Guardianships

November 8, 2011

Estate Disputes Should Be Avoided But Sometimes Never End

The New York Probate Lawyer Blog has reviewed many instances and issues regarding estate litigation, Will contests and disputes among heirs and beneficiaries. Sometimes controversies begin before a person dies when they become ill and incapacitated. Relatives and friends can abuse or breach fiduciary obligations in attempting to control a person’s finances before death. Guardianship Proceedings, which are provided by Article 81 of the New York Mental Hygiene Law, are just a rehearsal for the battles that occur concerning assets and Wills after death. Westchester and Manhattan Guardianship attorneys, as well as guardianship lawyers throughout New York, have seen these disputes time and again.

An example of such pre-death contests appeared with regard to the actress Zsa Zsa Gabor. As reported in an article in Estate of Denial by Andy and Danielle Mayorals dated June 25, 2011, pre-death fighting between Ms. Gabor’s husband (her ninth) and daughter revolved around each arranging for her to re-write her Last Will and the sale of her home and personal property.

Even after death occurs controversy regarding a decedent’s estate and affairs can go on for years. It was recently reported by Daniel Kreps in Amplifier on May 6, 2011 that the estate of the late rock and roll star, Jimi Hendrix, was commencing a lawsuit over the ownership of master recordings made during concerts in 1969. Jimi Hendrix died on
September 18, 1970.

Another pending lawsuit involving the ownership of rights to the musical legacy of country singer, Jim Reeves, was reported in an article by Anita Wadhwani in The Tennessean on November 2, 2011. Jim Reeves died in 1964. However, none of the above appear to rival the almost daily notoriety surrounding the death of Michael Jackson.

A recent article in the AARP Bulletin by John F. Wosik on October 19, 2011 entitled “A To-Do List for Estate Planning” provides a brief guide for some estate planning considerations that may help avoid disputes. Among the items discussed are:
(1) A “Health Care power of attorney” known as a Health Care Proxy in New York. This document will specify the persons who can make health care decisions for you in the event you are unable to do so yourself.
(2) A “Financial power of attorney“. This document will specify the persons who can make property management decisions for you when you are unavailable or unable to do so. The terms of the Power of Attorney can be limited and specifically defined according to your desires.
(3) “Wills and Trusts“. These documents provide the foundation of your instructions and reflect the manner in which you want your property disposed of after death. Additionally, proper estate planning through Will and Trust provisions may provide appropriate tax benefits.

Consulting a good New York Estate planning and Guardianship attorney may help avoid the Surrogate’s Court litigation that seems to forever encompass some estates. In view of the complexity of issues often involved in property and business ownership, breaches of fiduciary duty and beneficiary rights, disputes among family members and third parties are probably inevitable.

September 27, 2011

World Alzheimer’s Month Good Time to Plan for Comprehensive New York Estate Planning

by Jules M. Haas

September is World Alzheimer’s Month, calling attention and awareness to this devastating disease. It is also a time to reflect on how we should all be planning to help older family members and friends who have yet to get a handle on their estate plans.

In some cases, a Manhattan guardianship attorney must be called on to help ensure that an elderly relative who has dementia is properly cared for. Mental Hygiene Law Article 81 in New York allows for the court to appoint a guardian to assist a person who is incapacitated.In an emergency, the court can appoint a temporary guardian to manage the loved one’s affairs while the court reviews the matter.

Forbes.com reports that someone develops Alzheimer’s disease every 69 seconds in the United States. By 2050, more than 13 million Americans are expected to have the disease, spending $1 trillion on medical and long-term care costs. The September awareness campaign calls attention to find a cure and better ways of treating the illness.

Typically, medical treatments and care plans are likely a family’s most pressing issues for their loved ones with Alzheimer’s. Also important to consider is how well the family members are progressing as caregivers, and possibly setting up in-home or assisted living care for the person. A living will may also be necessary to allow for the care of a loved one who becomes incapacitated. End-of-life decisions can be laid out.

Active planning brings peace of mind that everything will be taken care of as the needs arise. Dissension among family members after your passing can be minimized and the process can reduce stress for all involved.

In still other cases, a will is contested in New York. Protecting the integrity of a will or challenging the disbursement of an estate requires an experienced law firm.

As we recognize the need for research, and the need for improved treatment and care options for those stricken with Alzheimer’s, getting serious about estate planning is a proactive step we can all take.

September 1, 2011

New York Power of Attorney Issues Overlap Guardianship and Estate Matters

by Jules M. Haas

Brooklyn and Nassau estate attorneys, as well as those assisting their clients throughout all parts of New York State, are often confronted with a myriad of issues relating to Powers of Attorney, Health Care Proxies, Article 81 Guardianship and estate settlement.

In a typical situation, an individual may have prepared a Last Will while at the same time preparing a New York Power of Attorney and a Health Care Proxy. The New York Probate Lawyer Blog has previously discussed the importance of preparing advance directives such as a Power of Attorney and Health Care Proxy by which others can be appointed to handle a person’s property and health care issues in case of illness or incapacity.

All parties involved in these matters should be particularly aware that agents appointed in a Power of Attorney and Health Care Proxy have similar fiduciary duties to act appropriately as do Court appointed fiduciaries such as Article 81 Guardians and Executors and Administrators. In many instances, questionable conduct by these lifetime agents may end up being reviewed by a Court in a Guardianship Proceeding or in proceedings in the New York Surrogate’s Court after the appointing person dies. Issues regarding property transfers, expenditure of funds, and the change of names or beneficiaries on bank accounts, life insurance and retirement funds can result in disputes that overlap lifetime and post death periods.

A recent lawsuit entitled Kaufman v. Kaufman, in New York State Supreme Court, New York County, provides an excellent example of the problems and issues that can arise in these situations. Kaufman involved two brothers, Allen and Kenneth, both of whom were appointed as agents in a Power of Attorney by their father, Hyman. Allen and Kenneth were also Co-Trustees under family trusts. Hyman, who had suffered a brain injury, had been in a nursing home for a number of years.

Allen petitioned the Court for an accounting and requested among other things, that Kenneth be removed as attorney-in-fact under the power of attorney and as a trustee for violating his fiduciary duties. As recounted by the Court, Allen claimed that Kenneth was “refusing to share financial information, failing to provide a complete record of financial transactions, and using Hyman’s assets for personal and business purposes.”

Following a review of the parties assertions, Justice Donna Mills in a decision dated August 4, 2011, directed Kenneth to provide an accounting of his activities pursuant to New York General Obligations Law Section 5-1505. This Statute, entitled “Standard of Care: fiduciary duties; compelling disclosure of record”, requires in paragraph 2(3) an agent under a power of attorney “to keep a record of all receipts, disbursements, and transactions entered into by the agent on behalf of the principal and to make such record and power of attorney available to the principal or to third parties at the request of the principal”
It is apparent that issues involving fiduciary duties and the safeguarding or misuse of assets can overlap from the lifetime stage to a post death estate settlement controversy. Suppose Hyman had died prior to the resolution of the Supreme Court case. In such event, questions regarding the propriety of Kenneth’s acts might need to be resolved in the Manhattan Surrogate’s Court as part of the administration of Hyman’s estate.

I have counseled clients, both fiduciaries and beneficiaries, in many situations similar to those raised in Kaufman. The appointment of lifetime agents, as well as executors and trustees, requires thorough consideration and the problems faced by the fiduciaries and those whose interests they are protecting can arise and require resolution in many different forums.

July 22, 2011

Using Mental Hygiene Law Article 81 to Protect Family Members Key in New York Counties such as the Bronx and Westchester

by Jules M. Haas

It seems like every week you hear a story on the news or read in the newspaper about an elderly person who suffers physical abuse, either by a caretaker or family member. Sometimes the person victimized is handicapped or otherwise dealing with challenges in life.

Sadly, it often takes law enforcement intervention to protect these adults. But there is another type of abuse in New York that sometimes goes unreported and it involves people who try to take advantage of a person’s finances.In other cases, an older adult is simply no longer capable of handling his or her own affairs. In still other situations, a parent of an adult child with mental or physical challenges wants to make sure he or she is cared for after the parents pass on. A New York Guardianship Attorney can assist in such cases via New York’s Mental Hygiene Law Article 81, which allows for the appointment of a guardian to handle a person’s financial affairs or personal needs. The New York Probate Lawyer Blog has discussed many aspects of Guardianship occurring throughout New York in counties such as the Bronx and Westchester.

A special-needs trust may also be established to ensure that an adult child is cared for. Too often, parents will purchase life insurance for this purpose, not realizing that a lump sum settlement can make an heir ineligible for social security, Medicaid or other vital government programs.

People will sometimes use the lure of money and the instability of an elderly adult’s mental state to try to take advantage. But New York State laws provide opportunities to stop this type of injustice.

Under Mental Hygiene Law Article 81, there are certain guidelines that set forth factors a judge will take into consideration when deciding to appoint a guardian and the powers that guardian will have. This can be a litigious process, with family members arguing about whether a guardian should be appointed or not. But it also offers more protection than a power of attorney, which grants legal authority, sometimes broadly, to act on a person’s behalf and can be easily abused.

An interesting case in New York where these issues have been brought up is the case of heiress Huguette Clark, the 104-year-old who was a recluse but who had homes and assets worth hundreds of millions of dollars.

Her case is fascinating not only because she was worth millions of dollars, but also because she didn’t live an all-out lifestyle. Ms. Clark lived mainly in hospital rooms. Her case is also not unique because distant family members allege that her attorney unlawfully solicited a $1.5 million gift from her in 2001, as previously discussed in the New York Probate Lawyer Blog.

Knowing and understanding the tools of guardianship proceedings and the ways to help an incapacitated person can assist you and your family in protecting loved ones and ensuring they are properly cared for, either in their old age, or after you pass on.

In situations like these, an experienced guardianship lawyer is necessary to assess a case and determine the best course of action. The last thing a person expects is for the wealth and assets they’ve acquired over their life to be squandered by a fraudster. If they are being taken advantage of, they deserve someone to intervene on their behalf.

June 2, 2011

New York Article 81 Guardians Face Complex Issues

by Jules M. Haas

The New York Probate Lawyer Blog has discussed many issues concerning New York Article 81 Guardianship proceedings. These issues included the appointment process for a Guardian and the powers that are given to a Guardian by the Court.

Section 81.02 of the Mental Hygiene Law (MHL) provides that the Court may appoint a Guardian with regard to an individual’s personal needs and/or property management. Once appointed, the Guardian faces an array of issues in carrying out his or her fiduciary duties and obligations.

Initially, a Guardian must follow the directions and limitations provided by the Court Order appointing the Guardian. MHL Section 81.20(a)1 provides that “a guardian shall exercise only those powers that the guardian is authorized to exercise by Court order.” MHL Section 81.21 provides a detailed list of the powers that a Court “may” give to a property management Guardian and MHL Section 81.22 provides a list of powers that “may” be granted to a Guardian for personal needs. The Court can limit or expand these powers as necessary.

When exercising his or her powers, the Guardian owes a fiduciary responsibility to the incapacitated person. As stated in MHL Section 81.20 (a)(3) “a guardian shall exhibit the utmost degree of trust, loyalty and fidelity in relation to the incapacitated person.”

Since a Guardian is accountable for his or her acts, extreme caution and diligence should be exercised by the Guardian, particularly when faced with difficult or complex situations. These situations arise with regard to both personal needs and property management. Ultimately, a Court may approve or disapprove of the Guardian’s conduct.

An example of a complex issue facing a Guardian regarding the personal needs of an incapacitated person arose in the Matter of Northern Manhattan Nursing Home, decided by Justice Laura Visitacion-Lewis (Supreme Court, New York County) on April 26, 2011 and reported in the New York Law Journal on May 26, 2011. In Northern the incapacitated person was a 92 year old man suffering from terminal cancer, dementia and hypothyroidism. The prognosis was that he would not live for more than 6 months. The Guardian had asked the Court for authorization to withhold consent to the insertion of a feeding tube and treatment for the cancer and to sign Orders of Do Not Resuscitate and Do No Intubate. Following a hearing and a review by the Court concerning the incapacitated person’s end-of-life preferences and the provisions of the New York Family Health Care Decisions Action Section 2994-d(5), the Court granted the Guardian the authority to proceed as it had requested and withhold consent to further treatment and to sign the DNR and DNI.

The Northern case shows the seriousness and complexity of decisions that a Guardian may encounter. Having an experienced New York Guardianship attorney is important to provide a Guardian with guidance in exercising powers and obtaining Court directions and appointment. I have represented many family members and Guardians in these matters.

Unlike Northern, where the Court allowed the Guardian to proceed after a review of a request for authorization, a Court can admonish a Guardian who acts without or outside of his or her authority. This was the situation in Matter of Roy W. Lantigua, Jr. decided by Justice Betsy Barros (Supreme Court, Kings County) on March 31, 2011 and reported in the New York Law Journal on April 22, 2011. In Lantigua, after review, the Court denied a Guardian commissions and surcharged him for improper conduct. Among other things, the Court found the Guardian engaged in self-dealing and conflict of interests and expended guardianship funds improvidently. Thus, the outcome in Lantigua is in striking contrast to that in Northern where the Court pre-approved a proper request for a Guardian to pursue a certain course of conduct.

May 31, 2011

Huguette Clark Case Should Get Interesting If Will is Contested in New York Court

by Jules M. Haas

New York Probate Lawyer Blog has already touched on the fascinating case of 104-year-old heiress Huguette Clark, who died recently in New York City.

What makes the situation unique is that Clark, who inherited a giant fortune from her father, a copper baron and one of the richest Americans at the turn of the 20th Century, was a recluse whom people rarely saw. She died at a hospital, where she lived for at least the last two decades, MSNBC.com reports. Now it is likely that her contested will could play out in the news, requiring an experienced New York City probate attorney to sort out the details.News reports of her reclusive lifestyle, despite owning an estate in Santa Barbera, Calif., a country house in New Canaan, Conn., and a 42-room apartment on Fifth Avenue in New York City in total valued at $225 million — none of which she lived in — led to a criminal investigation into how her affairs were being handled by a New York City attorney and accountant. No charges have been filed and both men told news agencies they handled her financial matters according to her wishes.

Last fall, family members went to a New York court asking that a guardian be appointed to look after her assets and well-being after the accountant and attorney banned them from visiting her, MSNBC reports. The attorney has admitted to soliciting a gift of $1.5 million after the Sept. 11 terrorism attacks to safeguard his daughter living in Israel, which may be a violation of New York ethics rules.

Huguette Clark’s father was a Montana senator at the turn of the century, who struck it rich in copper and real estate. Huguette was only briefly married and never had children. Although she inherited her father’s wealth, according to news reports, she rarely used it. Huguette was secluded in hospitals, even when she was healthy. She was guarded by fake names and paid servants.

Many fear the potential for estate fraud and undue influence where an elderly woman who is fabulously rich is being shut off from family members and giving millions of dollars to the people controlling her estate. The probate process is designed, in part, to ensure that an estate is not plundered.

Prior to death in similar cases, Article 81 of the New York State Mental Hygiene Law can come into play. Adult guardianship in New York applies when family members believe an older family member cannot manage his or her personal or property affiairs on their own or is susceptible to being victimized by others.

It’s important to be represented in Article 81 Guardianship matters by an attorney with decades of experience handling these types of cases. This area of probate and guardianship law in Manhattan and throughout the New York City Courts is complex and it is important to consult with an attorney with the knowledge and experience to assist you through the process.

April 20, 2011

New York Article 81 Guardianship Can Involve the Settlement Of Property Rights Between Spouses

by Jules M. Haas

The New York Probate Lawyer Blog has discussed many issues regarding Guardianship of the person and property of an incapacitated person. These issues can include, among other things, a determination of the assets owned by the incapacitated person and the powers granted to a Guardian with regard to the management of such property. Section 81.21 of the New York Mental Hygiene Law (MHL) sets forth various property management powers that a Guardian may be given by the Court.

In the many guardianship proceedings in which I have been involved, it was always essential to have a full understanding of the incapacitated person’s property so that the Court could be requested to provide proper authority for the management and/or disposition of the property in a final order. For example, it may be desired that property be transferred to a spouse or special needs trust so that the incapacitated person may qualify for governmental benefits such as Medicaid. Another consideration may be the long term support of the incapacitated person’s family. Section 81.21(a) 2 of the MHL allows the Court to provide an order directing that guardianship funds be used for such support.

The variety of property dispositions that occur in these proceedings are endless. In a recent case, In Re Donald L.L., 916 N.Y.S.2d 451, decided by the Appellate Division, Fourth Dept., on February 10, 2011, the Court upheld a Stipulation of Settlement entered into between a husband and the Guardian for his wife.

The Stipulation provided that the husband and wife would live separately, that their marital property would be divided between them as agreed, and that the husband would pay the wife maintenance and support. The Court found the agreement to be valid although it was not based upon the concept of equitable distribution involving the applicability of the Domestic Relations Law.

Proper estate planning with the help of a New York Estate Planning Attorney, including the preparation of a Last Will and Living Trust and advanced directives such as a Power of Attorney and Health Care Proxy, may avoid the necessity of a guardianship determination of incapacity. However, a good New York Guardianship attorney is needed when such proceedings can help a disabled person and his or her family deal with property management issues and personal care decisions in the absence of alternative planning.

March 21, 2011

New York Decedent’s Burial Can Be Complicated By Conflicts Between Family Members and Guardians

by Jules M. Haas

The New York Probate Lawyer Blog has previously discussed issues regarding the rights of relatives to make burial decisions regarding a decedent. New York Public Health Law Section 4201 entitled “Disposition of remains: responsibility therefore”, provides a framework for this decision-making by essentially giving priority to a decedent’s spouse and closest living relatives in descending order to determine disposal of the remains.

Notwithstanding the statute, a person may put into place his or her desires by pre-paying for a funeral or cremation, purchasing a burial plot or otherwise expressing in a Last Will certain desires or preferences.

Of course, situations constantly arise when survivors, whether relatives or fiduciaries such as guardians, have conflicting ideas as to the disposal of the decedent’s remains. Such was the situation in The Matter of Louis V.P., which was decided by New York State Supreme Court Justice Joel K. Asarch on February 22, 2011. In this case Louis V.P. was determined to be an incapacitated person under Article 81 of the New York Mental Hygiene Law. Guardians for his personal needs and property management were appointed. When Louis died at age 86, his sister, Vita, wanted Louis to be cremated. Vita was also a co-guardian of Louis’ property. However, Louis’ niece, Grace, who was Louis’ personal needs guardian, desired that Louis be buried in the cemetery burial plot that he had purchased approximately 35 years ago.

After considering all of the evidence, the Court noted that the desires of a decedent “regarding the disposition of his or her own remains are paramount….” The Court thus ruled that Louis was to be buried in the burial plot he had purchased since that was the method he apparently intended.

In another recent burial controversy reported in the New York Post on Thursday, March 17, 2011 by William J. Gorta, “Brooklyn heirs burned in cremation flap“, a Court ruled that a decedent’s third wife could not sue a funeral home and cemetery for having a decedent’s remains cremated at the direction of the decedent’s fourth wife. Apparently, the family was unaware of the fourth marriage.

Family conflicts can take many forms following a decedent’s death ranging from burial directions to Will contests and identification of distributees through kinship proceedings. I have represented clients in New York to help them resolve these issues and protect their family’s rights.

March 10, 2011

Undue Influence In Changing Life Insurance Beneficiary Can Be Difficult to Prove

by Jules M. Haas

The New York Probate Lawyer Blog has previously discussed the naming of a beneficiary on a life insurance policy or other asset such as a pension or retirement account. Upon a person’s death, these assets are paid directly to the named beneficiary (assuming the beneficiary is surviving) and are not part of the probate or intestate administration.

It is of utmost importance that the beneficiary designation clause be completed properly and clearly so that the intended beneficiary can receive the asset proceeds following a death. These designations should be well thought out as part of an overall estate plan.

Unfortunately, controversy and Court litigation often arises when beneficiary selections are changed while a person is elderly, or experiencing medical problems or when the change occurs shortly before death. Such changes are particularly dramatic when the new beneficiary is a person who has not been involved in the decedent’s life until recently such as a new friend, spouse or health aide. The initial reaction to such change, particularly from the now disinherited beneficiary – such as a child, long-time friend or other seemingly natural beneficiary selection – is that the change could only be the result of some kind of undue influence perpetrated upon the decedent at a time when he or she was vulnerable, weakened due to illness or old age or incapacitated.

However, despite the ready appearance of wrongdoing, actually demonstrating that the decedent did not intend the change and that the new designation should be voided is not an easy task. Such was the situation in a recent case entitled Metropolitan Life Insurance v. Felecia Bradway, decided in the Federal District Court, Southern District of New York, 10 Civ. 0254. As reported in the New York Law Journal by Mark Hamblett on February 28, 2011, the decedent, Bradway, had designated his daughter as the beneficiary of a $300,000 life insurance policy in 1998. However, in May, 2008 Bradway changed the beneficiary designation to a co-worker whom he married later that year. Bradway had been taking a narcotic pain medication and was diagnosed with liver cancer shortly before his wedding. Bradway then died in March 2009.

The disinherited daughter claimed that the new spouse, “who was 30 years younger than Mr. Bradway, influenced him by proposing marriage while he was ‘terminally ill’ , by attempting to isolate him from his family following his cancer diagnosis and by failing to provide him with proper medical care after the diagnosis.”

As reported in the article, notwithstanding the daughter’s allegations, the Court found that “there was not enough evidence for a ‘reasonable finder of fact’ to show Mr. Bradway’s mind was subverted when he made the May 27, 2008 designation of beneficiary.”

The Bradway case demonstrates that it is important to make clear beneficiary designations as part of an estate plan. Probate, Guardianship, and other Court proceedings provide avenues to attack designations that may seem particularly improper under the circumstances. Such attacks however, require the proper presentation of proof to succeed.

March 2, 2011

New York Article 81 Guardians Are Bound By The Court To Act Properly

by Jules M. Haas

The New York Probate Lawyer Blog has discussed the powers and obligations of a property management and personal needs Guardian. When a person is found to be incapacitated and a Guardian is appointed, the Court maintains scrutiny over the actions of the Guardian.

One of the safeguards provided by Article 81 of the Mental Hygiene Law (MHL) is that the Court may require the posting of a bond (MHL Sec. 81.25). A bond is essentially an insurance policy issued by a surety company that insures payment to creditors and others entitled to receive the incapacitated person’s funds in the event the Guardian misappropriates those funds. The Court will set the amount of the bond based upon the value of and income from the assets of the incapacitated person. Since the Court appointed Guardian must qualify for the bond, the surety will check the Guardian’s credit and financial history. A poor credit history may result in the denial of a bond and, thereby, prevent a person from qualifying as a Guardian.

It is a good practice, which I follow, to have the bonding company review a client’s credit before he or she files a petition for appointment as a Guardian so that we can be certain the client can qualify if appointed.

Another safeguard provided by the law is contained in MHL Section 81.31 which requires that the Guardian file an Annual Report with the Court every May. The Annual Report contains information concerning the Guardianship financial transactions that occurred during the prior year along with information regarding the incapacitated person’s physical and mental condition. This information is typically reviewed by a Court Examiner. In the event the Court Examiner finds information that shows improper conduct on the part of the Guardian, the findings will be reported to the Court.

A recent case where a Guardian’s actions were found to be improper was reported by Daniel Wise in the New York Law Journal on January 6, 2011. The Article entitled Guardian Must Return Funds Paid to Family For Ward’s Care, described a case where a lawyer-guardian was required by the Court to repay to the incapacitated person’s estate over $100,000.00 that the Guardian had paid to a company that provided care to the Incapacitated Person. It was found that the company was controlled by the Guardian’s spouse. Judge Charles J. Thomas also ruled that the Guardian had to forfeit commissions and legal fees.

Guardians are required to be diligent in the performance of their duties. Both Guardians and the families of the Incapacitated Person often require legal representation to fully understand and protect their interests.