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Promise to Give House in Exchange for Care is Unenforceable, but Compensation Still Due

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When Genevieve Stevenson was discharged from a rehabilitation hospital in May 2015, the facility required her daughter, Holly Stevenson, to “‘sign a paper that said that [she] would be there with [the mother] 24/7’ as a condition of the mother’s return home.” Holly, in fact, did provide around-the-clock care to her mother until her death in February 2017.

According to Holly, her mother “did not ‘want to go into a nursing home’ and instead insisted that [she] ‘take care of [her].'” She further reported that “her mother told her ‘[m]any times’ that she ‘was getting half of the house’ as ‘compensation . . . for the services that [she] had been providing.'”

However, Genevieve’s will did not give half the house to Holly. Holly sued Genevieve’s estate to enforce the oral contract with her mother, half the house in exchange for the services she provided. At trial, the the superior court ruled that the contract was unenforceable because it was not in writing, but awarded Holly $140,000 as just compensation for the care she provided under the legal concept of quantum meruit.

Contract vs. Just Compensation

On appeal, in Holly Stevenson v. Michael Stevenson (Mass. App. Ct. No. 21-P-995, Nov. 22, 2022), the Massachusetts Appeals Court affirms the superior court decision. It explains that pursuant to the Statute of Frauds, “a contract to make a devise [must] be in ‘writing signed by the decedent evidencing the contract.'”

However, the Statute of Frauds does not bar a claim under the theory of quantum meruit, which entitles someone who provided labor to be receive “fair and reasonable” compensation for services provided:

To recover on a theory of quantum meruit, the plaintiff must prove “(1) that [she] conferred a measurable benefit upon the defendant[]; (2) that the claimant reasonably expected compensation from the defendant[]; and (3) that the defendant [] accepted the benefit with the knowledge, actual or chargeable, of the claimant’s reasonable expectation.” [Citation omitted.]

When Value Exceeds Promise and Rebutting Presumption of Uncompensated Services

In this case, at trial Holly had presented evidence of the services she provided her mother and expert testimony from a licensed social worker as to the likely out-of-pocket cost of hiring a live-in caregiver. The Appeals Court concludes that “[t]he judge’s determination of the reasonable value of services that the plaintiff rendered to the mother was supported by the evidence.”

Interestingly, it appears that the $140,000 award to Holly for services was more than half the value of Genevieve’s home. The estate argues that Holly’s compensation should be capped at half the value of the house since that was what she was promised in exchange for the services she provided. The Appeals Court, however, states that since the estate did not raise this issue at trial, it cannot now raise it on appeal.

Of further interest is the Appeals Court’s comment about whether family members who provide “household services” may be presumed to be doing so gratuitously — for no compensation. It says that this is unsettled law in Massachusetts, but that for purposes of it decision it will assume that there is such a presumption here. However, that presumption is rebuttable and Holly successfully rebutted it in this case.

Conclusion

This case shows that family members who provide home care services are entitled to compensation, but only under certain circumstances. They must have proof of the services they provided, be able to show its fair market value, and rebut the presumption that they provided the services gratuitously, in other words, that they expected to be compensated.

In this case, it appears that the estate would have done well to honor Genevieve’s promise even if it was unenforceable as a matter of contract, given that Holly’s compensation appears to have exceeded the value of half the house (not to mention the legal fees, bad feelings and effort wracked up in litigating this matter).

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