Articles Posted in ELDER LAW

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Living in southern California gets more expensive every year. For many elderly San Diego residents on a fixed income, just paying monthly bills can be a struggle. This is one reason “reverse mortgages” have become popular in recent years.

How Reverse Mortgages Work

Most of us have taken out a home mortgage loan at some point in our lives. The typical mortgage is a 30-year loan secured by the property being purchased. Each month the borrower must make fixed payments towards the mortgage’s principal and interest.

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Sibling rivalry is a natural part of childhood and growing up. When sibling rivalry continues into adulthood, it can have negative consequences for a parent’s estate planning. In some cases an adult child may even attempt to manipulate a parent’s will or trust to place his or herself at an advantage over a sibling.

Toxic Sibling Rivalry Leads to Court-Appointed Conservator

Such behavior may constitute elder abuse and require a court to step in. For example, an appeals court in Los Angeles recently upheld a probate judge’s decision to appoint a neutral third-party conservator for a woman in her 80s. The conservatorship was necessary, according to the court, due to her son and daughter’s jockeying for “position to control, manage, and ultimately inherit their mother’s assets.”

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A power of attorney is a document where you give an agent the authority to act on your behalf with respect to property. An agent (also known as an “attorney-in-fact”) has a duty under California law to “observe the standard of care that would be observed by a prudent person dealing with the property of another.” This means that the agent may be legally liable if he or she mismanages or squanders your property.

Former Agent Ordered to Compensate Principal Over Uncollected Rent

A recent California appeals court decision illustrates how an agent may exceed the authority granted under a power of attorney. This case is only an example and should not be treated as a definitive statement of California law on this subject.

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A conservatorship is a court-ordered guardian who takes charge of the financial or personal affairs of an individual if he or she is unable to care for him or herself. A conservatorship is often necessary when a disabled adult (called a “conservatee”) does not have a proper estate plan—i.e., he or she has not signed a power of attorney designating an agent to act on his or her behalf. In some cases, a California court will name a “public guardian” to serve as conservator if nobody else is qualified and available.

Court Sides With Conservator Over Lender in Property Sale Dispute

A critical function of a conservator or agent is protecting the assets of the disabled adult. Here is an illustration from a recent California case. This is only an example and should not be construed as a complete statement of California law on the subject.

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One reason to hire an experienced San Diego estate planning attorney is to help protect your will or trust from a challenge after your death. It is not uncommon for relatives who may feel entitled to a greater share of a decedent’s estate to claim there was fraud or undue influence behind an estate planning document. In some cases, an estate planning attorney’s testimony can to see that your will or trust truly reflects your wishes.

Court Rejects Nephew’s Challenge to Uncle’s Trust

Here is a recent example from a decision by the California Fourth District Court of Appeal, which has jurisdiction over San Diego and surrounding counties. This is an unpublished decision, so this case should only be viewed as an illustration of how courts examine probate cases and not a definitive statement of California law on the subject.

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Elder abuse remains a major problem in California estate planning. Relatives, caregivers, and other parties often exploit their relationship with someone who is ill or dying in order to obtain an inheritance from their estate. Such undue influence is against the law, and an interested party may ask a probate court to nullify any provision in a will or trust that benefits the abuser.

Court Holds Disclaimer Does Not End Elder Abuse Petition

A California appeals court in Santa Clara recently emphasized the public policy importance of discouraging elder abuse in a recent decision involving an ongoing contest to a revocable living trust. The trust was originally created by a married couple in 1990. Upon the wife’s death, the trust was subdivided into two trusts, one of which remained subject to amendment or revocation at the husband’s discretion.

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In a recent post we discussed how Medi-Cal, California’s Medicaid system, can go after the assets of a deceased beneficiary recipient’s probate estate or revocable living trust for reimbursement of medical costs paid during the person’s lifetime. There is some good news for future Medi-Cal beneficiaries and their potential heirs. California’s recently adopted state budget includes important provisions designed to limit Medi-Cal “recovery” against estates. This is an important decision that will help many low-income California residents and their families by protecting their homes and savings from mandatory state seizure.

Legislature Adopts Important Protections for Medi-Cal Recipients and Families

There are actually two categories of reimbursements sought by Medi-Cal. The first is for “specified medical assistance, including nursing facility services, home and community-based services, and related hospital and prescription drug services” provided to California residents ages 55 and over. Federal law requires California to seek reimbursement from a recipient’s estate in these cases.

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A conservatorship is designed to protect the health and finances of a person who is no longer capable of acting for themselves. A conservator is someone appointed by a California probate court to oversee the disabled person’s estate or person. Once appointed, the conservator is accountable to the court, and a judge may issue additional orders to ensure the conservatorship is handled properly.

Judge Erred in Ordering Premature Division of Couple’s Community Property

Judges are not always right. In a recent case from Santa Ana, a California appeals court overruled a probate court’s order against the spouse of a man under a conservatorship. The probate judge said the spouse disobeyed an order related to the conservatorship.

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A mother of six adult children owned a home in San Luis Obispo County. She lived in the house with one of her sons and his wife. The couple, together with two of the other children, gave their mother money each month to help pay her mortgage.

In 2007, the mother signed a form will in the presence of an attorney. The will left the house to the son and daughter-in-law who lived with her. She simultaneously signed a deed transferring the house to the son while reserving a “life estate” for herself. This is a common estate planning device, but not usually favored given the problems that arise in this case. Basically, the mother became a “life tenant” of the house, and upon her death, the son would assume sole ownership.

Two years later, the relationship between the mother and her daughter-in-law deteriorated. The daughter-in-law told the mother she no longer owned the house and could be kicked out. At this point, three of the mother’s daughters arranged for her to meet with a new estate planning attorney. The daughters were aware of the 2007 will leaving the house to their brother, but not the deed conveying the property to him with a life estate for their mother. The mother told the new attorney she now wished to leave the house to one of her daughters. Accordingly, she signed a new will, together with a document giving her daughter power of attorney.

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Many elderly persons wish to remain in their own homes, but lack the financial means to do so. One option for such individuals is to take out what is known as a “home equity conversion mortgage,” commonly referred to as a “reverse mortgage.” Whereas a conventional mortgage requires the borrower to make monthly payments until the loan is repaid, with a reverse mortgage, all payments are deferred until the borrower dies or decides to sell the property.

Most reverse mortgages are regulated and insured by the U.S. Department of Housing and Urban Development (HUD). Under HUD rules, any person over 62 who resides in the house they own may qualify for a reverse mortgage. HUD maintains an online directory of qualified reverse mortgage counselors to advise individuals on the best way to obtain such loans.

Reverse Mortgages and Estate Planning

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