Guardianship | The Better Chancery Practice Blog

Medicaid and the “Made-Whole” Rule

July 13, 2015 § Leave a comment

In Mississippi, an insurer is not entitled to equitable subrogation unless and until the insured has been fully compensated. It’s known as the “made-whole” rule. Hare v. State, 733 So.2d 277, 284 (¶26) (Miss. 1999).

Can a chancellor rely on the made-whole rule to deny Medicaid’s claim of subrogation in a minor’s settlement?

A chancellor did deny Medicaid’s right of subrogation that would have left Javas Pittman, a minor, with only $6,000 from a $25,000 settlement. Javas had been seriously injured when he was riding on the hood of a car that was involved in a crash. There is no explanation in the record for the reason why the child was on the hood of a moving automobile. If his medical bills are any indication of the gravity of his injuries, they must have been severe, because they totaled more than $170,000, of which Medicaid paid around $66,000. The judge relied on Hare to deny Medicaid’s claim.

The COA reversed the trial court ruling in the case of Medicaid v. Pittman, handed down June 30, 2014. Judge Maxwell wrote for the court:

¶14. Unlike Hare, here there are no “issues of unilateral contracts and bargaining power in negotiations.” Miss. Ins. Guar. Ass’n v. Brewer, 922 So. 2d 807, 812 (¶23) (Miss. Ct. App. 2005). Instead, we are faced with a statute creating a clear right to reimbursement. Miss. Code Ann. § 43-13-125. [Footnote omitted] And according to the supreme court, when the “right of reimbursement ‘exists by virtue of statute,’” the equitable made-whole rule does not apply. Federated Mut. Ins. v. McNeal, 943 So. 2d 658, 661 (¶¶13-14) (Miss. 2006) (quoting Miss.Food & Fuel Workers’ Comp. Trust v. Tackett, 778 So. 2d 136, 143 (¶27) (Miss. Ct. App. 2000)). Instead, the existence of this right “must rise or fall strictly as a matter of statutory interpretation.” Id. at (¶13).

¶15. Melissa [Javas’s guardian] argues McNeal’s holding is narrow and only applies to the specific statute addressed in that case, Mississippi Code Annotated section 71-3-71 (Rev. 2011), which is part of the workers’ compensation act. But what distinguished the subrogation rights in McNeal from the rights in Hare was not workers’ compensation. Rather, the key distinction in McNeal was the fact the insurer’s subrogation rights “do not spring from a contractual agreement as in Hare, but rather are conferred by [s]ection 71-3-71.” McNeal, 943 So. 2d at 661 (¶13); see also Brewer, 922 So. 2d at 812 (¶23) (distinguishing legislatively established subrogation rights from the contractual rights subject to the made-whole rule in Hare). In other words, it was the source of the subrogation right—statute versus contract—that made the equitable made-whole doctrine inapplicable. McNeal, 943 So. 2d at 661 (¶¶13-14); see also Proulx, 121 So. 3d at 223-24 n.1 (acknowledging Medicaid’s statutory right to impose a lien on a settlement that did not make the injured party whole).

¶16. Here, Medicaid’s right to reimbursement did “not spring from a contractual agreement” but rather was conferred by section 43-13-125. McNeal, 943 So. 2d at 661 (¶13). Thus, the chancellor “erred when [he] applied the equitable made-whole doctrine to [this] statutory right[.]” Id. Like section 71-3-71,7 section 43-13-125(2) “unambiguously provides the method for distributing proceeds when, as here, an injured [Medicaid recipient] recovers from a third party.” McNeal, 943 So. 2d at 661 (¶14). So like section 71-3-71, the clear directive of section 43-13-125(2) could not be disregarded. See McNeal, 943 So. 2d at 661 (¶¶13-14).

¶17. Under section 43-13-125(2), “Any amount recovered by a recipient or his or her legal representative shall be applied,” first, to the recipient’s attorney’s fees and legal costs of recovery, second, to the amount of Medicaid’s interest, and, last, to the recipient, should there be “any excess.” While the chancellor recognized Javas’s attorney’s right to a priority payment of $8,640.89 for legal fees and expenses, the chancellor improperly ordered that Melissa could receive the excess on Javas’s behalf without first reimbursing Medicaid $10,308.40.

¶18. The chancellor based his decision not to follow section 43-13-125(2)’s directive by asserting Medicaid’s $10,308.40 recovery would unfairly leave Javas with a little over $6,000—a “neglible [sic] sum,” as he put it. While this may be true, “a chancellor, despite his broad equitable powers, is not free to disregard the clear guidance of a pertinent statute simply because he concludes that it would be unfair on the particular facts of the case to apply the statute according to its terms.” McNeal, 943 So. 2d at 661 (¶13) (quoting Tackett, 778 So. 2d at 143 (¶27)). Further, were Melissa to comply with the order and receive the settlement proceeds without first reimbursing Medicaid, she would be in clear violation of section 43-11-125(2), which in turn would jeopardize her and Javas’s Medicaid-eligibility status. See Miss. Code Ann. § 43-13-307 (Rev. 2009). [Footnote omitted]

¶19. Though the Mississippi Constitution vests chancery courts with subject-matter jurisdiction over equitable matters involving minors [Footnote omitted], such jurisdiction does not permit exceptions to clear statutes because they apply to minors. “[E]quity follows the law,” and “courts of equity cannot modify or ignore an unambiguous statutory principle in an effort to shape relief.” In re Estate of Smith, 891 So. 2d 811, 813 (¶5) (Miss. 2005) (citing In re Estate of Miller, 840 So. 2d 703, 708 (¶14) (Miss. 2003)). Because the order approving the minor’s settlement contained a condition that conflicts with the clear statutory principle that Medicaid shall recover its interest from the settlement, the order cannot stand. We have no option but to reverse the chancellor’s judgment and remand this case back to the chancery court to oversee a settlement that both takes into account Javas’s best interest and Medicaid’s unambiguous statutory right to reimbursement from the settlement.

Don’t forget that Medicaid will negotiate the amount of its lien. I have seen cases in which Medicaid has foregone its claim altogether, although I understand from one of the participants in this case that Medicaid refused to reduce its claim for some reason.

Always make sure you inquire about whether the minor for whom the settlement is sought is a Medicaid recipient. Carefully study the medical bills to see whether Medicaid paid anything. If it did, you must notify it of the settlement and get a letter specifying the amount of the lien it is claiming, and make that letter a part of the record.

Asking Permission Rather than Forgiveness

June 18, 2015 § 3 Comments

That old saw about it being easier to ask forgiveness than to get permission may apply in some aspects of life. It does not, however, apply in guardianships.

I wish I had a few bucks for every time I have seen a lawyer open a guardianship, qualify the guardian, and then go off and file a PI or wrongful death case “for the benefit of the ward.” Later, the attorney has to beg forgiveness, because he had no permission.

MCA 93-13-27 spells out specifically what is required:

All suits, complaints, actions and administrative and quasi judicial proceedings for or on behalf of a ward for whom a general guardian has been appointed shall be brought in the name of the general guardian for the use and benefit of such ward, be such general guardian that of his estate or that of his estate and person or that of his person only. And all such actions, suits or proceedings shall be commenced only after authority has been granted to such general guardian by proper order or decree of the court or chancellor of the county in this state in which the guardianship proceedings are pending, upon proper sworn petition and supporting oral testimony. A certified copy of said order authorizing such suit or proceedings shall be attached to the complaint or instrument or document originally filed as commencing such action, suits or proceedings. If such proceedings be commenced by act of said general guardian, then on request therefor a certified copy of said order or decree shall be submitted by said general guardian as evidence of his authority to the person or persons with or through whom the guardian may deal in performing any act commencing such proceedings. [Emphasis added]

So before you go crashing off into circuit, county, or district court, you must: (a) file a sworn petition in the guardianship case outlining what it is you propose to do; (b) set the matter for hearing; and (c) present oral testimony in support of your petition. It should go without saying that the petition can only by filed by a guardian who has been properly appointed by the court, has posted whatever bond was required, has taken the oath, and has been issued letters of guardianship.

When the lawsuit is filed, a certified copy of the order authorizing it must be attached as an exhibit to the complaint.

There can be some ramifications here. If I were a defendant, I think I might sit back and let the statute of limitations run on the claim, and then file to dismiss the lawsuit for lack of standing. How would you feel as the attorney for the guardian in that situation?

Substantial Evidence and the GAL Report

March 9, 2015 § Leave a comment

The recent MSSC decision in Gateley v. Gateley, handed down February 12, 2015, is a notable guardian ad litem (GAL) case in several respects.

Clayton and Lauren Gateley had entered into a consent to divorce on the sole ground of irreconcilable differences, leaving several issues for adjudication by the court, including custody of their 6- and 2-year-old children.

Both parties pointed the finger of unfitness at each other. Lauren accused Clayton of drinking too much beer. Clayton accused Lauren of suffering from trichotillomania — “a nervous disorder characterized by the irresistible impulse to pull one’s own hair.”

At trial, Lauren’s witnesses did not corroborate her accusations that Clayton would drink before, during, and after work, that he drove around with a cooler of beer in his truck and drank beer while driving, including when the children were in the car, and that he would often be drunk. Clayton denied all of the allegations, and Clayton’s witnesses backed him up.

Clayton testified that Lauren spent hours in the bathroom indulging her hair-pulling, taking her attention away from the children. Lauren denied it, but Clayton’s witnesses contradicted her.

The chancellor found that two Albright factors favored Clayton: physical and mental health of parents, and stability of home environment. And two favored Lauren: age and sex of the children, and better parenting skills. The other factors favored neither. But:

¶10. Noting that each parent had two factors in their favor, the chancellor explained “this is not a scoring contest. It must be considered in the overall circumstances in which the parents and children find themselves.” After considering “the totality of the circumstances and examining those factors accordingly,” and finding both parties “fit, proper and suitable parents,” the chancellor awarded Clayton custody of the son and awarded Lauren custody of the daughter. This unusual arrangement, he explained, would only be temporary, until an investigation could be conducted and a custody determination finalized.

The GAL, attorney Debra Branan, filed no written report, but did give her recommendations at trial. Her testimony was generally based on hearsay. She recommended that, if the court did not continue the split-custody arrangement, custody be awarded to Clayton. Neither attorney questioned the GAL. Neither party, after being given the opportunity by the court, had anything further by way of testimony or argument.

The court entered an order granting custody to Clayton, and Lauren appealed.

The MSSC affirmed, unanimously.

On the question whether the GAL report was adequate:

¶21. We find it unnecessary to pass on the question of whether Branan’s investigation was lacking. Because, even assuming for purposes of argument that Branan’s investigation was woefully inadequate—as Lauren argues—we still would affirm the chancellor. As stated above, the “cardinal principle” in custody decisions is what is in the “best interests and welfare of the minor child.” Once a chancellor has decided what is in a minor’s best interests, we will not overturn that decision—provided it is based on substantial evidence—unless it is clearly erroneous. After careful review, we find that the chancellor’s decision here is supported by substantial evidence and is not clearly erroneous.

¶22. This Court previously has held: “In any case where a [guardian ad litem] is appointed to represent a child, the chancellor’s role as fact-finder requires the evidence presented by the [guardian ad litem], as well as all other relevant evidence, to be considered and given such weight as the chancellor determines it deserves . . . .Thus the question to be answered by this Court is . . . whether the evidence in the record support[s] the chancellor’s decision.” Lorenz v. Strait, 987 So. 2d 427, 431 (Miss. 2008) (citing Yates v. Yates, 284 So. 2d 46, 47 (Miss. 1973)) (emphasis added).

¶23. As noted above, the chancellor discussed each Albright factor individually and specifically. In doing so, he made several findings of fact that provide support for his ultimate custody determination. Among those, that Clayton offered the more stable home, that Clayton was mentally healthier than Lauren, and that Lauren had moved twice and lived in a four-bedroom house with her boyfriend and his two children.

¶24. Our law does not mandate that the chancellor follow a guardian ad litem’s recommendation, because the chancellor, “not the guardian ad litem, is the ultimate finder of fact.” S.G. v. D.C., 13 So. 3d 269, 282 (Miss. 2009) (citing Hensarling v. Hensarling, 824 So. 2d 583, 587 (Miss. 2002)). The chancellor made this clear to the parties when he explained that he would “listen to [Branan’s] recommendation and may very well accept her recommendation, reject her recommendation, do something totally different, or leave it the way it is.”

¶25. In short, the chancellor properly fulfilled his role as factfinder by considering Branan’s oral report and her recommendation, along with all the other relevant evidence, and determining how much weight it deserved. See Hensarling, 842 So. 2d at 587. See also S.N.C. v. J.R.D., 755 So. 2d 1077, 1082 (Miss. 2000) (“The guardian ad litem’s presence . . . in no way detracts from the chancellor’s duty to hear the evidence and make a decision on all of the evidence, not just on the testimony of the guardian ad litem.”); S.G., 13 So. 3d at 282 (“Recommendations of a guardian ad litem must never substitute for the duty of a chancellor.”).

¶26. Moreover, this Court will uphold a chancellor’s custody order even if it is partly based on a less-than-perfect guardian-ad-litem investigation. See White v. White, 26 So. 3d 342 (Miss. 2010). In White, the chancery court modified a custody order in favor of a father, and when the mother appealed, this Court affirmed. Id. at 352. The chancellor considered a guardian ad litem’s recommendation, even though the guardian ad litem had not conducted a court-ordered home study (or otherwise visited the mother’s home), and had not reviewed all the records she had sought from the mother. In affirming the judgment of the chancery court, this Court did not even address the arguments about the guardian ad litem’s recommendation, explaining that “[o]n appeal, we cannot reweigh the evidence and must defer to the chancellor’s findings of the facts, so long as they are supported by substantial evidence.” Id. at 352.

As for whether the issue of the adequacy of the report was preserved for appeal, Justice Lamar addressed the question in footnote 4:

As noted above, Lauren declined to cross-examine Branan and failed to make any contemporaneous objections. However, these issues are preserved for appeal because of their bearing on the best interests of the minor children involved. Natural Father v. United Methodist Children’s Home, 418 So. 2d 807, 809 (Miss. 1982) (Explaining that in “case[s] where the basic issue involves the rights and destiny of small children” this Court relaxes “[t]he general rule . . . that questions not raised at the trial level will not be considered . . . as grounds for reversal”). And we also note that, strictly speaking, Lauren raised these “at the trial court level” in her motion to reconsider, which the chancellor denied on its merits.

Boiled down to its essentials, the chancellor was affirmed because there was substantial evidence in the record to support his findings. That’s as it should be.

A couple of pointers:

If the judge is going to appoint a GAL, insist on a written report to be provided to you well in advance of trial. It’s no fun to be ambushed. If the judge won’t include an order for a written report in advance of trial, file a motion asking for it to be done, and get a ruling so as to preserve the point for appeal.
If the GAL report is against your client, have witnesses lined up to refute it. Always cross-examine the GAL.

I was glad to see that the court did not take McDonald v. McDonald, 39 So.3d 868 (Miss. 2010), to the next level by outlawing all hearsay in GAL reports as Justice Dickinson suggested in his specially concurring opinion in that case. Justice Lamar’s opinion reflects what should be our law: that the overriding consideration in child custody cases is the best interest of the child, and whatever resources can be brought to bear to achieve it should be used.

From the Land of Broken Dreams

February 18, 2015 § 1 Comment

I’ve posted here, here, here, here, and here about the unfortunate guardianship of Demon B. McClinton, who inherited more than $3 million dollars from his mother, who died in 1999. The guardianship was closed in 2006, but reopened later to investigate abuses in the case.

What the guardian ad litem discovered was that Demon’s guardian and others had pilfered the account to near-extinction. The attorney, Michael J. Brown, was jailed until he could either account for the missing millions, or until he could replace them. He ultimately could do neither.

Disenchanted with the chancellor’s ruling finding him in contempt, Mr. Brown appealed. You can read how the COA disposed of his appeal in In re: Guardianship of Demon B. McClinton: Michael J. Brown v. Thomas A. McClinton, decided by the COA February 3, 2015. To put it in blunt terms, his appeal was for naught.

You can read the COA’s opinion by Judge Roberts for yourself. The point I am intending to drive home here is that there are serious professional, financial, legal, and even criminal repercussions awaiting lawyers who ignore or flout their duties in fiduciary matters. Read the Uniform Chancery Court Rules, Part 6, for yourself. Or, simply consider what happened to Mr. Brown. His mishandling of this guardianship is a textbook example of how not to represent a fiduciary.

Oh, and lest you are chafing at the lawyer being saddled with the blame, check out what the court did to the guardian and his friends who benefited financially at the ward’s expense.

Sadly, however, as the opinion points out, there may be nothing that Mr. McClendon can recover from the malefactors. Whatever his dreams were for the comfortable estate that his mother left him will not be realized. There may be actions available against Mr. Brown’s malpractice carrier and the fiduciary’s bonding company. I don’t know that for a fact, but even if he pursues, those avenues, it’s doubtful that Mr. McClendon will ever recoup his losses.

Let’s not overlook the wreckage that Mr. Brown left in his wake. There is a legal practice destroyed and a reputation annihilated. The toll on his family, I am sure, has been devastating. All because he let a guardianship get out of control.

The Role of the GAL in a Neglect and Abuse Case

January 21, 2015 § 1 Comment

Margaret Jones and David Brown had a daughter out of a non-marital relationship. They lived together for a time, and in 2012, David took the child, Christina, and left with her. A child-custody battle ensued in chancery court, with both parties charging abuse and neglect in their pleadings.

The chancellor appointed a guardian ad litem (GAL).

Margaret was not happy with the judge’s ruling, and she appealed. One issue she raised was the role assigned for the GAL by the chancellor. The COA affirmed in the case of Jones v. Brown, handed down January 6, 2015. Judge Fair, for the court, explained:

¶9. Because there were allegations of neglect, the chancellor appointed a guardian ad litem for Christina. The chancellor chose a law student from Mississippi College School of Law, Thujee Lhendup, who was admitted to limited practice under the supervision of Shirley Kennedy, a professor who is also a licensed attorney. Lhendup was assigned to investigate the allegations and make recommendations as to Christina’s best interest, as an arm of the court. The chancellor was very complimentary of Lhendup’s performance, describing him as exceptionally energetic and thorough. The record bears that out.

¶10. Margaret takes issue not with the guardian ad litem’s execution of his duties, but with the nature of his assignment. She contends that the chancellor was required to appoint a guardian ad litem to act as an attorney for Christina, not one who would investigate and make recommendations as an arm of the court. Margaret’s argument is based on the Mississippi Supreme Court’s decision in S.G. v. D.C., 13 So. 3d 269, 280-81 (¶47) (Miss. 2009), where the court discussed the importance of clearly defining the role of the guardian ad litem:

In Mississippi jurisprudence, the role of a guardian ad litem historically has not been limited to a particular set of responsibilities. In some cases, a guardian ad litem is appointed as counsel for minor children or incompetents, in which case an attorney-client relationship exists and all the rights and responsibilities of such relationship arise. In others, a guardian ad litem may serve as an arm of the court – to investigate, find facts, and make an independent report to the court. The guardian ad litem may serve in a very limited purpose if the court finds such service necessary in the interest of justice. Furthermore, the guardian ad litem’s role at trial may vary depending on the needs of the particular case. The guardian ad litem may, in some cases, participate in the trial by examining witnesses. In some cases, the guardian ad litem may be called to testify, and in others, the role may be more limited.

Margaret latches onto language from another case, In re R.D., 658 So. 2d 1378, 1384 (Miss. 1995), where the supreme court held minors had a due process right to “representation by” a guardian ad litem when abuse or neglect was alleged. See also Miss. Code Ann. § 93-5-23 (Rev. 2013); Miss. Code Ann. § 43-21-121 (Rev. 2009). From this Margaret argues that the chancery court was required to appoint a guardian ad litem to represent Christina as her attorney and not as an arm of the court.

¶11. This argument is erroneous and relies on cherry picking language from In re R.D. In fact, the court there repeatedly stated that (in the context of a termination of parental rights proceeding where abuse or neglect is at issue) the guardian ad litem had a duty to represent the child’s best interest. See id. at 1382-83, 1386. The court cited with approval cases outlining the role of a guardian ad litem as an arm of the court. See id. at 1383 (citing Short v. Short, 730 F. Supp. 1037, 1038 (D. Colo. 1990); Shainwald v. Shainwald, 395 S.E.2d 441, 444 (S.C. Ct. App. 1990)).

¶12. Moreover, the supreme court in S.G. v. D.C. made a point of emphasizing that prior dictates of that court had been confusing or ambiguous on the proper role of a guardian ad litem. The court urged chancellors to make it clear what was expected:

We find no fault with any of these diverse duties and responsibilities a chancellor might assign to a guardian ad litem in a particular case. However, we encourage chancellors to set forth clearly the reasons an appointment has been made and the role the guardian ad litem is expected to play in the proceedings. To avoid potential problems regarding confidential communications and other expectations, chancellors should make clear: (1) the relationship between the guardian ad litem and the children, incompetent, or other ward of the court; (2) the role the guardian ad litem will play in the trial; and (3) the expectations the trial judge has for the guardian ad litem. The role a chancellor expects a guardian ad litem to play should be set forth clearly in the written order of appointment. Doing so will make the guardian ad litem’s relationships and general responsibilities clear to each of the parties (including those wards old enough to comprehend), the attorneys, the court, and to the guardian ad litem.

S.G., 13 So. 3d at 281 (¶48). The Court also acknowledged that the chancellor must have discretion and flexibility in defining the guardian’s duties on a case-by-case basis:

Setting out such expectations should not permanently bind the court should needs change as the litigation progresses. Judges may revise these expectation by order as the need arises, so long as the guardian ad litem is not required to breach client confidences or other ethical duties by the change in responsibilities. Chancellors should be free to assign duties to a guardian ad litem as the needs of a particular case dictate, and the role of the guardian ad litem should at all times be clear.

Id. at (¶49).

¶13. Furthermore, in distinguishing between the two roles of a guardian ad litem, the S.G. court cited a case involving allegations of abuse or neglect as its example of an instance where the guardian ad litem should serve the role of investigator and arm of the court. See id. at (¶43) (citing S.N.C. v. J.R.D. Jr., 755 So. 2d 1077, 1082 (¶¶15-17) (Miss. 2000)). The example where the guardian ad litem should act more strictly as the child’s fiduciary or attorney was a will contest in which the child was a beneficiary. Id. (citing In re Prine’s Estate, 208 So. 2d 187, 192 (Miss. 1968)). The court in S.G. also discussed potential concerns about confidentiality, but that was clearly not an issue in this case, as Christina was not old enough to meaningfully communicate with someone she believed was her attorney. See id. at 282 (¶¶53-54).

¶14. The record reflects that the guardian ad litem in this case was properly directed to act as an arm of the court in representing the best interest of the child, and he executed that duty faithfully. This issue is without merit.

A few take-aways:

If you’re accepting appointment as a GAL, make sure the chancellor has clearly defined your role. Once you have a clear understanding, consider offering to draft the order yourself. Here is a link to a draft you might use or be able to adapt. I most often use the GAL as an arm of the court to investigate and make proposed findings; after all, the parents are the combatants, and I can’t be sure they are putting the best interest of the child first. But that’s not the only role a GAL might have. I have employed GAL’s to oversee visitation scheduling and to direct random drug screenings. That kind of flexibility in assigning a role is what the COA described in its holding. The delineation of duties in the order must be clear.
Just because the GAL makes findings or proposed findings, that does not make them automatically admissible in evidence. As I have said here before, you should “Call every witness identified in the GAL report to establish the substantive facts that support the GAL’s recommendations, and, of course any other witnesses you feel that you need to call.”
In my opinion, it’s a rare case that is appropriate for appointment of the GAL in the role of attorney, and should be limited to cases where appointment of an attorney is needed to protect the ward’s best interest. The Prine’s Estate case cited by the COA is a good example. I prefer the GAL to be independent, and to look behind the facts claimed by the parties.
Another important point if you are GAL is to let your chancellor know about things affecting the course of the case. For instance, if you need more authority, or if your role changes, or if a party is obstructing, file something with the court. If it affects the rights of the parties, set it for hearing and let the judge decide. I always order the parties to pay a deposit toward the GAL’s fees; if either or both fail to do so, or if they do not cooperate, file a pleading asking the court to address the situation.

How to Address the GAL Report

October 15, 2014 § 2 Comments

There are three types of cases in which a chancellor is required to appoint a guardian ad litem (GAL):

MCA 93-5-23 requires appointment of a GAL “when a charge of abuse or neglect arises in the course of a custody action.”
MCA 93-15-107 requires a GAL for the child(ren) in termination of parental rights (TPR) cases.
MCA 93-17-8 requires a GAL for the child(ren) in a contested adoption.

In other cases the court may appoint a GAL whenever the court deems it necessary to protect the interests of a child or vulnerable adult.

The chancellor is never required to follow or adopt the recommendations and findings of a GAL, but when she does not do so there are certain requirements that the judge must meet in rendering her opinion.

In the October 9, 2014, MSSC case, Borden v. Borden, Chief Justice Waller, for the unanimous court, spelled it out:

¶11. In child-custody cases where there are allegations of abuse or neglect, courts must appoint a guardian. Miss. Code Ann.§ 93-5-23 (Rev. 2013); Floyd v. Floyd, 949 So. 2d 26, 28 (Miss. 2007). And when the appointment is mandatory, chancellors, in their findings of fact, must include at least a summary of the guardian ad litem’s recommendations. Id. While a chancellor is not bound by the guardian ad litem’s recommendations, “if the court rejects the recommendations . . . , the court’s findings must include its reasons for rejecting the guardian’s recommendations.” Id.; S.N.C. v. J.R.D., Jr., 755 So. 2d 1077, 1082 (Miss. 2000).

¶12. In the current case, Mary Jane raised her concerns that the children might have been sexually abused. Accordingly, the chancellor appointed a guardian ad litem. The guardian ad litem conducted an investigation into the child-abuse claims and prepared a recommendation regarding custody of the children. The guardian ad litem found no evidence of abuse, and after an Albright analysis, determined that Mary Jane should be awarded custody.

¶13. When the guardian ad litem’s appointment is mandatory, as in this case, the chancellor must include a summary of the guardian ad litem’s recommendations in his or her findings of fact and conclusions of law. S.N.C., 755 So. 2d at1082. And “when a chancellor’s ruling is contrary to [that] recommendation . . .” the court must state “the reasons for not adopting the . . . recommendation . . . in the findings of fact and conclusions of law.” Id. While the chancellor in the current case acknowledged the guardian ad litem’s recommendation, he did not provide a summary of the report or a summary of his reasons for rejecting the guardian ad litem’s recommendation. Therefore, we find the chancellor erred in failing to do so.

The court reversed on this and another ground, and remanded the case for proceedings consistent with the opinion.

If you have a case involving a GAL, and the judge rules contrary to the GAL’s recommendations, be sure that the court’s findings include both a summary of the GAL’s findings and the court’s reasons for not following the GAL’s recommendations. Whether the appointment was mandatory or not, I think it’s the best practice. If the judge neglected to do that in his opinion, file a timely R59 motion and ask the court to add his findings. Don’t do it and you might just get a free pass for a retrial after a brief detour to the COA.

Dealing with Missing Persons

October 2, 2014 § Leave a comment

Several years ago a woman in our district disappeared without a trace, leaving behind some real property on which was situated her residence, some bank accounts, and some other assets, along with the usual bills that accompany those. After some fruitless weeks the focus of the family’s attention shifted from finding her to dealing with her affairs. What could they do?

The answer is in the conservatorship statute, MCA 93-13-251, which states:

If a person is incapable of managing his own estate … because the person is missing or outside the United States and unable to return, the chancery court of the county where the person resides or, in the case of a missing or absent person, the chancery court of the county where the person most recently resided, upon petition of … one or more of his friends or relatives, may appoint a conservator to have charge and management of the property of the person … subject to the direction of the appointing court.

NOTE: We’re not dealing here with military missing or missing in action. That is specifically addressed in MCA 93-13-161.

Since the person is not to be found in Mississippi, an affidavit must be filed that the person is not to be found in the state after diligent inquiry, and process by publication must be made on the missing person pursuant to MRCP 4(c)(4). Thirty days’ process should be given, with notice to a day and time certain. Personal process, waiver, or joinder must also be had on one relative of the proposed ward residing in Mississippi, and MCA 93-13-153 spells out what class of relative will satisfy the requirement.

MCA 93-13-255 provides that the court shall conduct a hearing on the need for a conservator, and may appoint a guardian ad litem (GAL). In my opinion, it would be prudent to appoint a GAL in cases of this sort. The section also requires that the ward be examined by two physicians. That, of course, is problematical where the ward is missing. I think it can be reasonably deduced from the conservatorship statutes that this requirement applies only to proceedings of incapacity of advanced age, and not to missing persons. Since missing persons are specifically mentioned in Section 251, and are not mentioned in Section 255, it is reasonable to assume that there is no such requirement for them.

The conservator in such cases, has the same powers and duties as guardian of a minor (Section 259). The conservator may make provision for support of the ward’s dependents (Section 263).

Appointment of a conservator imposes the same disability on the missing ward as if he or she were a minor (Section 261). If the ward reappears, a petition must be filed to restore the ward’s legal capacity and end the conservatorship (Section 265). That would require a final account, with notice to the ward, all as provided in MCA 93-13-77.

Difficulties in Talking About Incompetence and Incapacity, Part IV

August 28, 2014 § Leave a comment

[This is Part IV of a paper by Attorney Tom Freeland, IV, of Oxford, presented at a seminar sponsored by the North Mississippi Rural Legal Services Elder Law Project, Jennie Kilgore, Director]

Wills and Powers of Attorney

Every person eighteen (18) years of age or older, being of sound and disposing mind, shall have power, by last will and testament, or codicil in writing, to devise all the estate, right, title and interest in possession, reversion, or remainder, which he or she hath, or at the time of his or her death shall have…

Miss. Code. Ann. § 91-5-1. The Mississippi courts have explained what “sound and disposing mind” means here:

For testamentary capacity to be present, the testator must be of “sound and disposing mind” at the time of the will’s execution. Miss.Code Ann. § 91–5–1 (Rev.2004); In re Estate of Edwards v. Edwards, 520 So.2d 1370, 1372 (Miss.1988); Weems, at § 4:3. The requirement of a sound and disposing mind does not mean the testator’s mind must be as good as it ever was. Weems, at § 4:3. Rather, the relevant test centers on the time the will is executed. At that time, the testator must: “understand and appreciate the nature and effect of his act [of making a will,] the natural objects or persons to receive his bounty and their relation to him, and [be] able to determine what disposition he desires to make of his property.” In re Estate of Mask v. Elrod, 703 So.2d 852, 856 (¶ 17) (Miss. 1997).

Noblin v. Burgess, 54 So. 3d 282, 291 (Miss. Ct. App. 2010).

Rather than focusing on the statutory language—”sound and disposing mind”—the courts focus on the test quoted from Estate of Mask and repeated in many other cases. Did the testator “understand and appreciate the nature and effect of his act?” That is, did the testator know he or she was making a will? Did the testator know the “natural objects or persons to receive this bounty and their relationship to him?” That is, did the testator know who his heirs would naturally be, and was making an intentional decision about disposition? Finally, was the testator “able to determine what disposition he desires to make…” That is, were the terms of the will established by the testator’s decision of what disposition to make.

The courts have moved away from a possible vagueness trap—what is “of sound mind?”— to more particular language that focuses on the testator’s understanding of what it means to make a will.

Another factor in the test is one of timing: The test for whether a person had capacity to make a will looks to capacity at the specific time the will was signed and witnessed. [Fn 5] This has led the Mississippi Supreme Court to reject medical testimony that a long-term patient lacked capacity due to age and illness and that it was “possible but improbable” that the patient had a lucid interval, in favor of testimony from the testator’s lawyer that the patient knew the extent of his property and established the provisions for the will, and where the testator told the witnesses that it was his will and he wanted them to witness it. Hayward v. Hawyard, 299 So.2d 207, 209 (Miss. 1974). Even findings that a testator had been diagnosed with paranoid schizophrenia or where a conservatorship had been granted for mental instability, that testator can still be competent to make a will. Estate of McCorkle v. Beeson, 27 So.2d 1180, 1187-1188 (Miss. Ct. App. 2009). The Mississippi Supreme Court has held:

The general law (recognized by the chancellor) is that an insane person may execute a valid will ‘in a lucid interval.’ Gholson v. Peters, 180 Miss. 256, 176 So. 605 (1937). Although the conservator in this case had legal control of the property and estate of the testator, this did not affect the testamentary capacity of the one whose property was under the conservatorship. The key to testamentary capacity is mental competency at the time the will is made. Scally v. Wardlaw, 123 Miss. 857, 86 So. 625 (1920). Regardless of the existence of the conservatorship, one whose property is under conservatorship may execute a valid will during lucidity, if possessed of the requisite understanding and mental capacity.

Lee v. Lee, 337 So.2d 713, 714-15 (Miss. 1976).

[Fn 5] If there is a codicil to the will, the test of competency looks to the time of the codicil because the codicil republishes the will.

A final question of competency or capacity is the competency to make a power of attorney. Mississippi’s Uniform Durable Power of Attorney Act provides no guidance except that it provides that, where the principal (the maker of a power of attorney) lapses into incapacity, the powers granted continue, “as if the principal were competent and not disabled.” Miss. Code Ann. § 87-3-307. This creates the problem of a holder of a power of attorney who ignores his fiduciary duties and abuses the power with a client who is incapacitated and therefore no longer has the capacity to cancel the grant of the power. [Fn 6] At that point, the only real solution would be the appointment of a conservator, an appointment that many use a power of attorney to avoid.

The Court of Appeals has attempted to bridge this gap in statutory definition for competency to make a power of attorney by looking to the test for making a will. Dowdy v. Smith, 818 So.2d 1255, 1258-59 (Miss. Ct. App. 2002). While not justified by statute, this is understandable because it involves adoption of the clearest of the tests discussed in this article, and because it looks to the capacity of a maker of an instrument at the moment the instrument is made:

We find that a fair analogy is the standard for determining whether a testator has the capacity to execute a will. Both a general power of attorney and a last will and testament require an appreciation of the nature and extent of a grantor’s estate and the effects of a potential distribution.

At least until the Supreme Court opines otherwise, this is the best indication we have of the capacity the maker of a power of attorney must hold.

[Fn 6] The prospect of a holder of a power of attorney whose principal was incapacitated is one of many possible abuses. The author is aware of deeds in the land records of Lafayette County made by a holder of a power of attorney after the death of the principal, in violation of Miss. Code Ann. § 87-3-111 (cancelling powers of attorney on death). The deeds were also, on their face, self-dealing.

Conclusion

Clear or definitive answers are not available even when focusing just on the legal profession in an attempt to pin down or establish a clear meaning for the terms “incompetence” or “incapacity.” The courts and legislature have not agreed on precise or consistent meanings. There is statutory overlap in areas that seem distinct—a guardian looks over the person of the ward, while a conservator looks over the estate unless the court decides otherwise. These tensions are exacerbated when an attempt is made to look beyond the courts and law and ask what meaning these terms may have to other professions.

[Thanks to Mr. Freeland for allowing me to share this informative paper with blog readers.]

Difficulties in Talking About Incompetence and Incapacity, Part III

August 27, 2014 § Leave a comment

[This is Part III of a paper by Attorney Tom Freeland, IV, of Oxford, presented at a seminar sponsored by the North Mississippi Rural Legal Services Elder Law Project, Jennie Kilgore, Director]

Conservatorships

The standard for appointing a conservator is stated in Miss. Code. Ann. § 93-13-251:

If a person is incapable of managing his own estate by reason of advanced age, physical incapacity or mental weakness… the chancery court of the county wherein the person resides… upon the petition of the person or of one or more of his friends or relatives, may appoint a conservator to have charge and management of the property of the person and, if the court deems it advisable, also to have charge and custody of the person subject to the direction of the appointing court.

Several provisions are notable here: First, the test is “incapable of managing his own estate,” and, if that test is met, the chancellor can appoint a conservator who shall have charge of “the property of the person” and, if the chancellor deems advisable, have “charge and custody of the person,” subject to court direction. The subject of a conservatorship has the same limitation on their ability to make a contract as a minor. Miss. Code. Ann. § 93-13-261.

The statute for conservatorships was adopted because of a need for protective services for adults who were not incapacitated as defined in the guardianship statutes. The leading case on the conservatorship statutes, Harvey v. Meador, 459 So.2d 288, 291-292 (Miss. 1984), described this history:

In recent decades there has been an increased number of older adults in our society who possess assets in need of protective services provided through guardianships. But modification of laws have broadened the definition of persons for whom assistance can be afforded by the courts, and such statutes do not restrict such protection only to the adult incompetent or insane.

Noting that trend in our society, the Mississippi Legislature incorporated into law in 1962 the conservatorship procedure for persons who, by reason of advanced age, physical incapacity, or mental weakness, were incapable of managing their own estates. Miss.Code Ann. § 93-13-251, et seq. (1972).

Thus the Legislature provided a new procedure through conservatorship for supervision of estates of older adults with physical incapacity or mental weakness, without the stigma of legally declaring the person non compos mentis. This additional procedure was intended to encompass a broader class of people than just the incompetent.

The Court began with a comparison of conditions that would or would not support the appointment of a conservator:

[M]ere advanced age alone is insufficient. Advanced age will naturally bring about decrease in physical prowess and mental efficiency. However, advanced age which renders an inability to manage property or which advanced age exhibits a serious degree of deterioration is contemplated by the statute.

The fact that physical incapacity exists is not in and of itself sufficient justification for the court taking jurisdiction of property involuntarily. A blind or deaf person may be capable of understanding matters of business and receiving communication on the subject. However, almost complete physical paralysis resulting from a cerebral hemorrhage rendering one incapable of managing the estate would qualify under the statute as physical incapacity. Loss v. Loss, 25 Ill.2d 515, 185 N.E.2d 228 (1962).

Mental weakness, as opposed to the more strict application of mental incompetency, is another statutory standard which also employs some vagueness. Mere lack of good business judgment, not amounting to some degree of wasted or dissipated property, is not a sufficient standard. Mental weakness which renders the subject incapable of understanding and acting within discretion in the ordinary affairs of life is sufficient. See Annot., 9 A.L.R.3d 796 (1966) (and cases cited therein).

Harvey, 459 So.2d at 292. From these considerations, the Court went on to adopt what it called “a management competency test as the standard to be applied under the conservatorship statute.” Id. The Court set forth factors to be examined in following the management competency test.

A test of management competency can be answered by considering the factors of: ability to manage, or improvident disposition, or dissipation of property, or susceptibility to influence or deception by others, or other similar factors.

Id. The Court of Appeals has suggested that any one of these factors is sufficient to allow appointment of a conservator. In re Conservator for Demoville, 856 So.2d 607, 609-610 (Miss. Ct. App. 2003). The Court of Appeals case In re Conservatorship of Hester, 989 So.2d 986, 989-90 (Miss. Ct. App. 2008) provides facts with a good example of the sort of proof that establishes the need for a conservatorship:

[A]t the time of trial, Emma was a seventy-six-year-old woman of below average intellect who had never concerned herself with thehandling of her own business affairs. Instead, she deferred to others to handle these matters in her stead, i.e., her husband, Elden, until his death, then [her live-in son,] Glen. Emma’s own testimony vividly illustrates her inability and/or refusal to deal with the management of her estate. She possesses little meaningful knowledge regarding the amount or whereabouts of her finances, and she has exhibited overall indifference to her business affairs and her living conditions alike. Emma has clearly misplaced her reliance on Glen who has dissipated her funds at will, using them as his own. Emma’s indifference to and/or ratification of Glen’s overreaching demonstrates the level of ease with which Emma may be taken advantage of. Although there was evidence that Emma was capable of performing basic tasks of self-preservation, the evidence supports the conclusion that Emma was incapable of managing her own affairs by reason of advanced age and mental weakness. The record also makes clear that one more responsible than Glen was needed to exercise care and custody over Emma’s estate and person.

Difficulties in Talking About Incompetence and Incapacity, Part II

August 26, 2014 § Leave a comment

[This is Part II of a paper by Attorney Tom Freeland, IV, of Oxford, presented at a seminar sponsored by the North Mississippi Rural Legal Services Elder Law Project, Jennie Kilgore, Director]

New Statute Relating to Guardianships and Conservatorships

In the most recent term, the legislature passed Senate Bill 2240, [Fn 1] which made substantial additions and some changes to the statutes governing conservatorships and guardianships. Most of the new provisions related to multi-state issues and jurisdiction. There is a provision defining conservator:

[Fn 1] The full statute may be found at: http://billstatus.ls.state.ms.us/documents/2014/pdf/SB/2200-2299/SB2240SG.pdf

“Conservator” means a person appointed by the court to administer the property of an adult, including a person appointed under Section 93-13-251 et seq.

The cited code sections are those for conservatorships; it is not clear why the word “including” is used. There is a provision defining guardian:

“Guardian” means a person appointed by the court to make decisions regarding the person of an adult, including a person appointed under Section 931-13-111 and Sections 931-13-121 through 93-13-135.

The cited sections are the guardianship statutes.

These provisions have been described as clarifying the distinction between a conservatorship and guardianship. [Fn 2] In one aspect, it is confusing. Under prior law, the conservatorship statute provided for a conservator “to have charge and management of the property” of the subject, or, if the court saw fit, the person of the adult. Miss. Code. Ann. § 93-13-251. This provision is explicitly carried forward by Senate Bill 2240. It is not entirely clear how these different definitions (“managing” property and “having charge and custody of the person” versus “mak[ing] decisions regarding the person of an adult…”) will work in practice, if they are different at all. Further evidence that they may not be different is found in another statutory provision, Miss. Code Ann. § 93-13-261, which defines the powers of a conservator as the same as those of the guardian of a minor.

[Fn 2] Judge Primeaux on his blog, which is one of the best legal resources on the internet for Mississippi lawyers, particularly those in chancery court, described the definitions as clarifying. https://chancery12.wordpress.com/2014/07/10/new-procedures-in-adult-guardianships-and-conservatorships/

The statute also defines an “Incapacitated person” as “an adult for whom a guardian has been appointed….” This highlights a distinction between conservatorships and guardianships that will be discussed, below, in the section on conservatorships: An adult under a guardianship is said to be “incapacitated,” while the subject of a conservatorship is “incompetent.”

Guardianships

Incapacity requiring a guardianship for an adult comes the closest to having a statutory definition. In a chapter titled, “Persons in Need of Mental Treatment,” Miss. Code Ann. §93-13-111 provides:

The chancellor may appoint guardians of the person and estate, or either, of persons found to be in need of mental treatment as defined in Section 41-21-61 et seq. and incapable of taking care of his person and property, upon the motion of the chancellor or clerk of the chancery court, or upon the application of relatives or friends of such persons or upon the application of any other interested party.

This seems to require both a showing of “need of mental treatment” and that the person is “incapable of taking care of his person and property.” The statute then restates the requirement but seems to say that either showing would suffice:

If the chancellor should find from the evidence that such person is in need of mental treatment and incapable of taking care of his estate and person, or either, the chancellor shall appoint a guardian of such person’s estate and person, or either, as the case may be.

The language stating it can be “either” here in the statement of the required proof and, later, in the description of the contents of a petition suggests that either would suffice. The statutory provision referred to by the guardianship statute does not define persons in need of mental treatment. Instead it defines a “Mentally ill person” and a “Mentally retarded person.” Miss. Code. Ann. § 41-21-61 (e) and (f). It is important to note that chapter 41-21 is the part of the code that provides for a commitment proceeding; essentially for a chancellor to find a person is in need of mental treatment, the chancellor must find that the person is subject to being committed. [Fn 3] The statutory definition may be as important for what it excludes at the end as it is for what it includes at the beginning. It provides:

(e) “Person with mental illness” means any person who has a substantial psychiatric disorder of thought, mood, perception, orientation, or memory which grossly impairs judgment, behavior, capacity to recognize reality, or to reason or understand, which (i) is manifested by instances of grossly disturbed behavior or faulty perceptions; and (ii) poses a substantial likelihood of physical harm to himself or others as demonstrated by (A) a recent attempt or threat to physically harm himself or others, or (B) a failure to provide necessary food, clothing, shelter or medical care for himself, as a result of the impairment. “Person with mental illness” includes a person who, based on treatment history and other applicable psychiatric indicia, is in need of treatment in order to prevent further disability or deterioration which would predictably result in dangerousness to himself or others when his current mental illness limits or negates his ability to make an informed decision to seek or comply with recommended treatment. “Person with mental illness” does not include a person having only one or more of the following conditions: (1) epilepsy, (2) an intellectual disability, (3) brief periods of intoxication caused by alcohol or drugs, (4) dependence upon or addiction to any alcohol or drugs, or (5) senile dementia.

[Fn 3] Beyond the definition of a mentally ill person, the procedures in the guardianship statutes are different than the procedures in the commitment proceeding statutes. Commitment proceeding statutes provide that a relative “may make affidavit” that includes facts relating to why the commitment is needed. Miss. Code. Ann. § 41-21-65. They provide that, after the hearing, the chancellor “shall forthwith appoint” either two physicians or a physician and a psychologist to conduct a physical and mental examination of the person. Miss. Code. Ann. § 41-21-67. There are no parallel provisions in the guardianship statute.

If by “person in need of mental treatment,” Miss. Code Ann. §93-13-111 means “person with mental illness,” then persons with an intellectual disability or senile dementia could not be placed in guardianships under that part of the test. They are specifically excluded. [Fn 4] The statute goes on with another definition:

(f) “Person with an intellectual disability” means any person (i) who has been diagnosed as having substantial limitations in present functioning, manifested before age eighteen (18), characterized by significantly subaverage intellectual functioning, existing concurrently with related limitations in two (2) or more of the following applicable adaptive skill areas: communication, self-care, home living, social skills, community use, self-direction, health and safety, functional academics, leisure and work, and (ii) whose recent conduct is a result of having an intellectual disability and poses a substantial likelihood of physical harm to himself or others in that there has been (A) a recent attempt or threat to physically harm himself or others, or (B) a failure and inability to provide necessary food, clothing, shelter, safety, or medical care for himself.

[Fn 4] That infirmities of aging do not support appointment of a guardian is confirmed by Miss. Code. Ann. § 93-13-121, which covers appointment of a guardianship for an adult who had been appointed an out-of-state guardian. It requires that the court find that the ward is now a resident of this state and is incompetent to manage his estate, but that “infirmities of old age shall not be considered elements of infirmities.”

Miss. Code Ann. § 41-21-61 (f). The language about the incompetencies required to appoint a guardian in this paragraph—”failure to provide necessary food, clothing, shelter, safety, or medical care for himself”—would seem almost identical to the second requirement of Miss. Code. Ann. § 93-13-11— “incapable of taking care of his estate and person.”

The code provides that a guardianship proceeding can be begun by the chancellor’s own motion, a motion from the chancery clerk, or a motion by “relatives or friends of such persons” or “the application of any other interested party.” Miss. Code. Ann. § 93-13-111. The petition is required to be sworn. It must be: “a sworn petition in the chancery court of the county of the residence of such person, setting forth that such person is in need of mental treatment and incapable of taking care of his person and estate, or either.” A guardianship proceeding begins quickly—once a petition is filed, a hearing can be had on five days notice to the potential ward. Id.

Where Am I?