Section 1
Section 2
Section 3
Section 4
Health and Social Services?
If the helper is assisting the dependent adult with their medical care, hygiene, household tasks or finances, or simply providing companionship, the law will consider the helper to be providing what is known as “health and social services.”
According to California Probate Code section 21362, A helper providing the above services is considered a “care custodian” unless the following exceptions apply:
- The helper provided such services without receiving any caregiver compensation; and
- The helper had a personal relationship with the dependent adult at least three (3) months before providing such assistance and at least six (6) months before the dependent adult’s death, and before the dependent adult enters hospice care.
Why Might Gifts to Caregivers Be Problematic?
As a result of the helper’s generous assistance, the dependent adult might give the helper a gift, change their estate plan (e.g., make a gift through a trust or will) or execute other documents to provide for the helper after their death.
While a dependent adult rewarding a helper for their good deeds in the form of gifts might make sense, the dependent adult’s family members may take issue with these gifts to the helper after the dependent adult’s death.
If a party takes legal action surrounding the gifts from a dependent adult to their helper, there will be a presumption that the gift was the product of fraud or undue influence (“the presumption”), according to Probate Code section 21380. In other words, the gift would be invalid unless proven otherwise. This means the burden of proof would shift to the helper, leaving them to have to prove they did not perpetrate fraud or undue influence against the dependent adult in obtaining the gift.
There are, of course, exceptions to the presumption, including:
- Probate Code section 21362: This statute excludes certain individuals (e.g., unpaid helpers who have a personal relationship with the dependent adult) from being categorized as care custodians, which means the presumption would not apply to them if the dependent adult were to leave them a gift.
- Probate Code section 21382: This statute lists categories of individuals (e.g., the dependent adult’s blood relatives within the fourth degree and their cohabitants) to whom the presumption would not apply if the dependent adult were to leave them a gift.
- Probate Code section 21384: This statute overrides the presumption by allowing an attorney, who has counseled the dependent adult on the consequences of leaving a gift to a helper and ensured that neither fraud nor undue influence were involved in their decision to leave the helper a gift, to sign and deliver a certificate of independent review, which can serve as evidence of the dependent adult’s true final intentions in the event someone challenges the validity of their gift.
Is Room and Board for a Live In Caregiver Considered Compensation?
When a dependent adult requires a helper, the helper usually moves in with the dependent adult. However, is living with a dependent adult without paying rent considered “compensation” for the purpose of triggering the presumption of fraud or undue influence?
If so, the helper would be considered a care custodian, and any gift the dependent adult leaves them would be subject to the presumption. This is the primary issue the California Court of Appeal addressed in Robinson v. Gutierrez (2023) 316 Cal.App.5th 278.
Robinson v. Gutierrez: Did the Decedent Leave Gifts to Her Helper or Care Custodian?
The Robinson case involved an elder, Gwyneth Robinson (“Gwyneth”), who wanted to have a helper move into her house to assist her. Specifically, the helper would perform household duties of cleaning and laundry, drive Gwyneth when necessary and provide her with companionship.
Gwyneth was able to find a helper, Elva Gutierrez (“Elva”), with whom she was presumed to have a personal relationship. Elva moved in with Gwyneth and received free room and board in exchange for helping Gwyneth. This arrangement lasted for nearly three years until Gwyneth’s death. Elva did not receive any money for her services.
A couple years into the arrangement, Gwyneth signed a joint tenancy deed naming Elva as a joint tenant to her residence, which meant that Elva would become the sole owner of the residence upon Gwyneth’s death. A few weeks later, Gwyneth signed a trust and a will that stated all her property would go to Elva upon her death. Shortly after signing the trust and will, Gwyneth passed away.
Gwyneth was survived by her four children and brother (“Gwyneth’s Family”), who filed a lawsuit challenging the validity of the joint tenancy deed, as well as a will contest and trust contest challenging the validity of the estate planning documents.
Gwyneth’s Family argued that Elva was a care custodian, as Elva received compensation in the form of free room and board, and that the gifts made from Gwyneth to Elva were presumptively the product of fraud or undue influence.
Elva, on the other hand, argued that because she had a personal relationship with Gwyneth and did not receive anything other than free room and board, her room and board did not qualify as compensation, which meant she was not a care custodian, and the presumption did not apply to her gifts.
Trial Court Rules Room and Board for a Live In Caregiver Does Not Qualify as Compensation
At trial, the court agreed with Elva and determined that free room and board did not constitute compensation, which meant that Elva was not a care custodian, and that the presumption did not apply to the gifts from Gwyneth to Elva.
The trial court explained that because no dollar value was placed on the room and board received by Elva, it did not qualify as taxable income, and therefore, was not a form of compensation.
Appellate Court Finds Cash Payments and Noncash Benefits Qualify as Caregiver Compensation
Gwyneth’s Family appealed the trial court’s ruling, arguing that free room and board qualified as compensation, and that Elva was a care custodian. The appellate court concluded that “compensation” includes both cash payments and noncash benefits provided in exchange for care services.
The appellate court reviewed the definition of “remuneration,” “pay” and “compensation,” and determined that such words can be used interchangeably. It went on to state that “remuneration” refers to not only compensation in the form of money, but also “some other thing of equivalent value.”
As a result, the appellate court concluded that, in exchange for custodial care services, compensation may come in the form of room and board or other noncash benefits.
The appellate court determined that there was no support for the trial court’s finding that compensation is limited to the receipt of “taxable income.” The appellate court further reasoned that broadening the definition of compensation to include non monetary payments furthers the intent of the lawmakers to deem all gifts by a dependent adult to care providers as presumptively the result of fraud or undue influence, except those made to true, personal friends.
Based on its analysis, the Court of Appeal concluded that:
- Elva did in fact receive compensation for her services by receiving free room and board, and therefore was a care custodian; and
- Gwyneth’s donative gifts to Elva were therefore subject to the presumption of fraud or undue influence.
Appellate Court Reverses Trial Court’s Ruling That Room and Board Does Not Constitute Caregiver Compensation
Because the trial court did not apply the presumption, the appellate court reversed the trial court’s judgment and sent the case back to the trial court with instructions to apply the presumption. This means the trial court must conduct another trial with the presumption in place.
Key Takeaways: You Do Not Have to Receive Monetary Compensation to Be Considered a Care Custodian Under California Law
For those of you who have or will consider providing help to someone in need of health and social services, the key takeaways from this case are as follows:
- You do not have to provide medical care or even assist with household chores to be considered a care custodian. Providing companionship is enough.
- If you receive noncash benefits, such as free room and board or even free meals, it could be determined that you are receiving “compensation” for the purpose of being considered a “care custodian.”
- If you qualify as a care custodian and a dependent adult makes a donative gift to you, that gift will be presumed to be the result of fraud or undue influence, meaning that the gift will be invalid unless you can prove you did not obtain the gift through fraud or undue influence.
- A certificate of independent review can be signed by an attorney for the dependent adult to potentially override the presumption.
- The presumption does not apply to the blood relatives of a dependent adult within the fourth degree, or their cohabitants.
Have questions about California Caregiver Laws? We have answers.
If an elder has a care custodian, it’s crucial for both the caregiver and the loved ones of the deceased to understand California’s laws surrounding caregivers.
These laws can be challenging to navigate without the expertise of a skilled probate attorney. Our attorneys are well equipped to assist care custodians who have been left gifts enforce their inheritance rights. We also are well equipped to assist the loved ones of decedents in taking action against caregivers suspected of using undue influence or fraud to secure gifts.
Our attorneys are committed to helping you achieve the outcome you desire. Contact us today to see if you qualify for a free consultation with one of our attorneys.
