COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 67064 IN RE: LILLIAN EDENBURG, : INCOMPETENT : : [Appeal by Former Guardian : JOURNAL ENTRY Appellant James Burns] : : AND : : OPINION : DATE OF ANNOUNCEMENT OF DECISION: MAY 4, 1995 CHARACTER OF PROCEEDING: Civil appeal from Probate Court Case No. 1040050 JUDGMENT: REVERSED AND REMANDED. DATE OF JOURNALIZATION: APPEARANCES: For Montefiore Nursing Home: RONALD P. FRIEDBERG Kahn, Kleinman, Yanowitz & Arnson Co., L.P.A. 2600 Tower at Erieview Cleveland, Ohio 44114-1824 For Successor Guardian of ALAN G. GELBMAN Lillian Edenburg, Incompetent: 14600 Detroit Avenue, #1030 Lakewood, Ohio 44107 For Former Guardian-Appellant TIMOTHY D. JOHNSON James E. Burns: 2500 Terminal Tower Cleveland, Ohio 44113-2241 For Peerless Insurance Co.: RUSSELL J. MERAGLIO, JR. 113 St. Clair Building Cleveland, Ohio 44114 - 2 - KARPINSKI, J.: The appeal sub judice arises from an order of the probate court imposing personal liability against a guardian removed for failing to file an account and granting a motion to surcharge a surety bond posted by the removed guardian in the amount of $17,546.01 in unpaid nursing home charges, $2,750 in attorney fees and $50 in court costs. The record demonstrates that Lillian Edenburg began residing in the Montefiore nursing home more than three years prior to the filing of this case. Lillian's brother Eugene Edenburg also signed her admission agreement with Montefiore on March 12, 1986, and agreed to be jointly liable for Lillian's nursing home debts. The record demonstrates the probate court subsequently appointed attorney James E. Burns as guardian for Lillian and Eugene Edenburg in separate cases. Burns filed an Application for Appointment of Guardian for Lillian Edenburg, Incompetent in Probate Case No. 1040050 on November 21, 1989. Burns filed a Fiduciary's Acceptance (Guardian) and posted a Guardian's Bond in the amount of $53,000 issued by Peerless Insurance Company ("Peerless") the same day. Burns was thereafter duly appointed guardian for Lillian Edenburg by order of the probate court December 12, 1989. Burns subsequently filed a Guardian's Inventory on March 26, 1990, listing Lillian Edenburg's sole asset as an account at First National Bank of Ohio in the amount of $65,618.79. Burns - 3 - posted a supplemental Guardian's Bond issued by Peerless in the amount of $77,000, as ordered by the probate court. The record demonstrates Burns intermittently made payments to Montefiore for the cost of Lillian Edenburg's nursing home care from the funds in her account and the funds in Eugene's account when her funds became depleted. Burns never filed an application on behalf of Lillian Edenburg for Medicaid to pay any of her nursing home expenses. Within two years of his appointment as guardian, that is, by December 13, 1991, Burns had failed to file an account of Lillian Edenburg's financial condition. In an order journalized April 7, 1992, the probate court specifically ordered Burns to file an account summarizing Lillian Edenburg's financial condition. Burns failed to respond. On May 18, 1992, the probate court sua sponte scheduled a hearing to remove Burns as guardian for failure to file the account in accordance with R.C. 2109.30. The probate court thereafter removed Burns as guardian for failure to file the account approximately six months after the due date and taxed costs against Burns in an order journalized June 19, 1992. Following his removal, Burns prepared an account which was incomplete in two respects, viz.: (1) it did not contain a voucher for one payment from Lillian Edenburg's account and (2) it lacked a physician's certificate concerning her incompetence. Because it was incomplete, this account was rejected for filing - 4 - on June 22, 1992, three days following his removal. Burns did not subsequently seek reinstatement as guardian for Lillian Edenburg, nor did he file a complete account until May 5, 1993. The record indicates Burns was also removed as guardian for Eugene Edenburg, who by this time also resided at Montefiore. Approximately three months after Burns was removed as guardian, the probate court appointed attorney Alan Gelbman as successor guardian for Lillian and Eugene Edenburg in the two probate cases. Gelbman filed his Application for Appointment as Successor Guardian for Lillian Edenburg on September 16, 1992, and was appointed as successor guardian by the probate court in an order journalized the same day. Five days later, on September 21, 1992, successor guardian Gelbman filed a Motion to Surcharge in Lillian Edenburg's case against former guardian Burns personally and against the surety bonds issued by Peerless. The motion sought to recover unspecified damages arising from Burns' failure to file an account. Gelbman subsequently filed a Successor Guardian's Memorandum/Report of Investigation on December 21, 1992, in Lillian Edenburg's case, which summarized receipts and disbursements of guardianship funds and outstanding guardianship debts. The dispute in this case concerns attorney fees, court costs and unpaid nursing home charges for Lillian Edenburg for the period following May 1, 1992. Prior to his removal as guardian, Burns paid in full all Lillian's nursing home charges - 5 - through April, 1992. Some of the funds to pay Lillian's nursing home debts, however, came from Eugene's bank account, since he agreed to be jointly liable for her debts and since her bank account had essentially been exhausted. Successor guardian Gelbman was apparently unaware of Eugene's agreement to pay Lillian's nursing home debts and used Eugene's funds to pay only Eugene's nursing home charges. Gelbman's Memorandum supporting the Motion to Surcharge in this case stated the balance of Lillian's unpaid nursing home charges totalled $13,806.03 for the four-month period from May through August, 1992. The Memorandum sought to recover other surcharges in the amount of $1,706.47, including attorney Gelbman's fees. The certificate of service accompanying Gelbman's Memorandum indicates that Gelbman served the document on former guardian Burns, Peerless, and Montefiore. Counsel for Montefiore filed a notice of appearance in the probate court on January 11, 1993. However, the record demonstrates that Montefiore did not file any motion to intervene in the proceedings to raise any claim concerning unpaid nursing home charges for Lillian Edenburg accruing since May, 1992. The record demonstrates that Gelbman subsequently filed a Successor Guardian's Supplemental Memorandum/Report of Investigation Re Motion to Surcharge on March 19, 1993. Gelbman's Supplemental Memorandum referred to a total of $17,397.44 in unpaid nursing home fees and sought to recover - 6 - additional surcharges for attorney fees and costs incurred after the original Memorandum. The Supplemental Memorandum did not explain how the balance of Lillian's nursing home charges was calculated and did not provide any basis for an award of court costs. Montefiore, former guardian Burns, and Peerless filed hearing briefs prior to the May 5, 1993, hearing before the referee on successor guardian Gelbman's motion to surcharge. The transcript of the May 5, 1993, proceedings conducted by the probate court referee demonstrates that successor guardian Gelbman did not present any evidence. However, counsel for Montefiore presented testimony from the following four witnesses, viz.: (1) Montefiore Finance Director, David Rodgers; (2) Montefiore social worker, Scott Greenwald; (3) successor guardian Alan Gelbman; and (4) removed guardian James Burns, as if on cross-examination. The hearing concluded without oral arguments. Former guardian Burns, Peerless, successor guardian Gelbman, and Montefiore each filed written post-hearing briefs in June, 1993. On August 27, 1993, the probate court referee issued a detailed seven-page typewritten report with findings of fact and conclusions of law. The referee recommended the probate court deny the motion to surcharge for unpaid nursing home fees and enter judgment in favor of successor guardian Gelbman for only $1,785 in attorney fees plus $50 in court costs. Successor - 7 - guardian Gelbman, Montefiore, and former guardian Burns thereafter filed objections to the referee's report. The record demonstrates the probate court disposed of the objections to the referee's report and entered judgment in orders journalized March 9, 1994. The probate court's Judgment Entry granted the motion to surcharge for $17,546.01 in nursing home charges and awarded successor guardian Gelbman $2,750 in attorney fees and $50 in court costs. The probate court's judgment entry imposed personal liability against Burns and provided that Peerless was obligated to pay these amounts if Burns timely failed to satisfy these obligations. The probate court granted Burns' motion to stay execution on the judgment pending appeal. Burns timely appeals raising the following two assignments of error: THE PROBATE COURT ERRED IN GRANTING THE SUCCESSOR GUARDIAN'S MOTION TO SURCHARGE WHEN THE PRIOR GUARDIAN (APPELLANT) ACCOUNTED FOR ALL ASSETS IN THE ESTATE AND ENDED HIS TERM AS GUARDIAN WITH SUFFICIENT ASSETS TO PAY ALL OUTSTANDING DEBTS. THE PROBATE COURT ERRED IN CHARGING THE APPELLANT SUCCESSOR [SIC] GUARDIAN WITH NURSING HOME FEES WHICH ACCRUED AFTER THE APPELLANT WAS REMOVED AS GUARDIAN AND NOT AS A RESULT OF ANY MALADMINISTRATION BY THE APPELLANT. Burns' two assignments of error are well taken in part. Burns' brief on appeal does not separately argue these two assignments of error, but instead raises two distinct arguments. First, Burns contends the probate court improperly entered judgment against him in favor of successor guardian Gelbman for - 8 - $2,750 in attorney fees and $50 in court costs. Burns also argues the probate court improperly granted the Motion to Surcharge and ordered him to pay $17,546.01 for Lillian Edenburg's unpaid Montefiore nursing home charges. Burns' first argument challenges the probate court's award of attorney fees and costs to successor guardian Gelbman. The record demonstrates the Motion to Surcharge was filed by Gelbman on behalf of Lillian Edenburg and her estate. Gelbman's motion did not seek payment of any attorney fees or costs to him personally. The Motion was supported by various invoices, including a final itemized invoice to the estate for attorney fees in the amount of $3,570, based on 42 total hours at $85 per hour. The record demonstrates Gelbman offered no testimony during the hearing concerning the reasonableness of the attorney fees. Furthermore, the record contains absolutely no basis for the imposition of $50 "court costs" in connection with the Motion to Surcharge. It is well established that a court-ordered award of attorney fees must be entered in favor of a party litigant and not directly in favor of the party's attorney. Gullia v. Gullia (1994), 93 Ohio App.3d 653, 664-665. Since Gelbman is not a party in this case, and did not even request payment of any attorney fees or costs to him directly, the probate court's award of attorney fees and court costs to Gelbman is clearly contrary to law. Accordingly, judgment of the probate court ordering - 9 - payment by Burns to Gelbman of $2,750 in attorney fees and $50 in court costs is hereby reversed in its entirety and remanded. Burns also challenges the probate court's order granting the Motion to Surcharge in the amount of $17,546.01 for unpaid nursing home charges incurred at Montefiore for the care of Lillian Edenburg from the five-month period from May, 1992, through September, 1992. Based on our review of the record, Burns' second argument is well taken in part. The record demonstrates that each of the two guardians argued during the hearing that the other guardian was responsible for payment of Lillian Edenburg's nursing home charges during this period. Removed guardian Burns argued successor guardian Gelbman was responsible for payment of these charges since Gelbman failed to exhaust Eugene's funds to pay Lillian's expenses and to apply timely for Medicaid on behalf of Lillian. Gelbman argued to the contrary that he was unaware of this agreement and therefore had no obligation to use Eugene's funds. The litigants also disputed when an application for Medicaid should have been filed for Lillian Edenburg. Gelbman argued Burns should have filed a Medicaid application by May, 1992, when Lillian had less than $1,500 in her own personal bank account. However, Burns argued Lillian did not become eligible for Medicaid until after his removal as guardian in June, 1992, at the earliest, since Eugene was obligated to pay Lillian's - 10 - nursing home debts and had sufficient funds in his bank account to preclude her from qualifying for Medicaid reimbursement. Testimony during the hearing indicated that under existing regulations Medicaid applicants were not eligible for reimbursement of nursing home expenses as long as the applicant owned more than $1,500 worth of "assets." Unresolved, however, was the question whether Eugene's assets and promise to pay Lillian's nursing home debt precluded her from being eligible for Medicaid. The answer to this question will determine what date Burns' liability, if any, began. If Lillian Edenburg was not eligible for reimbursement under Medicaid regulations until the combined assets of both Lillian and Eugene totalled less than $1,500, that is, then the date of his liability did not begin until sometime after June 19, 1992. The record indicates, moreover, that no application for Medicaid was filed on behalf of Lillian Edenburg until December, 1992, approximately six months after she became eligible and three months following Gelbman's appointment as successor guardian. Gelbman was aware of her eligibility at least by October 29, 1992, the date he sent a letter to Montefiore requesting a Medicaid application and advising Montefiore that Lillian's checking account contained only $116.07. Hearing Exhibit 5. The total amount of Lillian Edenburg's nursing home debt not covered by Medicaid is unclear from the record. The record - 11 - contains at least three different calculations of this indebtedness. Gelbman's Motion to Surcharge did not specify any amount. Gelbman's first Memorandum stated the balance totalled $13,806.03 for the four-month period from May, 1992, through August, 1992. Gelbman's Supplemental Memorandum, however, stated the balance was $17,397.44 for the five-month period from May, 1992, through September, 1992, despite his own delay in filing a Medicaid application. The record demonstrates the total indebtedness for Lillian Edenburg's nursing home charges not covered by Medicaid was calculated a third time, during the hearing, as an even larger amount. The evidence indicated that Lillian's nursing home debt had grown to $27,950.01 for the five-month period from May, 1992, through December, 1992, since Gelbman used the funds in Eugene's bank account to pay only Eugene's nursing home charges and not any portion of Lillian's expenses. Lillian Edenburg's application for Medicaid had still not been approved by the time of the hearing. Gelbman stated that Medicaid ordinarily provides reimbursement for covered expenses incurred within three months prior to the filing of the application. See OAC 5101:1- 39-02. Montefiore "estimated" that Lillian Edenburg would receive $10,404.00 from Medicaid for the three-month period from October, 1992, through December, 1992. As a result, the probate court calculated the amount of the surcharge for unpaid nursing home fees as follows: - 12 - Total Unpaid Nursing Home Charges $27,590.01 (May 1, 1992-December 31, 1992) "Estimated" Medicaid Reimbursement $10,404.00 (October 1, 1992-December 31, 1992) Net Nursing Home Surcharge $17,546.01 Based on our review of the record, the probate court's judgment for $17,546.01 fails to establish the amount of damages with reasonable certainty. Gelbman's Motion to Surcharge sought to recover damages resulting, in part, from Burns' failure to file a Medicaid application for Lillian Edenburg. Recoverable damages should be limited to the amount of nursing home charges that Medicaid would have paid if Burns had filed a timely application. The record provides absolutely no basis to evaluate the reliability of Montefiore's "estimated" Medicaid reimbursement. Moreover, even if Montefiore's "estimate" were accurate, the calculations employed by the probate court clearly overstate the amount of damages resulting from Burn's failure to file a Medicaid application. Montefiore's estimate reveals that Medicaid does not reimburse 100% of the monthly nursing home expense; however, the probate court used 100% of the entire monthly cost as the basis for awarding damages. Accordingly, the judgment of the probate court granting the Motion to Surcharge for $17,546.01 in unpaid nursing home charges and awarding successor guardian Gelbman $2,750 in attorney fees and $50 court costs is hereby reversed and remanded with instructions. On remand, the probate court is instructed to - 13 - limit the nursing home surcharge, if any, to the amount Medicaid would have paid for Lillian Edenburg's expenses beginning with the date Lillian Edenburg was eligible for Medicaid and extending to the time when Gelbman should have known to file for Medicaid, less the retroactive grace period. In determining the first date, the court is to determine whether Eugene's assets and promise to pay Lillian's nursing home debt precluded her from being eligible for Medicaid. In determining the second date, the court is to consider that at least by October 29, 1992, Gelbman was aware Lillian was eligible for Medicaid. Moreover, Medicaid benefits are usually awarded retroactive to three months prior to the month of application. Finally, the probate court is instructed to readdress the attorney fee award. Judgment accordingly. - 14 - It is ordered that appellant(s) recover of appellee(s) their costs herein taxed. The Court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this Court directing the Probate Court to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. SPELLACY, P.J., and DYKE, J., CONCUR. JUDGE DIANE KARPINSKI N.B. This entry is made pursuant to the third sentence of Rule 22(D), Ohio Rules of Appellate Procedure. This is an announce- ment of decision (see Rule 26). Ten (10) days from the date hereof, this document will be stamped to indicate journaliza- .