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Recovering Payment for Expenses or Services Provided for a Deceased

In Tennessee, family members and non-family members alike often provide care, perform services or pay for expenses for someone who passes away without compensating the person who provided the care or services or who paid expenses on their behalf. Can a family member or non-family member recover for care, services or expenses provided to someone while they were alive, after that person dies? The answer is: Sometimes they can, and sometimes they can’t.

If the person who provided the care, services or who paid the expenses (the “Provider”) has a valid and enforceable written agreement between him or her and the person who passed away (the “Deceased”), which is often not the case, then recovery against the estate of the Deceased should not be a problem (provided the probate estate has assets to pay the debt).

Frequently, life is not so orderly that a Provider receives an enforceable written agreement. Sometimes, death occurs before the Deceased was able to make arrangements to compensate the Provider by changing his or her will or by preparing a written agreement that will allow the Provider to recover. Sometimes, neither the Provider nor the Deceased anticipate that payment to the Provider will be a problem after the Deceased is gone, but it certainly can be.

If there is no enforceable written agreement between the Deceased and the Provider and the Deceased’s will or trust does not provide for payment to the Provider, whether a Provider can still recover for services, care or expenses paid is best approached by first determining whether the Provider was a family member or not. Why? Because the standard for recovery in such situations may well differ depending on whether the Provider was a family member or not, as explained more fully below.

Under Tennessee probate law, the term “family member” is a very flexible term and can include persons not related to the Deceased by blood or marriage. In Tennessee, if the Deceased and the Provider had a relationship of “mutual dependence” and “reciprocal kindness” that promoted “the comfort and convenience of living together,” then the Provider is considered a family member. For example, in Tennessee cases, unmarried couples living together have been considered family members.

STANDARD FOR NON-FAMILY MEMBERS

If the Provider was not a family member of the Deceased, then, if the Provider can prove that the Deceased and the Provider had an enforceable agreement, even an oral one, providing for the Provider to be compensated, then the Provider can recover. Even if the non-family member Provider and the Deceased did not have an enforceable agreement, the Provider can recover under quantum meruit. For a discussion of quantum meruit, see my earlier blog.

STANDARD FOR FAMILY MEMBERS: THE FAMILY SERVICE RULE

If the Provider and the Deceased were family members, then what is known in Tennessee as the family service rule applies. The family service rule creates a rebuttable presumption that the care, services, or expenses were provided or paid out of love and affection and that, therefore, the Provider is not entitled to be compensated for them.

The Provider may rebut the presumption of the family service rule in either of two ways. First, if the Provider can prove that the Deceased expressly agreed to pay for services or to reimburse expenses, the Provider can rebut the presumption. Second, if the Provider can prove that the Deceased knew or should have known that the Provider expected to be compensated or reimbursed, the Provider can rebut the presumption.

Other states have adopted the rule that the family service rule does not apply to services that are of a business nature and which are not normally performed without compensation, as opposed to domestic services like household chores and personal care. Tennessee has not expressly adopted that rule, but seemed to follow it in the case of In re Estate of Marks (Tenn. Ct. App. 2005), which contains a helpful discussion of the family service rule.

In my experience, it is usually much easier to prove entitlement to reimbursement for expenses than to prove entitlement to payment for care or services for obvious reasons. Also, a Provider must always prove the reasonable value of his or her services to recover. Lastly, as lawyers who handle probate litigation know very well, the proof in cases where a Provider is requesting to be paid from the Deceased’s probate estate is often limited by the Deadman’s Statute.