Caregiver Statute

California Probate Code Section 21350, also known as the Care Custodian Statute, presumptively invalidates testamentary gifts (gifts left in a will or a trust or even by beneficiary designation) made by an elder to individuals who provided health and social services to the elder. Health and Social services is very broad and can include daily assistance to an elderly person. For purposes of the Care Custodian Statute, “elder” is defined as any individual over the age of sixty-four whose physical and/or mental abilities have diminished as a result of age.

The purpose of the Care Custodian Statute is to protect elderly individuals from predatory people, who would otherwise abuse the reliant, trusting nature of the care custodian relationship to manipulate the elder into giving the care custodian a portion, if not all, of the elder’s estate.

While it is exceedingly important to protect elderly individuals from opportunistic care custodians, not all gifts made by elders to care custodians are suspect or inappropriate.  Indeed, it is common for an elderly individual to desire to provide for the individual(s) who assisted the elder as he or she aged and required additional support.  It is also common that the persons named in an elderly person’s will or trust years ago are those exact persons who later do want to care for the elderly person. In order to protect the elder, the Code requires that gifts made to these people be independently reviewed by an attorney to ensure the elder knowingly made such gift happily and voluntarily.  Persons who are exempt from such review include the elder’s spouse, registered domestic partner, or persons related to the elder by blood.

Additional exceptions are available under the California Probate Code for testamentary gifts from an elder to a care custodian; however, these exceptions are very fact specific and should be discussed with an attorney.

An independent review by separate counsel is not a lengthy or difficult process, but is quite necesssary to ensure that the gift is properly made.

If you are interested in obtaining information regarding the Care Custodian Statute or would like to discuss the process of independent review, please feel free to contact us.

Elder Financial Abuse: the lesser-known evil

By Vanessa Sundin

John is 73 and lives in a retirement home in San Francisco. Although his family lives in the area, John sees them only two or three times a month. To chase away the lonely bug and to see some new faces, John often has dinner at a restaurant, named Lenny’s, near his retirement home. While having dinner at Lenny’s one evening, John met Cassandra, a pretty twenty-something woman, who seemed friendly and intelligent. John and Cassandra struck up a friendship and began to meet at Lenny’s for dinner a couple of times a week. John did not tell his family about Cassandra, as he was concerned that they would not approve of their friendship.

Although John really enjoyed Cassandra’s company, he could not help noticing that unfortunate events always seemed to befall her. For instance, within the first two months of their friendship, Cassandra’s car broke down, her ex-boyfriend stole money from her bank account, her purse was stolen, and she lost her job. Initially, John had to coax Cassandra into borrowing money from him to cover the damages she incurred as a result of her terrible encounters. After a month or two, however, Cassandra began to expect – and even demand – that John give her money. Soon, John no longer wanted to be friends with Cassandra, but he was too afraid to tell her to leave him alone. Finally, after Cassandra successfully demanded that John help her fix her car for the third time, John broke down and told his family about his “friendship” with Cassandra. John’s family immediately reported Cassandra’s behavior to the police and to Adult Protective Services. However, Cassandra seemed to know she had pushed John beyond his limit, and had vanished. Although John’s family is hopeful that the police will find her eventually, it appears that Cassandra may have succeeded in abusing John out of more than $50,000.

John’s story is more common than most people would expect. Nearly 85,000 elder financial abuse cases were reported nationwide in 2004.[1] This number is even more staggering considering it is estimated that only 1 in every 25 elder financial abuse case is ever reported.[2] Elder financial abuse typically goes unnoticed or unreported, because the abused elder often does not realize he or she is has been victimized, or because he or she is too afraid and/or embarrassed to admit that she has been victimized.

Elder financial abuse occurs when an individual or entity exploits an elderly individual by preying on the elder’s age-related vulnerabilities, such as impaired mental capacity or loneliness. Elder financial abuse is most commonly committed by a person the elder knows and trusts, such as a family member, friend, caregiver, banker, or nursing home employee.  The abuser commonly manipulates the elder into prematurely selling his or her assets, giving the abuser the elder’s money and assets either through gifts or by supporting them, or changing the elder’s estate plan to leave the elder’s estate to the abuser. Those with such malintent also often withhold the elder’s money for daily necessities and/or alienate the elder from his or her family and loved ones, thereby making the elder dependent upon the abuser. Elder financial abuse may also be committed by businesses and organizations. An example of this form of abuse is a financial institution that targets elders, and intentionally sells them financial products that are unnecessary and often financially detrimental or devastating.

Because elder financial abuse can be difficult to discover and often is not uncovered until well after the acts have been committed, it is important that the friends, family, and professionals who assist elders watch for signs of potential elder abuse. These symptoms and signs of elder financial abuse may include:

  • Increased, uncharacteristic withdrawals from the elder’s financial accounts;
  • Increased, uncharacteristic use of the elder’s credit card;
  • Changes to the designated beneficiaries on the elder’s accounts, particularly to include either a caregiver or new “friend” of the elder;
  • Authorization of new signors or authorized users on the elder’s financial accounts;
  • Adding a caregiver or new “friend” to the title of the elder’s properties and/or vehicles;
  • Recent changes to the elder’s power of attorney, health care documents, will, and/or trust, especially if the documents were changed to include the elder’s caregiver or new “friend”;
  • The elder is increasingly introverted or depressed;
  • The elder is less willing to discuss matters he or she once discussed regularly and without hesitation;
  • The elder’s caregiver or new “friend” restricts the elder’s access to family, friends, and social activities;
  • The elder’s caregiver is overly interested in the elder’s finances or estate planning; and
  • The elder allows a caregiver or new “friend” to speak on his or her behalf and to handle the elder’s financial affairs.

Sometimes, however, elder abuse can be more subtle. If you or someone you know may be the victim of financial elder abuse, or if you have questions regarding financial elder abuse, please contact our offices.

[1] http://www.ncvc.org/ncvc/main.aspx?dbName=DocumentViewer&DocumentID=32350#6

[2] http://www.ncea.aoa.gov/NCEAroot/main_site/pdf/publication/FinalStatistics050331.pdf