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Case Law Update: Casterline v. Roberts

5/31/2012

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Earlier this month, Division II of the Washington State Court of Appeals issued a published opinion in the trust administration case of Casterline v. Roberts.  

The case involved an adult daughter who had been named as the trustee of her mother's revocable living trust.  She used her role as trustee to spend a large sum of her mother's money to purchase property and build a house for herself with the stated but never realized intention of having her mother live with her. 

Upon the petitioning of the mother's other children, a professional guardian was assigned for the mother who sought to put a lien on the house to recover the mother's money only to find that the daughter had already transferred the property and her other real estate to her husband and brother-in-law via quit claim deed for no consideration.  The court allowed the guardian to put the lien on the home anyway under a theory of fraudulent transfer and found that the homestead exemption did to apply to the home because it was bought with ill gotten resources.  The daughter appealed and the court upheld the lower court's decision.

While much of case focuses on the ins and outs of liens and exemptions, it also contains some good reminders about the meaning of fiduciary duty that can be helpful to anyone serving as a trustee or attorney-in-fact for a parent. 

It is not uncommon in our experience for aging parents to prefer to live with adult children if possible over living in a nursing home or other institutional setting and that often involves costs to the children that can properly be paid for by a trust or through a power of attorney but only with great care - which was not taken in this case.  The court found that if the daughter had really intended to have her mother live with her she should have segregated her mother's funds from her own and protected her mother's interest by providing her with a secured interest in the house - which would have prevented the very kind of self-serving transfer the daughter later engaged in.  While court isn't specific, it appears that to avoid the breach the trustee could have either put the trust directly on the title of the property to reflects its percentage investment or could have been given a promissory note backed by a deed of trust. 

Moreover the court makes it clear that any self-dealing and co-mingling of assets can be a breach of fiduciary duty that would result in a fiduciary being removed even if the money is eventually replaced as the trust suffers no losses.  All to often we find that people get "sloppy" with powers of attorney and revocable trusts because, unlike guardianship or court supervised trusts, there are usually not annual accountings or reports that need to be affirmatively produced for the court each year.  That lack of oversight is part of why these are less expensive ways to assist a disabled loved one but it should not be viewed as permission to cut corners by creating joint accounts, failing to keep keep funds segregated, or failing to keep adequate records of spending.  The facts of the Roberts case suggest that this fiduciary did not have her mom's best interests at heart and clearly should have been removed. But we have also seen very well intentioned and loving adult children get challenged and even removed from their parents' care because family conflict erupts and they have not bee doing a good job of keeping funds separate and accounted for.  

If you are serving as a trustee, attorney-in-fact or other fiduciary and what advice how to best protect you and your loved ones, please call us to schedule a consultation at info@phinneyestatelaw.com or (206) 459-1908. If you are concerned that you or a loved one is being taken advantage of by a current fiduciary and want to understand your options for responding, please contact us as well. 

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Case Law Update: Raven v. Department of Social & Health Services

4/2/2012

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Resa Raven v. Department of Social & Health Services (Washington State Court of Appeals Division 2, March 27, 2012), is a sad case that highlights in many ways the limits of guardianship to resolve care issues for seniors.  The case involves the neglect and death of senior under the care of a professional guardian.

The senior, referred to in the case only as Ida due to privacy issues, became bedridden after a fall in 1996.  Her condition declined and became complicated by dementia that lead her to believe that family members who were providing care were imposters.  Ida was uncooperative with care and evidence suggests that her family were unable or unwilling to properly administer pain medication and other care.  After numerous reports and a prior inconclusive investigation, in 2204 APS filed for guardianship and Resa Raven, a certified professional guardian was appointed as her limited guardian.  ”The trial court gave Raven authority to (1) consent to or refuse medical treatment and (2) decide who would provide care and assistance.”

Raven served as her guardian for 20 months.  Based on her historical and ongoing refusal to nursing home placement, Raven attempted to have her cared for at home.  Ida's refusal to cooperate with care along with doctor who quit and care agencies that lack staff to provide sufficient hours of care or who were unwilling to cooperate with orders for more regular turning lead to a further decline in health.  In the Winter storm of 2006, Ida was left unattended and declined further and died after a brief hospitalization.

After Ida's death DSHS charged Raven with neglect under the Abuse of Vulnerable Adults Act, RCW ch. 74.34.

The Court of Appeals described Raven’s duty to Ida: A court-appointed guardian owes a duty of care to her ward.  RCW 11.92.043(4).  Specifically, a guardian has a duty “to care for and maintain the incapacitated person in the setting least restrictive to the incapacitated person’s freedom and appropriate to the incapacitated person’s personal care needs, [and to] assert the incapacitated person’s rights and best interests.” RCW 11.92.043(4).

The court acknowledged Raven's duty "did not include guaranteeing effective care and treatment" but did include making every reasonable effort to provide the care Ida needed.  Raven argued that because the law does not allow involuntary detention in a residential treatment facility and mental health evaluators had refused to find Ida qualified for involuntary commitment she had not breached any duty.  The court found in "failing to aggressively pursue transitioning Ida from home care to residential care, Raven was not balancing Ida's wishes against her medical needs." The court appears to suggest that Raven's obligation was to convince Ida to go into residential care, find adequate in home care, or "step aside" and allow a more experience guardian to be appointed.

The decision made it clear that in negligence cases under the Vulnerable Adult statute it was not necessary to prove the neglect lead to the harm finding that the Act requires DSHS to prove a pattern of conduct resulting in a deprivation of care. But it plainly does not require DSHS to prove that such pattern of conduct caused Ida harm or that if Raven had offered an alternative care plan, Ida would have accepted it.. and that the standard was a mere preponderance of the evidence. 

There is much about Raven's handling of the situation that is problematic.  She was not making regular visits to Ida to fully assess the seriousness of the situation and try to convince Ida to reconsider residential care.  She did not make efforts to find staff to fill all of the care slots funded by DSHS when the care agency had inadequate staff to work all funded shifts or replace doctors and nurses that quit or replace health care workers who refused to comply with hospice orders on care because they disagreed with them.  But she also ran up against many problems that plague even the best of guardians.  Guardianship does not give the guardian the power to force a ward into residential care and many wards refuse to consent even when the issue is aggressively pursued.  Good in home care can be difficult to find or prohibitively expensive for wards who require round the clock care.  It is not uncommon for workers, facilities, and even doctors to refuse to continue to work when resources dry up, families are difficult, and wards are uncooperative and the guardian has little control over any of those factors.

The courts response to these very real structural problems with our society's resources and systems of care for the aging is to "agree that Ida’s case presented difficult problems. . . . [which] frustrates the very purpose of her appointment as Ida’s guardian.  When Raven reached the conclusion that obstacles were beyond her control, she should have stepped aside."

While every professional who works in the realm of guardianship hates to see a ward this vulnerable receive this little care or attention with this tragic result, we also need to recognize that there may be cases, even with the best of professionals, without good answers.  Everyone stepping aside may simply leave no one responsible and even less care for the ward. 

We regularly see cases where facilities, family, and friends seek a guardianship to try to force their loved one into residential care when they refuse.  It is often our job to explain that guardianship doesn't give them that power although it may give them more tools, such as financial control, to influence the ward.  With this case, we will also need to explain that if those tools don't work and a good in home plan cannot be created, they may need to step aside or face claims of negligence.  In many of these case what is needed is a plan to get the ward, if possible, to agree to care and get people in place with the legal authority to implement the plan.  That may not always be guardianship and may be best pursued through ADR outside the courts.

Another good take away message from the case is that guardians, when appointed, need legal representation.  In this case Raven was advised by the court to seek legal representation to address the issue and declined.  An attorney might have been able to assist her in petitioning for instructions from the court on how to overcome the challenges she faced, documenting her attempts to get Ida care, and ultimately helping her to resign if no solution could be found.  There are many volunteer family guardians operating without legal representation with even less access to community resources and understanding of their legal rights and obligations.  That may be unwise.  Assuming the duties of a guardian is not a small step and I think all guardians need some assistance from an attorney.  Failure to get help when needed can lead to legal liability for them and inadequate care for their ward.

If you would like to set up a consultation to discuss options for caring for a declining loved one or are a guardian needing representation to protect you and your ward, contact us at info@phinneyestatelaw.com or call us at (206) 459-1908.

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New Rules for Lay Guardians Go In To Effect July 22, 2011

7/22/2011

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At Phinney Estate Law we regularly represent friends and family members petitioning to become or serving as court appointed Guardians.  Because these people are serving as guardian for less than three people they are not required to be certified by the court and are referred to as "Lay Guardians."  Because of concern that lay guardians, especially those not represented by counsel, may fail to do all they are required to do in their position, the legislature has passed new rules for lay guardians that go into effect July 22, 2011.

The most significant of these new rules require that lay guardians have "expiring letters" meaning that the letter that gives them authority has an expiration date and must be renewed by filing the required annual or tri-annual reports.  King County and Snohomish County has already had this requirement for many years so guardians serving there will not see a change.

Another significant changes is that all lay guardians will be required to take an online video training about their responsibilities.  This new training is different that the video training already offered in King and Spokane County.  All new guardians will need to do the training before they are appointed and all serving guardians will need to retake it every time they submit their annual or tri-annual reports. 

There are other changes to court forms and 90 day reports but these are very similar to what is already done in King and Snohomish County and so should not be a change for guardians serving in these counties.

All current PEL clients serving as Guardians will receive instructions about these new rules and how to comply.  If you are not a current client and have questions about these new rules and how they will impact you, please contact us at info@phinneyestatelaw.com or (206) 459-1908.





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    PEL Blog

    This Blog is written by Seattle Attorneys Jamie Clausen & Michael Ballnik.
    It is made available for educational purposes only. Its purpose is to give you general information and a general understanding of the law, not to provide specific legal advice. Reading this blog does not create an attorney client relationship between you and Phinney Estate Law. Because each individual and family is unique, the Blog should not be used as a substitute for legal advice from a licensed professional attorney in your state.

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