Casey Kasem died June 15th, and now his daughter claims that Mr. Kasem’s body is missing (as reported by Jane Caffrey with CNN).  Kasem’s daughters and his wife (Jean Kasem) were engaged in a contentious battle over control of Kasem prior to his death.  Now that Kasem has passed, Jean Kasem has moved Kasem’s body from the mortuary where it was kept without telling his daughters.  So the fight continues on even with who makes funeral arrangements and how the body is ultimately laid to rest

Seems ridiculous, but it happens more often than you may think.  So who has the ultimate control over a person’s body after death?  That can be a tricky question to answer.

Let’s start with California’s Health and Safety code that provides what is supposed to be an orderly way to determine who has control of a decedent’s remains after death.  Under Health and Safety Code Section 7100, the following people, in this order, have the power to control the disposition of remains:

1.  An agent given that power under a Health Care Directive.

2.  The surviving spouse, if competent to make decisions.

3.  The decedent’s child, or a majority of children if the decedent had more than one child.  However, a group of children smaller than the majority can act if they cannot get in contact with the other children.

4.  And then parents, siblings of the decadent, and next of kin, in that order.

The problem comes from a disagreement either between the surviving spouse and the agent under the Health Care Directive, or between multiple children.  I have seen both and it always is an ugly fight.

In Kasem’s case, he had a surviving spouse, but she is not the mother of Kasem’s children, which is a natural breeding ground for conflict in many cases.  Add to that a Health Care Directive that named Kasem’s daughter as agent.  That’s enough to pit spouse against daughter in this mess.  And in some cases there can even be a competing Health Care Directive signed shortly before death that further complicates the problem.

The result: a contentious fight between family members attempting to control the remains and disposition of the decedent’s body.  Who wins and who loses?  That’s up for the Court to decide.   What started as a fight during Kasem’s lifetime now will be a drawn out Court affair lasting long after he is gone.  So much for resting in peace.

Our next video features Stewart R. Albertson discusses the finer points of Financial Elder Abuse in California Trust and Will litigation cases.

To our email subscribers: click on the title link to view the video on our website.

My friend and colleague, Michael Hackard, with Hackard Law in Sacramento, California, approached me the other day with an intriguing and much overlooked concept to recapture lost assets from an elder abuser: “constructive trusts.”  Our discussion lead to the following article that we co-drafted on the issue of constructive trusts. 

THE PROBLEM: FINANCIAL ABUSE OF THE ELDERLY IN NON-PROBATE TRANSFERS. Financial abuse of the elderly takes many forms and its signs are painfully common. Abusive conduct includes: taking money or property; forging signatures; using deception, coercion or undue influence to secure property or money transfers; and falsely assuring the elderly of lifetime care in exchange for money or other assets.

Abusers might include family members with a sense of entitlement or predatory individual serial abusers. Whoever the abuser is, the financial impact of the abuse is often not evident until the elderly victim’s death. 

But how do you recover assets wrongfully taken by an elder abuser?  The law doesn’t allow you to walk in and take property out of the hands of the wrongdoer, but there is a legal way in which to accomplish the same result.

SOLUTIONS: CONSTRUCTIVE TRUSTS AND LIS PENDENS. Recovering assets from an elder abuser is like closing the barn door after the horse has bolted because you have to chase down those elusive assets.  Constructive trust actions, however, can help to bring the “horse” back into the barn, or often times, more importantly, recover assets that were purchased with the elder’s stolen money or property.

Since the elder is usually deceased by the time the theft is detected, it is the elder’s heirs and/or beneficiaries who are left to bring suit as plaintiffs against the elder-abuser defendant.  A “remedy” (which is just a legal term for the relief the Court provides in a lawsuit) for the plaintiffs includes the creation of a constructive trust against real property that was wrongfully taken by the defendant. It is interesting to note that a “constructive trust” is not a Trust at all—at least not in the legal sense.  Rather it is a term used to describe the forced transfer of property from the wrongdoer (the elder abuser) to the rightful owners (the heirs and/or beneficiaries of the deceased elder).  When a Court “imposes a constructive trust” over property, really the Court is just ordering the party who has legal title to that property to transfer it to the plaintiffs.  This can be a powerful tool in recovering stolen property.

In fact, Courts have found the remedy appropriate even in those circumstances where the money obtained from the elderly victim was later used to buy new property. Not only is the wrongfully taken property subject to a constructive trust, so is any subsequent property purchased with those assets by the elder abuser.  Now that’s a horse of a different color.  But whatever the color of the horse (or cow, or chicken or whatever the wrongdoer bought), it can all be returned to the rightful owners through use of a constructive trust.

An equally powerful mechanism, however, is stopping further property transfers from occurring in the first place.  The law has a mechanism to stop the further transfer of wrongfully obtained property—referred to as a “lis pendens.”

LIS PENDENS: CRACKING THE REAL ESTATE TRANSFER. A lis pendens allows a party “to an action asserting a real property claim . . . (to) record a notice of pendency of action in which that real property claim is alleged.” (Cal. Civ. Proc. Code § 405.20).  In its simplest terms a lis pendens is a lien on the property that puts all third parties on notice that someone other than the title holder has asserted a claim against the property. The claim is based on the premise that “[o]ne who gains a thing by fraud, accident, mistake, undue influence, the violation of a trust, or other wrongful act, is . . . an involuntary trustee of the thing gained, for the benefit of the person who would otherwise have had it.” (Cal. Civ. Code § 2224).  

A lis pendens can only be filed after a legal action has begun in Court.  But once a lawsuit has been filed, a lis pendens can be recorded against the real property and then filed with the Court.  At that point, any further transfer, or attempted transfer, of the real property would be subject to the lien and could be return to the rightful owners if they are successful in their suit.

CONSTRUCTIVE TRUSTS AND LEGAL MUSCLE. Constructive trusts are becoming increasingly important given the prevalence of abusive non-probate transfers. Living trusts, joint-tenancy bank accounts, durable powers of attorney and retirement plan designations are efficient estate transfer mechanisms, but they can also be invitations for fraud and undue influence by elder abusers. While estate related litigation ranges from traditional will contests to fraud and punitive damage claims, the utilization of the constructive trust action is expanding.

Constructive trust claims can be filed in courts with probate jurisdiction or in courts of general jurisdiction having authority over civil non-probate matters. The plaintiff’s choice for judicial oversight is based upon a mix of statutory limitations, strategy, tactics, ease of discovery and estimated time to trial. 

Estate and trust litigation attorneys often share their clients’ frustration over the difficulties in remedying the financial abuse of the elderly. Remedies such as constructive trusts can go a long and creative way in preventing obvious and unfair results that would otherwise occur absent judicial intervention.

 

© Copyright Albertson & Davidson, LLP and Michael A. Hackard, 2012. All rights reserved. 

Trust and Will lawsuits often provide different paths to the same destination. My client, a trust beneficiary, recently filed a lawsuit against a trustee of a California trust for financial elder abuse, and at the same time sued for undue influence to set aside the Trust amendment created at the hands of the Trustee/Abuser. In this case the Trustee ended up with a significant portion of the Trust and my client was effectively disinherited.

The Trustee, hoping for an easy out, tried to convince the Court that the elder abuse claim should be dismissed summarily (called a demurrer) because the claim was based on a transfer by Trust, and in his opinion, the abuse of the elder did not actually occur until the trust creators died and their Trust became irrevocable (the “taking argument”). His claim was that the beneficiary cannot use the same undue influence facts to (1) overturn the Trust amendment, and (2) sue for financial elder abuse.  In other words, he may have been an undue influencer for purposes of the Trust amendment, but not for purposes of financial elder abuse.

But California law disagrees. Specifically, there are three different ways in which financial abuse may be pleaded under the Elder Abuse Act found at Welfare and Institutions Code section 15610.30(a), which states a person is guilty of financial elder abuse if they take property of an elder for wrongful use, or with intent to defraud, or by way of undue influence. (Welf. & Inst. Code, § 15610.30, subdivisions (a)(1), (a)(2), and (a)(3).) Thus, the act of undue influence used to overturn a California Trust (or in this case a Trust amendment) can also be used to establish a claim for financial elder abuse. Further, the Elder Abuse Act defines a “taking” to include the receipt of assets by a “testamentary instrument”, which includes California trusts and wills. (Welf. & Inst. Code, § 15610.30(c).)

Does this mean my client would get double damages, one with the Trust set aside and another in the amount of the property taken? No. But it does mean my client can proceed on both claims and take full damages under either one. For example, the elder abuse statute allows for punitive damages and attorneys’ fee whereas the Trust set aside claim does not.

The trial court heard oral argument on the demurrer on May 5, 2011. After hearing oral argument, the trial court was persuaded that the financial elder abuse claim could go forward based on undue influence as it was properly pleaded in my client’s lawsuit, and was supported by the Elder Abuse Act.

The next time you see facts showing a “garden-variety” trust or will contest, think about whether those facts also support a claim based on financial elder abuse.

It doesn’t happen often, but the existence of fraud can cause a Will to be invalid. Fraud is simply a lie (called a misstatement of a material fact in legal parlance).  Thus, if someone lies to a person creating a Will (called the testator) and that lie causes a different disposition under the Will than otherwise would have been made, then the Will is invalid for fraud.

Let’s put this legal-talk to an actual example.  A testator had two sons, Adam and Brian; Adam was an alcoholic, but rehabilitated himself and no longer drinks.  The testator had previously disinherited Adam when he was an alcoholic, but then created a new Will giving Adam an equal share once he was rehabilitated. However, the testator warns Adam that “if I ever see you drink again, you’re out of my Will for good!”

A few weeks later, the testator and his other son Brian are walking down the street and they see someone exiting a bar with a drink in his hand that looks like Adam, but the testator isn’t sure if it’s Adam.  He asks Brian if that is his brother exiting the bar, and Brian says “that’s my brother Adam all right” even though Brian can clearly tell that the man exiting the bar is not Adam.  The testator then changes his Will and disinherits his son Adam based on that lie. 

Since the Will in this example was created based on a lie, and the Will was changed in a way that would not have occurred absent the lie, the Will could, and very likely should, be overturned.

The problem, of course, is that these statements made to the testator must be established by credible evidence in court.  And if no one else heard the lying statement by Brian and no one else knew exactly why the testator changed his Will, then there won’t be any evidence to present in court—Brian certainly is not going to admit to the lie in open Court.

So fraud is a ground, albeit a difficult ground, that can be used to overturn a California Will or Trust (this same discussion applies to the creation or amendment to a Will or Trust  too).