Herman v. Ramsey County Community Human Services Department

373 N.W.2d 345, 1985 Minn. App. LEXIS 4891
CourtCourt of Appeals of Minnesota
DecidedAugust 20, 1985
DocketC3-85-528
StatusPublished
Cited by7 cases

This text of 373 N.W.2d 345 (Herman v. Ramsey County Community Human Services Department) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Herman v. Ramsey County Community Human Services Department, 373 N.W.2d 345, 1985 Minn. App. LEXIS 4891 (Mich. Ct. App. 1985).

Opinion

OPINION

FORSBERG, Judge.

This case arose from a denial by respondent Ramsey County Community Human Services Department of appellant Bessie Herman’s application for medical assistance. Ramsey County denied medical assistance because it determined appellant had available to her upon demand the proceeds of a probate court surcharge order in the amount of at least $75,000. Appellant claims the proceeds were not “actually available” to her.

FACTS

In 1971, Harvey Herman (guardian) was appointed guardian of his mother, appellant Bessie Herman, then in her sixties. The petition for guardianship appointment alleged appellant was incompetent to handle her affairs due to old age. However, the guardianship was apparently created as a convenience for appellant who, although mentally competent, wished to be relieved of anxiety-inducing cares. As required, the guardian filed a surety bond in the amount of $75,000 obtained from United States Fidelity and Guaranty Company (Surety).

Appellant’s assets were valued at nearly $135,000 on the date of appointment. Thereafter, the guardian made certain loans, including a $15,000 unsecured loan to appellant’s daughter, and distributed gifts to himself and family members total-ling more than $65,000. The gifts were made at appellant’s request, however, none had probate court approval. No accounts were filed with the probate court until 1978 when the court so ordered. The final account filed in March, 1979, showed a zero balance in appellant’s account.

In December 1978, appellant, who had moved to a nursing home in 1973, applied to Hennepin County for medical assistance benefits. Hennepin County required appellant to ask the donees to return the gifts. When the donees refused, Hennepin County provided medical assistance.

In December 1979, the probate court found the guardian acted unreasonably and breached his fiduciary duty by completely depleting his ward’s estate. The court issued an order surcharging him $80,556.96, the amount attributed to disallowed gifts and the unsecured, uncollectible loan. The surety was surcharged $75,000, the full extent of its liability. The order further provided that if appellant filed a receipt with the probate court for the balance due, the guardian and surety may be discharged. Also in December 1979, the probate court issued an order restoring appellant to capacity.

The surcharge order was upheld on appeal to a three-judge district court appeals panel. The Minnesota Supreme Court denied appellant permission to appeal.

Hennepin County terminated appellant’s medical assistance in December 1980 and subsequently sued appellant and the guardian to recover the value of the benefits given. The lawsuit was later dismissed pursuant to appellant’s summary judgment motion.

In December 1981, appellant applied to respondent Ramsey County for medical assistance after moving to a St. Paul nursing home. Respondent denied medical assistance after concluding the $75,000 surety bond was a resource to which appellant had access.

In January 1984 appellant filed a receipt with the probate court for the balance due her from the guardian and the surety and obtained an order discharging them in May 1984.

Ramsey County’s decision was affirmed on successive appeals to the Minnesota Department of Welfare and Ramsey County *347 District Court. Appellant appeals from the district court order.

ISSUES

1. Is appellant ineligible to- receive medical assistance benefits from respondent because the proceeds of an order surcharging her former guardian and his surety were actually available to her at the time of her application?

2. Did the trial court err in denying appellant’s motion to present new and additional evidence?

ANALYSIS

I.

The trial court affirmed the Department of Welfare after concluding that its decision had a factual basis and was a reasonable application and interpretation of the relevant statutes. On review, however, this court must independently review the agency’s decision without according any special deference to the district court’s review. Minnesota Power & Light Co. v. Minnesota Public Utilities Commission, 342 N.W.2d 324, 329 (Minn.1983).

Our standard of review is governed by Minn.Stat. § 14.69 (1984) which provides in part that this court may reverse an administrative decision if it is affected by an erroneous interpretation of the law or is unsupported by substantial evidence in view of the entire record as submitted. Minn.Stat. § 14.69, (d) and (e). Nevertheless, “because of an agency’s expertise, its order is presumptively valid and the reviewing court should show deference to conclusions involving its expertise.” Minnesota Power & Light Co. at 329.

At the time appellant applied for medical assistance from respondent, Minn. Stat. § 256B.06, subd. 1(8) (Supp.1981) provided that medical assistance may be paid for any person “[w]ho individually does not own more than $2,000 in cash or liquid assets, * * See also 12 MCAR § 2.047(C)(4)(b)(92) (now 1984 Minn. Rules 9500.0820). Personal property to be included in determining eligibility for medical assistance includes:

[LJiquid assets such as savings, checking account balances, cash on hand, stocks, bonds, trust funds, contracts for deed, prepaid burial contracts, cash surrender value of life insurance, motor vehicles, and other possessions which are not real property.
Personal property must be actually available to the applicant * * * or it cannot be considered in determining eligibility.

Minnesota Department of Public Welfare Medical Assistance Program Manual Section IV-G-5 (1981).

Appellant claims respondent should not have considered the proceeds of the surcharge order in evaluating her eligibility for medical assistance because they were merely “allegedly anticipated future assets” and thus not “actually available” to her. Respondent contends that even though appellant did not possess the proceeds, they were available to her upon demand and thus constituted a liquid asset large enough to render her ineligible for medical assistance. We agree.

In McNiff v. Olmsted County Welfare Department, 287 Minn. 40, 176 N.W.2d 888 (1970), a similar argument was made involving a discretionary trust in which the applicant was a co-beneficiary. The applicant argued her interest in the trust was only an inchoate or expectant interest and not a liquid asset. Id. at 45, 176 N.W.2d at 892. The court rejected the applicant’s narrow interpretation of the statute and held that because the applicant had the power to compel the trustee to disburse a portion of the trust assets for her benefit, the trust constituted a liquid asset. Id. Similarly in this case, appellant had the power at the time of her application for medical assistance, to demand payment of the proceeds of the surcharge order.

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Cite This Page — Counsel Stack

Bluebook (online)
373 N.W.2d 345, 1985 Minn. App. LEXIS 4891, Counsel Stack Legal Research, https://law.counselstack.com/opinion/herman-v-ramsey-county-community-human-services-department-minnctapp-1985.