There have been plenty of new topics to learn, as a result of the newly enacted Massachusetts Uniform Probate Code (“MUPC”) in Massachusetts. Yet another one was manifest in the recent nine-page decision of In Re: Estate of O’Brien.
In the O’Brien case, the court determined that a secured judgment lien—in this case, that a woman held on property in her late brother’s estate—took precedence over a MassHealth’s right to recoup Medicaid benefits.
MassHealth attempted to lump in the sister’s claim in the, “all other claims” category within the MUPC priority list that is provided within M.G.L. c 190B, §3-805. The Judge, however, disagreed. Judge Randy J. Kaplan agreed with MassHealth’s argument that secured creditors are not directly addressed within the MUPC. Kaplan, however, looked to the preferential treatment of secured creditors in other sections of the MUPC and determined that the priority list within the Code is not even implicated if a secured interest encumbers the estate.
This decision, while understandably upsetting to MassHealth advocates is an important one, especially when considering title and property law—yet another instance of the new Code implicating seemingly unrelated areas of practice. In property law, a recorded lien on property establishes priority. So, if this long-standing precedence had been ignored by the Judge, it would have created a myriad of title and property law issues. And, if future health needs could somehow overturn recorded liens, there would be enumerable issues that would result. In this case, the Judge correctly decided that the secured creditor did not need further permission from the probate court, as her matter had already been adjudicated.
This case is a wonderful example of how our Collections practice has become so important, and explains why it continues to grow as an area of practice within our law firm.
