Estates, Trusts and Probate Law

Estates, Trusts and Probate Law Section February 2013 Newsletter


Greetings From the Steering Committee Cochairs
Dear Section Members:

We start off the year with new judicial assignments in the Probate Division. The Honorable John M. Campbell has been appointed Presiding Judge of the Probate Division, replacing Judge Rhonda Reid–Winston, who spent six years in the Probate Division and has rotated to the Criminal Division. We also welcome the Honorable Erik P. Christian and the Honorable Gerald I. Fisher to serve as Deputy Presiding Judges. Many of Judge Campbell’s cases have been reassigned and the new assignments appear on the docket. If your case is an ADM or LIT case then you can check the docket online at Court Cases Online.

We are also happy to report that we are embracing new technology and offered our first Webinar video-cast of our September, 2012 luncheon program. We plan to continue to offer Webinars in 2013. The Webinar service is a video link that will allow you to watch select luncheon programs at your convenience from your computer. Series subscribers will receive access to the Webinars free of charge and all others can access the Webinar for a cost of $35 per program. This means if you are unable to attend a luncheon program in person, you can still watch the live program. To subscribe for the luncheon series, a specific program or to register for a Webinar, contact the D.C. Bar Sections Office.

In addition, we continue to collaborate with the D.C. Bar Pro Bono Program to bring important free legal services to the community and training to our members. We are co-sponsoring training by the D.C. Bar Pro Bono program which will bring members together with volunteer opportunities.

More information about these volunteer opportunities is found in this newsletter. See the Probate Resource Center Announcement and the article by Ed Varrone entitled, Being Good, Doing Good, Having Fun!

We recognize that our section members have long been dedicated to community service and we send a big thank you out to Andrea Sloan and all of our members who made the Fifth Annual Holiday Gift Drive a success. We were able to provide gifts to the residents of Stoddard Baptist Nursing Home and the Washington Nursing Facility.

We hope you enjoy this newsletter addressing the topics of real property tax rates for vacant and blighted properties and changes to the law impacting Medicare coverage for nursing home care, as well as summaries of recent decisions in the area of probate law.

Thank you for your continued support and your contributions to the section.

Katherine M. Wiedmann and Mark Griffin
Cochairs
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Community Outreach and Pro Bono Opportunities

Probate Resource Center Announcement
The D.C. Bar Pro Bono Program is pleased to announce that it is now operating the Probate Resource Center as a walk-in clinic forlarge estate administration issues on Tuesday afternoons from 12:30 to 4:30 in Room 319 in Building A of the Superior Court. The change, made in coordination with and at the request of the Court and the Register of Wills, is part of an effort to reach more unrepresented litigants who typically slow down the system by appearing in Court uninformed and unprepared.

Each session is staffed with one experienced probate attorney and two other attorneys, with less experience, who can rely on the more experienced attorney for mentoring and support. Each attorney meets with individuals seeking legal assistance and provides the tools necessary to successfully complete the probate endeavor, to the extent possible through brief services. The services provided by a volunteer attorney may include counseling customers about the probate process, working with customers to prepare the Petition for Probate and related documents, helping customers understand how property should be distributed to beneficiaries or helping customers with the transfer of property to beneficiaries.

The Pro Bono Program is now recruiting attorneys to volunteer at the Resource Center.

This opportunity is open to attorneys of all levels of probate experience, including experienced probate practitioners. This is a great opportunity to serve the District’s most vulnerable residents through a volunteer experience that has a finite time commitment. For attorneys with less probate experience, this is also an opportunity to learn about basic estate administration practices and procedures from more experienced practitioners.

The time commitment requested of each attorney is sixteen hours per year, which would require staffing the Resource Center four times per year, with each session lasting approximately four hours. Malpractice coverage is provided to all volunteers by the D.C. Bar Pro Bono Program.

If you are interested in taking advantage of this volunteer opportunity, or if you have any questions about the Center’s operation, please contact Skip Mark (202-737-4700 ext. 3354), a managing attorney at the D.C. Bar Pro Bono Program.
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Being Good, Doing Good, Having Fun!
By Ed Varrone

What more can one ask from just a couple of hours!
The Estates, Trusts and Probate Law Section participates in several pro bono projects, all of which provide legal advice and one–time assistance to persons who truly need help. In conjunction with the D.C. Bar’s Pro Bono Program, volunteers staff the Advice and Referral Clinic, the Probate Resource Center and the Interventions Self–Help Center.

Volunteer attorneys provide one–time evaluations of a person’s case, and provide suggestions and guidance. Frequently, the volunteer attorney will assist the customer to complete a court form or a simple pleading. Many people can be helped in a single meeting, but if ongoing legal representation is needed, the person is given suggestions on how to obtain their own attorney. No volunteer is expected to take on a case or provide continuing representation.

Virtually all of the people who seek assistance at one of the clinics are truly needy and are often in vulnerable situations or have no idea of their rights or what they can do to protect their interests. Volunteers unanimously report that the people they see are always very grateful for the services provided and appreciate the information and guidance which they receive. Most importantly, volunteers provide a very important public service to a critically under-served population in the District of Columbia.

For the volunteer, donating just two or three hours of pro bono service both helps meet an important need and is a very satisfying way to fulfill the pro bono obligation that every attorney shares. One volunteer writes, “Thank you for introducing me to the Pro Bono Clinic. It was so fulfilling to be able to help!” After volunteering one time, many attorneys offer to volunteer again and again, reporting that they find the experience rewarding and often even fun.

There are three clinics which need help:

(1) The D.C. Bar Pro Bono Program's Advice and Referral Clinic is held on the second Saturday of every month, at the Bread for the City office on 7th Street NW. and the Max Robinson Center on Good Hope Road, S.E. Volunteers meet at 9:00 a.m. and leave by 1:00 p.m., at the latest.

(2) The Probate Resource Center operates a walk-in clinic on Tuesdays, for approximately 4 hours in the afternoon at the Register of Wills office.

(3) The Intervention Self–Help Center operates once a week, on Wednesdays, in the afternoon at the Register of Wills office.

All three offer opportunities for brief, but very important and rewarding, “painless pro bono.”

Contact Ed Varrone if you are interested in participating in any of these programs.
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Proposed Settlement Helps Medicare Beneficiaries Receive Skilled Nursing Care
by Morris Klein

Morris Klein concentrates in elder law and special needs law from his office in Bethesda, MD

A proposed settlement with the U.S. Department of Health and Human Services will make it easier for patients to receive skilled nursing care services at a nursing facility or at home. The settlement will require Medicare to pay for skilled care services that are necessary to maintain a beneficiary’s current health or to prevent further deterioration in care. Under current practice, Medicare provided coverage only if the skilled care resulted in an improvement of the patient’s condition.

Medicare will pay for up to 100 days of skilled care in a nursing facility after discharge (or within 30 days of discharge) from a hospital where the patient has been admitted for at least three days.[1] Medicare pays the entire cost for the first 20 days, and the patient is responsible for paying a co-pay during the remaining 80 days. In 2013 the co-pay is $148/day. Medicare will also pay for physician-authorized skilled care to a home–bound beneficiary on an intermittent basis. Skilled care includes physical, occupational and speech therapy, wound therapy, and observation of changing conditions.

Under current decades–old procedures, Medicare contractors who processed skilled care claims would deny payment if the patient “failed to progress” when receiving skilled care services. Many patients requiring skilled care have long-term or debilitating conditions and are incapable of showing improvement, although skilled care may keep them from further deterioration. The policy resulted in many Medicare beneficiaries in nursing homes losing their skilled care benefit far short of the 100–day limit and homebound patients prematurely losing skilled care at home.

In Jimmo v. Sebelius, No. 11-CV-17 (D. Vt.), six individual plaintiffs and seven organizations (including the Alzheimer’s Association, the Paralyzed Veterans of North America and the National Multiple Sclerosis Society) filed a class-action lawsuit challenging the “failure to progress” standard. Glenda Jimmo, the named plaintiff, had a below–the–knee amputation due to diabetes and required skilled care services at home for wound care. Medicare had refused to continue pay for her care because the care would only “maintain” and not”improve” her condition. The plaintiffs argued that the “failure to progress” standard was more restrictive than permitted under Medicare law and regulations.

After the defendant’s motion to dismiss was largely denied, 2011 WL 5104355, the parties filed a settlement agreement with the court on October 16, 2012. The settlement clarifies that Medicare will pay for skilled care to “maintain the patient’s current condition or prevent or slow further deterioration.”

All sides expect the judge to sign the agreement, a process that can take several months. Once the judge approves the settlement, the Center of Medicare and Medicaid Services (CMS) will revise its Medicare Benefit Policy Manual and other agency directives to remove implications that skilled care is dependent upon a patient’s improvement. CMS will also mount a nationwide educational campaign to communicate the new standard to Medicare providers and contractors. The court will maintain jurisdiction for an undetermined amount of time after the end of the educational campaign, during which plaintiffs may seek enforcement of any settlement provisions that they believe that the government has failed to comply.

Also under the terms of the settlement, the court will certify a nationwide class of more than 10,000 Medicare beneficiaries who received an adverse administrative decision based on the improvement standard that became final and non-appealable on or after January 18, 2011. These beneficiaries may be able to have their claims reviewed under the revised standard.

The Center for Medicare Advocacy, Inc., one of the attorneys representing the plaintiffs, is urging health care providers to implement the maintenance standard now because the underlying Medicare law has not been changed. It is also encouraging Medicare beneficiaries to appeal denials even if they think the appeal will be futile because, once finalized, the settlement agreement will provide a review under the proper standard for all claims that were denied after January 18, 2011 on the basis of the improvement standard.

It is important to note that the settlement affects only the standard to receive skilled care. Other Medicare eligibility criteria remain the same. Medicare’s 100-day limit on skilled nursing care is not changed, although it is more likely that a patient will receive the full 100 days as a result of the litigation.
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[1] A patient must be formally admitted to a hospital to qualify for skilled nursing care.  Some hospitals have placed patients in “observation status” rather than admitting them, and such patients do not qualify for skilled nursing care.  A separate lawsuit, Bagnall v. Sebelius, No. 11-1703 (D.Conn.), filed August 17, 2012, is challenging federal policy of allowing hospitalized Medicare beneficiaries to be placed in "observation status," rather than formally admitting them, as a deprivation of plaintiffs’ Medicare coverage.
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The Good, the Bad, and the Ugly: Property Condition and Property Tax in the District of Columbia
By Mark Griffin

Mr. Griffin has a law practice specializing in Real Estate and Estate Planning & Probate.

The Good: A D.C. property that is occupied and in full compliance with D.C. Code; taxed at the lowest applicable rate.
The Bad: A D.C. property which has not been properly registered as a vacant property or which has been properly registered but is not eligible for any vacant property exemptions. When such a property has been designated by the District of Columbia Department of Consumer and Regulatory Affairs (DCRA) as a vacant property; taxed at a 5% rate unless qualified for an exemption. DCRA maintains a list of vacant properties. There are currently about 1200 vacant properties on the list and about 90 that are about to be added to the list and about 570 exempt vacant properties.
The Ugly: A D.C. property which is vacant and which has been designated by DCRA to be unsafe, insanitary, or which is otherwise determined to threaten the health, safety or general welfare of the community; taxed at a 10% rate - no exceptions. DCRA maintains a list of blighted properties. There are about 336 blighted properties currently on the list and about 60 properties that are about to be added to the list. DCRA has been delegated by the Mayor to identify Vacant and Blighted Properties in the District of Columbia.

Vacant Properties
Vacant properties in the District of Columbia that have been designated as vacant by DCRA will be taxed at a rate of 5% unless the vacant property is registered by the property owner and the property qualifies for an exemption that will shield it from the 5% tax. Vacant properties that are not exempt and are maintained in accordance with D.C. Code Sec. 42-3131.12, will be taxed at a rate of 3%.

Here are the exemptions which apply to a vacant property:

1. The Property is under active construction and there is a building permit to make the building fit for occupancy that was issued, renewed, or extended within 12 months of the required registration date.

2. The Property is actively seeking to sell or rent the property, and the property is being properly maintained per D.C. Code Sec. 42-3131.12. The time period cannot exceed one year from the initial listing, offer or advertisement for the sale of residential property, two years for the sale of commercial property and one year for all rentals.

3. The Property is the subject of probate proceeding or the Property is the subject of litigation and is otherwise being properly maintained as required by Code. The time period cannot exceed 24 months.

4. The Property is the subject of a pending application before a D.C. Development Board. The time period cannot exceed 12 months.

5. The Property qualifies for a Special Exemption as determined by DCRA on a case by case basis and is otherwise maintained as required by Code. The time period cannot not to exceed 12 months from the required registration date, subject to renewal on the basis of continuing extraordinary circumstances and substantial undue economic hardship.

Vacant properties are required to be registered with DCRA before they can qualify for an exemption. Property owners must request an exemption from DCRA. DCRA sends out a notice to the property owner before the property is officially designated as being vacant. A copy of the DCRA Vacant Property Response Form which is used to respond to this notice and, if appropriate, to request an exemption, can be found below.

Sometimes occupied properties are mistakenly listed as vacant by DCRA. In such cases, the property owner must prove that the property is actually occupied. This situation often occurs when the property is being occupied periodically by an owner who also has another residence in a different jurisdiction. Utility bills, a driver’s license, a voter registration card and tax returns are often useful is fighting these cases. However, you don’t need to be a lawful resident of D.C. in order to maintain an occupied property in D.C.

Vacant Property Response Form
This is a 2–page, 5.88 MB pdf document
Click to download Acrobat Reader Download and save

Blighted Properties
Vacant properties that have been designated by DCRA as blighted will be taxed at a rate of 10%. There are NO exemptions. The biggest cause of properties being designated blighted is windows and/or doors that have been boarded up. Vacant properties without doors or windows must have these openings closed up with cinder block. This is true even if the boards being used are sturdy and the building is secure as a result of these boards being in place.

DCRA sends out a notice before it places a property on a Blighted Property list. A copy of the Blighted Property Response Form which is to be used to contest such a designation appears below.

Blighted Property Response Form
This is a 2–page, 4.78 MB pdf document
Click to download Acrobat Reader Download and save

Conclusion
The District of Columbia government is charged with keeping track of Vacant and Blighted properties so that these properties will not cause a nuisance or otherwise threaten the well-being and safety of its citizens. Compliance with the laws and regulations pertaining to these properties is fairly easy and straightforward. In addition, the DCRA staff members who deal with this subject are, in my experience, both helpful and fair. A D.C. property owner with a vacant property will only experience serious tax problems if the property owner ignores the law and/or fails to properly maintain his or her property.
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Case Digests for Winter 2012-13

Intervention Proceedings
In Re: Ruth M. Toliver-Woody, 199 INT 257 (June 11, 2012)
The matter arises from a petition for compensation from the Guardianship Fund by a guardian. The Court reviewed the entire history of the guardianship when the Court noticed dubious claims made by the guardian. The Court denied numerous claims for fees by the guardian and reduced the overall compensation owed to the guardian by seventy-five percent (75%).

There were several issues of note for other guardians to follow related what steps need to be take when a ward dies. The Court held that the guardian who waited almost two months after the ward had died to file a “suggestion of death” pursuant to SCR-PD 328(d) demonstrated a failure to comply with the Rule requiring “forthwith” filing of a Suggestion of Death.

The guardian’s filing of a petition for compensation almost six months after the ward died and without any accompanying motion for leave to “late file” violated SCR-PD 308(c)(1). Rule 308 states, “a guardian’s final petition for compensation shall be filed no later than 60 days after the termination of the guardianship” and that the authority and responsibility of a guardian terminated upon the death of the guardian or ward. See D.C. Code §21-2048 (2001). In the case at hand, the Court stated it could deny the entire Petition merely for failing to seek permission to file the tardy document but stated it would review the entire petition on its merits.

The main issue raised by the Court related to the duties the guardian failed to fulfill during the multi-year guardianship. The Court found the guardian was warned several times throughout the guardianship about the guardian’s lack of attentiveness with respect to visiting the Ward. The guardian’s lack of attentiveness included not attending any of the Ward’s care planning meetings or signing the required regular care plan document. The Court also noted that guardian was informed that reliance on nursing home facility staff and a “designee” that would replace the guardian during times when the guardian could not meet with the Ward did not meet the statutory requirement for regular visits.

The Court denied any claims the guardian filed related to multi-hour, “client conferences” at a time when the Ward was on a ventilator in hospice care as not credible when compared to lack of billing by the guardian for any lengthy “meetings” when the Ward was in good health. The Court also denied claims for excessive telephone calls made by the guardian when the Ward was on a ventilator and where the time was uniformly billed. The guardian’s claims for legal research and preparation of court filings that were never made were also denied by the Court because the Court found the Ward received no benefit from this activity. The Court also denied the guardian’s expenses related to three documents that were notarized at a total cost of $80.00. The Court found that notary fees are compensable but the guardian’s notarization costs were extraordinarily high given the fee regulations imposed on notary fees.

The guardian also sought compensation for work performed after the death of the Ward. The guardian’s Petition included time spent making telephone calls, reviewing correspondence and making post-death “funeral arrangements.” The Court rejected the guardian’s claims given these were actions not authorized and the guardianship terminated on the Ward’s death.

Lastly, the Court, while noting that the fee request had numerous legitimate claims stated that a line-by-line inspection of the entire fee request would by extremely time consuming. Thus, the Court held that it can apply a percentage discount to a fee request to “[trim] the fat from a fee application.” New York State Ass’n for Retarded Children v. Carey, 711 F.2d 1136, 1146 (2d. Cir. 1983); see Lively v. Flexible Packaging Ass’n, 930 A.2d 984, 993 (D.C. 2007).
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ADM
In re: Sarah Ellen Henneghan, 45 A.3d 684 (D.C. 2012)
Court of Appeals reversed the trial court’s order admitting a will to probate on the ground that the will lacked proper attestation by two witnesses and, therefore, was not duly executed.

The matter at issue arises because the executed will contained only the decedent’s signature and a notary seal without two witness signatures. Appellant filed an intestate petition with the probate court along with a copy of the will which appellant contended was invalid for lack of two witness sigatnures. The trial court agreed that the copy of the will was void and Appellant was named co-personal representative with appellant’s brother. Appellee subsequently filed a separate Petition for Abbreviated Probate attaching the original copy of the will. The trial court, noting the two petitions, set aside the appellant’s appointment pending the court’s ruling.

The probate court issued an order admitting the decedent’s will into probate in an abbreviated probate proceeding, pursuant to D.C. Code § 20-312 (b)(2) after appellee submitted sworn statements to the court from four individuals that either spoke to the decedent about finalizing her will, present in the building at the time of the decedent’s execution of the will with a notary or in the open reception room when the decedent executed her will. The appellee contended that the sworn statements from the four individuals met the definition of coming from “any person with personal knowledge of the circumstances of execution, whether or not the person was in fact an attesting witness, reciting facts showing due execution of the will.” The appellee argued that the due execution requirement found in D.C. Code § 18-103(2) can be substituted by the abbreviated probate due execution presumption language of D.C. Code § 20-312(b)(2) and the trial court apparently relied on this reasoning in admitting the will to probate.

The Court of Appeals rejected the appellee’s argument. The Court examined D.C. Code § 18-103, which states that a will is properly executed only if it: (1) is in writing and signed by the testator (or by another person in the testator's presence and by his or her express direction); and (2) is attested to and subscribed by at least two credible witnesses in the presence of the testator. The Court found that the affidavits were not statements evidencing “due execution” of the will and concluded that the affidavits from non-attesting witnesses, who cannot verify that they witnessed two attesting witness sign the will in the presence of the testator fails to satisfy the statutory requirements for the due execution of a will. The Court held that D.C. Code § 18-103 requires a will must be in writing and signed by the testator (or by another person in his presence and by his express direction), and must be attested and subscribed in the presence of the testator, by at least two credible witnesses. Further, the Court found that language of D.C. Code § 20-312 does not act as substitute for the execution requirements of D.C. Code § 18-103.

In re: John H. Pye, 2012 D.C. App. LEXIS 673 (D.C. Dec. 27, 2012).
The Court of Appeals accepted the Board on Professional Responsibility’s recommendation and disbarred an attorney who was acting as successor personal representative of an estate for misappropriation of funds and other violations of the rules of ethics. This case is the Bar Counsel companion case to the Estate of Green v. Loewinger, 912 A.2d 1198 (D.C. 2006) (entering civil judgment plus interest and attorney’s fees against the personal representative in an amount representing fees that were denied by the Court but which the personal representative paid to himself after entering into invalid side agreements with some of the heirs when his full fee was denied by the Court,).

After the trial court denied a portion of his fees, the successor personal representative wrote a deceptive letter to the heirs stating that he was filing an appeal to dispute the order reducing his fee, indicating that he could not make any estate distribution to the heirs until the Court of Appeals decided the appeal, predicting that he had a “reasonably good chance of success” on appeal, and threatening that unless the heirs settle the case now by agreeing to pay him the fees that were denied they would have to wait “at least a year” for the Court of Appeals to issue an Order. The Court found that the letter unfairly exploited the heirs’ interest in getting prompt distribution in order to recoup fees that were denied by the Court and in doing so he placed his own financial gain above the interests of the heirs.

The personal representative misappropriated funds when he paid himself $9,458.16 more that the Court authorized based on an agreement reached with seven of the heirs. The personal representative was not entitled to pay himself the fees because the Estate was governed by “old law” which required Court approval before any fees could be paid from an estate. In addition, the purported agreement with the heirs was invalid because the personal representative induced the heirs to consent based on false and misleading statements and actions which constituted a breach of his fiduciary duty.
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