DECLINES TO ORDER A NUNC PRO TUNC GIFT TO AVOID NEW
An Article 81 Guardian sought
authorization from the Tomkins County Supreme Court
to gift $60,000 to each of the ward’s two sisters
and, additionally, to make its order nunc pro tunc to
avoid the effects of the changes to the Medicaid law
on February 8, 2006. Under the new Medicaid rules, the
gift would cause the Ward to incur a 60-month period
of ineligibility which would not start to run until
(1) a Medicaid application is submitted, (2) the ward
is receiving a form of institutional care, and (3) the
ward’s resources do not exceed the then resource
limit for a single person. According to the opinion,
the court declined to issue an Order nunc pro tunc because
courts only had the power to issue a nunc pro tunc order
to correct ministerial errors and not to approve a gift
as of an earlier date when in fact the gift was not
actually made on that earlier date. Since the actual
gift was given after February 8, 2006, the
court held new Medicaid laws would apply to the gift.
The ward had $352,000 of liquid assets and the cost
of his nursing home was $5,000 per month, or $60,000
a year. Thus, $60,000 x 5 ($300,000) would need to be
retained to pay for the ineligibility period, which
was potentially 5 years. Thus the court allowed a total
gift of $60,000 effective as of the date that the gift
was made (leaving $8,000 short of the $300,000 needed
for 5 years of nursing home costs).The court noted that
in this case the application to make the gift was not
made prior to the instant application, leaving the door
open for future cases. Thus, if an application to make
the gift was made at an earlier time, it is possible
that the Rolland court would have entertained that motion
and authorized gifting nunc pro tunc to the date of
the prior application.
Matter of Rolland,
13 Misc.3d 230, 818 N.Y.S.2d 439 (Decided June 22, 2006).
HOLDS ARTICLE 81 GUARDIANSHIPS ARE NOT INTENDED TO ASSIST
NURSING HOMES SEEKING TO BE PAID
Petitioner nursing home brought
an Article 81 proceeding because it had not received
the resident’s NAMI (net available monthly income).
The resident’s spouse cross-petitioned citing
the fact that the resident executed a durable power
of attorney appointing his spouse as the attorney-in-fact.
The court held that absent any evidence that the person
was incapacitated when the power of attorney was signed,
it would be inappropriate to invalidate the power of
attorney and appoint a guardian for the person under
Mental Hygiene Law § 81.02. The spouse was collecting
the resident’s Social Security income in the belief
that the resident was covered by a long-term care policy.
The social services director testified that the reason
why the guardianship proceeding was brought was because
the nursing home had not received any of the NAMI. The
court denied the application and dismissed the application
advising that the purpose for which the proceeding was
brought (to collect the NAMI) was not the legislature’s
intended purpose of an Article 81 application.
Matter of the Application
for the Appointment of a Guardian for S.K., 2006
NY Slip Op 26384, 2006 N.Y. Misc. LEXIS 2609 (Decided
September 26, 2006).
JOINT ACCOUNT - SURVIVORSHIP
In Matter of Dudley,
the Chautauqua County Surrogate grappled with the question
of whether a joint account with rights of survivorship
established by an agent under a power of attorney from
the decedent (the “Agent”) for a person
who thereafter died entitled the surviving account owner
(the “Survivor”) to the proceeds on the
death of the decedent or whether the joint account was
merely a convenience account payable on death to the
decedent’s estate. The Survivor and an attorney
for the decedent opened an account at a local bank.
The Agent had requested the bank to open the account
as a convenience account but was told by a bank employee
that the bank could not do so. Thus the account opened
was a joint account with rights of survivorship. When
the decedent died, the Survivor refused to turn the
account proceeds over to the decedent’s estate.
The Survivor testified that the account was opened so
that he could pay the bills of the decedent who did
in fact die a few days after the account was opened.
The Surrogate’s opinion referred to the fact that
the Survivor further testified that “[he] ...did
not know what type of account was opened or what a convenience
account was but knew that he could pay [the decedent’s]
bills out of the account.” While a joint account
established under § 675 of the Banking Law was
presumptively a joint account with rights of survivorship,
that presumption is not conclusive and thus may be rebutted.
Since 1) the joint account was established by an attorney
acting under a power of attorney, 2) the agent under
the power did not have the right to make gifts, and
3) the bank was requested to establish a convenience
account, the court held that the presumption in favor
of rights of survivorship was overcome.
Matter of Dudley,
2006 NY Slip Op 52042U; 2006 N.Y. LEXIS 3074 (Decided
October 25, 2006).
DOES AN ARTICLE 81 PERSONAL
NEEDS GUARDIAN HAVE THE RIGHT TO AN ACCOUNTING FROM
AN INSTITUTIONAL TRUSTEE OF A REVOCABLE TRUST?
In Matter of Mary XX,
the Albany County Supreme Court appointed the petitioner
the personal needs guardian of Mary XX. The Court refused
to appoint the petitioner the property guardian of Mary
XX since there was an outstanding power of attorney
and revocable trust that were sufficient property management
devices. As personal needs guardian, the Judgment appointing
the petitioner also directed the petitioner to examine
“...all relevant circumstances... and the existing
financial circumstances” in determining the best
arrangements for Mary’s care and treatment, including
who shall provide care and assistance and what home
improvements and hospital equipment may be necessary
for Mary to reside in her home comfortably. The petitioner
requested certain documents from the trustee which the
trustee refused to give to the petitioner taking the
position that the petitioner lacked standing to obtain
those documents. Petitioner then requested an accounting
which was denied by the Albany Supreme Court.
The issue on appeal was whether a personal needs guardian
is entitled to information about the IP’s property
when the petitioner was not appointed the property guardian
and the petitioner has no fiduciary relationship with
the IP related to property matters. The Supreme Court
determined that the personal needs guardian has no such
right (interestingly, this is the same court that appointed
the petitioner and directed the petitioner to examine
all the relevant circumstances). On appeal to the Third
Department, the Appellate Court said that an accounting
can be ordered when there is (1) a fiduciary relationship,
(2) an entrustment of money or property, (3) no other
remedy is available, and (4) a demand and refusal of
an accounting. In this case, the Appellate Division
found that the trustee is a fiduciary, he is holding
money and property of the IP, and a demand and refusal
for an accounting have been made. Furthermore, the court
stated that there was no other remedy for the guardian
to carry out the lower court’s instructions. Therefore,
the institutional trustee was ordered to provide the
accounting to the personal needs guardian.
Matter of Mary XX,
2006 NY Slip Op 7535, 2006 N.Y. App Div. LEXIS 12513
(Decided and entered September 19, 2006).
DOES AHLBORN REQUIRE A
NEW LOOK AT OLD MEDICAID LIEN PAYMENTS?
In Matter of Margaret Fergeson,
the issue before the Kings County Supreme Court was
whether a negotiated settlement of a Medicaid lien was
to be set aside following the Ahlborn decision issued
by the United States Supreme Court (126 S. Ct. 1752,
May 1, 2006). In Ahlborn, the United States
Supreme Court clarified the circumstances under federal
Medicaid law when a lien could be imposed on a tort
recovery. Counsel argued that the anti-lien provision
prohibited recovery of medicaid liens from tort proceeds
that exceeded the portions allotted for medical expenses.
DSS argued that if the Ahlborn decision applied
retroactively, the compromised settlement amount of
$40,000 should be set aside and that the full lien should
be reinstated. The Court indicated that Ahlborn
did not warrant vacatur of the settlement order reached
prior to the issuance of the Ahlborn decision.
Since the court had directed counsel to negotiate a
lesser compromise figure with the DSS, which the court
thereafter agreed to set as the medical lien portion
of the arbitrated award, the reduced amount agreed upon
became the designated medical costs allocated to the
settlement, and was the only amount that could be recovered
by the SSL § 104-b lien. All motions were denied
and the settlement stood as agreed upon.
Matter of Margaret Fergeson,
2006 NY Slip Op 26376; 2006 N.Y. Misc. LEXIS 2539 (Decided
September 20, 2006).
IS A MEDICAID APPLICATION CONSIDERED TO HAVE BEEN FILED?
In Matter of Patricia
Bensman, the applicant’s 2002 Medicaid application
was denied because of asset transfers and because of
insufficient documentation. The applicant claimed that
she did not perfect an appeal of that denial owing to
the bad advice received from a DSS employee. The asset
transfers were thereafter reversed and a new 2003 application
containing all needed documentation was filed and approved
based on the second application. The applicant argued
at a fair hearing that the application should have been
approved as of the date of the 2002 application. The
applicant lost that argument at a fair hearing and appealed
under CPLR Article 78. The Fourth Department decided
that because there was a lack of documentation associated
with the 2002 application, and because it was undisputed
that an appeal would not be successful notwithstanding
the apparent advice of the DSS employee, the 2003 application
is the appropriate application on which to consider
the date of Medicaid eligibility.
Matter of Patricia
Bensman, 2006 NY Slip Op 6661, 821 N.Y.S.2d 341;
2006 N.Y. App Div. LEXIS 11195 (Decided September 22,