We always warn our clients about the need to take appropriate steps to shelter assets from medicaid claims when one spouse spends considerable time in skilled nursing care. The Third Department of New York’s Appellate Division has affirmed a lower court decision in In Re Estate of Tomeck  846 N.Y.S. 2d 693 which determined that the Surrogate’s Court lacked personal jurisdiction over an irrevocable trust created by the decedent during her lifetime.

In this instance, the decedent was the "community spouse" , meaning that she had continued to live in her home following need to place her husband in a nursing home. During her lifetime, the Department of Social Services made substantial payments to support the decedent’s husband in the nursing home and, after her death, that department’s commissioner attempted to recover these funds from the community spouse’s estate.

The social services commissioner filed objections to the petition for a formal accounting which was filed by Mrs. Tomeck’s executor. This was done independently of the trustees of the irrevocable trust who never subjected themselves voluntarily to the jurisdiction of the Surrogate’s Court  —even though the petitioner conceded that the trust was a testamentary substitute and included it in the estate inventory for the accounting! It was also noted that the Department of Social Services itself never filed a claim against the trust and did not seek to cite the trustees.