Maxwell-Jolly v. Martin

198 Cal. App. 4th 347, 129 Cal. Rptr. 3d 278, 2011 Cal. App. LEXIS 1057
CourtCalifornia Court of Appeal
DecidedAugust 11, 2011
DocketNo. A128711
StatusPublished
Cited by12 cases

This text of 198 Cal. App. 4th 347 (Maxwell-Jolly v. Martin) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Maxwell-Jolly v. Martin, 198 Cal. App. 4th 347, 129 Cal. Rptr. 3d 278, 2011 Cal. App. LEXIS 1057 (Cal. Ct. App. 2011).

Opinion

Opinion

RICHMAN, J.

This case presents one purely legal question: which statute of limitations applies when a person who received health care services funded by Medi-Cal during her or his lifetime dies with assets held in trust, and the State Department of Health Care Services (DHCS) seeks to recover the Medi-Cal payments from the trustee and distributees of the trust. Appellants, the trustee and distributees of the trust, contend that the one-year statute of limitations in Code of Civil Procedure section 366.3 applies,1 as it governs claims that arise “from a promise or agreement with a decedent to distribution from an estate or trust or under another instrument. . . .” (Id., subd. (a).) Respondent, the Director of the DHCS (Director), contends that the three-year statute in section 338, subdivision (a) applies, as it governs actions “upon a liability created by statute.” We conclude that the Director is correct, and thus affirm the summary judgment.

FACTUAL AND PROCEDURAL BACKGROUND

The material facts are not in dispute. Decedent Bunnie R. Gregoire owned a home in Brisbane, which she transferred into a restated revocable trust on July 18, 1997. Under the terms of the trust, the assets remaining at her death were to be divided equally between two of her grandchildren, appellants Selena H. Firth and Jennifer C. Martin, to be held in trust until their 35th birthdays. The trustee was given the discretionary power to make an earlier distribution to either granddaughter for her “health, education, support and maintenance.”

[350]*350In approximately April 2001, Gregoire was admitted to St. Francis Convalescent Pavilion, a skilled nursing facility. On December 10, 2001, Firth applied for Medi-Cal benefits on behalf of her grandmother, who was then nearly 90 years old. As part of the application process, Firth signed forms acknowledging on Gregoire’s behalf, “After my death, the State has the right to seek reimbursement from my estate for all Medi-Cal benefits I received after age 55 . . . .” This obligation of reimbursement arose from Welfare and Institutions Code section 14009.52 and California Code of Regulations, title 22, section 50961.3 Gregoire thereafter received Medi-Cal payments totaling $237,939.18 to cover the cost of her nursing home care.

“(a) Notwithstanding any other provision of this chapter, the department shall claim against the estate of the decedent, or against any recipient of the property of that decedent by distribution or survival an amount equal to the payments for the health care services received or the value of the property received by any recipient from the decedent by distribution or survival, whichever is less.
“(b) The department may not claim in any of the following circumstances:
“(1) The decedent was under 55 when services were received, except in the case of an individual who had been an inpatient in a nursing facility.
“(2) Where there is any of the following:
“(A) A surviving spouse during his or her lifetime. However, upon the death of a surviving spouse, the department shall make a claim against the estate of the surviving spouse, or against any recipient of property from the surviving spouse obtained by distribution or survival, for either the amount paid for the medical assistance given to the decedent or the value of any of the decedent’s property received by the surviving spouse through distribution or survival, whichever is less. Any statute of limitations that purports to limit the ability to recover for medical assistance granted under this chapter shall not apply to any claim made for reimbursement.
“(B) A surviving child who is under age 21.
“(C) A surviving child who is blind or permanently and totally disabled, within the meaning of Section 1614 of the federal Social Security Act (42 U.S.C.A. Sec. 1382c).
“(3) Any exemption described in paragraph (2) that restricts the department from filing a claim against a decedent’s property shall apply only to the proportionate share of the decedent’s estate or property that passes to those recipients, by survival or distribution, who qualify for an exemption under paragraph (2).
“(c)(1) The department shall waive its claim, in whole or in part, if it determines that enforcement of the claim would result in substantial hardship to other dependents, heirs, or survivors of the individual against whose estate the claim exists.
“(2) The department shall notify individuals of the waiver provision and the opportunity for a hearing to establish that a waiver should be granted.
“(d) The following definitions shall govern the construction of this section:
“(1) ‘Decedent’ means a beneficiary who has received health care under this chapter or Chapter 8 (commencing with Section 14200) and who has died leaving property to others either through distribution or survival.
“(2) ‘Dependents’ includes, but is not limited to, immediate family or blood relatives of the decedent.”

[351]*351On October 24, 2002, the San Mateo County Public Guardian (Public Guardian) was appointed conservator of the person and estate of Gregoire.

Gregoire died on November 10, 2005. On November 15, the Public Guardian sent a notice of death to respondent DHCS in Sacramento recording the value of Gregoire’s estate as “0.00.” On November 23, 2005, a DHCS employee discovered conflicting information in that Westlaw showed Gregoire owned the house in Brisbane. The computer entry noted that a “case” was being “set[] up.”

On December 20, 2005, DHCS sent a questionnaire to the Public Guardian inquiring about assets held by Gregoire. The response indicated a zero value for all assets other than “house/land/mobile home,” which was left blank. The names of heirs and co-owners were also left blank.

On February 8, 2006, DHCS gave notice to the Public Guardian of its creditor’s claim against the estate in the amount of $237,939.18.

On June 15, 2006, appellant George Mousetis signed a certification that he was successor trustee of the revocable trust. The certification was recorded July 7, 2006.

On the same date, July 7, 2006, Mousetis sold the Brisbane home for $700,000. Ten days later he wired half the net proceeds to Martin ($313,740.84), retaining the other half in trust for Firth. Over the succeeding years all of the funds held in trust have been distributed to Firth under the trustee’s discretionary powers.

Having received no response to its February 2006 notice of its claim against the estate, DHCS followed up with status requests to the Public Guardian on September 21, 2006, and March 27, 2007. Unbeknownst to DHCS, the trustee had already sold the property.

On April 4, 2007, the Public Guardian called DHCS and reported there were no assets in the conservatorship but there was real property held in trust. At that time DHCS was also given the name and contact information for the successor trustee. On April 5, 2007, DHCS advised the trastee of its claim against the estate. Having received no response, DHCS followed up with letters to the trustee and his attorney on July 13, 2007.

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Cite This Page — Counsel Stack

Bluebook (online)
198 Cal. App. 4th 347, 129 Cal. Rptr. 3d 278, 2011 Cal. App. LEXIS 1057, Counsel Stack Legal Research, https://law.counselstack.com/opinion/maxwell-jolly-v-martin-calctapp-2011.