June 15 – World Elder Abuse Awareness Day

One in ten Americans aged 60 or above have experienced some form of elder abuse.

June 15th is World Elder Abuse Awareness Day, a day designated to bring visibility to the prevalence of global elder abuse. According to the National Council on Aging, one in ten Americans aged 60 or above have experienced some form of elder abuse. It is expected that with the number of older persons growing, abuse of the elderly will also grow. Though elder abuse is a serious and common problem that could lead to poverty, hunger, homelessness, compromised health and well-being, and even premature mortality, it often is one of the least investigated or reported types of abuse.

Recent research findings have highlighted financial exploitation as a frequent form of elder abuse. It has been estimated on a global scale that 5 to 10 per cent of older people may experience some kind of financial exploitation. Financial exploitation often goes unreported either due to the victim’s embarrassment or because of an impairment resulting in an inability to report the abuse.

An older person may be vulnerable to financial exploitation due to social isolation and cognitive impairments. Other factors that place the elderly at risk include: emotional or physical dependence on the perpetrator, financial dependence of the abuser on the older person, certain living arrangements, poverty, widowhood and lack of support networks. Societal prejudices such as ageism and discriminatory systems may also contribute toward the elderly being at risk of financial exploitation.

One way to prevent elder abuse is to plan for the future. A power of attorney or a living will can address health care and financial decisions and better avoid confusion and problems later on. Having a will and reviewing the will periodically may also help prevent abuse. An estate planning attorney can provide assistance in planning for the future.

Family members and others concerned about preventing or stopping ongoing elder abuse also have options. Education on abuse and being able to identify the common forms it takes can be critical to prevention. For education resources go to https://ncea.acl.gov/

Reporting abuse or suspected abuse is also vital. For immediate, life-threatening danger, the police should be contacted. If an older person is being mistreated the local Adult Protective Services office should be contacted. If the older person is in a facility, such as a nursing home, the Long-Term Care Ombudsman should be contacted. In Oregon the Elder Abuse Hotline number is 1-855-503-7233.

While physical abuse and some financial abuse issues can be appropriately responded to by the police, other financial abuse issues may require an experienced elder abuse attorney.

An experienced elder abuse attorney may be able to determine whether financial elder abuse has occurred through undue influence, lack of capacity, or a breach of fiduciary duty. If financial abuse has occurred an experienced elder abuse attorney may be able to litigate abuse claims on behalf of the victim or the victim’s family.

Special thanks to Daniela Holgate for her work on this article. Daniela is a law clerk at SYK, and a J.D. candidate at Lewis & Clark School of law.

Victoria Blachly - Parter

Not only is Victoria Blachly a partner at SYK, and an experienced fiduciary litigator that works with many elderly clients, cases or causes, she is also a proud Board Member for the Oregon Alzheimer’s Association Chapter.

Competency Can be Tricky: Don’t Rule Out the Nonagenarian

The brain is a challenging maze and competency blends medicine and law in a complicated fashion.

Sumner Redstone, at 92 years-old and the controlling shareholder of his $40 billion media empire, Viacom Inc. and CBS Corp. has accomplished a lot. And a court recently ruled he can continue to make his own decisions, including deciding who should be his health-care agent.

This ruling disappointed (to say the least) his former girlfriend and longtime companion, whom he had evicted last fall and removed as his health-care agent, before also removing her from his Will, in which she was to inherit $70 million in cash and real estate.

Although a speech therapist had to interpret Mr. Redstone’s impaired speech, the judge was swayed by the video deposition in which Mr. Redstone made it clear that he wanted his ex-girlfriend out of his life and preferred his daughter to be his health-care agent. The judge remained unconvinced by an expert witness who failed to overcome the presumption of capacity.

The brain is a challenging maze and competency blends medicine and law in a complicated fashion. Our country’s ageism tends to count out anyone over 65, but the judge in this hearing found otherwise.

Oregon First to Pass RUFADAA – Allowing Legal Access to Your Digital Assets

Oregon becomes the first state to pass RUFADAA: The Revised Uniform Fiduciary Access to Digital Accounts Act.

SYK has been advising our clients, friends and colleagues about managing Digital Assets (your online accounts) for many years, lamenting the fact that the Internet was outrunning the law. We’ve been writing about it, testifying before legislators, speaking at seminars and encouraging everyone to prepare a VAIL – or Virtual Asset Instruction Letter. 

We are happy to report that there is new light on the issue. Oregon has just become the first state in the nation to pass RUFADAA: The Revised Uniform Fiduciary Access to Digital Accounts Act. Oregon Senate Bill 1554 was signed by the Governor yesterday and will become effective January 1, 2017.

This law is important in that while it allows for personal representatives, powers of attorney and trustees to have access to online accounts to perform their fiduciary duties, it also requires everyone to be proactive in affirmatively stating in your trust or estate plan that you grant such authority; otherwise, the online providers’ terms of service agreements will control. And those agreements often give the online provider all of the power, including the power to hit “delete” when they know someone has passed, which could destroy vital financial information or precious memories you had intended to share with those you leave behind.

So dust off that will or trust you prepared so long ago and call your estate planner; it’s time that your estate plan caught up with the Internet.

Attorney Victoria Blachly is a fiduciary litigator who has been working on digital asset legislation for six years, testifying before legislators and presenting at seminars throughout the U.S. The issue became very personal to her when she lost a young niece and saw how invaluable her social media was to the grieving family and friends she left behind. Victoria worked closely with one of SYK’s estate planners, Jeff Cheyne, and one of SYK’s business attorneys, Michael Walker, to pursue legislation that was initially hard fought by very large and well-funded online providers.

Blachly’s Article Featured in The American Bar Association Publication

Congratulations to SYK attorney Victoria Blachly.  Her article “Uniform Fiduciary Access to Digital Assets Act: What UFADAA Know” was recently published in Probate & Property, a Publication of the Real Property, Trust and Estate Law Section.

Her article explores the issues that arise when a family member passes away, or becomes incapacitated, in an increasingly paperless society such as our own. Financial accounts, social media, person photographs, what happens to all of these things left behind online?

Arbitration Clauses Binding Upon Account Beneficiaries

From time to time we publish interesting trust and estate cases: 

Citigroup Smith Barney v. Henderson, Oregon Court of Appeals

Decedent opened up an IRA with Citigroup Smith Barney, and under the terms of the IRA agreement, the decedent agreed that all claims “arising from the business of [Citigroup] or otherwise” would be subject to arbitration and that New York law would govern and construe the IRA agreement.

 

The decedent then completed two forms to designate the beneficiaries of the IRA: the first form designated his personal trust – of which his second wife was the successor trustee – as the beneficiary, and the second form designated the children of the decedent’s first marriage as the beneficiaries. The second form, however, was not dated.

 

Upon the decedent’s death, Citigroup discovered the conflicting forms and recommended that the beneficiaries resolve the matter among themselves. When the beneficiaries were unable to resolve their competing claims to the IRA, Citigroup moved to deposit the proceeds of the IRA with the court, and moved to obtain an order relieving it of any further liability for the IRA. The trial court granted Citigroup’s motion to interplead the IRA funds, denied its motion to be dismissed, and ordered that the conflicting beneficiaries interplead and litigate any claims in the action.

 

The decedent’s wife filed an answer and counterclaim, alleging that Citigroup had breached its fiduciary duties to her when it accepted contradictory beneficiary designation. Likewise, the decedent’s children filed an answer and counterclaim alleging that Citigroup had breached its contract to the decedent by failing to properly manage his file and that the children were the intended beneficiaries.

 

In response, Citigroup filed a motion to compel arbitration of the counterclaims brought by the conflicting beneficiaries, contending that the counterclaims were subject to the arbitration clause in the IRA agreement. The decedent’s wife, in turn, argued that the arbitration clause required arbitration of all claims, including Citigroup’s interpleader action, and thus Citigroup had waived its right to arbitrate when it filed the interpleader action.  The children agreed with the wife’s argument, and in addition claimed that they could not be compelled to arbitrate because they had never agreed to do so. The trial court denied Citigroup’s motion to compel arbitration.

 

On appeal, Citigroup assigned error to the trial court’s denial of its motion to compel arbitration, arguing that all of the beneficiaries were subject to the arbitration clause and that it did not waive its right to arbitrate upon filing the interpleader action.

 

Upon recognizing that New York law applied to the IRA agreement pursuant to the Federal Arbitration Act ("FAA"), the court next addressed the issue of whether the children, as third-party beneficiaries, were bound by the arbitration clause in the IRA agreement. Under New York law, a party who has not signed an agreement containing an arbitration clause can be compelled to arbitrate if such party has derived a benefit from the contract or relied upon the contract in asserting a claim. As a result, the children’s claims were subject to the arbitration clause.

 

Next, the court considered whether the trial court had correctly determined that Citigroup had waived its right to arbitrate. The issue in this case, the court stated, was not how the issue should be resolved, but instead who should decide whether Citigroup had waived its right to arbitrate: an arbitrator or a court. Under the FAA, the issue of which forum should decide a question is a matter of contract interpretation under state law. Where the arbitration agreement is silent as to who should decide issues of waiver, and where the parties’ intent cannot be discerned, the default rule under the FAA is to presume that waiver issues are to be decided by the arbitrator. Moreover, the Supreme Court has recognized that it is presumed that an arbitrator will decide “procedural questions which grow out of the dispute and bear on its final disposition.” 

 

Here, the IRA agreement provided that it “shall be governed and construed in accordance with the laws of the State of New York.” Under New York law, choice of law provisions that select New York law to govern the enforcement of a contract are distinguished from those that select New York law to govern the contract. That is, a contract that is to be governed by New York law does not express an agreement to have New York law govern the enforcement of the agreement. Here, the IRA agreement did not include the language “shall be enforced,” and thus the parties had not intended that a court decide the issue of waiver. Likewise, because the IRA agreement was silent as to which forum should decide issues of waiver of the arbitration agreement, the court applied the presumption that waiver is an issue of procedural arbitrability that is for the arbitrator, and not the court, to decide. 

 

In conclusion, the court held that the children’s rights under the agreement were subject to the same limitations as were included in the wife’s IRA agreement, and thus the children were bound by the arbitration clause. Additionally, because waiver is an issue of procedural arbitrability, the issue of whether Citigroup had waived its right to arbitrate was to be left to an arbitrator. 

When Joint Bank Accounts Fail

Taufen v. Estate of Kirpes, 155 Wash App 598, 230 P2d 199 (2010)

Decedent’s estate included a joint checking account which named Decedent and Mr. Yochum as joint owners. Although Decedent made no mention of survivorship when she opened the account, the banker unilaterally elected to add a right of survivorship without discussing the matter with Decedent. Upon Decedent’s death, Mr. Yochum transferred the balance of the account to the estate after he was informed that the money in the joint account belonged solely to Decedent’s estate. Thereafter, he sued the estate for the account proceeds.

In recognizing that the essential issue before the court was whether Decedent intended to create the account with a right of survivorship, the court first acknowledged that there is a rebuttable statutory presumption that funds belonging to a deceased depositor which remain in a joint account with a right of survivorship belong to the surviving depositor unless there is clear and convincing evidence of a contrary intent. When the presumption is overcome, however, it ceases to exist and cannot be further considered.

The court determined that, although the signed account card created a rebuttable presumption of intent to create a right of survivorship, the estate met its burden of production by providing evidence that: 1) Decedent only instructed the banker that she wanted to open up a joint account, 2) Decedent never instructed the banker that there was to be a right of survivorship, 3) It was the banker who elected to create a joint account with a right of survivorship, and 4) the designation of a right to survivorship was never discussed with Decedent. Thus, the statutory presumption of intent disappeared, and judgment was entered in favor of the estate.

LESSON: The presumption of a joint bank account may be overcome with the right evidence.

What is a Fiduciary Litigator?

I am a civil trial attorney.  More specifically, I am a fiduciary litigator.  The problem is most people don’t have a good working knowledge of what that means, since there are no popular television series about attorneys that handle litigation for individual trustees, corporate trustees, beneficiaries, and personal representatives, including trust and estate litigation, will contests, trust disputes, undue influence, capacity cases, claims of fiduciary breach, financial elder abuse cases, and guardianships and conservatorships.

Sometimes I tell people my job is to manage family dysfunction and I’m really just a very expensive form of therapy. 

In a Business Journal article about probate attorney Tom Rickhoff from San Antonio, author Sandra Lowe Sanchez quoted him as describing his job as, “An endlessly fascinating study of human motivation." 

Mr. Rickhoff may have summarized my job better than I ever have….. 

Family Fights: Top 5 Reasons Settlement Beats Litigation

Catdogfight.jpg

 
Jay Folberg recently wrote the four page article,
 "Mediating Family Property and Estate Conflicts"
in the ABA’s December 2009 issue of Probate &
Property
.  I’ve distilled it into the top five reasons
why you want to heed his advice to mediate rather
than litigate:


1.       Expense.  Litigation is ridiculously expensive.  It takes
untold hours for partners, associates, and paralegals to wade through
discovery documents, take depositions, fight numerous pre-trial battles,
and properly prepare a case to proceed to a hearing or trial.  Don’t get
me wrong – that’s how I make my living and sometimes there is no other
choice, but it takes a tremendous amount of time and money to litigate.
Settlement at any stage of litigation stops the bleeding of attorneys’
fees. 

2.       Publicity.  Certain family members are good at starting a fight
without looking down the road to see where that path leads.  When the
mud between disgruntled family members starts to be tossed around, it
may feel good for the person that starts the fight to file their
salacious allegations, but those become public documents for curious
gawkers to review.  And the responsive documents filed could turn out to
be even more salacious and damaging.  Early mediation avoids battling in
a very public forum. 

3.       Non-Party Participation.   The plaintiff or petitioner files
the lawsuit or petition and the defendant or respondent answers.  But
with family disputes, there are often non-party players that are pulling
the strings behind the scenes that have great influence.   With
mediation, the non-parties may be allowed to participate in the process,
which allows them to voice their opinions and can be beneficial in
allowing all to feel they have had their "day in court" without actual
litigation.

4.       Creative Resolution.  Often times in litigation there is a
winner and a loser, without much gray area in between.  Mediations are
opportunities to toss around creative resolutions that the court may not
have the ability to use.  For example, Folberg notes a settlement in
which one brother settled for income producing real property, because
that met with his needs and interest, and the other brother received the
real property with the development potential, because that met with his
very different needs and interest. 

5.       Family Communication.  Conventional litigation, with the
parties speaking through their attorneys, does not allow for the
interaction that may be necessary to help frustrated family members
resolve their conflict.  The right mediator and the right attorneys can
be powerful in guiding conflicted families back toward some sort of
relationship.  Can it happen?  Absolutely.  Does it happen?  Not nearly
often enough.       

Recent Ruling: Elective Share

  From time to time we will publish recent local cases or legislative bills:

Wilson v. Wilson, 224 Or App 360, 197 P.3d 1141 (2008)

Background: This is a spousal elective share case. The conservator of the decedent’s wife filed a claim for her elective share. Before the court determined whether or not to grant the elective share, the wife died.

 

Holding: The elective share is personal to the surviving spouse and the right to it extinguishes upon the death of the surviving spouse.

 

Comment: This past legislative session, the Oregon Legislature amended the surviving spouse elective share statute. A copy of the statute is available here

Recent Ruling: Personal Representative Compensation

From time to time, we will publish blurbs on recent local court opinions and state legislation:

Brown v. Hackney, — P.3d –, 2009 WL 1394832 (Or App 2009)

Background: Brother of the decedent, a beneficiary through intestate (without a will) succession, challenged the payment of the personal representative from funds acquired through the settlement of a wrongful death action initiated by the personal representative.

 

Holding: The personal representative may be compensated based on the proceeds of a wrongful death settlement. ORS 116.173 bases personal representative compensation on the “whole estate” which is greater than the intestacy “estate.” The decedent’s “whole estate” is “comprised of all property both within the jurisdiction of the probate court as well as property outside the jurisdiction of the probate court.”

 

Comment:  This fight was over an amount of $5,200.  $5,200!  Really!?!  Can’t we negotiate matters like grownups, instead of taking them up to the court of appeals?