Friday, December 19, 2014

Pennsylvanians Face New Requirements for Effective POAs Written in 2015

Starting on January 1, 2015, Pennsylvanians have new rules that apply in order to create effective Powers of Attorney (POAs).  The changes are wrought by Act 95 of 2014, and were stimulated in large part by a case decided in 2010 that invalidated a POA that had been executed under suspicious circumstances.  We discussed the background here.

There are important, and sometimes subtle options for principals to consider in accepting or rejecting the "default rules" in the Act.  All of the changes were intended to provide better protections for principals from abuse by agents, but not all principals will want those protections, particularly if it means more risk of third-party intervention or oversight.  For an up-to-date and thoughtful summary of the changes and implications, read ElderLawGuy Jeff Marshall's recent blog post on "What You Need to Know."

For attorneys seeking the latest information on POA drafting and best practices, the Pennsylvania Bar Institute is offering several CLE programs around the state in January 2015.

December 19, 2014 in Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Saturday, December 13, 2014

Los Angeles Public Radio Affilliate Continues Discussion on Capacity and Consent

AirTalk, a program aired daily by Public Radio affilliate KPCC in Southern California, hosted a discussion about the issues identified in news articles about the Iowa criminal case, where a husband faces "statutory rape" charges for having sexual relations with his wife after she was diagnosed with advanced dementia and began residing in a nursing home.

Here's the link to a podcast of the December 12, 2014 segment.

December 13, 2014 in Cognitive Impairment, Crimes, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Health Care/Long Term Care, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Friday, December 12, 2014

Another Filial Friday: Rest Haven York v. Deitz

"Nonprecedential decisions" sometimes make me a little crazy.  Talk about them? Ignore them?  What if that's where all the action is happening on a tough topic? 

This time I think it is important to report a nonprecedential decision, one of the few to emerge from the appellate courts in Pennsylvania in recent years where sons or daughters are not held liable under Pennsylvania's filial support law, and thus were not required to pay for the parent's nursing home care.

In the case of Rest Haven York v. Deitz, Case No. 426 MDA 2014, the Pennsylvania Superior Court issued a nonprecedential memorandum ruling on August 22, 2014.   Mom resided in the plaintiff-nursing home for about two and a half years, and when she died there was an alleged unpaid bill of approximately $55k.  No details are provided in the opinion about why that debt accrued or whether Medicaid was used for any payments.  The amount is large enough to suggest something went wrong somewhere on the payment side of the ledger, but it also is not large enough to suggest that no payments were made.

The facility sued the resident's daughter, who was alleged to have "signed the admitting papers as agent under a power of attorney" executed by her mother.  The complaint, filed three months after the mother's death, alleged breach of contract, implied contract, unjust enrichment, fraud, "and breach of duty to support" under Pennsylvania's filial support law, 23 Pa.C.S.A. Section 4603.

Daughter was granted summary judgment by the trial court, dismissing the entire suit.  The only issue on appeal was whether the nursing home had "failed to provide evidence that could have allowed the trial court to declare [the mother] indigent." Indigency, an undefined term in the statute, is one element of Pennsylvania's filial support law. 

The appellate court rejected the daughter's argument that indigency must somehow be declared or established by a judgment before a family member's support obligation can be triggered.  However, the court also concluded that attaching a copy of the contract signed by the daughter, as agent for her mother, and attaching a copy of "overdue" charges on the mother's account did not suffice. Interestingly, the court then went on to offer a bit of a lesson on how nursing homes "could" prove their case -- so, a nonprecedential opinion with a moral?

"To present competent evidence to prove indigence, Rest Haven should have provided a bank statement or similar documentation attesting to [the mother's] financial condition." 

In giving this lesson, the court cited two very precedential cases decided by the same court, Healthcare & Retirement Corp. of America v. Pittas (2012) and Presbyterian Medical Center v. Budd (2003).

As I often say to family members or lawyers who are startled to read about filial support law obligations, Pennsylvania appellate courts take this law very seriously when it comes to unpaid nursing homes.  There are some defense strategies available, but a successful defense is not easy.    

December 12, 2014 in Health Care/Long Term Care, Medicaid, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Thursday, December 11, 2014

When Does Dementia Mean You No Longer Have the Right to Say Yes to Sexual Activity?

In August, I reported on criminal charges filed that month in Iowa, charging a husband with sexual abuse of his wife who was living in a nursing home. 

As a result of that post, I was invited by a reporter, who was working on an extended analysis of the case, to review certain information and records emerging from the case. Much of my own research is closely focused on issues both of capacity and protection.

The more one reads about the Iowa case, the sadder it seems.  Even though at first it seemed the husband, a state legislator, might be expected to have sophisticated legal knowledge of the implications of what it might mean for his wife to be diagnosed with dementia, it became pretty clear -- at least to me, reading from afar -- that the husband is a fairly simple guy: A farmer, high school education, part-time legislator who liked pig roasts and parades, and someone who cared deeply for his second wife, trying as hard as possible to see her as "just a little" impaired. 

I suspect that for many of us who have experiences with a loved one with dementia, there is a phase of denial, not just about the fact of dementia, but about the level of dementia. I remember one instance where a client always had her husband sign their joint tax returns, because even with Alzheimer's, he was "able" to sign his name clearly.   

Reading the statute used to charge the Iowa husband also gave me pause. Iowa Code Section 709 was the basis of the sexual abuse charges.  Sexual abuse in the third degree under Section 709.4 could be charged where a sex act "is done by force or against the will of the other person." That provision did not seem to apply.  Charges could also be brought where the act is between persons who are not cohabiting as husband and wife, "if any of the following" is true: "The other person is suffering from a mental defect or incapacity which precludes giving consent."

Section 709.1A of the Act defines "incapacitation" to include "mentally incapacitated" or "physically incapacitated" and neither quite seemed to apply.  Under Iowa law, "mentally incapacitated" means that a person is "temporarily incapable of apprising or controlling the person's own conduct due to the influence of a narcotic, anesthetic, or intoxicating substance."  And "physically incapacitated" means that a person has a bodily impairment or handicap that substantially limits the person's ability to resist or flee."

So, how was the husband charged?  He was charged under Section 709.4 (2)(a) on the grounds that his wife, with whom he was not "cohabiting," suffered from a "mental defect" that precluded giving consent.

So that makes the "elder  law" issue fairly stark: Has his wife's diagnosis of dementia, especially advanced dementia, prevented her from giving legally effective "consent?"

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December 11, 2014 in Cognitive Impairment, Crimes, Dementia/Alzheimer’s, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 10, 2014

Comparative Legal News on the CARE Act: A Report from Pennsylvania's AARP Family Caregiver Summit

Earlier this year, Kim Dayton reported in our Blog (here) about the new CARE Act, enacted in Oklahoma as a means to provide better transition from facility-based care to home care for individuals needing support.  The CARE Act is a nation-wide project sponsored by AARP and thus I was excited to be invited to participate in an AARP Pennsylvania Family Caregiver Summit, as part of the discussion about introduction and passage of a CARE Act in my state. 

The Summit was held yesterday with administrative agency heads, legislators and their staff invited to attend.  The turnout was probably a bit affected by the weather reports for the day.  (What happened to the predicted Nor'easter, anyway?  Not that I'm complaining about winter weather that proves to be milder than predicted!)  I found the event very interesting.  As so often happens, I ended up being more of a student than a teacher, even while serving as a panelist.

It was quickly clear that virtually everyone in the room had experience with or personal awareness of the challenges of serving as a family caregiver under stress.  The room was practically vibrating with stories about how tough it can be to know what to do when you confront the reality that a parent or other aging family member needs significant support.  The keynote speaker, Cate Barron, a vice president of the PennLive and Patriot-News media group and by her own admission a take-charge kind of gal, spoke with great candor and humor about the process of realizing that a "diagnosis" of what is wrong did not necessarily provide answers to her mother's need for assistance.  We are so pre-programmed to believe that if we can find the right diagnosis of the problem, there must be a "solution" worth pursuing.

The opening presentation by Glenn Fewkes from the AARP National office provided the latest statistics and graphics about aging in the U.S.  What I found especially interesting were his graphics about Long-Term Services and Supports (LTSS) for individuals with caregiving needs.  It turns out Pennsylvania ranks near the bottom (42nd, according to the most recent statistics) on a national scorecard. evaluating LTSS for affordability and access.  That means the state with the fourth "oldest" population has some real challenges ahead.

That is where AARP's CARE Act project comes into play as a first step to improve supports for individuals needing care.  As we reported earlier, CARE is an acronym for "Caregiver Advise, Record and Enable" and AARP's model has straight-forward objectives.  To me, a key goal in adopting the model CARE Act is to create smoother transitions.  This can be facilitated  by making sure that hospitals or rehab facilities have clear information about any designated "caregiver," that they give notifice of discharge at least 4 hours in advance,  and that they offer practical instruction on any medical tasks that will need to be performed in the home.  For example, under the model CARE Act, the instruction shall include:

  • a live demonstration of needed "after-care tasks"
  • an opportunity for caregiver and patient to ask questions
  • answers to the caregiver and patient questions "provided in a culturally competent manner and in accordance with the hospital's requirements to provide language access services under state and federal law."

My own research has shown that family members often cite "access to accurate information" as one of the most important first needs for families responding to caregiving crises.  The CARE Act is clearly intended to respond to a critical first window of need -- hospital discharge --  by requiring facilities to give useful information and relevant instruction.

During the Family Caregiver Summit, there were a lot of good questions about the CARE Act, and it was great to have Pennsylvania State Representative Tim Hennessey on the panel. In his role as majority chair of the House Aging and Older Adult Services Committee, it is likely he will be able to provide early analysis and support for the CARE Act in Pennsylvania. 

As part of my own preparation for the Summit, I took a closer look at Oklahoma's result with the CARE Act.   Title 63 Okla. St. Ann. Sections 3113- 3117 (the statutory provisions created by the April 2014 passage of Senate Bill 1536) became effective on November 1, 2014.  The law requires that  hospitals "provide each patient or patient's legal guardian with an opportunity to designate one lay caregiver" following admission, and to record the designated caregiver and the caregiver's contact information in the patient's medical record.  Such a choice then triggers the hospital to "request the written consent" of the patient or guardian to release medical information to the patient." Only if the patient both designates a lay caregiver AND gives "written" consent is the hospital then obligated to do anything further with respect to discharge planning with the caregiver.

But what happens in Oklahoma when the written consent to share information with the designated caregiver is given? 

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December 10, 2014 in Consumer Information, Current Affairs, Health Care/Long Term Care, State Statutes/Regulations, Statistics | 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.

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

Monday, November 24, 2014

Proposed Changes to Attorney Disciplinary Rules Follow Recent Theft Reports

Several high profile incidents, such as those reported here in our Blog and here by the Philadelphia Inquirer, involving attorneys disciplined or convicted of theft of client funds, have triggered proposed changes in Pennsylvania's Rules of Professional Conduct for attorneys. The rule changes proposed by the Pennsylvania Supreme Court's Disciplinary Board include:

  • imposing restrictions on an attorney's brokering or offering of "investment products" connected to that lawyer's provision of legal services;
  • clarifying the type of financial records that attorneys would be required to maintain and report, regarding their handling of client funds and fiduciary accounts;
  • clarifying the obligation of attorneys to cooperate with investigations in a timely fashion;
  • clarifying the obligation of suspended, disbarred, or "inactive" attorneys to cease operations and to notify clients "promptly" of the change in their professional status. 

The Disciplinary Board called for comments on the proposed rule changes, noting that although individual claims against the Pennsylvania Lawyers Fund for Client Security are confidential, "Fund personnel can attest that from time to time, the  number of claims filed against a single attorney will be in double digits and the total compensable loss will amount to millions of dollars."  The comment window closed on November 3. 2014.

In recommending changes, the Disciplinary Board noted common threads running through many of the cases, including:

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November 24, 2014 in Crimes, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, Ethical Issues, Federal Cases, Federal Statutes/Regulations, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Friday, November 21, 2014

Oral Argument Before Third Circuit on Use of Short Term Annuities in Medicaid Planning

On November 19, attorneys representing families and the Commonwealth of Pennsylvania argued consolidated cases before a panel of the Third Circuit Court of Appeals,  involving use of short-term annuities in connection with applications for Medicaid-funded care.  The argument follows appeals from a January 2014 decision on summary judgment motions by the Western District of Pennsylvania in the case of  Zahner et al. v. Commonwealth of Pennsylvania

A key issue on appeal is whether use of "shorter" term annuities is permitted by the language of federal Medicaid statutes referring to actuarially-sound annuities, or whether such use automatically constitutes a transfer of assets for less than fair value, and thus is treated as a prohibited gift.  HCFA Transmittal 64 is the subject of much of the very technical debate.

Here is a link to the recording of the oral argument.

The jurists on the panel are Judge Theodore McKee (the male judge's voice on the recording), Judge Marjorie Rendell, and Senior Judge Dolores Sloviter (the softer voice on the recording).  Interestingly, rather early in the argument, at least two of the judges interject to make the observation that "there is nothing wrong with Medicaid planning, per se," noting, rather, that the issue is the extent to which specific planning approaches have been directly addressed by federal law.

The attorney arguing the position of the appellant families is René Reixach; the attorney arguing the case for the state appellee is Jason Manne

Listening to the oral argument in this case provides an opportunity for students in advanced legal studies on asset planning to consider cutting edge legal issues and policy concerns.  The argument is also an opportunity for even first-year law students to discuss argument techniques, and to consider what does or does not work well with judges (and vice versa). It was a "hot" bench and there was a lot of interruption from both sides.  

November 21, 2014 in Federal Statutes/Regulations, Health Care/Long Term Care, Medicaid, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, November 17, 2014

PA Supreme Court's Elder Law Task Force Issues "Bold" Recommendations

On November 17,  2014, following more than a year of study  and consultation, the Pennsylvania Supreme Court's Elder Law Task Force issued a comprehensive (284 pages!) report and recommendations addressing a host of core concerns, including how better to assure that older Pennsylvanians' rights and needs are recognized under the law.  With Justice Debra Todd as the chair, the Task Force organized into three committees, focusing on Guardianships and Legal Counsel, Guardianship Monitoring, and Elder Abuse and Neglect.  The Task Force included more than 40 individuals from across the state, reflecting backgrounds in private legal practice, legal service organizations, government service agencies, social care organizations, criminal law, banking, and the courts. Pennsylvania Supreme Court Elder Law Task Force 2014 

From the 130 recommendations, Justice Todd highlighted several "bold" provisions at a press conference including:

  • Recommending the state's so-called "Slayer"  law be amended to prevent an individual who has been convicted of abusing or neglecting an elder from inheriting from the elder;
  • Recommending changes to court rules to mandate training for all guardians, including, but not limited to, family members serving as guardians;
  • Recommending adoption of mandatory reporting by financial institutions who witness suspected elder abuse, including financial abuse.

The full report is available on the Pennsylvania Supreme Court website here.  As a consequence of the Task Force study, the Supreme Court has approved the creation of an ongoing "Office of Elder Justice in the Courts" to support implementation of recommendations, and has created an "Advisory Council on Elder Justice to the Courts" to be chaired by Pennsylvania Superior Court Judge Paula Francisco Ott. 

November 17, 2014 in Consumer Information, Crimes, Current Affairs, Housing, State Statutes/Regulations, Statistics | 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)

Thursday, November 13, 2014

Does "Unlimited" Gifting Power in POA Protect the Agent from Criminal Liability for Self-Gifting? PA Appellate Court Says "No"

Following a nonjury trial in 2012, David Patton was convicted of 95 counts of statutory theft by unlawful taking, arising out of his use of a power of attorney (POA).  The POA named him as agent for his 86 year-old aunt.  At issue was more than $200,000. Patton appealed the conviction, alleging the POA that expressly granted him authority to make "limited or unlimited gifts," made it impossible for him to be held liable for theft by cashing checks and making withdrawals from his aunt's accounts for his personal use in 2008, 2009 and 2010. In September 2014, the Superior Court of Pennsylvania, an intermediate appellate court, issued a "nonprecedential" written opinion affirming the convictions, concluding:

"Simply stated, we reject Appellant's bold claim that the 'unlimited gift' provision in the power of attorney provided Appellant with a license to steal [his aunt's] assets and use all of her money for Appellant's own benefit. To the contrary, the gifting power was clearly subject to the condition [stated in a statutorily required affidavit signed by Appellant] that Appellant use the power 'for [his aunt's] benefit' - and Appellant clearly violated this condition when he took all of [his aunt's] money and used it as if it was his own. Therefore, since Appellant's actions were not authorized by the power of attorney, Appellant's sufficiency of the evidence claim necessarily fails."

In reaching this decision, the appellate court adopted the trial court's "meticulous" rulings as its own.  In the trial court's final order, the judge rejected the defendant's testimony that he had no awareness or notice that using the POA  to make the transfers in question was a crime.  The trial judge wrote: "He did not need to be notified in writing to know that he could be charged with theft for taking for his own personal use over $200,000 of [his aunt's] savings, using some of it to go gambling in Erie and depriving her of sufficient funds to pay for her nursing home care in her old age."

An additional interesting, and perhaps confusing aspect of the case, is testimony by the attorney who drafted the POA. 

When called by the defense to testify as "an expert" on powers of attorney, as well as a fact witness, the attorney testified he "always" included both "limited and unlimited" gifting authority in his POAs.  He testified he explained to the aunt that the broadly-worded POA enabled the agent to "do anything that she could do." On direct examination, he testified the gifting language was "completely unconditional." 

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November 13, 2014 in Crimes, Estates and Trusts, Ethical Issues, Legal Practice/Practice Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, October 27, 2014

Debating Fiduciary Duties and Resident Rights in Continuing Care Communities

Last week I was part of a panel hosted by the National Continuing Care Residents' Association (NaCCRA) in Nashville, a component of the larger (much larger!) annual meeting of LeadingAge.  The theme for the panel was "Resident Engagement in Continuing Care Life" and for my part of the panel, I used an interesting Third Circuit bankruptcy court decision, In re Lemington Home for the Aged, to discuss whether residents of financially troubled CCRCs should be treated as entitled to enforce specific fiduciary duties owed by the CCRC owners to creditors generally, even unsecured creditors, fiduciary duties that may give rise to a direct cause of action connected to "deepening insolvency."  NaCCRA LeadingAge Meeting October 2014

Jennifer Young (pictured on the left), a CCRC resident, talked about what it is like to "be" an unsecured creditor in a CCRC's Chapter 11 bankruptcy court proceeding.  Her explanation of how creditors' committees operate in bankruptcy court (including how they hire legal counsel and how that counsel is paid out of the Debtor's estate) was both practical and illuminating.  The closing speaker on the panel was Jack Cumming (below left). Jack's has deep experience as an actuary and a CCRC resident.  He noted the disconnect between the intentions of providers and the realities faced by residents and called for stronger accountability in investment of resident fees.Jack Cumming October 2014  I always come away from my time with Jack with lots to think about. Our moderator was NaCCRA president Daniel Seeger (right), from Pennswood Village in Pennsylvania.  Dan Seeger October 2014

In my final comments, I reminded our audience that even though our panel was focusing on "problems" with certain CCRC operations, including some multi-site facilities, many (indeed most) CCRCs are on sound financial footing, especially as occupancy numbers rebound in several regions of the country.  Both panelists and audience members emphasized, however, that for CCRCs to be able to attract new residents, the responsibility of the CCRC industry must improve.  For more on these financial points, go to NaCCRA's great educational website, that includes both text and videos, here.

Interestingly, during the LeadingAge programming that began on Saturday, October 18 and continued through October 22, I was hearing a lot about a potentially major shift in the long-term housing and service market.  Some of the largest attendance was for deep-dive sessions on new service models for "Continuing Care at Home," sometimes shortened to CCAH or CCaH.  CCAH is often seen as a way for more traditional CCRCs to broaden their client base, particularly in the face of occupancy challenges that began with the financial crisis of 2008-2010.  

As a corollary of this observation about market change, one of the topics under debate within the leadership of LeadingAge is whether Continuing Care Retirement Communities need a new name, and I can see movement to adopt a name that aligns better with the larger menu of non-facility based services that many providers are seeking to offer. 

Of course, as a law professor, I wonder what these market changes mean for oversight or regulation of new models.  Not all states are keeping up with the changes in the Continuing Care industry, and name changes may complicate or obscure the most important regulatory questions.       

October 27, 2014 in Current Affairs, Ethical Issues, Federal Cases, Health Care/Long Term Care, Housing, Retirement, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Sunday, October 26, 2014

Filial Liability + Bankruptcy = Trouble

As regular readers of the Elder Law Prof Blog may recognize, I reside and work squarely in a zone where "filial support claims" are more than just theoretical propositions.  Pennsylvania continues to be Ground Zero for modern complications arising from use of a Colonial era law that permits adult children to be held liable for the cost of an indigent parent's long-term care. 

The latest example is In re Skinner, 2014 WL 5033258, decided by Bankruptcy Judge Madeline Coleman in the Eastern District of Pennsylvania on October 8, 2014.

The issue is whether one sibling can prevent another sibling from "discharging" any obligation to pay an assisted living facility for their mother's care.  Both brothers were sued by the facility, resulting in a default judgment against one brother (Thomas) for $32,225, who in turn sought discharge of that debt in bankruptcy court.  Brother William, probably facing the prospect of picking up the full tab for his defaulting brother, initiated an adversary proceeding, seeking to prevent the discharge.   The court concludes that Brother William "lacks standing" to prevent Brother Thomas' discharge of the debt to the assisted living facility.

In dismissing Brother William's claim, the Bankruptcy Judge addresses both the Uniform Fraudulent Transfer Act and Pennsylvania's filial support law.  According to the opinion, Brother William alleges that Thomas used a Power of Attorney executed by their mother in 2007, to access her bank accounts in a "scheme [with his wife] to use the Mother's assets, including her interest in long-term care benefits, to fund approximately $85,000 of their personal expenses." However, the court concludes that even accepting the truth of allegations that "suggest that the Mother was injured by the [Thomas'] conduct, that conduct was directed at the Mother and her property. The conduct was not directed at [William]."  The Bankruptcy Court also rejected any theory of "derivative standing."  

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October 26, 2014 in Current Affairs, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, Federal Cases, Health Care/Long Term Care, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 16, 2014

PA Attorney Disbarred After Ten Years of Involvement In "Living Trust Scams" Targeting Seniors

Following several months of investigation of complaints from older adults and their family members, in 2004 the Pennsylvania Attorney General announced a civil suit against an array of companies and individuals, including several attorneys, alleging their participation in a scheme to defraud through sales of unnecessary revocable living trusts and unsuitable annuities and insurance products. The alleged target was "senior citizens age 65 and older."

Ten years later, one of the Pennsylvania attorneys named in that original investigation, Brett B. Weinstein, has been disbarred.  This particular disciplinary action has been a lo-o-o-o-ng-time coming.

Beginning as early as 2000, the Pennsylvania disciplinary board received complaints about Weinstein's role in the sales by non-lawyer third-parties of so-called "living trusts," often packaged with high-priced annuities.  Weinstein himself rarely met with the clients, and provided little in the way of legal advice or counseling.  He was formally cautioned about his use of unsupervised non-lawyers to provide legal advice and in 2001 he entered into a written Assurance of  Voluntary Compliance. 

The conduct, however, apparently did not stop.  An undercover investigator was used to document continued problems.   In recommending disbarrment, the Disciplinary Office concluded that from 2002 to 2012, acting on his own and in concert with others, Weinstein "assisted sales and delivery agents for a series of estate planning companies  in the un-authorized practice of law." Further, he engaged in "false and misleading conduct, failed to consult with his clients concerning their objectives and placed his own interests above his responsibilities to his clients."

In discussing the case against Weinstein and rejecting his attempts to justify his conduct, the Disciplinary opinion points to a long-history of concerns about attorneys involved with living trust "mills" in other states (including Colorado, Missouri, and Ohio), where the products are pushed on older persons with little or no analysis of the clients' real legal needs and specific financial circumstances. Read here for the complete Disciplinary findings and the PA Supreme Court Order dated July 28, 2014.

September 16, 2014 in Consumer Information, Elder Abuse/Guardianship/Conservatorship, Estates and Trusts, Ethical Issues, Legal Practice/Practice Management, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, September 15, 2014

Tailoring Powers of Attorney: Beyond the Minimum Statutory Requirements

One of our great readers, attorney Paul Meints from Bloomington, Illinois, has shared ideas about how to make Powers of Attorney (POAs) more responsive to practical concerns, including  the possibility that when tough times eventually occur, the principal may fail to realize or recognize his or her own waning abilities, including the ability to drive safely.  Here is language Paul has tailored to address these potential concerns:

Inability to Function as Principal; Inability to Operate a Motor Vehicle in a Safe and Proper Manner:

My successor Agent or My Attorney may execute and deliver an Affidavit that I am unwilling or unable to serve or to continue to serve, and such affidavit shall be conclusive evidence insofar as third parties are concerned of the facts set forth therein, and in such event any person acting in reliance upon such affidavit shall incur no liability to my estate because of such reliance.  The decision as to determining my inability (1) to properly, prudently, and fully function as Principal and/or (2) to operate a motor vehicle shall be made by a Committee consisting of three of the persons [or such person’s designee] named on page one together with one other person selected by my attorney or the family committee.  I authorize all health care providers who may have provided, or be providing me with any type of health care (physical and mental), to disclose all direct or Protected Health Information (HIPAA/PHI) to each member of the family committee.  If, in the Committee's sole and ab­solute judgment, I am so incapacitated by reason of illness, age, or other cause that I am incapable of expending funds for my own use and benefit or am not giving prompt attention to my financial affairs,  then my successor agent is authorized to act on my behalf.  If, in the Committee's sole and ab­solute judgment, I am so incapacitated by reason of illness, age, or other cause that I am incapable of operating a motor vehicle in a safe, proper, and prudent manner, then my successor agent, My Attorney, or both are authorized to release and terminate my driving privileges.

I like the fact that this language realizes that not all agents will feel comfortable making decisions on sensitive matters by acting alone, and that the POA actually provides guidance for how to make an ulitimate decision about the principal's inability to handle finances or drive. In essence, this POA would appear to permit the agent to override the principal's resistence. Thanks for sharing this language, Paul.  Reactions from other readers?  Would your state recognize the vailidity of such language? 

September 15, 2014 in Cognitive Impairment, Estates and Trusts, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Monday, September 8, 2014

Anyone Can Be a Victim of a Scam...Anyone.

We all know how prevalent financial scams are, and that they are becoming more and more sophisticated. One of my colleagues, and dear friend, forwarded an email to me purportedly from his financial institution-and the email had the correct last 4 #s of his credit card!  He promptly contacted the financial institution because it looked so authentic, only to find out it was a scam.  The institution insisted there was no data breach. He promptly closed that account. I'm sure you have had similar experiences, or know someone who has (every semester I ask my students whether any of them have been victims of identity theft. Unfortunately, there is always at least one).

Governing ran a story a couple of weeks ago about state efforts to combat financial scams that target elders. The article, States Fight Financial Scams Aimed at Seniors,  quotes Mary Twomey of the National Center on Elder Abuse, that the advancement in fighting scams is happening at the state level. For example, the article indicates that in 2014 "lawmakers in at least 28 states and the District of Columbia introduced legislation addressing the issue. Some measures focus on enhancing criminal penalties. Others target caregivers who exploit elderly charges. Some require financial institutions to report suspected exploitation."

We all know the dearth of statistics makes it a challenge to really understand the magnitude of the problem.  The article quotes some studies with statistics, including a recent one from the Journal of General Internal Medicine "that found that one in 20 older adults in New York state reported that they had been financially exploited, usually by a family member, but sometimes by a friend or home-care aide."

The article also reviews some of the innovations in certain states, such as Colorado which requires training of law enforcement to recognize exploitation and abuse, with each department required to have a minimum of 1 trained officer by 01/01/2015;  and North Carolina, which allows "courts ... to freeze the assets of a defendant charged with financial exploitation of a senior or disabled adult, if the victim has lost more than $5,000."

September 8, 2014 in Consumer Information, Crimes, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Friday, August 29, 2014

Kaiser Health News: Will Calif. Governor Sign Legislation Limiting Medicaid Estate Recovery?

From Kaiser Health News (in partnership with NPR and Capitol Public Radio):

"A bill passed by the California legislature this week is putting Gov. Jerry Brown in a delicate position: Sign the measure and support consumer demands for a change in the state’s policy on recovering assets from Medicaid enrollees or keep the current system that generates about $30 million used to provide Medicaid benefits to more residents.

 

The governor typically does not comment on bills until he receives the actual text from the legislature. His Department Of Finance, however, opposes the bill, pointing out that the recovered assets help the state provide services to others. The bill that just passed the legislature this week, would prohibit the state from trying to recoup some of the money spent on older Medicaid enrollees for ordinary health coverage by recovering assets after they die.

 

Federal law requires states to recoup money spent on institutional care, such as nursing homes, by Medicaid, the state-federal health care program for low-income people. But it also allows states to recover costs from people after they die if they received basic medical services through Medicaid at the age of 55 or older. 

 

In California, advocates of the bill say the current law is complicating enrollment in Medi-Cal, the state’s Medicaid program, with some people refusing to sign up, and others terminating enrollment for fear of not being able to pass on their estate.The state has enrolled 2.2 million people into Medi-Cal under the Affordable Care Act."

For more, see "Calif. Bill Would Protect Estates of Many Who Received Medicaid."

 

August 29, 2014 in Estates and Trusts, Medicaid, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Thursday, August 28, 2014

The Latest Ruling on "The Most Litigated Will In History"

Pennsylvania has a long and colorful history with charitable trusts and bequests coming from wealthy entrepreneurs, including the histories of The Barnes Foundation and The Hershey Trust, both of which have generated "classic" cases studied in law school courses.

This week, a Philadelphia Court of Common Pleas (the trial level court) issued the latest decision on the Stephen Girard Trust from 1831, the "painstaking details" of which created Girard College.  For much of its existence Girard College functioned as a multi-year, residential boarding school program for orphan boys.  Past court cases have resulted in rulings that permitted significant "deviations" from the terms of the wealthy philanthropist's will, including admission of minority students, female students, and expansion of the definition of "orphans" to admit students who still had one living parent.

At issue now is whether the trustees (actually a "Board of City Trusts" created by statute in 1869 to administer trusts left to Philadelphia for charitable purposes) will be permitted to further "deviate" from the settlor's original vision for the school, in order to create a more "financially sustainable" model. 

Despite the long history of changes, leading the court to describe Stephen Girard's will as "the most litigated will in history," the court treated the latest proposals -- elimination of the residential program and "high school" classes -- as triggering a stricter standard of review, under the doctrine of cy pres:

"This Court does not agree that the requested modifications relate to administrative provisions of Stephen Girard's Will.  The design of Girard College as a boarding school, intended to provide a residence, as well as an education to its students is reflected in the very terms of the Will....

 

Rather than an administrative decision, this Board [of City Trusts, acting as trustees] is seeking a cy pres remedy.  This doctrine, unlike administrative deviation, is applied where a change is sought to the purpose of the trust.... Divorcing the residential aspect of Girard College and the high school program from a Girard education is inconsistent with the very terms of the Will and the directions of the testator.

 

The cy pres doctrine, now codified,... permits this Court to approve a change in the terms of a Trust to direct it to purposes that are as close as reasonably possible to the settlor's original intent and that are possible to fulfill.  The cy pres doctrine cannot be invoked until it is clearly established that the direction of the donor cannot be carried into effect."

After reviewing the evidence about the operating finances of Girard College, the court takes the time to commend the trustees "for beginning to confront the myriad of financial, educational and institutional challenges currently facing Girard College."  Nonetheless, the court concludes that based on the financial information it  "cannot permit the Board to modify the Will of Stephen Girard as requested.... This Court cannot treat those proposed changes as administrative deviations and will not apply the cy pres doctrine absent a showing that achieving those objectives is impracticable."

In addition to the discussion that clearly distinguishes the law of "deviation" from "cy pres," the outcome is also notable because:

  • The court had earlier rejected "standing" for a Girard College alumni group that sought to oppose the proposed changes;  
  • The changes were denied despite the fact that the Attorney General, who has statutory standing to enforce terms of charitable estates in Pennsylvania, had apparently declined to take action;
  • The court appointed an individual to serve as "amicus curiae" to examine and report on the Trustees' proposal to modify the trust terms and the individual's recommendations were clearly important to the ruling. 

Pennsylvania Attorney Neil Hendershot (and Dickinson Law alum)  who represented the Girard College Alumni Association, and who alerted me to this interesting decision, has additional details on his Pa Elder, Estate and Fiduciary Law Blog.  Thanks, Neil!

Whether the trial court's decision will be appealed is not yet known. 

And by the way, as evidence of the long litigation history of the Stephen Girard Trust, this latest ruling is filed under what appears to be the original -- or at least a very early -- Orphan's Court docket number: "O.C. No. 10 DE of 1885." A docket number that lasts 129 years? Impressive.

August 28, 2014 in Current Affairs, Estates and Trusts, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Sunday, August 24, 2014

State Legislator Charged with "Sexual Assault" of Wife In Complicated Nursing Home Case

We've reported several times, including here and here, on recent academic and professional publications that address the sensitive topic of "consent" to sexual relations for individuals residing in nursing homes. 

The Huffington Post and other media reports now bring the topic into the general public realm with coverage of a complicated case emerging in Iowa, where a husband has been arrested on charges connected to sexual relations with his wife, a resident with Alzheimer's, in her nursing home room. 

Two items that may be critical to the outcome of the case: Alleged "notice" to the husband by the facility that his wife was no longer legally able to give consent to sexual relations, and the identity of the husband as a public figure. The fact that the husband is a state legislator is a reason why the case may get wide news coverage.  But that wider coverage could also generate important discussion and debate about the deeper legal, personal and public issues.  From one article:

"An Iowa legislator who allegedly had sex with his mentally incapacitated late wife has been charged with sexual abuse. Henry Rayhons, 78, a Republican state representative from Iowa House District 8, was told by medical staff on May 15 that his wife, 78-year-old Donna Rayhons, no longer had the mental ability to consent to sexual activity, according to a criminal complaint obtained by WHO-TV. Donna Rayhons, who suffered from Alzheimer's disease, had been living in Concord Care Center in Garner, Iowa, since March, according to the Des Moines Register....

 

In an interview with law enforcement in June,Rayhons allegedly confessed to 'having sexual contact' with his wife, according to KCCI. He also allegedly admitted that he had a copy of the document that stated his wife did not have the cognitive ability to give consent. Rayhons was charged with third-degree sexual abuse on Friday.

 

Elizabeth Barnhill, executive director of the Iowa Coalition Against Sexual Assault, told the Des Moines Register that even though spousal rape has been illegal in Iowa for about 25 years, arrests for the crime are rare and 'convictions are even rarer.' Barnhill also noted that sexual assault between spouses is not considered a 'forcible felony' in Iowa."

According to new sources, the family has also made a statement

August 24, 2014 in Cognitive Impairment, Crimes, Dementia/Alzheimer’s, Elder Abuse/Guardianship/Conservatorship, Ethical Issues, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)

Pennsylvania Commission Urges Reforms for Long-term Care Services & Supports

The Pennsyvania Joint State Government Commission issued a final report of its Advisory Committee on Long Term Care Services and Support for Older Pennsylvanians on August 21, 2014, following a year-long assessment of existing concerns of independent and care-dependent elders in Pennsylvania.

In a one-page summary of the 200 page report, the Commision makes the following Recommendations:

"Opportunities exist to improve system structure and organization, reduce barriers, and break down silos that characterize service delivery and payment. Better care transitions and improved coordination of service providers are also crucial, along with increased support for family caregivers. Focused information and awareness for consumers and families helps ensure they know where to turn when a crisis hits, which is often their first exposure to long term care. Expanding access to services and supports, through a tiered system that shares costs, will help improve quality and increase accountability. Enhancements to local resources, including Area Agency on Aging networks, will focus services and advance more equal community, facility, and home care options. These reforms will help ensure access to long term care for all Pennsylvania seniors, and prevent those who need assistance but don’t qualify for supports, from falling between the cracks."

Now comes the hard work . . . getting to an implementation stage.

August 24, 2014 in Health Care/Long Term Care, Housing, State Cases, State Statutes/Regulations | Permalink | Comments (0) | TrackBack (0)