[SEE CAPTION AT 1.3.1 ]
DECREE
Now, this day of , 20 , in consideration of the annexed Petition, it is hereby ORDERED and DECREED as follows:
1. The attached Special Needs Trust pursuant to 42 U.S.C. § 1396p(d)(4)(A) for the benefit of Lisa Dunn, an Incapacitated Person ("Trust") is hereby created, approved and incorporated herein by reference;2. ABC Bank ("Trustee") is hereby appointed to serve as Trustee of the said Trust pursuant to the terms of the Trust; and3. The Trustee shall accept the settlement proceeds of a personal injury action filed on behalf of the incapacitated person in the Court of Common Pleas of Philadelphia County, Trial Division, entitled "Lisa Dunn, an Incapacitated Person, et al v. Thomas White (June Term, 1997, No. 3479)" consisting of lump sum cash and a tax-free structured settlement, which settlement was approved by Order dated July 2, 1999 of the Honorable Anita S. Jones, and shall hold and administer such funds in accordance with the terms of the said Trust. J.
[SEE CAPTION AT 1.3.2 ]
PETITION FOR APPROVAL OF SPECIAL NEEDS TRUST FOR INCAPACITATED PERSON UNDER 42 U.S.C. § 1396p(d)(4)(A)
Pamela Dunn, Guardian of the Estate of Lisa Dunn, an Incapacitated Person, respectfully submits this Petition seeking approval of a Special Needs Trust for Lisa Dunn, with ABC Bank to serve as Trustee to receive and administer settlement funds awarded to Lisa in a personal injury action, and in support thereof, Petitioner avers the following:
1. Lisa Dunn ("Lisa" or the "incapacitated person") was born on July 1, 1967. She is currently 32 years old and resides with her mother, Pamela Dunn, at 111 Pine Street, Philadelphia, Pennsylvania 19111. Her social security number is 111-11-1111.2. On September 1, 1994, Lisa was struck by a car while crossing Oak Street in Philadelphia.3. Lisa suffered traumatic brain damage in the accident and as a result, has severe and permanent cognitive and physical disabilities. She cannot walk or talk. Although she appears to recognize her family members and care givers, she cannot speak or communicate in any effective way. She requires assistance for all of her daily needs (personal hygiene, feeding, dressing, etc). She will require 24-hour nursing and custodial care as well as significant medical care for the rest of her life. Her condition and required care are described in the reports of her neurosurgeon, Susan Smith, M.D. and neurologist, William Jones, M.D., copies of which are attached hereto as Exhibits "A" and "B" respectively.4. Following Lisa's injuries, Lisa was adjudicated a totally incapacitated person and Pamela Dunn, the incapacitated person's mother, was appointed plenary guardian of her estate and person, by Decree dated January 15, 1995 of the Honorable Anita S. Jones.5. The Guardian of Lisa's estate, through her attorneys, Smith and Smith, filed an action on Lisa's behalf in Philadelphia County, Pennsylvania, entitled "Lisa Dunn, an Incapacitated Person, by the Guardian of her Estate, Pamela Dunn et al. v. Thomas White et al (June Term, 1997, No. 3479)" for her injuries arising from the accident. Plaintiff sued the driver of the automobile and others alleging that the injuries were the result of the defendants' negligence.6. The parties settled out of court for the gross combined amount of $2,000,000. Pamela Dunn filed a Petition for Leave to Compromise an Incapacitated Person's Action ("Incapacitated Person's Compromise Petition") in the Philadelphia Court of Common Pleas for approval of the settlement of the action on behalf of Lisa. That Petition set forth Petitioner's intention to seek approval for a Special Needs Trust for Lisa and a Decree authorizing distribution of the settlement proceeds to the Guardian for distribution to the Special Needs Trust. A copy of the Incapacitated Person's Compromise Petition is attached as Exhibit "C."7. By Order dated July 2, 1999 ("Settlement Approval Order"), the Honorable Anita S. Jones approved the settlement and ordered distribution of the settlement proceeds to the Guardian for distribution to a Corporate Trustee of a Special Needs Trust to be approved by the Orphans' Court Division. Thus, Lisa's settlement proceeds may not be distributed until this Court has entered an order approving the Special Needs Trust and an appropriate Trustee. A copy of Judge Jones' Settlement Approval Order dated July 2, 1999 is attached hereto as Exhibit "D."8. The net amount of the settlement distributable to Lisa after payment of all liens, expenses and other deductions associated with the civil action, is as follows: a. Cash payment of $500,000, andb. Monthly, tax-free structured settlement payments of $3,350 per month, guaranteed for a minimum period of 10 years and life thereafter, to commence 9/1/99.9. By this Petition, Petitioners seek to obtain approval for the creation and funding of a Special Needs Trust for Lisa under 42 U.S.C. § 1396p(d)(4)(A), with ABC Bank to serve as the trustee of the said Trust.10. Lisa has no assets other than the personal injury settlement described above. Lisa's only income (other than the investment income to be earned on her settlement funds) is her SSI income in the amount of $550 per month.11. Lisa qualifies for and relies upon Medicaid for all of her medical care, which is substantial.12. In light of Lisa's serious and permanent disabilities, Petitioner seeks this Court's approval to create a Special Needs Disability Trust under 42 U.S.C. § 1396p(d)(4)(A) for Lisa in order to preserve her Medicaid benefits. ABC Bank will serve as Trustee and receive and administer Lisa's settlement proceeds pursuant to the terms of the Trust. For Medicaid eligibility reasons, all funds distributable to Lisa in the personal injury suit should be paid directly to ABC Bank as Trustee of the Trust for Lisa.13. Because the Trust will contain all of Lisa's assets and there is no need for the Guardian to post additional security. ABC Bank's consent to serve as Trustee of the Trust is attached as Exhibit "E."14. The Pennsylvania Rules of Civil Procedure, as amended January 1, 1997, specifically authorize the creation of Special Needs Trusts as vehicles for administering the proceeds of a settlement of an action for an incapacitated plaintiff. See Pa. R. Civ. P. No. 2064. In addition, 20 Pa. C.S.A. § 5536(b) allows the Court to approve the creation of a Trust for an Incapacitated Person.15. The federal statute, 42 U.S.C. § 1396p(d)(4)(A) provides an extraordinary Medicaid benefit to disabled individuals only if they place their funds are placed in a Special Needs Trust like the one proposed herein.16. Under 42 U.S.C. § 1396p(d)(4)(A), Lisa will continue to be eligible for Medicaid benefits. Upon her death, however, the Trustee will be required to reimburse the Commonwealth of Pennsylvania for all Medicaid payments made on behalf of Lisa during her lifetime. In light of the extraordinary cost of Lisa's round-the-clock nursing care, without the Trust, Lisa's settlement funds would be insufficient to provide any sustained increase in the quality of her life over her entire lifetime and would be depleted well before the end of her life expectancy.17. Petitioner has attached as Exhibit "F" a copy of the proposed Trust. A separate memorandum, attached as Exhibit "G," describes the Trust's terms, benefits, and purposes in further detail.18. The structured settlement annuity payment will be paid directly to the Trustee of the Trust and, upon the incapacitated person's death, will be paid to her estate to the extent that there are any guaranteed payments left to be made.19. The estimated annual cost of Lisa's care is substantial. Petitioners have engaged a private case management firm to prepare an updated, actual care plan for Lisa. Petitioners will file a separate Petition for allowances to obtain approval to expend Trust principal for Lisa's actual special needs beyond those covered by insurance.20. The incapacitated person has never been married and has no children. She does not have a Will. Her presumptive intestate heirs are as follows: | Pamela Dunn | Mother, Guardian of the Estate (Petitioner herein) |
| Joseph Dunn | Father |
The minor's parents were divorced in 1992. The consents of the foregoing intestate heirs are attached as Exhibit "H."
21. By letter dated July 26, 1999, a copy of which is attached to the Certificate of Service submitted herewith, Petitioner provided notice of the filing (as well as a copy) of this Petition to the following: Department of Public Welfare, Legal
302 State Office Building
1400 Spring Garden Street
Philadelphia PA 19130
SSI Program Support Team
Attention: Team Leader
Mid Atlantic Program Service Center
3rd and Spring Garden Streets
Philadelphia PA 19101
Wherefore, Petitioner respectfully requests that this Court enter the proposed Decree attached hereto, which provides as follows:
A. The attached Special Needs Trust under 42 U.S.C. § 1396p(d)(4)(A) for the benefit of Lisa Dunn, an incapacitated person is created, approved and incorporated herein by reference;B. ABC Bank ("Trustee") is hereby appointed to serve as trustee of the said Trust pursuant to the terms of the Trust;C. The Trustee shall accept the settlement proceeds of a personal injury action filed on behalf of the incapacitated person in the Court of Common Pleas of Philadelphia County, Trial Division, entitled "Lisa Dunn, an Incapacitated Person, by the Guardian of her Estate, Pamela Dunn et al. v. Thomas White (June Term, 1997, No. 3479)" consisting of lump sum cash and a tax-free structured settlement, which settlement was approved by Order dated July 2, 1999 of the Honorable Anita S. Jones, and the Trustee shall hold and administer such funds in accordance with the terms of the said Trust. Jane K. Trustworthy, Esquire
Attorney for Petitioner
[SEE AFFIDAVIT AT 1.4.1 OR VERIFICATION AT 1.4.3 ]
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