California financial elder abuse series – enhanced remedies for reckless conduct!
California’s elder abuse statutes is one of the best in the nation. It is not perfect, but it is good and provides incentives to attorney to fight the unscrupulous acts of real estate agents, financial planners, life insurance agents, stock brokers, used car dealers, boat and RV dealers, timeshare salesman, caretakers, predatory friends and family members and others who prey on seniors over the age of 65. The remedies are generous including compensatory damages (which compensate for actual losses suffered), attorney fees, enhanced damages, and possibly punitive damages for fraudulent, malicious, or oppressive conduct. This blog discusses the topic of enhanced damages under the Welfare & Institutions code.
California Welfare & Institutions Code 15657
Cal W & I Code section 15657 states:
“Where it is proven by clear and convincing evidence that a defendant is liable for physical abuse as defined in Section 15610.63, or neglect as defined in Section 15610.57, and that the defendant has been guilty of recklessness, oppression, fraud, or malice in the commission of this abuse, the following shall apply, in addition to all other remedies otherwise provided by law:
(a) The court shall award to the plaintiff reasonable attorney’s fees and costs. The term “costs” includes, but is not limited to, reasonable fees for the services of a conservator, if any, devoted to the litigation of a claim brought under this article.
(b) The limitations imposed by Section 377.34 of the Code of Civil Procedure on the damages recoverable shall not apply. However, the damages recovered shall not exceed the damages permitted to be recovered pursuant to subdivision (b) of Section 3333.2 of the Civil Code.
(c) The standards set forth in subdivision (b) of Section 3294 of the Civil Code regarding the imposition of punitive damages on an employer based upon the acts of an employee shall be satisfied before any damages or attorney’s fees permitted under this section may be imposed against an employer.
Attorney Steve tip: Note that “recklessness” is included for enhanced remedies. Normally, recklessness is not sufficiently bad conduct to warrant punitive damages, but in the case of financial elder abuse enhanced remedies, it will suffice. The legal definition of reckless is defined below. Also note that the above code section only applies to “neglect” and “physical” abuse. To cover “financial elder abuse” we need to go to 15657.5, which is very similar.
California Welfare & Institutions Code 15657.5
(a) Where it is proven by a preponderance of the evidence that a defendant is liable for financial abuse, as defined in Section 15610.30, in addition to compensatory damages and all other remedies otherwise provided by law, the court shall award to the plaintiff reasonable attorney’s fees and costs. The term “costs” includes, but is not limited to, reasonable fees for the services of a conservator, if any, devoted to the litigation of a claim brought under this article.
(b) Where it is proven by a preponderance of the evidence that a defendant is liable for financial abuse, as defined in Section 15610.30, and where it is proven by clear and convincing evidence that the defendant has been guilty of recklessness, oppression, fraud, or malice in the commission of the abuse, in addition to reasonable attorney’s fees and costs set forth in subdivision (a), compensatory damages, and all other remedies otherwise provided by law, the limitations imposed by Section 377.34 of the Code of Civil Procedure on the damages recoverable shall not apply.
(c) The standards set forth in subdivision (b) of Section 3294 of the Civil Code regarding the imposition of punitive damages on an employer based upon the acts of an employee shall be satisfied before any punitive damages may be imposed against an employer found liable for financial abuse as defined in Section 15610.30. This subdivision shall not apply to the recovery of compensatory damages or attorney’ s fees and costs.
(d) Nothing in this section affects the award of punitive damages under Section 3294 of the Civil Code.
(e) Any money judgment in an action under this section shall include a statement that the damages are awarded based on a claim for financial abuse of an elder or dependent adult, as defined in Section 15610.30. If only part of the judgment is based on that claim, the judgment shall specify what amount was awarded on that basis.
Attorney Steve analysis: What does all this mean? It means that in a financial elder abuse case, where a Plaintiff can show reckless, fraudulent, oppressive, or malicious conduct (by clear and convincing evidence) the following damages calculation can apply:
1. Compensatory damages (ex. 500k lost life insurance from a “vested” policy and $25,000 in premiums paid)
2. Attorney fees and costs (ex. 200k)
3. Punitive damages
5. Max $250,000 for pain and suffering
Total using a sample denial of life insurance benefits claims = Approximately one million dollars plus any other damages that might apply.
What does CCP section 337.34 (cited above) say – [this limit does not apply when recklesness is shown]
377.34. In an action or proceeding by a decedent’s personal representative or successor in interest on the decedent’s cause of action, the damages recoverable are limited to the loss or damage that the decedent sustained or incurred before death, including any penalties or punitive or exemplary damages that the decedent would have been entitled to recover had the decedent lived, and do not include damages for pain, suffering, or disfigurement.
Attorney Steve Tip: This means pain and suffering damages up to $250,000 cap are on the table as set forth above in my calculation.
Section 15610.30 definition of acts constituting financial elder abuse
Cal. W & I code section 15610.30 states.
(a) “Financial abuse” of an elder or dependent adult occurs when a person or entity does any of the following:
(1) Takes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
(2) Assists in taking, secreting, appropriating, obtaining, or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
(3) Takes, secretes, appropriates, obtains, or retains, or assists in taking, secreting, appropriating, obtaining, or retaining, real or personal property of an elder or dependent adult by undue influence, as defined in Section 15610.70.
What is “undue influence” under Welfare & Institutions Code section 15610.70?
(a) “Undue influence” means excessive persuasion that causes another person to act or refrain from acting by overcoming that person’s free will and results in inequity. In determining whether a result was produced by undue influence, all of the following shall be considered:
(1) The vulnerability of the victim. Evidence of vulnerability may include, but is not limited to, incapacity, illness, disability, injury, age, education, impaired cognitive function, emotional distress, isolation, or dependency, and whether the influencer knew or should have known of the alleged victim’s vulnerability.
(2) The influencer’s apparent authority. Evidence of apparent authority may include, but is not limited to, status as a fiduciary, family member, care provider, health care professional, legal professional, spiritual adviser, expert, or other qualification.
(3) The actions or tactics used by the influencer. Evidence of actions or tactics used may include, but is not limited to, all of the following:
(A) Controlling necessaries of life, medication, the victim’s interactions with others, access to information, or sleep.
(B) Use of affection, intimidation, or coercion.
(C) Initiation of changes in personal or property rights, use of haste or secrecy in effecting those changes, effecting changes at inappropriate times and places, and claims of expertise in effecting changes.
(4) The equity of the result. Evidence of the equity of the result may include, but is not limited to, the economic consequences to the victim, any divergence from the victim’s prior intent or course of conduct or dealing, the relationship of the value conveyed to the value of any services or consideration received, or the appropriateness of the change in light of the length and nature of the relationship.
(b) Evidence of an inequitable result, without more, is not sufficient to prove undue influence.
(b) A person or entity shall be deemed to have taken, secreted, appropriated, obtained, or retained property for a wrongful use if, among other things, the person or entity takes, secretes, appropriates, obtains, or retains the property and the person or entity knew or should have known that this conduct is likely to be harmful to the elder or dependent adult.
(c) For purposes of this section, a person or entity takes, secretes, appropriates, obtains, or retains real or personal property when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.
(d) For purposes of this section, “representative” means a person or entity that is either of the following: (1) A conservator, trustee, or other representative of the estate of an elder or dependent adult. (2) An attorney-in-fact of an elder or dependent adult who acts within the authority of the power of attorney.
California Caselaw dealing with enhanced remedies for “reckless” conduct of Defendant
‘Recklessness’ refers to a subjective state of culpability greater than simple negligence. The Plaintiff must show that the conduct of the Defendant was done with a ‘deliberate disregard’ of a ‘high degree of probability’ that an injury will occur. Recklessness requires more than just carelessness and, unlike negligence, involves more than ‘inadvertence, incompetence, unskillfulness, or a failure to take precautions’ but rather rises to the level of a conscious choice of a course of action, with knowledge of the serious danger to others involved in it. See Delaney v. Baker (1999) 20 Cal.4th at 31-32.”
Contact a California financial elder abuse firm
We assist with civil actions, lawsuits and arbitrations against life insurance agents and companies, real estate brokers and brokerages, and stock and financial planning companies, car, boar and RV dealerships, and friends, families and caretakers that abuse senior loved ones, Call us at (877) 276-5084 or fill out the form below to have one of our litigation lawyers contact you, normally within the hour. Some financial elder abuse cases can be taken on a full or partial contingency fee basis.
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