Hoarding: Finding A Way Out - Legal Issues - Louis W. Pierro, Esq. NYS Coalition for the Aging & NYS Association of Area Agencies on Aging

Hoarding: Finding A Way OutHoarding: Finding A Way Out- Legal Issues -- Legal Issues -

Louis W. Pierro, Esq.

NYS Coalition for the Aging & NYS Association of Area Agencies on Aging

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Safeguarding SeniorsSafeguarding Seniors

• Protection from Financial Abuse

• Protection from Mental and Physical Abuse

• Appointing individuals to carry out wishes of the individual– Making financial decisions– Executing terms of an estate plan– Making health care and end of life decisions

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Use of Estate Planning DocumentsUse of Estate Planning Documents

Sound Estate Planning protects:

• A senior’s finances - appointing trusted individuals to act as “fiduciaries”

-(POA, Trustees, Executors under Will)

• Provides plan for gifting while senior is still alive

• Provides plan for how assets will pass to next generation

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Use of Estate Planning DocumentsUse of Estate Planning Documents

Sound Estate Planning also protects those assisting the senior to carry out his/her wishes

• Provides a set of directions for the fiduciary• Empowers the selected person to act• Can permit fiduciaries to make gifts to

himself/herself – if it is part of the estate plan• Don’t have to excluded an agent from plan, if

serving under POA

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Caring for Aging Family MembersCaring for Aging Family Members

WHO will make decisions?

• Family Member, Friend, Trusted Advisor

• Surrogate Decision Makers– Role of Advance Directives (POA, HCP)– Role of Guardianship – Role of Trusts

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Durable Power of AttorneyDurable Power of Attorney

What is it?

• A legal document which allows you to grant another individual authority to transact business or manage your assets.

• POA law and form changed in New York as of September 1, 2009, and September 12, 2010.

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New Durable Power of AttorneyNew Durable Power of Attorney

• Why Did they Create It? -Perceived financial abuse under the old POA form-Easy for unscrupulous individuals to have senior sign POA with unlimited gifting, then avail themselves of senior’s estate-Not just paid caregivers, but often family who thought they “deserved”the money

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POA Changes POA Changes

• Must use new form after September 12, 2010-Old forms no longer effective

• Any POA properly executed prior to 9/12/10 still granted full force and effect

• Why? -Prevent abuse under POA

• Opportunity to appoint individual(s) to “monitor” agent under POA

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POA ChangesPOA Changes

• Specific opportunity to revoke or keep prior POAs in existence– Signing new POA automatically revokes ALL prior

POAs, so must specifically draft modifications to keep old POAs in place, including to IRS, NYS Tax and Finance, etc.

• Provides opportunity to compensate agent under POA

• Separate “Statutory Major Gifts Rider” for gifting

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Changes: Agent AcknowledgementChanges: Agent Acknowledgement

• Contains specific statement to agent outlining duties

(1) act in principal’s best interest;(2) avoid conflicts of interest;(3) no comingling of funds;(4) must maintain detailed records of all transactions(5) guidance in how to sign as agent under POA(6) how to resign

• Agent must then SIGN in front of notary that agent understands and acknowledgesthese duties

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Changes: Gifting AuthorityChanges: Gifting Authority

• Separate “Statutory Major Gifts Rider” (SMGR) to POA for gifting– If individual executes POA after 9/1/09 and no

SMGR, then NO AUTHORITY TO GIFT ANY AMOUNT TO ANYONE

– Ability to make “annual exclusion” gifts even removed from POA unless SMGR executed

– Still have authority to modify language to fit client’s specific needs

– MUST fill in specific types of gifts and specific individuals or classes of individualsto grant gifting authority

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Changes: New Signing RequirementsChanges: New Signing Requirements

• New Durable Power of Attorney– Principal must initial more affirmative statements

than prior POA– Agent(s) must also sign and acknowledge in

presence of a notary (major change)

• Statutory Major Gifts Rider– Principal must initial additional affirmative

statements– Principal must sign in presence of notary

and 2 disinterested witnesses

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Health Care ProxyHealth Care Proxy

What is it?

• An appointed health care agent is authorized to make medical decisions for you if you become incapacitated or incompetent

• Instructions are provided to guide your agent, including end of life decision making (Living Will)

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Health Care Proxy UpdatesHealth Care Proxy Updates

• Inclusion of HIPAA Language– Agent under HCP authorized to act as HIPAA

representative

• Optional Anatomical Gift Notice– Witnessed statement regarding donation of

organs and/or tissue– No age limits on organs and tissue

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New HCP For Mental IllnessNew HCP For Mental Illness

• Persons with mental illness may cycle in and out of competency and may have periods of paranoia or delusions

• Provides opportunity for directions on types of treatment, preferences for specific treatment facilities, suggestions about successful past treatments

• Recommended that principal hand-writes wishes, so they are recognized as his/her own notes and not something “others” are trying to implement

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Mental CapacityMental Capacity

Does individual have mental capacity to execute Advanced Directives?

If yes, then sign: • Health Care Proxy or HCP for Mental Illness• Power of Attorney

If no, then pursue Guardianship

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GuardianshipsGuardianships

• Can make a broad range of financial and personal decisions on behalf of an incapacitated person

• Personal Decisions– Routine and major medical and dental

treatment– living arrangements; educational and training

opportunities– Application for government benefits including

SSI and Medicaid

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• Court Proceeding - litigation• The determination of whether to appoint a

guardian is discretionary and rests upon a two-pronged analysis:1. The petitioner must establish that the appointment is

necessary to provide for the personal needs and/or property management of the AIP (MHL 81.02(a)(1).

2. The petitioner must establish that the AIP either agrees to the appointment or that the AIP is incapacitated as defined in MHL section 81.02(b).

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Article 81 of Mental Hygiene Law

- Supreme Court proceeding

- Utilized with any individual (aged, dementia, any disability) who may be incapacitated or consents and is in need of support

• Specifically tailored to needs of individual

• More complicated + more players= more expensive

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Special Needs TrustsSpecial Needs Trusts

• A guardian can set up a Special Needs Trust which will allow a trustee to hold the person's assets for his or her benefit without compromising Medicaid eligibility.

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Preventing Abuse and NeglectPreventing Abuse and Neglect

Use of Health Care Proxy and POA to arrange health care

Agents may decide:

• Care at home vs. care at institution

• Which home care agency or staff to hire

• Which assisted living, rehabilitation or skilled nursing facility can be trusted with loved one

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Preventing Abuse and NeglectPreventing Abuse and Neglect

Is there a perfect health care solution? NoThere are pros and cons to both

Home Care and Institutional Care Settings - Who runs the agency/institutions?

- Who hires, trains and supervises care staff?

- Who is really looking out for the patient’s best interest?

Ex. Northwoods lawsuit

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Family Health Care Decision ActFamily Health Care Decision Act

Governor Patterson signed law creating the Family Health Care Decision Act– Effective beginning June 1, 2010– Amends Public Health Law, Mental Hygiene Law and

Surrogate’s Court Procedures Act– Enables family members and others close to an

incapacitated person to make health care decisions in accordance with certain procedures

– Does NOT replace Health Care Proxy or Living Will– Includes end of life decisions– Does not grant authority if individual always lacked

capacity to make decisions – Article 17-A still controls

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Trust & Estate Litigation Common Causes Trust & Estate Litigation Common Causes

• Challenges to the Plan– Lack of Capacity– Fraud, Duress and Undue Influence– Revocation of a Will – Prenuptial and Postnuptial Agreements

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Trust & Estate Litigation Common CausesTrust & Estate Litigation Common Causes

• Serious Deprivation of Rights– Article 81 of the NY Mental Hygiene Law

requires that a hearing be held at which the alleged incapacitate person (“AIP”) is present. (MHL 81.11(a), (c))

– Determination of incapacity is based on clear and convincing evidence. (MHL 81.12(a))

– The burden of proof rests on the petitioner.

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Hoarding CasesHoarding Cases

• Stratton Cooperative, Inc. v. Anne Fener (211 A.D.2d 559; 621 N.Y.S.2d 77; 1995 N.Y. App. Div.)

– accumulation of newspapers and debris in respondent's apartment causing a health and fire hazard

– Remedy under article 81 of the Mental Hygiene Law allowed for the appointment of a guardian ad litem for the limited purpose of assisting with the clean-up

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• Matter of Florence Linden-Rath (188 Misc. 2d 537; 729 N.Y.S.2d 265; 2001 N.Y. Misc)

– Landlord sought permission to sue her Guardian based upon a notice of termination of residential tenancy

– Guardian applied to permanently stay the termination of the tenancy

– Since condition of apartment improved since appointment of Guardian and periodic visits by a housekeeper and the Guardian, the court determined that the accumulation and housekeeping issues were not a nuisance

– Court granted the application to permanently stay the termination of the tenancy and denied permission to sue the Guardian

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• Matter of MURRAY F. (2005 NY Slip Op 50562U; 7 Misc. 3d 1011A; 801 N.Y.S.2d 237; 2005 N.Y. Misc.)

– Self Help Community Services was appointed Guardian

– The guardian attempted to set up essential heavy duty cleanings of the apartment but were thwarted - refused access to their apartment

– Guardian rented storage units and moved much of the salvageable material that Mr. and Mrs. F. wanted to keep there.

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• Mr. & Mrs. F. remained in control of funds, did not pay the rent or stay current on many other bills

• Guardian encountered tremendous difficulty in trying to gain control over Mr. and Mrs. F.'s money to assist in bill paying

• Guardian fought off eviction, facilitated in finding doctors who take their insurance plan, established budget to live within their means

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• Mr. F. repeatedly complained about Guardian and sought to have replaced with a distant relative

• Thought replacement Guardian would not be as involved and let Mr. & Mrs. F. resume destructive behaviors

• Court Ruled that although Mr. & Mrs. F. might continue to complain, it was a “no win” situation and Self Help would remain as Guardian

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Questions?Questions?

Thank You!Thank You!

Pierro Law Group20 Corporate Woods Blvd. Albany, NY 12211

P: 518-459-2100 F: 518-459-22001-866-951-PLAN

www.PierroLaw.com