Automatic Termination of Emergency Guardianship; Incapacity & Financial Transactions

Gavin v. Loeffelbein, 161 A.3d 340 (Pa. Super. 2017), allocatur granted Nov. 28, 2017, appeal docket 74 MAP 2017

Monica was married to James Gavin, Elaine’s brother. Monica filed for divorce, but Monica and James continued to reside at the marital residence with their two children, although Monica and James lived separate and apart within the residence. Two years later, on May 24, 2012, the Lehigh County Court of Common Pleas appointed an emergency guardian, Ms. Schnaufer, for James on the basis of incapacity. Pursuant to Section 5513 of the Probate, Estates, and Fiduciaries Code (PEF Code), an order appointing an emergency guardian “shall not exceed 30 days. After 30 days, a full guardianship proceeding must be initiated pursuant to section 5511.” Ms. Schnaufer placed James in an assisted living facility in Allentown while Monica remained at the marital residence with the children.

In July 2012, and without the knowledge of Monica or Ms. Schnaufer, more than 30 days after the emergency order and before a full guardianship proceeding resulted in appointment of Elaine as permanent guardian, Elaine and James went to the marital residence. James and Monica’s teenaged children allowed Elaine and James inside and assisted James and Elaine with removing a collection of rare books and autographs with an estimated value of $515,000 to a storage locker controlled by Elaine. In August, 2012, Elaine was appointed permanent guardian of James.

The court overseeing the divorce proceeding accorded Monica the right to inventory James’ collection of rare books and autographs at the office of Elaine’s counsel, where Monica catalogued the items in the boxes in a room by herself.  Monica concluded that 296 items with an estimated value of $236,161 were missing from the boxes inventoried, and that she lost $236,000 in marital assets as a result.

In 2014 Monica filed a pro se complaint against Elaine, arguing that even though James co-owned the residence, Elaine’s July 2012 entry with James was unauthorized because James was not capable of giving consent to it. Furthermore, even though the collection of books and autographs belonged to James, Monica contended that the collection was stolen since James did not have the capacity to consent to the transfer of control over the collection to Elaine.

In an amended complaint Monica raised counts in trespass, conversion, negligence, and punitive damages, alleging Elaine was negligent when she failed to 1) obtain lawful consent to remove James’ collection; 2) properly store and safeguard the collection after removing it; 3) inventory and oversee the collection; 4) insure the collection against loss; 5) take reasonable steps to prevent the collectibles from being stolen, lost, or misplaced; and 6) return the collection when Monica demanded it be placed in her custody. James died during the pendency of the action and the suit continued with Monica and his estate as plaintiffs.

At trial, the court outlined various sections of the guardianship law to the jury, including the definition of an incapacitated person and excerpts of the statute outlining the procedure for appointment of an emergency guardian. The trial court also read portions of the May 24, 2012 order appointing an emergency guardian for James and then summarized what occurred during the guardianship proceeding. The court thereafter advised the jury:

With respect to the emergency guardian, the emergency guardian of the person was limited to placement, and to make medical decisions. And the emergency guardian of the Estate was for the powers that I mentioned, in terms of—including other things—assembling Mr. Gavin’s personal property.

The power to the emergency guardian of the person is not exclusive to the guardian; that is to say, that Mr. Gavin was not precluded from expressing his wishes, and making some decisions regarding his personal property.

Slip Op., at 10.

The crux of Monica’s argument was that James did not have the legal ability to consent to Elaine’s entry into his home or to consent to her removal of his memorabilia collection because an emergency guardian had been appointed for him on May 24, 2012; therefore, the trial court’s instructions were in error.

The trial court granted Elaine’s request for nonsuit as to trespass and punitive damages counts, and entered judgment on the jury verdict in favor of Elaine on conversion and negligence counts, and denied Monica’s post-trial motions. Monica appealed.

On appeal, Monica argued that the May 24, 2012 order accorded Ms. Schnaufer the power to “ascertain, assemble and administer all of ” James’  property and that this language “meant that the guardian of the estate had sole management and control over all of James’ property” to the exclusion of James; therefore, James could not legally consent to Elaine’s entry into the home and removal of property. Slip Op., at 11. Superior Court rejected this argument, reasoning that the emergency guardianship order automatically terminated prior to the July incident pursuant to the 30 day limitation in Section 5513 of the PEF Code. Based on this limitation, the court concluded that because Ms. Schnaufer’s appointment was expired by the time of July 2012 incident and Elaine was not appointed as  permanent guardian until August 2012, James was sui juris when he entered the house and removed the collection.

Additionally, the court noted that James was not a totally incapacitated person under the PEF Code, because James understood that he owned a financial resource, a collection with significant monetary value, and effectively communicated his desires about that financial resource. While the May 24, 2012 emergency order was premised upon a finding that James appeared to be incapacitated, he was not declared legally incapacitated until the August 2012 hearing. Until clear and convincing proof was presented to the trial court to find James was incapacitated, he was presumptively competent.

Furthermore, the court held that appointment of an emergency guardian did not strip James of all control over his property or its disposition. Instead, the court emphasized its prior reasoning in In re Estate of Rosengarten, 871 A.2d 1249, 1255 (Pa. Super. 2005):

the intentions of the incapacitated person are to be honored to the fullest extent possible. This concept is best illustrated in Estate of Haertsch, 437 Pa.Super. 187, 649 A.2d 719, 721 (1994): “It is clear that throughout the carefully drawn legislation [,being the guardianship provisions of the PEF Code,] it was intended that the incapacitated person be permitted the fullest degree of freedom and control over his/her physical and financial affairs.”

Slip Op., at 16.

The Superior Court thus concluded that , given the evidence of James’ capacity and expiration of the emergency guardianship order, the trial court did not err in instructing the jury that the fact that James had an emergency guardian did not preclude James from expressing his wishes and making some decisions about his property.

The Supreme Court granted allocatur on the following issues:

  1. Did the Superior Court err by holding emergency guardianship orders automatically expire?
  2. Did the Superior Court err by holding that the rebuttable presumption that an incapacitated person is unable to engage in financial transactions is inapplicable to a person under the protection of an emergency guardian who has been appointed for the person and his estate?

For more information, contact Kevin McKeon or Dennis Whitaker.