Update: on December 12, 2018, the Supreme Court of Ohio handed down a merit decision in this case.  Read the analysis here.

“What if it is an insolvent estate…What happens to Embassy’s bill?”

Chief Justice O’Connor, to counsel for Cora Bell

“Because he (Robert Bell) is deceased, isn’t the place to litigate or determine his ability or inability to pay in an estate?”

Justice DeGenaro, to counsel for Embassy Healthcare

On July 18, 2018, the Supreme Court of Ohio heard oral argument in Embassy Healthcare v. Cora Sue Bell, 2017-1031. At issue in this case is whether a creditor’s failure to present a claim against a decedent’s estate within the six-month statute of limitations of R.C. 2117.06(C) precludes a later action against the decedent’s surviving spouse under Ohio’s necessaries statute, R.C. 3103.03.

Case Background

Appellee Embassy Healthcare (“Embassy”) operates a nursing home where Appellant Cora Sue Bell’s late husband, Robert, stayed beginning in early 2014. Robert died in May 2014 and no estate was opened. Over six months after his death, Embassy sent Cora (“Cora” or “Bell”) a letter as putative personal representative, asking for payment from Robert’s estate for unpaid nursing services.

In June 2015, Embassy sued Cora individually under R.C. 3103.03, Ohio’s necessaries statute, seeking to recover $1,678 in unpaid nursing services that it provided to Robert, alleging that Cora was obligated to reimburse it for Robert’s debt.

Bell presented two arguments in opposition to Embassy’s claim: (1) that Embassy could not prove, as a matter of law, that Robert could not have paid his own debts, and (2) that the claim was time barred by the six-month statute of limitations for filing claims against a decedent’s estate under R.C. 2117.06.

A magistrate found in favor of Bell, reasoning that Embassy had presented no evidence showing that Robert could not support himself and pay off the debts that Embassy sought.

The trial court agreed with the magistrate, but on different grounds. Finding in favor of Bell on summary judgment, the trial court found that Robert’s alleged debt to Embassy became a debt of Robert’s estate upon his death, but since Embassy failed to present a claim to Robert’s estate, or open an estate for the purposes of doing so within the six-month limitations period imposed by R.C. 2117.06, Embassy’s claim was time-barred. Embassy appealed.

The Appeal

In a split decision authored by Judge Robert A. Hendrickson, in which Judge Michael E. Powell concurred, the Twelfth District Court of Appeals reversed the trial court’s grant of summary judgment to Cora Bell. The appeals court held Embassy’s claim for necessaries against Cora to recover for Robert’s debts under R.C. 3103.03 was an independent cause of action, and not within the purview of R.C. 2117.06(C) or its six-month statute of limitations.

Judge Robin N. Piper dissented, and would affirm summary judgment for Cora Bell. He would find that Embassy, which had the burden of proof under the necessaries statute, failed to prove that Robert was unable to pay for his necessary medical expenses.

Read the oral argument preview of the case here.

 Key Statutes and Precedent

 R.C. 3103.03 Ohio’s Necessaries Statute (“Each married person must support the person’s self and spouse out of the person’s property or by the person’s labor. If a married person is unable to do so, the spouse of the married person must assist in the support so far as the spouse is able.”)

R.C. 2117.06(C) (“Except as provided in section 2117.061 of the Revised Code, a claim that is not presented within six months after the death of the decedent shall be forever barred as to all parties including, but not limited to, devisees, legatees, and distributees.”)

Smith v. Sutter, 90 Ohio App. 320 (6th Dist. 1951) (“The term, ‘necessaries,’ as used in the statute means such food, medicines, clothing, shelter, or personal services as are usually considered reasonably essential for the preservation and enjoyment of life.”)

Wrinkle v. Trabert, 174 Ohio St. 233 (1963) (“where one has a claim against an estate, it is incumbent upon him, if no administrator has been appointed, to procure the appointment of an administrator against whom he can proceed.”)

Cleveland Metropolitan General Hospital v. Firestone, 8th Dist. Cuyahoga No. 40967, 1980 WL 354787, at * 4 (Aug. 14, 1980) (finding that failure to present a claim within the time requirements of R.C. 2117.06 did not bar an action for medical expenses under R.C. 3103.03.)

Ohio St. Univ. Hosp. v. Kincaid, 48 Ohio St. 3d 78 (1990) (“Where a husband is unable to provide for his own support, pursuant to R.C. 3103.03 a wife must aid in the support of her husband to the extent that she is able . . . implicit in our decision, without saying more, is that medical expenses are necessaries and, as such, are included as part of any definition of ‘support.’”)

Lewis v. Steinreich, 73 Ohio St.3d 299 (1995) (“The presentment requirements of R.C. 2117.06 apply only to those claims which may be allowed as debts payable out of the assets of an estate.”)

Home Helpers/Direct Link v. St. Pierre, 2011-Ohio-4909 (12th Dist.) (“the plain language of R.C. 3103.03(A) requires that the married person be unable to support himself before the spouse of the married person must assist.”)

Wilson v. Lawrence, 2017-Ohio-1410 (“a claim against an estate must be timely presented in writing to the executor or administrator of the estate in order to meet the mandatory requirements of R.C. 2117.06(A)(1)(a) . . . .”)

At Oral Argument

Arguing Counsel

Miriam H. Sheline, Pro Seniors, Inc., Cincinnati, for Appellant Cora Sue Bell

Susan M. Audey, Tucker Ellis LLP, Cleveland, for Appellee Embassy Healthcare

Cora Bell’s Argument

This case involves the intersection of R.C. 2117.06(C), which is a probate statute setting forth the procedure and the statute of limitations for claims against an estate, and R.C. 3103.03, Ohio’s necessaries statute. R.C. 3103.03 was not originally gender-neutral. It was enacted at a time when the husband had the primary obligation to support his wife with necessaries because the wife could not contract on her own. When it was changed to become gender neutral, it adopted the conditional approach—the individual who receives  the service is obligated to support himself/herself through his/her labor and his/her property. If he/she is unable to do so, then the other spouse can be obligated to do so up to the amount of his/her ability.

When an individual dies, that individual’s obligations become the obligations of the individual’s estate, and the estate administrator must pay the individual’s debts upon presentment of a claim. If there is no estate, a creditor can open one. If a claim is not presented within six months, pursuant to R.C. 2117.06(C), it is barred against all parties. No payment shall be made on the claim and no action shall be maintained on the claim. So Embassy’s claim against Robert Bell is forever barred.

R.C. 3103.03 establishes a method of payment of a claim.  It does not create a new claim. It provides a conditional obligation on the spouse, with the primary obligation on the individual who has received the services. That claim is and remains that Mr. Bell owed Embassy Healthcare for services it provided him. R.C. 3103 merely allows Embassy to seek payment from another source.  But Embassy never sought payment from Mr. Bell, the individual who has the primary obligation to pay this debt.  Since Embassy never sought payment, it can never show Mr. Bell’s inability to pay.

Allowing R.C. 3103.03 to be construed as an independent cause of action gives the necessaries creditor a much superior status to all others. Necessaries creditors could just ignore the probate proceedings, and pursue the spouse later.

The question is, can the creditor just pick and choose? Can the creditor just ignore the probate process, and go after the spouse directly? The answer is, and should be, no.

Embassy’s Argument

The necessaries statute is a complete and separate statute from a claim against an estate. It creates an independent claim because there is an independent and reciprocal duty among spouses. R.C. 3103 does contain protections for the surviving spouse, or any spouse. The parties must be married, what is owed must be for necessaries, not luxuries, and the debtor spouse has to be unable to pay. Embassy still has to prove all of this at the trial court level. Embassy would have to show at a trial that Mr. Bell was unable to pay his debt, but it has not yet had the chance to do so. If Mr. Bell had the ability to pay, that would eliminate the claim under the necessaries statute. If Embassy cannot prove what is required under the necessaries statute, then it cannot recover from Mrs. Bell.

The probate statute and the necessaries statute create two separate claims against two different people, for two different remedies. A claim for necessaries is not a claim against the estate; it is a claim against a spouse, surviving or not. The choice as to which route to take is up to the creditor—the creditor can pursue either the spouse or the estate. One is not subsumed under the other. If an estate is not opened and the creditor does not open an estate, then the creditor can pursue its claim under the necessaries statute. There are no conflicts between these statutes.

What Was On Their Minds

The Interplay Between the Two Statutes

What if there had been a showing that Mr. Bell’s assets were not sufficient to cover the bill, asked Justice French? Is Embassy still barred under the necessaries statute because of the failure to present a claim against the estate?

What should the court do with the plain language of R.C. 2117.06, which says that claims are barred if not presented, asked Justice DeWine?  Isn’t the only reasonable way to read that is that all claims against the estate are barred unless they are presented, not other claims, against other people? Isn’t that what the language says?  Isn’t the court being asked to do something other than just follow the language of 2117.06? Nothing in the statute says anything about barring a claim against someone else, he added. An independent claim that separately arises can’t be pursued? How is a claim against a spouse based on say, a contract, different from one under the necessaries statute?

Isn’t it who has the obligation, asked Chief Justice O’Connor, commenting that if Cora Bell had signed, that would be a contractual obligation, but that this was not a case where Embassy didn’t know Robert Bell had died, because he died in its facility. So more than a year went by and Embassy realized it had a claim to assert against Mr. Bell, but it was too late, since there was no estate, so then Embassy turned to a separate cause of action under the spousal duty. Had the debt accrued while Mr. Bell was still alive, what was Embassy’s option? Could Embassy have proceeded under R.C. 3103 against Mrs. Bell while Mr. Bell was alive? Given that Mr. Bell was receiving Medicare, didn’t he himself have the ability to pay?

Is Embassy arguing that it could collect from the estate and then from Mrs. Bell, asked Justice DeGenaro? If the estate had been opened, could Embassy  have opted not to file a claim against the estate but to go after the spouse personally? (Ms. Audey insisted repeatedly that it was the creditor’s option to pursue either the estate or the spouse.)

If the evidence showed that Mr. Bell had the ability to pay that bill, would that preclude the necessaries claim, asked Justice O’Donnell? The two are independently operated, and the claimant has the option either to open the estate and pursue that individual or the spouse through the necessaries clause?

The Absence of an Estate

Was there no estate here, asked Chief Justice O’Connor? What if it is an insolvent estate? What if the assets are marshaled and statutorily the estate is insolvent? What happens to Embassy’s bill? Is there then no recourse against the surviving spouse? Embassy could have opened an estate, she commented. Was this a conscious choice by Embassy to say we don’t operate like this, we’re going to go after the widow?

If Embassy had opened the estate, as a creditor can, or if Mrs. Bell had opened it, and the estate had sufficient assets to pay Embassy’s bills, we wouldn’t be here, right, asked Justice DeGenaro? If there were enough assets in Mr. Bell’s estate, to pay Embassy’s bill in full, it would not then have to pursue Mrs. Bell, correct?

Are all claims not submitted under 2117  barred as to all parties, asked Justice O’Donnell?

Robert’s Ability or Inability to Pay His Own Debts

Must there be a showing that the individual could not support him or herself before the obligation shifts to the other spouse, asked Chief Justice O’Connor? And in this situation, there was no showing that Mr. Bell could not pay his own bills? Does there have to be a demonstration that the recipient of the benefits is unable to pay? And was that done here? How was care paid for before his death? Not out of pocket from Mrs. Bell?

How much was the debt, asked Justice O’Donnell?

Court of Appeals Decision

Justice DeWine asked Ms. Audey if she disagreed with that part of the appellate decision which said Embassy would have to show that there weren’t enough assets in the estate to pay the bill. (She pivoted, and again insisted it was a creditor’s option where to pursue the claim.)

How It Looks From The Bleachers

To Professor Emerita Bettman

It just doesn’t sit right with me that Embassy Healthcare clearly blew it here by failing to open an estate and/or file a claim (despite Ms. Audey’s smooth attempt to explain why no estate was opened, it still sounded like the dog ate my homework and gets to opt for another bite. Readers should note that neither she nor anyone in her firm was trial counsel or appellate counsel below). Yes, Embassy still has to prove Mr. Bell’s inability to pay, and a few other minor things, like were these really necessaries (no one disputes this point), but averting the probate requirements? If I were in charge, I’d make timely filing a claim with the estate a condition precedent to a necessaries filing as a policy matter.

I certainly agree with student contributor Carson Miller that Mrs. Bell should win this case, but I’m not sure I totally share his optimism that she will.  I think the Chief and Justice DeGenaro were put off by Embassy’s argument that it was the creditor’s choice either to open (if necessary) an estate and file a claim or to pursue an independent claim under the necessaries statute.  That is getting to avoid a serious probate requirement because of what sure sounds like a mistake in missing the probate statute of limitations.  But as Justice DeWine kept pointing out, just because all claims against the estate are barred after six months doesn’t mean there can’t be a separate claim against the surviving spouse, and that view could carry a majority.  Ms. Audey stayed on message that it was the creditor’s choice.  Other than those three justices, the Court was mostly quiet.

But even if Embassy prevails, it still has to prove that Robert Bell was unable to pay for his own nursing care in order to be able to collect from Cora. Given the little information in the record about his Medicare benefits, it might not be able to do that.

To Student Contributor Carson Miller

The central theme of Cora Bell’s argument was particularly compelling and informed the entire direction of the oral argument. I was surprised how much of the argument was focused on the reasonableness of allowing creditors to choose—at their discretion—to bring claims against a surviving spouse.  Chief Justice O’Connor and Justice French’s initial questions were not so much questions, but rather restatements of Cora Bell’s proposed propositions of law.

However, as Justice DeWine pointed out, the General Assembly passed 3103.03 as a separate statute for a reason, and requiring a creditor to also comply with 2117.06(C) could eliminate 3103.03 as a separate method for creditors to seek payment. It seemed as if Justice DeWine really wanted Ms. Sheline to articulate a situation in which a creditor ever could bring a separate claim under 3103.03, but the question was never really asked or answered.

As for Embassy’s argument, I was surprised by Ms. Audey’s affirmative response to Justice DeGenero’s questioning as to the proper way to litigate these cases; Ms. Audey effectively admitted that Embassy should have sued Robert Bell and instead lost track of time. Ultimately, there was enough skepticism from the Justices towards Embassy’s proposition—that a creditor could, at its own discretion, sue a surviving spouse at any time without making any effort to recover from the decedent—for me to predict that the court will find for Bell and overturn the lower court’s decision.