not permit filing of a lawsuit in the estate’s name. A year later the Court of Appeals dismissed an attempted appeal from the trial judge’s initial refusal to allow any recovery for the inherent value of Mrs. Winn’s life. That appeal had to wait for final resolution of the entire lawsuit, which was accomplished before the current (and probably final) appeal.

©2017 Fleming & Curti, PLC