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Arizona financial exploitation of an elder explained

Aug 15th, 2015 | By | Category: Financial Elder Abuse

Taking care of senior citizens: their property, their health, and their investments.

AZ elder abuse atty

Introduction

The concept of Elder Abuse violations in Arizona can be tricky.  This blog sets forth some general legal principles that might help you in your case, whether a civil lawsuit, mediation, or arbitration.  For specific questions, please fill out our contact form below.

The Adult Protective Services Act (“APSA”)

In the case of Estate of McGill ex rel. McGill v. Albrecht, 203 Ariz. 525, 527-28, 57 P.3d 384, 386-87 (2002) the Arizona Court discussed the APSA:
“Adopted in 1989, the civil version of APSA was intended to create a statutory civil cause of action. Id. The legislature created this cause of action with the following words:

An incapacitated or vulnerable adult whose life or health is being or has been endangered or injured by neglect, abuse or exploitation may file an action in superior court against any person or enterprise that has been employed to provide care, [or] that has assumed a legal duty to provide care….

A.R.S. § 46–455(B) (emphasis added). Incapacitated adults include those suffering from

an impairment by reason of mental illness, mental deficiency, mental disorder, physical illness or disability, [or] advanced age … to the extent that the person lacks sufficient understanding or capacity to make or communicate informed decisions concerning his [or her] person.

A.R.S. § 46451(A)(5). Vulnerable adults are those over eighteen years who are “unable to protect [themselves] from abuse, neglect or exploitation by others because of a physical or mental impairment.” A.R.S. § 46451(A)(10).”
APSA provides “a remedial cause of action against those who abuse, neglect, or exploit the elderly.” Winn, 214 Ariz. at 150 ¶ 5, 150 P.3d at 237. “We construe such remedial statutes broadly to effectuate the legislature’s purpose in enacting them.”  See In re Estate of Wyatt, 235 Ariz. 138, 140, 329 P.3d 1040, 1042 (2014).

Arizona financial elder abuse – what must be proven by the Plaintiff?

As the Court noted in Davis v. Zlatos, 211 Ariz. 519, 527, 123 P.3d 1156, 1164 (Ct. App. 2005):

“The APSA is violated only if it is shown that the person in a position of trust and confidence to the vulnerable adult either:
(1) failed to act for the benefit of the vulnerable adult to the same extent as a trustee, A.R.S. § 46–456(A),
or
(2) by intimidation or deception knowingly took control, title, use or management of the vulnerable adult’s property with the intent to permanently deprive the vulnerable person of the property.”

A trustee must avoid pursuing self-interests when dealing with an AZ elder

Pursuant to § 46–456(A):
“[a] person who is in a position of trust and confidence to an incapacitated or vulnerable adult shall act for the benefit of that person to the same extent as a trustee pursuant to title 14, chapter 7, article 3.” The trial court found that “Saenz was in a position of trust and confidence” to Mrs. Zlatos, and that finding is not disputed on appeal. Under Arizona law, a trustee is required to “observe the standard in dealing with the trust assets that would be observed by a prudent man dealing with the property of another.” A.R.S. § 14–7302 (Supp.2004). “The first duty of any trustee is to act with undivided loyalty to the trustor.” Shetter v. Rochelle, 2 Ariz.App. 358, 366, 409 P.2d 74, 82 (1965), modified by 2 Ariz.App. 607, 411 P.2d 45 (1966). Self-dealing can occur when “a trustee, acting for himself and also as trustee, seeks to consummate a deal where self interest is opposed to duty.” Seven G. Ranching Co. v. Stewart Title & Trust of Tucson, 128 Ariz. 590, 592, 627 P.2d 1088, 1090 (App.1981).

Adult Protective Services Act (“APSA”), A.R.S. §§ 46-451 to 459

A.R.S. section 46-451 sets forth some definitions that need to be kept in mind in every elder abuse case in Arizona:

A. In this chapter, unless the context otherwise requires:

1. “Abuse” means:

(a) Intentional infliction of physical harm.

(b) Injury caused by negligent acts or omissions.

(c) Unreasonable confinement. (d) Sexual abuse or sexual assault.

2. “De facto conservator” means any person who takes possession of the estate of a vulnerable adult, without right or lawful authority. A de facto conservator is subject to all of the responsibilities that attach to a legally appointed conservator or trustee.

3. “De facto guardian” means any person who takes possession of the person of a vulnerable adult, without right or lawful authority. A de facto guardian is subject to all of the responsibilities that attach to a legally appointed guardian.

4. “Exploitation” means the illegal or improper use of a vulnerable adult or his resources for another’s profit or advantage.

What is a “vulnerable adult?”

One of the threshold questions is the legal definition of vulnerable adult.  In one Arizona case the Court noted:

“The first step in our analysis of the statutory definition of “vulnerable adult” is to consider whether Mrs. Zlatos suffered from an “impairment.” The APSA does not define “impairment,” so we apply the ordinary meaning of the word. Mid Kansas Fed. Sav. & Loan v. Dynamic Dev. Corp., 167 Ariz. 122, 128, 804 P.2d 1310, 1316 (1991). An “impairment” is something that causes a “decrease in strength, value, amount, or quality.” Websters II, New College Dictionary 553 (Houghton Mifflin Co.2001). Other definitions have defined impairment in terms of injury, deterioration, or lessening. Webster’s Third New International Dictionary 1131 (Unabridged 1993); see also Oxford English Dictionary (Compact Ed.1971) (“deterioration; injurious lessening or weakening”).  See Davis v. Zlatos, 211 Ariz. 519, 525, 123 P.3d 1156, 1162 (Ct. App. 2005).”

What is a position of trust and confidence?

Arizona Revised Statutes § 46–456(G)(3) defines “position of trust and confidence” to mean that a person is any one of the following:
(a) One who has assumed a duty to provide care to the incapacitated or vulnerable adult.
(b) A joint tenant or a tenant in common with an incapacitated or vulnerable adult.
(c) One who is in a fiduciary relationship with an incapacitated or vulnerable adult including a de facto guardian or de facto conservator.

Financial exploitation

In one AZ case the Arizona Court of Appeals upheld a judgment in favor of the Plaintiff against the Defendant on the grounds of financial exploitation.  In this case, the Court stated:
Appellants also contend no evidence supports the court’s findings that they financially exploited Mr. Jonnas by using Mr. Jonnas’ funds for their own use. They also assert no financial exploitation occurred because Mr. Jonnas used his independent accountant and bankers for disposition of his assets.  We disagree. Appellants do not explain how the $200,000 that was transferred to them benefitted Mr. Jonnas. Indeed, the evidence shows Kalliope used half of that money to purchase Delaware real estate in her name, and she received the proceeds when that property was subsequently sold at a substantial profit. She therefore used the funds received from Mr. Jonnas for her own benefit in violation of § 46–456(A). Further, we are not persuaded that a transaction is rendered non-exploitative under APSA merely because a vulnerable adult relies on “independent” professionals to administratively effectuate the transaction. There is no evidence in the record that Mr. Jonnas’ accountant or bankers advised him that the $200,000 “gift” to Appellants was potentially exploitive and Mr. Jonnas nonetheless proceeded with the transaction. Accordingly, on this record, we cannot conclude the court’s finding that Appellants exploited Mr. Jonnas is unsupported by the evidence.”
See In re Estate of Jonnas, No. 1 CA-CV 12-0801, 2014 WL 50793, at *5 (Ariz. Ct. App. Jan. 7, 2014).  Not for publication.

Contact an Arizona elder abuse law firm

We can help with business, real estate broker fraud (dual agency disputes, fraudulent grant deeds, and scams to defraud elders out of their equity in residential or commercial real estate investments), stock broker churning, insurance disputes (including wrongful denial of life insurance benefits), and other scams against elderly persons in California and Arizona.  The best thing to do is to contact one of our elder abuse lawyers to have your case reviewed.  We have a strong history of protecting the rights of senior citizens.  Call us at (877) 276-5084 or fill out the contact form below to have one of our arbitration/litigation lawyers contact you, normally within the hour. Many cases we can take (on a full or partial) contingency fee basis.

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