COA Sets the Record Straight on Priorities

This new published Court of Appeals opinion shouldn’t surprise anyone. The COA holds that where a professional guardian/conservator resigns, and the only adult child of the ward petitions to be appointed guardian and conservator, the probate court cannot appoint a new professional guardian and conservator unless it makes a finding that the child is unsuitable.  That’s because the child has priority to be appointed.  The fact that the probate judge by-passed the child and appointed a new professional fiduciary without such evidence was reversible error.

Click here to read In Re Guardianship/Conservatorship of Harold William Gerstler.

The facts are kind of fun: a devious Aunt, a lazy guardian ad litem; but in the end the COA simply reads the statutes regarding priority of appointments and applies them to the facts.

The only thing curious about this case is that it is published. But perhaps the timing of this publication tells us something.  Perhaps, just maybe, the COA is trying to clean up the confusion left from the recently published (and revised and republished) Brody case which said that the statutory priorities were “merely a guide for the probate court’s exercise of discretion.”  [Check out the post “Better Than Nothing?” for a discussion of that case.]

Significantly, the Gerstler opinion also adopts the position that the standard of proof necessary to by-pass a person with priority is as stated in the Redd case: a preponderance. [Click here to read “Seeing Redd”.]

So, when the issue of appointment of either a guardian or conservator is in play, a party with priority is entitled to appointment unless it is shown by a preponderance of evidence that they are not suitable. That means a probate court has to have a hearing and consider evidence to make this decision. I, for one, am glad that’s clear.

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The Imperfect Bandage of Undue Influence

A rant this morning. Something to think about over your Sunday morning coffee (or tea).

Our firm starts lawsuits involving vulnerable adult exploitation as much as anyone I suppose. And we almost always plead two things: incapacity and undue influence.  While in some cases the evidence may support the proposition that the person really was so cognitively impaired that they didn’t know what they were doing, most often that is not the case.  Most often we plead incapacity in order to introduce the idea that this person’s capacity was impaired to the point that it reduced the level of persuasion that would be necessary to overcome their volition = undue influence.

For those who practice in this area, they know how difficult it is to win a case on undue influence. You have to show that the victim was essentially a conduit through which the bad actor achieved their objective – that the free will of the victim was completely overwhelmed by the power of the undue influencer.  The so-called “presumption of undue influence” can be a help, but most court cases hold that the presumption, even where it is established, can be rebutted with nominal evidence.  In any event, the presumption is not the topic today.

My point (or argument) today is that we rely on undue influence because we don’t have anything better. We don’t have law that reflects the reality of the aging process today.

I have discussed the research of Dr. Lichtenberg before (see Peter’s Principles and Our Evolving Understanding of Exploitation). His work, and the experience of those of us who handle these cases, informs us that older people can be exploited because of circumstances that have nothing to do with cognitive impairment – that exploitation can occur simply because an older person loses their sense of control, dignity and/or empowerment.

These cases don’t fit well into any current legal theory. But the best we have is undue influence. Other legal theories like unconscionability, mistake, fraud  and constructive trust are available, but like undue influence, these theories are imperfect for our purposes.

The most promising development is the concept of a “vulnerable adult,” which recently entered the legal lexicon. It now appears in the criminal code and in policy for adult protective services workers.  But it has yet to find its place in the civil and probate world. Perhaps the concept of vulnerable adult exploitation will lead to new civil theories and remedies.  But we have to be mindful of what that would mean.

If we move the goalpost, as it were, from incapacity to vulnerable adult, are we going too far? There are good reasons that incapacity has served as the bright line for (1) court jurisdiction to invade the rights of an individual through a guardianship or conservatorship, and (2) as grounds for setting aside estate planning documents, deeds, beneficiary designations and contracts entered into by adults who are presumed to have the ability to understand what they are giving up and what they are getting in return.  Is it a good idea to reduce the proofs necessary for either or both of these outcomes?

Societal changes triggered by modern medicine and the resulting explosion of people living to an advanced age have come upon us quickly. The law evolves slowly, but evolve it must.  Elder law attorneys and probate litigators are struggling to find legal theories to adequately address the civil injuries impacting our clients and their family members.  Undue influence is an imperfect bandage, but for now, it’s the best we’ve got.

 

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Storm Clouds in Elder Law Land

It seems to me that we are living through what could be a case study on the way the law evolves to address a rapidly changing social environment. More people are living longer.  More people are experiencing age-related cognitive impairments.  At the same time family dysfunction seems to be the rule, not the exception.

As a result, the law in the arena of adult guardianships and conservatorships is experiencing stress and litigants are experiencing a high degree of instability with respect to the process and outcomes in the trial courts. Trial courts hardly know what to do with these cases. They need clearer direction.  The issues that are coming up are difficult and deeply personal, factually unique in each case.  The laws only offer general guidelines about how to resolve these conflicts.  It is time for our appellate courts to figure out how these laws can best be construed to provide just results notwithstanding the complex issues, and to make practical compromises to allow the system to work in larger counties. More laws, I think, are not the answer.

My thoughts on this topic were triggered by a recent unpublished opinion, In re Conservatorship of Janet Kapp (click on the name to read the case). The case itself is insignificant, but offers a good example of the issues that commonly arise in these matters – both in terms of the facts that are coming into court, and the legal challenges that trial courts are struggling to address.  But the problem has been festering for some time.  In fact, I wrote an article for the State Bar Journal several years ago on the topic: Adult Guardianships, the New Divorce (click on the name to read the article).  It was evident then that we were facing a storm, now it seems the storm has arrived.

The issues include:

What does a Court have to do before passing over a family member with priority and appointing a professional fiduciary?

What role does family dysfunction play in this decision? Is it good enough for the trial judge to say: “You all can’t get along, so I’m appointing someone from outside the family”?

What role does alienation of affection play? Where a family member keeps other family members away, is that per se a basis for passing over that family member, or must a court look into whether that decision is rationally based? [On this point it is interesting that legislation is being proposed to create a process to address family visitation rights for vulnerable adults.  Click here to read that proposed legislation.  I personally see this effort as well-meaning but misguided.  We don’t need more laws, and the process proposed by the legislation is, to my mind, unworkable.  Trial courts have this power now (click here to see blog post Seeing Redd, for instance).]

What role do existing estate planning documents play? In this new Kapp case we see the trial court simply blowing past the existing documents, based on a Guardian ad Litem’s conclusion that the older adults were probably impaired when they were signed.  Is that ok?

How much discretion do trial courts have in this context to avoid holding an evidentiary hearing?

In numerous unpublished opinions, the Court of Appeals has been all over the board on all of these issues. As for published opinions, in the last three years alone we have seen wild fluctuations from, for instance, the Bittner case (click here to read Bittner’s Bite) to the rather incredible legal conclusions reached in Brody (click here to read Another Brody Bombshell).  Trial courts need guidance, but we need to appreciate this guidance has to allow for practical implementation – a workable system.  It is one thing for an experienced and engaged trial judge in a small county to hold a two day (or more) trial on the issue of suitability, and another thing to tell larger counties with busy dockets and a high percentage of pro per litigants to do the same.

Some help may be coming. The Michigan Supreme Court has agreed to take up Brody, and the Probate Section of the State Bar has been approved to file an Amicus Brief (proud to say that Chalgian and Tripp has been retained by the Section to prepare that brief).  But I wouldn’t expect too much.  While this case opens the door to the MSC to address many of these issues, they are likely to offer only some direction on the narrow issues in the appeal.

Finally, there’s an old saying: “May you live in interesting times,” and I’ve always felt that one of the things I enjoy about my chosen practice area is that it’s changing so rapidly, and the law is struggling to keep up – which makes for interesting times indeed for those of us who work with aging issues and vulnerable adult exploitation in particular. But when I looked up the saying on Wikipedia, I found this explanation of the saying, which suggests I may want to temper my enthusiasm:

“May you live in interesting times” is an English expression purported to be a translation of a traditional Chinese curse. While seemingly a blessing, the expression is always normally used ironically, with the clear implication that ‘uninteresting times’ of peace and tranquillity are more life-enhancing than interesting ones, which from historical perspective usually include disorder and conflict.

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Seeing Redd

Here’s another important published opinion on the topic of adult guardianships. The case is about the removal of a guardian of an adult ward appointed under EPIC.

The case deals with the very common, and therefore very important, situation in which a guardian is using its position to undermine healthy family relations. In this case, the facts relied upon by the trial court and the COA are that the existing guardian was actively interfering with visitations, and taking steps to cause the ward to be distrustful of other family members.  These alienation cases go on all the time.  It is helpful to have an opinion that clarifies that such behavior is a basis for removal of a fiduciary.  It is likely that this case will be cited frequently where such facts arise, and I suspect that the finding that such behavior disqualifies a guardian will be offered by extension to cases involving conservators and other fiduciaries.  And that’s good.  We need this law.

So basically the trial court removed a guardian for the reason that he was undermining family relations, and the COA affirms. Click here to read In re Guardianship of Dorothy Redd.

In reaching its decision, the COA holds that the standard for removal is “suitable and willing to serve.” This finding is an important clarification of MCL 700.5310 which is silent on the requirement for removal.

The COA also finds that the standard of proof for removing a guardian for unsuitability is not clear and convincing evidence, but rather a preponderance. Interestingly, in reaching this conclusion the COA indicates that the standard for proving unsuitability in the initial appointment hearing is clear and convincing evidence.  This reading of the priorities in a guardianship proceedings seems inconsistent with the conclusions regarding priorities and unsuitability reached by a separate panel discussing these issues in the context of a conservatorship, as addressed in my other post of today’s date regarding In Re Conservatorship of Rhea Brody.

So, it’s a big day in the world of litigating guardianships and conservatorships. These two published cases (Brody II and Redd) will be cited in the future, each for their own important conclusions of law.  Probate litigation in the age of living to be 100, where the fun never ends.

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Roush II: The Plot Thickens

A little drama is stewing in the elder law world.

I wrote about the Roush case when it came out. Click here to read that post appropriately titled “This Could Get Interesting.”

Since then, the matter has been taken up by the Michigan Supreme Court. And the MSC requested that the Elder Law Section of the State Bar file a brief setting forth what they believe the correct result should be.  That was done.

Awkward. Now some of the very same Section Council members who voted for the brief to be submitted (or at least chose not to vote against it as it was unanimously approved), are wondering if they made a mistake – as other advocates in the aging community are suggesting that the position taken in the Section’s brief interprets the controlling law in a way that is less than stridently protective of individual rights.

No Man’s Land. The issue  – and it’s an important one – comes about because Michigan’s patient advocate designation (“PAD”) law has long been recognized as unique (surprising even) in its express direction that a person can revoke their PAD even if they lack capacity to make their own medical decisions.  That is, even after two doctors have triggered the patient advocate’s authority by certifying that the patient lacks the ability to understand the implications of their own medical treatment decisions, that patient may nonetheless revoke the authority of the patient advocate.  The question in Roush is:  So what then?  What happens during the period after a person who has been deemed unable to make their own decisions revokes the PAD – and before a Court can appoint a guardian (or at least decide if one is needed)?  Is the person to be given all their natural rights to accept or reject medical care, as any competent person would have?  Or are their rights frozen until a Court decides who is in charge – themselves or someone else?  What’s a hospital (or in this case, nursing home) to do?

Many advocates would say the rights of that individual are restored in full. But the Elder Law Section’s position, as argued in the brief, is that those rights are not restored until a Court says so.

The Section’s brief was prepared by our very capable colleague Jim Steward and his colleague Angela Hentkowski (a very excellent lawyer in her own right). Click here to read the brief.

Oral arguments are scheduled for March.

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Capacity to Gender Identify

Talk about cutting edge cases…

How about this one out of Jackson County: 60 year-old biological male with history of developmental disabilities and psychiatric events, decides he wants to become a woman. Family recognizes he has a history of gender confusion but believes that this recent push is the function of his trying to impress a certain caregiver and get attention – and that s/he doesn’t have the capacity to fully comprehend the implications of the decision.

The matter comes to court as a petition for a DD Guardianship, for an adult who heretofore has functioned independently with supports, but without a court appointed fiduciary.

This tees up the question: What is the standard for capacity to identify one’s own gender? Intuitively one would expect that capacity to gender identify would be one of the lowest standards in the law (like capacity to marry); but what if it is a passing delusion of a fragile mind? It entails serious medical implications and is irreversible.

Even better that the case was handled by two wonderful young lawyers: Chris Smith of CT’s Southfield Office, an officer of the Elder Law and Disability Rights Section of the State Bar v Rick Mills with Marcoux Allen in Jackson (and formerly of CT), a member of the council of the Probate and Estate Planning Section of the State Bar. The case was well pled and prepared on both sides.

Ultimately, the trial Court adopted the recommendation of the court-appointed expert to appoint a neutral guardian with specific instructions to investigate the extent to which the desire to transgender is fully appreciated by the man/woman who is the subject of the petition. Kudos to Dr. Lisa Ficker, psychologist out of the Wayne State University Institute of Gerontology for an excellent report.

Reasonable result. Great issue. Makes you think.

 

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This Could Get Interesting

The Michigan Supreme Court is considering a case involving the issue of a medical provider and Michigan law regarding surrogate decision-making. Specifically, Margaret Roush was a resident of the Laurel’s of Carson City, a skilled nursing facility. Click here for Court of Appeals decision.

Ms. Roush had nominated a patient advocate. On October 24, 2012, that nominated patient advocate agreed that Ms. Roush should remain in the facility’s care. However, a dispute arose as to whether that nominated patient advocate’s authority had been properly invoked (that is, whether two doctors had certified Ms. Roush unable to make her own decisions). The resulting retention of Ms. Roush continued until November 21. In the intervening period, two doctors did in fact find Ms. Roush unable to participate in her decision making, but additional medical evidence was also produced to support the proposition that Ms. Roush was capable of making her own decisions; and, importantly, on November 12, Ms. Roush formally revoked the existing patient advocate designation.

Ms. Roush was ultimately allowed to leave the facility, and died a short time later in her home.

The facility was sued for false imprisonment and intentional infliction of emotional distress, among other things, which claims arose out of the period during which Ms. Roush was forced to remain in the facility after the dispute arose, and after she revoked the patient advocate designation. The case was dismissed at trial court on summary disposition in favor of the facility/defendant. The Court of Appeals, in its unpublished decision, reversed the trial court, finding that sufficient questions remained to preclude summary disposition to the defendant. The Michigan Supreme Court is now considering whether or not it will review the decision of the Court of Appeals.

Wherever it goes from here, if nothing else, this case reminds healthcare providers of the sticky situations they can find themselves in when the laws regarding surrogate decision-making are not carefully adhered to. A few years back, many nursing homes were cited for failing to use the proper procedure to rely on a patient advocate’s direction. That is, they were commonly deferring to nominated patient advocates for medical decision-making, before and without having two doctors formally certify the patient as unable to make their own decisions. And all of this falls within a long history of the medical community refusing to accept the technicalities of the legal process whereby one person can make decisions about the care of another (surrogate decision-making).

 

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Striking the Balance between Dignity and Safety of a Vulnerable Adult

I realized the other day there are a handful of things I never tire of watching.  One of those is probate court proceedings.  Admittedly I watch probate court proceedings in part because I like to watch judges and get to know their propensities – always helpful for both the cases I have in front of them now and the cases I will have before those judges in the future.  But what really intrigues me about watching probate court proceedings is to observe how our society is dealing with the primary legal conflict associated with our aging population – that issue is: striking the balance between the dignity and safety of vulnerable adults. 
I advise clients on this balance every day.  The typical scenario is a parent who is in decline.  They are still in their home.  They want to stay there.  But the child has concerns as to the parent’s ability to stay in the home and be safe.  Sometimes the parent is compliant and agrees to having caregivers in the home, limitations on (or elimination of) their driving rights, and physical modifications to the home.  But in many cases these steps are either insufficient to provide safety or are simply rejected by a stridently independent (sometimes suspicious and paranoid) parent.  So the ball goes back to the child.  How concerned are they?  Are their concerns real, exaggerated, maybe even motivated by unhealthy family dynamics? In giving advice I often resort to the one-year rule discussed in another post on this blog.   But, to be sure, the answer is never easy, and as a result, many of these cases end up in Court.
The law in adult guardianship and conservatorship proceedings is heavily weighted in favor of protecting the independence and dignity of the vulnerable adult.  The standard for allowing the court to intervene involves at least two hurdles:  (1) Is the subject of the petition sufficiently impaired (for a guardianship the standard is whether the person is unable to make and communicate informed decisions, for a conservator the standard is whether the person is unable to manage their affairs); and even if the first threshold is met, the court must also deny the petition if (2) sufficient alternative protections are or could be put in place.  In addition to these difficult threshold issues that the court must decide, the burden in these cases is on the party seeking the guardianship or conservatorship and the standard by which they must prove the case is the highest standard in the law: clear and convincing evidence.  As should be evident, the law considers a court’s intervention into the life of a vulnerable adult as a very serious undertaking only to be allowed where no other result is adequate.  And for good reason, the imposition of a guardianship or conservatorship over an adult is an invasion by the state into the fundamental rights of that person. It essentially reduces an adult to the legal status of a child. 
Now here’s the reality.  Notwithstanding the barriers placed on judges, they appoint guardians and conservators with amazing regularity – a frequency which many advocates for the aged and vulnerable consider to be excessive.  This is because even though judges understand the law, most judges want to protect vulnerable people, they see that as one of the primary jobs of the probate court; and they certainly don’t want disasters to occur in situations where they had a chance to stop the disaster before it happened.  Cases like that can make them look bad.
Further, as I have observed before, it is important to realize that we are the first generation to deal with the issue of vulnerable adults in the volume that it currently exists.  Until now, people were not living with any regularity into their 80’s, 90’s and beyond.  As a result, the numbers of people suffering from dementia and other cognitive impairments associated with aging were nowhere near what they are today. And, at the same time, the families involved in these cases are more fractured today than in generations past. 
All this adds up to a fascinating dynamic which plays out in our probate courts on a daily basis, where petitions to take away the rights of older adults are being heard and where judges are being forced to strike a balance in each case between dignity and safety. Talk about the scales of justice, striking this balance requires the most delicate of touches.

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Holiday Presents from DC and Lansing

Lots to blog about in the aftermath of busy lame duck sessions in Washington and Lansing.  In order of importance:

  • The Fiscal Cliff Law.  Among the components of the so-called American Taxpayer Relief Act of 2012 (that’s original), is the permanent fixing of the federal estate and gift tax unified credit at $5 million per person ($10 million per married couple) indexed for inflation and with the continuance of portability of the unused credit of the first spouse to die.  The highest rate was increased to 40%.  Although this represents no real change in the law, it punctuates the reality that estate plans for the vast majority of Americans no longer require federal estate tax planning components.  Over the last 10-12 years we have seen the federal estate tax removed as consideration in planning for middle class clients.  Practitioners who have historically relied upon A/B trusts and federal estate tax avoidance of justification for the documents they promote are going to have to change their tune.  It’s over.

 

  • SOL on legal malpractice.  A long pursued objective of the Probate and Estate Planning Section became reality with the signing of Senate Bill 1296.  Now, a claim for legal malpractice expires at the earlier of 2 years after the claim accrues or six years from the date of the act or omission.  This is a big deal to estate planning attorneys who have documents that are created decades before they are tested. A big thanks to Senator Tonya Schuitmaker, who sponsored the bill (as well as her father, Harold, the esteemed probate attorney from Paw Paw); Mark Harter, the Section chair who finally got this done; and Becky Bechler, the Section’s lobbyist.  We are all forever in your debt.

 

  • Annuity Suitability.  Of all the seemingly well-meaning but largely pointless (sorry) “elder abuse” laws that have been floating around over the past couple years, the signing of Senate Bill 467 is probably the most significant.  The bill requires people selling annuities to establish the suitability of the product before making the sale.  In my humble opinion, inappropriate annuity sales to senior citizens is the primary source of financial exploitation of vulnerable adults – and has been for years.  This bill should provide the state, and civil litigators, more tools to go after the bad actors that operate in this arena.

 

  • Interstate Guardianships. Senate Bill 539 provides a process for a person appointed guardian in another state to become guardian in Michigan.  This law should be helpful in those few situations where this issue arises. 

 

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The One Year Rule

The “one year rule” is something I developed counseling clients about adult guardianships, and specifically, when, and if, to file.

It comes up in the following situations:

Client is an adult child of a demented parent.  Parent is in situation that causes child to be concerned about their safety.  Things like:

  • they are hoarding and the house is a fire trap,
  • the food in the house is rotten,
  • they aren’t taking their medications,
  • they are driving and creating a risk to themselves and others, as well as getting lost.

On the other hand, the parent is fiercely independent and bristles at the idea that they should consider moving into a safer environment or give up their driving privileges.

We discuss guardianship – that it will give the child the authority to place their parent in a more restrictive setting, but that it will involve a confrontational court process whereby the child asks the court to find that their parent is without capacity to make their own decisions.  Child waffles.  They want to protect their demented parent but don’t want to take away their dignity and force them to live out the remainder of their life unhappy, feeling imprisoned, and angry at the child who betrayed them.

I explain to the child that it is possible that if the parent is placed in a protective setting, they may adjust and become safe and happy in their new setting.  On the other hand, it is also possible that the parent will never adjust, will be completely unhappy, and will blame the child who put them there.

It’s a tough call.  I explain to the client: I am only a lawyer.  I can tell them how to create a guardianship, but the decision as to whether it is the “right thing” to do is beyond my pay grade.  I do however offer the “one year rule” which I have found helpful for other clients facing the same situations. It goes like this:

Project yourself one year from now.  Assume that you did not petition for guardianship and all of the worst scenarios you can imagine happen during this next year (your parent starts a fire in the house, walks outside in the cold and gets lost, etc.).  Will you feel (a)  I can’t live with the fact that I knew about the danger and did not take the steps to protect my parent when I had a chance; or (b) I respected my parent’s dignity and made a conscious decision to put his/her happiness above their safety, and I can live with that.

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