Probate Code section 859, our subject in a recent post, packs a punch in California trust litigation. It awards double damages against someone who in bad faith wrongfully takes property from an elder, in bad faith takes property through undue influence, or who takes property through the commission of financial elder abuse.
While the
Mental capacity issues are commonplace in California trust and probate litigation. Jonathan Canick, Ph.D., who spoke last year at the Sacramento Estate Planning Council on the subject of “Aging, Cognition and Capacity,” graciously offered to share his thoughts with us here.
Dr. Canick has practiced neuropsychology for over 30 years. He is a member of the departments of psychiatry and neuroscience at California Pacific Medical Center, an associate clinical professor, University of California, San Francisco, and a member of the Board of Directors of Legal Assistance for Seniors, an Oakland-based nonprofit. He was a co-author of a research paper entitled “Reversal of Cognitive Decline in Alzheimer’s Disease” that was published in the June 2016 issue of the journal Aging.
What mental capacity standards apply in California civil litigation? Last month we presented on this subject at the Placer County Bar Association’s annual spring conference in Roseville. I’ll offer highlights here.
Short answer: it depends. The mental capacity standard varies depending on the setting. The policy rationale for the different standards is elusive, so as our clients present issues we focus on what standard governs instead of pondering why we have a hodgepodge of rules.
Stepmothers are frequent characters in California trust and estate litigation, as they are in fairy tales and Disney movies. With about half of all marriages ending in divorce, there are many stepmother/stepchild relationships. Mostly they work out fine, but some go south.
After blogging on sibling conflicts as a driver of trust and estate disputes, I offer thoughts today about the litigation I see between stepmothers and stepchildren. In Family Feud parlance, my personal survey says that step-parent relationships are a close second to sibling relationships as the setting of trust and estate litigation. I’ll focus on stepmothers here, though of course stepfathers also often clash with their stepchildren.
I’m a sibling lawyer. My career started early, as a middle child, and now continues as a Sacramento-based trust and estate litigation attorney. Most of my clients are grappling with sisters or brothers over the care and finances of aging or deceased parents. In Family Feud parlance, my “survey says” that sibling versus sibling is the top category of matchups in California trust and estate disputes.
Will this happen in your family? What leads siblings to litigate? In many of my cases, cracks in family relationships were evident long before anyone filed papers at the courthouse. But I’ve had many clients tell me they were always close to their siblings and “never saw it coming.”
Mental incapacity and undue influence are the most common theories used to try to invalidate wills, trusts and beneficiary designations in California and elsewhere. Occasionally, the subject in a trust and estate dispute has a thorough cognitive evaluation performed contemporaneously with his or her estate planning change. But, more often than not, the medical record is fragmentary.
In a prior post, we discussed the recurring issues that come up in cases involving Alzheimer’s disease. Dr. Charles Schaffer, a Sacramento forensic psychiatrist, recently sent me an article entitled “Protecting the Health and Finances of the Elderly with Early Cognitive Impairment,” published this year in the Journal of the American Academy of Psychiatry and the Law. The article focuses on mild cognitive impairment and early Alzheimer’s disease. The relatively subtle nature of these two medical conditions makes their impact on estate planning decisions hard to fathom.
Trustees in California trust disputes should not overlook the power of the constructive trust remedy as a way to recover errant trust assets. That’s a takeaway from Higgins v. Higgins (2017) 11 Cal.App.5th 648, an opinion in a trust litigation case published last week by the California Court of Appeal.
A Los Angeles Superior Court trial judge found a “clear moral obligation” on the part of Lupe Higgins to return several hundred thousand dollars to the Higgins Family Trust, but could not find a legal obligation, so the judge apologized to the Higgins family for being powerless to restore the funds. The appellate court did not like the sound of that music and came to the rescue, ruling that the trial court had discretion to compel Lupe to transfer the money to the trustee of the Trust.
New conservatorship cases in Sacramento County Superior Court have risen sharply over the past three years. Judge Steven M. Gevercer, who presides in Department 129 (the Probate Division), presented startling numbers at a March 21, 2017 lunch of the Sacramento County Bar Association’s Probate and Estate Planning Section. The panelists, including the judge and veteran court staff, spoke on “Issues Arising in Conservatorship Cases.”
According to Judge Gevercer, in Fiscal Year 2014 (ending June 30, 2014), there were 238 new conservatorship cases filed in Sacramento. The number rose to 287 new filings in Fiscal Year 2015 and 333 in Fiscal Year 2016. This amounts to a whopping 40 percent increase in conservatorship cases over the most recent three years.
Hired caregivers (also known as home care aides) permit many California seniors to remain in their homes as they age and need assistance with activities of daily living. Yet from my window looking out at Sacramento, I can see massive liability associated with the classification and payment of such workers. Consider that baby boomers are now entering their 70s and a 75-year-old American has a life expectancy of 12.2 years. A growing number of seniors will need help.
Let’s say Dad has advancing dementia, perhaps caused by Alzheimer’s disease, and needs round-the-clock caregivers to help with cooking, cleaning, toileting, and dressing. His daughter, perhaps as agent under his power of attorney or as a trustee of his trust, hires a home care agency, at a rate of $25-plus per hour, to provide multiple shifts of caregivers. Then one of the caregivers offers to work directly for Dad (and to bring in others to do the same) at a straight hourly wage of $15 per hour. This could save $250 or more per day, which will add up quickly as the weeks pass.
What’s wrong with this approach? Federal and California law likely treats caregivers as employees of the elders they serve. If the elder’s family ignores the assorted legal requirements associated with the employer/employee relationship, the elder (or his beneficiaries when he dies) may face hefty liability on two fronts. As we’ll briefly discuss below, tax authorities may seek taxes, interest and penalties. In a later post, we’ll explain how caregivers may sue for unpaid overtime and failure to provide meal and rest breaks – indeed, California law encourages such suits by awarding legal expenses to prevailing plaintiffs.
The Sacramento County Bar Association’s Probate and Estate Planning Section hosted its first ever “boot camp” program on trust and estate litigation on September 20, 2016. As an alternative to the monthly lunch programs, the Section offered a six-hour seminar at its office at 425 University Avenue in Sacramento. The program drew a full house of approximately 80 attendees, ranging from law students to experienced lawyers.
I presented on will and trust contests in California Superior Court and provide highlights from my talk below.