MAY 11, 1998 VOLUME 5, NUMBER 45
Lawyer Frederick Apt had a long-standing relationship with Robert and Hazel Irwin. He first prepared wills for the couple in 1981. In 1993, he updated their wills, and did so again later that same year. It was not surprising, then, that the family returned for his advice when Mr. Irwin was placed in a nursing home.
In January, 1995, both Irwins were in poor health. Mrs. Irwin was still living at home, but facing the likely prospect of nursing home placement. Robert Irwin, Jr., the couple’s son, contacted Mr. Apt to find out what he might do to get some assistance with the cost of long-term nursing home care.
The Irwins owned their home as joint tenants with right of survivorship. Of course under Medicaid rules the Irwins could keep the home and still qualify (once their other assets were reduced to the appropriate levels), but Robert Irwin, Jr., also wondered what effect the death of either of his parents might have on the ownership of the home.
Mr. Apt, the lawyer, apparently anticipated the problems which might arise if Mrs. Irwin were to die. Then, although the home would still be an exempt asset and Mr. Irwin could qualify for Medicaid assistance, the state Medicaid agency could impose a lien on the home. While Mr. Irwin’s direct ownership in the home would not be affected, their son would no longer inherit the home free and clear on Mr. Irwin’s death. Mr. Apt saw a way to forestall the problem.
On January 16, 1995, Mr. Apt prepared a blank deed to the home for the Irwins’ son to sign. Robert Irwin, Jr., signed the deed (using his power of attorney, prepared by Mr. Apt a year before) and it was notarized as if the property was being sold, even though no buyer had yet been located. Mrs. Irwin died two days later. Robert Irwin, Jr., then spoke with a real estate company, and the home was listed for sale a week later.
One month after the death of Mrs. Irwin, a prospective buyer made an offer on the property. Mr. Apt then typed the buyer’s name in on the deed showing Mrs. Irwin as one of the sellers, but before the transaction could be completed the buyer backed out.
It wasn’t until four months later that new buyers came forward. When Terry and Cheryl Sparks finally purchased the home, Mr. Apt simply prepared a new first page to the deed which had been signed in January, and submitted it as if Mrs. Irwin (now four months deceased) were one of the sellers.
The significance of Mr. Apt’s deception was simple. If the home had been sold by Mr. and Mrs. Irwin prior to her death, one half of the proceeds would go to her estate and thereafter to her children (her will having disinherited her husband, who was already ill at the time it was written). If, on the other hand, the sale was completed after her death, the entire proceeds would belong to Mr. Irwin, and would have to be spent on his nursing home care; the children would receive nothing.
After the sale was completed, Kansas’ Medicaid agency requested further information on the timing of the transaction. Mr. Apt replied, falsely explaining that the sale had been arranged prior to Mrs. Irwin’s death and that the parties were just waiting for financing arrangements at the time she died. The state Medicaid agency did not believe his explanation, and pointed out the inconsistencies in his correspondence with the agency. Then the agency filed both felony criminal charges and an ethical complaint with the Kansas State Bar.
Mr. Apt retired from the practice of law while the disciplinary action was pending. Still, the Kansas Supreme Court publicly censured him, noting that he had also plead guilty to a reduced misdemeanor charge. He was also ordered to pay the costs of the disciplinary proceedings. In re Apt, Oct. 31, 1997.
