No-Fault Cases Remanded To Determine If Guardian Improperly Delegated Tasks
Even though a guardian may delegate tasks, a question remains in these no-fault cases about whether the guardian improperly delegated certain tasks that altered the “rights, duties, liabilities, or other legal relations” of the protected individuals, the Michigan Court of Appeals has ruled.
In In re Guardianship of Malloy (Docket No. 358006) and In re Guardianship of Jenkins (Docket No. 358021), Mary Ann Malloy and Dana Jenkins sustained traumatic brain injuries in separate motor vehicle accidents. Malloy and Jenkins are both incapacitated and attorney Darren Findling, of the Darren Findling Law Firm, was appointed as their legal guardian. Malloy and Jenkins were insured by Auto Owners Insurance Company at the time of their accidents. Auto Owners refused to pay Findling for his guardianship services because he delegated various tasks to members of his law firm and did not provide them himself.
Findling filed two lawsuits against Auto Owners in the Oakland County Probate Court, seeking payment for the guardianship services he provided. The trial court ruled that Findling was entitled to payment because he delegated only certain duties and not his guardianship powers.
Auto-Owners appealed the trial court’s decision. The cases were consolidated on appeal.
The Court of Appeals affirmed in part and reversed in part.
“Because we conclude that the trial court correctly determined that many of the duties performed on behalf of the wards were able to be delegated by the court-appointed guardian, we affirm in part,” the Court of Appeals said. “Because there is a factual question as to whether or not actions taken on April 23, 2019 and April 24, 2019, on behalf of both wards were delegable by the court-appointed guardian, we reverse in part, and remand for further proceedings consistent with this opinion.”
Judge James Robert Redford wrote the published opinion, joined by Judge Brock A. Swartzle and Judge Mark J. Cavanagh.
Duties & Powers
The Court of Appeals began its analysis by explaining that it would address “the powers and duties of a guardian under MCL 700.5314, and the distinction between the delegation of a duty and a power of a guardian under MCL 700.5103 and MCL 700.5106.”
Defendant-Auto Owners basically argued it did not have to pay no-fault benefits because guardianship services were provided by someone other than Findling himself. “Specifically,” the Court of Appeals wrote, “defendant contends that plaintiff alone could provide guardianship services and because he had his law firm staff perform his duties he cannot obtain no-fault benefits for such services because MCL 700.5103 only allows a guardian to delegate his role to another person for 180 days if the guardian executed a power of attorney to the person and notified the court. Defendant contends that because of plaintiff’s failure to comply with MCL 700.5103, the guardianship services were not lawfully rendered.”
The Court of Appeals rejected the defendant’s argument, noting this appeal required the court to interpret how the No-Fault Act “intersects with” the Estates and Protected Individuals Code (EPIC), MCL 700.1101 et seq., and determine whether the trial court properly applied the law.
The Court of Appeals explained that EPIC “plainly distinguishes” between a guardian’s powers and duties. MCL 700.5314 provides that a guardian’s powers include: 1) establish the ward’s residence; 2) give consent or approval to enable the ward to receive medical care, mental health care, professional care, counseling, treatment or service; 3) execute, reaffirm, revoke a ward’s do-not-resuscitate order with some requirements; 4) execute, reaffirm, revoke a ward’s nonopioid directive; 5) execute, reaffirm, revoke a physician’s orders for scope of treatment for the ward; and 6) take action to compel persons responsible to support the ward, to pay money for the ward’s welfare, and apply money and property for the ward’s support, care and education.
Meanwhile, the Court of Appeals pointed out that a guardian’s duties generally include responsibility for the ward’s care, custody and control, as well as communicating and consulting with the ward (if possible) before making any decisions.
In addition, the Court of Appeals noted that MCL 700.5103 explains a guardian’s delegation of powers. That statute says: “(1) By a properly executed power of attorney, … a guardian of a … legally incapacitated individual may delegate to another person, for a period not exceeding 180 days, any of the … guardian’s powers regarding care, custody, or property of the … ward … (4) If a guardian for a … legally incapacitated individual delegates any power under this section, the guardian shall notify the court within 7 days after execution of the power of attorney and provide the court the name, address, and telephone number of the attorney-in-fact.”
According to the Court of Appeals, the defendant’s interpretation of EPIC “overlooks the statutory language in which the legislature makes distinctions between ‘duties’ and ‘powers.’” A guardian “is authorized and holds the legal right to alter the ‘rights, duties, liabilities, or other legal relations’ of the ward” when granted a power pursuant to EPIC. This conclusion, the Court of Appeals said, is supported by the plain language of MCL 700.5106(5) and (6), which “demonstrates that the legislature contemplated that individuals other than the guardian would perform duties on behalf of a ward.”
Regarding Malloy, the plaintiff “largely delegated the performance of duties to other individuals to assist in his care of his wards,” the Court of Appeals wrote. “He did not delegate powers. Therefore, he did not violate MCL 700.5103 as defendant contends. Specifically, billing records of plaintiff and plaintiff firm indicate that services performed by others – that is, other individuals at plaintiff firm who were delegated tasks by plaintiff to perform on behalf of Malloy – included attending meetings with Malloy’s doctors, attending guardianship visits, attending team meetings with Malloy’s family, telephone conferences with Patrick and Kathren, and meeting at a Social Security Administration office. Defendant points out in its brief on appeal that other tasks that plaintiff delegated included preparing Malloy’s annual guardian report, overseeing Malloy’s work program, and attending a hearing to modify Malloy’s guardianship. Virtually every task delegated to staff members by plaintiff did not alter the ‘rights, duties, liabilities, or other legal relations’ of Malloy. … Rather, these delegated tasks, such as telephone conferences with Patrick and Kathren, were merely ‘legal obligation[s] that [were] owed or due to [Malloy] and that [needed] to be satisfied.’”
However, the Court of Appeals continued, there was a genuine question about whether the plaintiff violated MCL 700.5103 by delegating tasks that altered the “rights, duties, liabilities, or other legal relations” of Malloy without complying with the statutory requirements. “Specifically, there is a genuine issue of material fact that preparing for a hearing to modify Malloy’s guardianship on April 23, 2019, and attending an April 24, 2019 hearing regarding the petition to modify Malloy’s guardianship altered Malloy’s rights and legal relations. Plaintiff appears to have assigned these two tasks to employees at his law firm but it is unclear whether and to what extent plaintiff engaged the services of the law firm or individuals and if he did so on behalf of the ward. Because these hearings involved adding and removing Malloy’s co-guardians, these tasks altered Malloy’s rights and legal relations - an act fitting the definition of a power. … Therefore - because plaintiff did not prepare for or attend the April 24, 2019 hearing himself - there is a genuine issue of material fact regarding whether plaintiff delegated his guardianship powers as to these two tasks and, in doing so, violated MCL 700.5103.”
The Court of Appeals concluded, “Because there is a genuine issue of material fact as to whether plaintiff delegated his guardianship powers as to the preparation for and attendance at a hearing to modify Malloy’s guardianship, there is also a genuine issue of material fact as to whether these services were ‘lawfully rendered’ within the meaning of the no-fault act and whether these services are compensable under the no-fault act. Therefore, the probate court erred in granting partial summary disposition in favor of the Malloy plaintiffs with regard to these two tasks.”
The Court of Appeals reached a similar conclusion as to Jenkins.
