Friday, March 27, 2015

NOT Elder Law, But It Is CRIMINAL Law

As reported in the ABA Journal, "A New Jersey lawyer has been sentenced for 10 years in prison for her part in a scheme to steal $3.8 million from 16 elderly victims:"

Prosecutors say the group took control of the finances of their victims by forging a power of attorney or obtaining one under false pretenses. They then added their names to the victims’ bank accounts and transferred the victims’ funds into accounts they controlled. As part of a plea deal with prosecutors, Lieberman has agreed to pay $3 million in restitution and testify against her co-defendants. 

Here are more details.  And here. And here. And here And according to one news source, the attorney actually served on the New Jersey Supreme Court's Ethics Committee while already engaged in misusing client funds.  Hat tip to retired New York Attorney Karen Miller, now living in Florida, for sharing a link to the ABA Journal article on this sad set of facts.

March 27, 2015 in Crimes, Current Affairs, Ethical Issues, Legal Practice/Practice Management, Property Management, State Cases | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 24, 2015

Has Acceptance of Same Sex Marriage Created Opportunities for Recognition of Other "Family Relationships?"

Columbia Law Professors Elizabeth S. Scott and Robert E. Scott have a new article, "From Contract to Status: Collaboration and the Evolution of Novel Family Relationships." They describe the successful movement to achieve marriage rights for LGBT couples as creating potential opportunities for recognition of other legal relationships that do not depend on "traditional" notions of marriage or family, such as "cohabiting couples and their children, voluntary kin groups, multigenerational groups, and polygamists."

In analyzing relationships that may gain greater legal recognition, the authors examine the possible influence of statutory obligations, including Pennsylvania's filial support laws used to impose care obligations on adult children, or more recent statutes granting visitation rights to grandparents:

"Probably the strongest candidate for full family status is the linear family group composed of grandparent(s), parent(s), and child(ren). It is clear that this familiar type of extended family can function satisfactorily to fulfill family functions. Further, the genetic bond among the members, together with well-defined family roles, reinforces already existing norms of commitment and caring. The primary challenge for these extended families may be the creation of networks with other similar families pursue their goals of increasing public support and attaining official family status.More complex multigenerational groups pose a greater challenge because they are less familiar to the public and less likely to be bound by family-commitment norms than are linear family groups. Partly for this reason, regulators may find it more difficult to verify the family functioning of these unconventional multigenerational groups."

The article was published in the Columbia Law Review, March 2015.

March 24, 2015 in Discrimination, Ethical Issues, Health Care/Long Term Care, Property Management, Social Security, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, March 16, 2015

Family Dynamics are Complicated, Particularly When We're Talking End-of-Life "Wealth" Transfers

GW Law Professor Naomi Cahn and Amy Zeittlow, affiliate scholar with the Institute of American Values, have collaborated on a new article that is fascinating.  In "Making Things Fair: An Empirical Study of How People Approach the Wealth Transmission System," to be published in a forthcoming issue of the Elder Law Journal, they ask fundamental questions about whether traditional laws governing testate and intestate wealth transmission reflect and serve the wishes of most Americans.  Professor Cahn previews the article as follows:

Based on an empirical study of intergenerational care for Baby Boomers, the article shows how the inheritance process actually works for many Americans.  Two fundamental questions about the wealth transfer system guided our analysis  of the data: 1) does the contemporary inheritance process respond to the changing structure of American families; and 2) does it reflect the needs of the non-elite, who have not traditionally been the focus of the system?    

Our study shows that the formal laws of the inheritance system are largely irrelevant to how property is  transferred at death. While the contemporary trusts and estates canon focuses on the importance of planning for  traditional forms of wealth in nuclear families, this study focuses on the transmission of wealth that has high emotional, but low financial, value. We illustrate how the logic of “making things fair” structured how families navigated the distribution process and accessed the law. Consequently, the article recommends that law reform should be guided by the needs of contemporary  families, where not only is wealth defined broadly but also family is defined broadly, through ties that are both formal and functional.  This means establishing default rules that maximize planning while also protecting familial relationships.

The article is part of a new book by the authors titled "Homeward Bound," with planned publication in 2016, and the authors welcome comments and suggestions. 

March 16, 2015 in Books, Current Affairs, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, Ethical Issues, Property Management, State Cases, State Statutes/Regulations, Statistics | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 10, 2015

8th Circuit Rejects "Attempt" to Create d4A Special Needs Trust to Permit SSI Eligibility

In Draper v. Colvin, petitioner sought judicial review of SSA's denial of her application for SSI benefits. Her claim was sympathetic, as "[e]ighteen-year-old Stephany Draper suffered a traumatic brain injury in a car accident in June 2006."

In an admittedly  "hard line" ruling on March 3, the 8th Circuit rejected her argument that her parents' intent to establish a valid third-party-settled special needs trust, using proceeds from a settlement of a personal injury suit on her behalf, should permit her to claim SSI. 

The ruling means that over $400,000 will be treated as "available resources," thus requiring spend down before she would be eligible for benefits.  The court explained (minus citations):

Admittedly, some evidence in the record supports Draper's claim that her parents intended to act in their individual capacities. Draper's parents identified themselves individually as settlors and trustees, and the trust document explicitly states that it was established “pursuant to 42 U.S.C. § 1396p(d)(4)(A)," a provision which notes that a third party, such as a parent, must create the special needs trust for the benefit of the disabled person. Nevertheless, as discussed [earlier in the opinion], other facts provide substantial evidence to support the conclusion that Draper's parents acted using the power of attorney when establishing the trust.

The Court continued on to its tough bottom line:

Continue reading

March 10, 2015 in Cognitive Impairment, Estates and Trusts, Federal Cases, Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, Property Management, Social Security, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Friday, March 6, 2015

Harvard Prof. Robert Sitkoff to Speak on Incapacity Planning at University of Illinois

Harvard Law Professor Robert H. Sitkoff is speaking at University of Illinois School of Law on Monday, March 9.  The topic is "Revocable Trusts & Incapacity Planning: More then Just a Will Substitute." Sitkoff-Publicity-HLS 

Here are details provided by Illinois Law Professor Richard Kaplan

The use of trusts has evolved from means of transferring property to mechanisms for managing assets and more recently, to will substitutes for avoiding probate and simplifying post-death transfers. But lawyers increasingly use revocable trusts in planning for possible client incapacity to avoid the costs and publicity associated with custodianship and guardianship. State-level reforms of trust law to accommodate older uses of these devices are not, however, well-suited to this newer use of trusts, and this lecture will examine those reforms in this context.

 

Professor Sitkoff was the youngest professor to receive a chair in the history of Harvard Law School. He previously taught at New York University School of Law and at Northwestern University School of Law. After graduated from the University of Chicago Law School with High Honors, he clerked for then Chief Judge Richard A. Posner of the United States Court of Appeals for the Seventh Circuit. Professor Sitkoff is an active participant in trust and estates law reform. He is a liaison member of the Joint Editorial Board for Uniform Trusts and Estates Acts within the Uniform Law Commission and has been a member of several drafting committees for acts involving trusts and estates matters. Sitkoff is also a member of the American Law Institute’s Council and has served on the consultative groups for the Restatement (Third) of Trusts and the Restatement (Third) of Property: Wills and Other Donative Transfers.

Word from Dick Kaplan is that Rob's  presentation will be available (eventually) via a recording, and his presentation will also be captured as an article in University of Illinois' Elder Law Journal

My students often ask why all casebooks can't be as engaging to read as the "Dukeminier" text on Wills, Trusts & Estates -- and I suspect one reason is that Rob Sitkoff, although uniquely prolific and gifted, is still only human and cannot write them all! 

Postscript:  I asked Rob to send me something other than his "official" Harvard photo.  The one above seems to capture his spirit and the smile I sometimes detect in his footnotes. 

March 6, 2015 in Books, Cognitive Impairment, Dementia/Alzheimer’s, Estates and Trusts, Health Care/Long Term Care, Programs/CLEs, Property Management | Permalink | Comments (0) | TrackBack (0)

Pennsylvania Bar Association Program on New Rules of Professional Conduct & Disciplinary Enforcement

On Wednesday, March 25, 2015 (1:30 to 3:30 p.m.), the Pennsylvania Bar Association (PBA)'s Elder Law Section is hosting a panel session at the annual PBA Section/Committee Day to discuss important changes in the Pennsylvania Rules of Professional Conduct and the Disciplinary Enforcement Rules. 

Several of the recent changes, including rules mandating greater oversight for trust accounts, timelier handling of complaints, and specific new prohibitions or restrictions on attorney involvement in marketing of "investment products," were a response, at least in part, to serious cases of attorney misconduct resulting in tragic financial losses for individuals.  In some instances the clients were older persons who entrusted large retirement assets to the care of a small number of attorneys. 

In planning the program, Elder Law Section Chair Jacqui Shafer commented that the program reflects the continuing commitment of the Bar and the Section to take affirmative steps to address and prevent misappropriation of funds from any client, including vulnerable seniors and their families.

Panelists include experienced private practitioners in elder law or estate planning practices and representatives of the Disciplinary Board and PBA's Legal Ethics and Professional Responsibilities Section.  Several participants were members of the Pennsylvania's recent Supreme Court Elder Law Task Force. 

Here is the link for more details on the program, including the link for required registration (free, including lunch).  The deadline for on-line registration is March 20.

March 6, 2015 in Crimes, Current Affairs, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, Ethical Issues, Legal Practice/Practice Management, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Thursday, March 5, 2015

ABA Webinars on Domestc Asset Protection Trust Planning

Yesterday I wrote about the Utah Supreme Court decision rejecting application of Nevada law to determine the nature of an asset protection trust.   Would the same result occur if the claimant was an "ordinary" creditor, rather than a spouse and co-settlor? 

One way to get in on the discussion would be the ABA's "Jurisdiction Selection Series" on "Domestic Asset Protection Trusts."  And as luck would have it, the next in the series of 5 webinar sessions covers Arizona, Maryland, New Hampshire --- and Nevada law.  The program is Tuesday, April 14, 2015, and will be followed by a session on June 9, 2015 covering Hawaii, Kentucky, South Dakota and Utah.  Here are some of the topics to be addressed:

  • What is an inter vivos QTIP trust and how can it help my clients?
  • Will domestic self-settled asset protection trusts benefit my clients?
  • Do the costs of creating a trust in one state for creditor protection or taxation benefits really outweigh the creation of such a trust in another?
  • Is the trust really protected from creditors?
  • Can the trust be used to avoid the income tax in the grantor's state of residence?
  • Can a same sex couple benefit from the use of these trusts?
  • Is using an offshore trust better?

A number of states have laws governing "full blown self-settled asset protection trusts" or permit some form of similar trust.  Here is the link to the details about registration, cost and timing for all of the ABA sessions.

Hat Tip to Penn State Law Professor James Puckett for sharing the timely info on this series.

March 5, 2015 in Current Affairs, Estates and Trusts, Ethical Issues, Property Management, State Cases, State Statutes/Regulations, Webinars | Permalink | Comments (0) | TrackBack (0)

Wednesday, March 4, 2015

Utah Supreme Court Rejects Attempt to Specify Nevada Law as Controlling "Irrevocable" Trust

In Dahl v. Dahl, the Utah Supreme Court was asked to examine the effect of a choice-of-law clause in a trust that purported to be "irrevocable." The clause provided:

"Governing Law. The validity, construction and effect of the provisions of this Agreement in all respects shall be governed and regulated according to and by the laws of the State of Nevada. The administration of each Trust shall be governed by the laws of the state in which the Trust is being administered."

The first sentence of the provision was significant, because the trust granted husband-settlor continuing rights of control, even as he argued the "irrevocable" label was valid, prohibiting wife from claiming any marital interest in assets used to fund the trust.

Continue reading

March 4, 2015 in Books, Estates and Trusts, Ethical Issues, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, March 2, 2015

The Economic Cost of Conflict of Interest for Advisors on Retirement Investments

The White House Council of Economic Advisors released "The Effects of Conflicted Investment Advice on Retirement Savings" in February 2015, and the report is a must-read for anyone teaching courses on aging policy. 

The major focus of the analysis is on evidence of  "conflicts of interest" for those advising individuals on roll-over investment of IRA accounts, but the findings undoubtedly have relevance beyond that window on retirement planning.

The decision whether to roll over one’s assets into an IRA can be confusing and the set of financial products that can be held in an IRA is vast, including savings accounts, money market accounts, mutual funds, exchange-traded funds, individual stocks and bonds, and annuities. Selecting and managing IRA investments can be a challenging and time-consuming task, frequently one of the most complex financial decisions in a person’s life, and many Americans turn to professional advisers for assistance. However, financial advisers are often compensated through fees and commissions that depend on their clients’ actions. Such fee structures generate acute conflicts of interest: the best recommendation for the saver may not be the best recommendation for the adviser’s bottom line.

The report focuses on the quantifiable cost from conflicted advice, concluding that savers receiving such advice "earn returns roughly 1 percentage point lower each year."  But isn't there also a deeper cost, as the large swath of middle-income Americans, who may have justified fears of being able to safely evaluate investment risk and their investment advisors, do nothing productive with their savings? 

The New York Times editorial board draws upon the White House Council's report to call for adoption of reality-based rules on fiduciary duties for the financial services industry.  See NYT's "Protecting Fragile Retirement Nest Eggs."   

March 2, 2015 in Consumer Information, Current Affairs, Ethical Issues, Federal Statutes/Regulations, Property Management, Retirement | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 10, 2015

Financial Decision-Making in Later Years

The Center for Retirement Research at Boston College has released a report, How Does Aging Affect Financial Decision Making? The introduction explains

 With the shift from defined benefit pensions to 401(k)plans, the welfare of retirees increasingly depends on their ability to make sound financial decisions. This situation has raised concerns that the cognitive decline that comes with age could compromise the elderly’s decision-making ability and thereby their financial well-being. This brief, based on a recent study,1 addresses this issue using a unique dataset that follows a group of elderly individuals over time. 

 The report is divided into four parts: literature review, data, analysis and conclusion. The conclusion paints an interesting picture

The findings confirm that declining cognition, a common occurrence among individuals in their 80s, is associated with a significant decline in financial literacy. The study also finds that large declines in cognition and financial literacy have little effect on an elderly individual’s confidence in their financial knowledge, and essentially no effect on their confidence in managing their finances. Individuals with declining cognition are more likely to get help with their finances. But the study finds that over half of all elderly individuals with significant declines in cognition get no help outside of a spouse. Given the increasing dependence of retirees on 401(k)/IRA savings, cognitive decline will likely have an increas-ingly significant adverse effect on the well-being of the elderly.

February 10, 2015 in Cognitive Impairment, Consumer Information, Dementia/Alzheimer’s, Property Management, Retirement | Permalink | Comments (1) | TrackBack (0)

Friday, January 9, 2015

Michigan Adopts New "Continuing Care Community Disclosure Act"

Michigan Governor Rick Snyder signed Michigan Senate Bill 886 and related bills (SB 887, 888 and 889) into law on December 30, 2014.  The new law is described as "an ongoing effort to continue to support consumer choice and protection while encouraging continued investments into vital care facilities" in the state of Michigan, focusing on continuing care retirement (CCRCs) and life care communities.

The law, titled the Continuing Care Community Disclosure Act, would appear to replace prior law, and thus it will be important to sit down with the new provisions and examine them carefully, especially given the announced reasons for passage. I'm guessing there might be some trade-offs here, with both consumers and providers having interests at stake. According to press releases, some of the "major" provisions of the new law include:    

  • A limit on amortization of the entrance fee to 1.5 percent for each month of occupancy
  • A requirement for any continuing care community to register with the Department of Licensing and Regulatory Affairs (LARA)
  • Setting a $250 registration fee and a $100 renewal fee
  • Organizations must report if any executive officers or director has been convicted of certain felonies
  • A feasibility study with a business plan must be included in each application
  • Exemptions from promulgated rules governing different types of facilities could be granted if the rules interfere delivery of care or with moving residents between different facilities
  • Regulations on the fees facilities may charge and how refunds are provided to potential and former residents
  • A continuing care community could petition for a guardian if a resident became incapacitated and unable to handle his or her personal or financial affairs

The legislation reportedly had the support of LeadingAge in Michigan.  I'm curious about the background on this new legislation -- perhaps some of our readers know the history and reasons for new laws here? 

January 9, 2015 in Health Care/Long Term Care, Housing, Property Management, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 6, 2015

N.M. Court of Appeals Rejects CCRC's Constitution-Based Claim for Charitable Property Tax Exemption

The New Mexico Court of Appeals recently rejected the claim by El Castillo, a Continuing Care Retirement Community (CCRC), for charitable property tax exemptions. I was particularly interested in this ruling, as I have visited the campus several times over the years, and have come to know many residents, who are some of the most active, socially aware seniors I've encountered. Just trying to keep up with 78-year old friends who are walking, walking, walking (at 7,000 feet) to their meetings can be a challenge.  The campus is very pleasant, quite modestly appointed, and fairly compact -- but perhaps most important of all, it has a terrific location.  I suspect that is a large part of the reason it is on the tax assessor's radar. IMAG0464-1_resizedThe campus is just a few blocks from the heart of beautiful Santa Fe and steps away from Canyon Road's art galleries. 

El Castillo has operated as a CCRC since 1971, with a Type A or "Life Care" structure, where residents age 65 and older pay non-refundable entrance fees, plus monthly service fees, with the expectation that all needs, whether in so-called "independent" apartments, assisted living units or nursing care, are provided on the same campus.  El Castillo is not associated with a particular faith nor with any fraternal organization, but it has operated since its inception under Section 501(c)(3) of the Internal Revenue Code, and thus is exempt from income taxes based on historical rulings that permit charitable tax exemptions for "homes for the aged."  However, as we have discussed in the past in this Blog, a state's standards for charitable property tax exemptions can be quite different than the IRS approach to charitable income tax exemptions. 

State and local governing bodies are constantly in search of tax revenues, and CCRC campuses, especially in urban locations, can be a tempting target.  Under New Mexico's state constitution, at Article VIII, Section 3, "all property used for educational or charitable purposes shall be exempt from taxation." Prior cases interpreting this provision did not require a facility to be operated "exclusively" for charitable purposes, but the landowner has the burden to show it operates "primarily and substantially for a charitable purpose."  

Key to the court's denial of the tax exemption was its observation that El Castillo appeared to operate as a self-sustaining unit funded entirely by fees paid by residents, with little or no "charitable" base.  The Court rejected El Castillo's argument that its charitable mission was to provide life-time care for residents who could (and sometimes do) become personally unable to pay, and that such a mission was only possible through "subsidizing" such residents by, in essence, pooling the fees paid by all residents. As demonstrated by contrasting rulings on property tax exemptions in other states, the financial analysis necessary to support a charitable use property tax exemption may require detailed analysis and advanced planning.  There is a fine line for any nonprofit to balance costs, sources of revenues and the goal of sustainability. In some instances, I have seen denial of property tax exemptions be the final straw for some nonprofit operators, especially those struggling with rising costs or occupancy rates after the 2008 financial downturn.

In New Mexico, there is both a constitutional basis for seeking a property tax exemption and a statutory basis.  The ruling on El Castillo -- which by the way, when translated from Spanish, means "The Castle" (a bit of irony perhaps, given the court's seeming hostility towards the exemption claim, pointing to the lack of "indigent" residents) -- was based only on the state constitution.  It appears the tax assessor actually failed to perfect his attempt to appeal a separate portion of the lower court ruling that had granted El Castillo the right to charitable tax exemptions on statutory grounds. Thus, it would appear that El Castillo would not immediately feel the effects of the Court's ruling, at least not for the specific tax years at issue in the multi-year litigation.   In a footnote, the Court of Appeals judges acknowedged that their decision on El Castillo creates a "dfferent result" than the same court's 2013 ruling on charitable property tax exemptions for a different life-care community, La Vida Llena, in Albuquerque, N.M.  The Court distinguished the La Vida Llena ruling as based only on statutory grounds.

For the complete ruling, including a complex jurisdictional issue, see El Castillo Retirement Residences v. Martinez, Case No. 31, 704, decided December 17, 2014.

January 6, 2015 in Health Care/Long Term Care, Housing, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 31, 2014

Maryland Court of Appeals Confirms Disbarment of "Elder Law" Attorney

On December 23, 2014, the Maryland Court of Appeals issued a detailed opinion explaining the disbarment of Attorney Michael C. Hodes, in proceedings initiated by the state's Attorney Grievance Commission. Hodes, an attorney with 39 years of experience, reportedly held himself out as concentrating his practice in estate planning and elder law. At the core of the charges against Hodes was "self-dealing," by improperly using money from a specific decedent's account and over $270,00 from a related trust account for his own needs.  He attempted to avoid disbarment, arguing that the sums should be characterized as a loan, that he had made restitution and his alleged misconduct was not in his role as an "attorney."

The Court concluded, however, that an attorney can be disciplined for violations of Rules of Professional Conduct, including conflict of interest, arising from conduct as an agent and trustee for an irrevocable trust created from assets from a decedent's estate, even if the attorney had been acting in a personal or non-legal capacity. 

Hodes argued as mitigation that he had an established reputation as a trustworthy and knowledgeable attorney, with no prior history of disciplinary sanctions, and pointed to his roles as an adjunct professor at two area law schools and his role as a regular commentator on "elder law" for the radio.  The court was unpersuaded, observing, "Yet, with all of his knowledge and experience in the practice areas of elder law and estates and trusts, Respondent displayed a remarkable lack of insight into his professional responsibility as an attorney and fiduciary. He continued to insist that he had taken a 'loan' of $270,000.00 from the Trust in order to pay personal bills, as if this form of self-dealing was acceptable."

The Maryland Court of Appeals also rejected Hodes' argument that the sanction of disbarment was excessive, as compared to prior disciplinary cases. The Court noted that to the extent the cases could be cited as permitting leniency for intentional misconduct, they "are no longer part of our modern attorney discipline jurisprudence."

For more, see here (Baltimore Business Journal), describing Michael Hodes' future plans. 

December 31, 2014 in Estates and Trusts, Ethical Issues, Legal Practice/Practice Management, Property Management | Permalink | TrackBack (0)

Monday, December 22, 2014

The Need for Granny Pads vs. "Parochial" Land Use Concerns

The amazing things you find when you start cleaning your office!  Here's a find.  Notre Dame Law Professors Margaret Brinig and Nichole Stelle Garnett wrote a great piece for The Urban Lawyer on what are sometimes called "granny pads," or more formally, "accessory dwelling units."  The authors track reform measures enacted in at least 12 states that either enable or mandate authority for such units, thus preventing local building or zoning limitations from restricting landowners to "one unit" per lot.  Additional reforms have occured at some municipal levels.  They point to experiences in California as a cautionary tale, however, suggesting that "local parochialism remains alive and well in American zoning codes, often buried in regulatory details that escape the attention of advocates and academics alike."

Here's a link to the full article, "A Room of One's Own? Accessory Dwelling Unit Reforms and Local Parochialism."    I'm embarrassed to admit this particular journal issue was on the 2013 level of my cleaning efforts.  Who knows what other gems may be hiding!

December 22, 2014 in Housing, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Friday, November 28, 2014

Maryland Court Affirms Criminal Conviction re Daughter's Theft From Father's Joint Account

In Wagner v. State of Maryland, decided October 30, 2014, the Court of Special Appeals of Maryland affirmed the conviction of a daughter on charges of theft and misappropriation as a fiduciary, arising from her withdrawal of funds from her father's bank account which she used for her own purposes.  The daughter had been added as a "joint owner" on the account by her 80+ year old father following the death of his wife.   

The issue as framed on appeal was whether a person can be guilty of theft from a joint account on which that person is named as a joint owner.  

The amount in controversy was more than $120,000 withdrawn by the daughter over 3 years. The appellate court concluded that "even though [the daughter] was named as a 'joint owner' in the parties' agreement with the bank, and not a convenience person, it does not determine conclusively that [she] was an [owner] for the purpose of the criminal statute." 

Several key facts supporting the conviction are described in the decision, including:

  • Testimony by the father at trial that the only reason he added his daughter's name to the account was to permit her to get money for him, if he was unable to get it for himself.
  • The father retained control over the checkbook for the account.
  • Evidence that thousands of dollars were withdrawn from the father's account by the daughter using a cash card, which the father said he was unaware existed.
  • The daughter had failed to make payments on a $85k mortgage taken out by her father on his home, which the father testified was a loan to his daughter to help her business, and not a gift as the daughter claimed. Notice of foreclosure on the home was apparently what tipped the father to ask questions about his finances.

Maryland has not, apparently, adopted the Uniform Multiple Person Accounts Act, (UMPAA, first approved 1989) which is intended to clarify the rights of depositors and other parties in jointly titled bank accounts.

Continue reading

November 28, 2014 in Crimes, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Property Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Tuesday, November 25, 2014

Factors to Consider In Determining Whether to Preserve Elder's Interest in Primary Residence

New Jersey Elder Law Attorney Linda Ershow-Levenberg outlines factual and legal issues to consider in deciding how to handle the family residence in a recent article for Experience, the ABA publication for the Senior Lawyers Division.  She warns that the "real trick is balancing [the clients'] financial security against the hopes of their heirs."

She begins by urging lawyers to resist a simplistic inquiry or "one size fits all" approach to elder law planning, stressing that lawyers should consider the impact of a proposed real estate conveyance on:

  • the elder's right to remain in the home;
  • a Medicaid application for either at-home or institutional services;
  • the income taxes of both transferor and transferee;
  • the elder’s financial and physical ability to remain in the home;
  • the elder’s estate plan; and
  • present and future liens and mortgages.

She observes that frequently an elder's "plan" to divide property equally among children or other heirs conflicts with the way in which property is already titled, noting that sometimes the choice of  co-owners or death beneficiaries was intentional.  "As often as not, however, the elder simply did not understand that beneficiary designations such as 'POD' (pay on death) or 'ITF (in trust for) control the disposition of an asset despite contrary instructions in the will."  Additional complicated and conclusive presumptions may exist, arising from the form of title for real property, that also may conflict with a will, thus triggering expensive challenges that could have been avoided with more comprehensive understanding of the client's estate.   

The article appears to be written for non-specialist lawyers, who are often asked to do "simple" estate planning that, in the wrong hands, can result in anything-but-simple outcomes for the family. 

Here's the link for more on "Preserving the Primary Residence: The Minefield of Real Estate Transactions in Elder Law Planning."

The theme of this issue of Experience is "Real Estate Issues Affecting the Elderly," and the issue includes discussion of the pitfalls of reverse mortgages, income tax liability connected to foreclosures, and "unique" property rights issues for seniors in Western states, including water rights.

November 25, 2014 in Estates and Trusts, Housing, Property Management | Permalink | Comments (0) | TrackBack (0)

Thursday, November 20, 2014

"City Sidewalks, Busy Sidewalks"... and the Importance of Safe Sidewalks

If you recognize the quoted language from the title above, you can imagine me humming the lyrics to "Silver Bells" as I type.  Perhaps we should add a new refrain.  As detailed in the Los Angeles Times piece on "Residents Celebrate the 100th Repaired Sidewalk in South L.A. District," safe sidewalks are important to everyone, but particularly to people who have mobility issues, including some older adults.  In the article, a stretch of deteriorated sidewalk outside an 84 year old woman's home prevented her for using her walker to get around her neighborhood. The challenge of accomplishing something as seemingly simple as this infrastructure issue, is demonstrated by the statistics in the article, showing there are 11,000 miles of sidewalks in L.A., and an estimated 40% are in need of repair. 

The question of how to pay for sidewalk repairs is significant for cities.  In Los Angeles, for example, policies on sidewalks can conflict with developers' preference for streets lined with trees.  Tree roots are often the cause of sidewalk damage.  For a number of years in the 70s, the city offered free repairs for sidewalks damaged by tree roots.  But as budgets tightened, public funding was withdrawn, and subsequent efforts to create alternative funding for sidewalk repairs have been controversial.

In my own small community, there is an ordinance that permits the governing body to mark sidewalks in need of repair with a big X (and for some reason they do so with pink paint), and the home or business owner has a fixed amount of time to make the repairs, or be subject to public repairs at a potentially higher price.  Obviously this approach won't work in every community -- and it is probably less than cost effective unless adjacent property owners work together to save money on contractors. 

By the way, while humming along on this topic, I discovered that there is a relevant, highly placed, law review article -- mostly dealing with sidewalk safety in winter weather -- published in 1897 in Yale's legal journal.  See "The Law of Icy Sidewalks in New York State," 6 Yale L. J. 258. In this article I learned the interesting historical fact, that at least in some jurisdictions of the day, "it is not negligence for a person to walk upon an icy sidewalk without rubbers." 

November 20, 2014 in Consumer Information, Current Affairs, Property Management | Permalink | Comments (0) | TrackBack (0)

Monday, November 17, 2014

Would Trustees' Investment in High-End Art Be Consistent with Fiduciary Standards?

We're discussing fiduciary duties for trustees in my Wills, Trusts & Estates course and perhaps that is why an article in the November- December issue of the ABA publication, Probate & Property, caught my eye.  The cover article is "Painting a Not-So-Pretty Picture: Art as an Alternative Investment in Fiduciary Accounts."  Author Michael Duffy, from Goldman Sachs, reports on recent eye-popping headlines for auction sales of artwork.  He  discusses the sales figures against the background of fiduciaries seeking better-than-conservative returns through use of alternative investments.  He outlines the tangible and not-so-tangible variables at the heart of art investment, leading to his thesis:

"It is the position of this author, however, that trustees should not be persuaded by the seemingly lackluster performance of their traditional investments reltative to these sensational headlines and that they should ignore the steady drumbeat of savvy marketers who have a vested interest in convincing them otherwise. There are simply too many considerations when buying and selling art that call into question the prudence of any such endeavor when undertaken by a fiduciary held to the highest investment standards under the law."

It is interesting to note that "absence of federal and state regulation" is one of the reasons for caution cited by this financial services author.

November 17, 2014 in Estates and Trusts, Ethical Issues, Property Management | Permalink | Comments (0) | TrackBack (0)

Sunday, November 16, 2014

Examining Maine's Unique Improvident Transfers Law (ABA Bifocal)

In the October issue of Bifocal, the ABA Commission on Law and Aging journal, the lead article examine's the history of Maine's Improvident Transfer of Title Act, 33 M.R.S.A. Section 1021 et seq., enacted in 1988 in an effort to better protect victims of undue influence and financial exploitation. BIFOCALSeptember-October2014_cover_jpg_imagep_107x141  As the author, Maine elder law attorney Sally Wagley, explains,

"For a period of time, the [proposed] bill continued to be unpopular with some sectors of the bar. This was ameliorated to some extent by elder law attorneys collaborating with real property lawyers to successfully propose a number of appropriate amendments related to transfers of real estate: (1) a provision which states that nothing in the Act affects the right, title, and interest of good faith purchasers, mortgagees, holders of security interests, or other third parties who obtain an interest in the transferred property for value after its transfer from the elderly dependent person; and (2) provisions affecting title practices, stating that the examiners were not required to inquire as to the age of the transferor and whether he or she had independent representation."

Has the law been useful in Maine?  Wagley concludes that in spite of continuing challenges, including the lack of resources to pursue claims and the effect of delays in litigation on elderly victims, the law's presumption of "improvidence" arising from certain "uncounseled" transfers, has had a deterrent effect.  She observes, "Knowledgeable attorneys now refer elders to outside counsel before assisting with a gift to family or others with whom the elder has a close relationship."

For more on Maine's law, see "Maine's Improvident Transfers Act: A Unique Approach to Protecting Exploited Elders."

November 16, 2014 in Consumer Information, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Property Management, State Statutes/Regulations | Permalink | TrackBack (0)

Wednesday, November 12, 2014

Should Estates Be Permitted to Sell Decedents' Body Parts, With Proceeds to Heirs or Beneficiaries?

Professor Reid Weisbord at Rutgers Law School - Newark has a new essay that takes on a challenging, two-part question: Whether a donor's estate should be permitted to sell a decedent's body parts or organs posthumously and whether the proceeds of such sales will be distributed to the donor's heirs or beneficiaries.  Professor Reid suggests an appropriate starting place is to define and provide for "anatomical intent" of the donor.  Before you start imagining vendors on Craigslist or at Sothebys, be advised the essay anticipates a regulated system.

You probably want to read more about this topic, correct?  See "Anatomical Intent" by Reed Weisbord from the November issue of Yale Law Review Forum.

November 12, 2014 in Advance Directives/End-of-Life, Estates and Trusts, Property Management | Permalink | Comments (0) | TrackBack (0)