Judge Could Not Impose an ‘Unusual’ Condition on a Reversal of a Default Judgment in a Nursing Home Breach of Contract Lawsuit

In a case where a the wife of a nursing home resident requested to vacate a default judgment against her in a breach of contract lawsuit by the nursing home, a Massachusetts appeals court reverses a lower court judge’s decision to impose a condition that prevented the woman from countersuing the nursing home for more money than her husband owed the nursing home. Care One Management, LLC v. Brown (Mass. Ct. App., No. 19-P-1165, Oct. 7, 2020).

George Brown entered a nursing home and signed an admission agreement, agreeing to apply for Medicaid benefits to pay for his care. Mr. Brown did not submit the necessary information to complete his Medicaid application, so his application was denied. The nursing home sued Mr. Brown and his wife, Gloria Brown, for breach of contract and lack of spousal support. Ms. Brown appeared at the initial hearing and argued that Mr. Brown had dementia and did not knowingly sign the agreement. In addition, she claimed he was mistreated at the nursing home.

The judge informed Ms. Brown that she needed to file an answer to the nursing home’s complaint. Ms. Brown never filed an answer, and the judge entered a default judgment against her. Six months later, Ms. Brown filed a request to remove the default judgment because she had been in the hospital. The judge granted her request to vacate the default judgment on the condition that Ms. Brown waive any claims Mr. Brown’s estate may have against the nursing home to the extent the monetary recovery amount exceeds the amount Mr. Brown owed to the nursing home. Ms. Brown refused the condition and appealed.

The Massachusetts Appeals Court reverses, holding that the condition imposed by the judge was not appropriate because the judge did not find that the nursing home suffered any prejudice from the default or the delays. According to the court, although the judge made passing reference to Ms. Brown’s delay in fighting the default judgment, the judge “did not explain how or why such factors impacted [the nursing home’s] claim, and did not evaluate and explain whether and to what extent [the nursing home] suffered any prejudice, before imposing the unusual condition on the removal of the default judgment.”

For the full text of this decision, go to: https://www.mass.gov/files/documents/2020/10/07/k19P1165.pdf

Did you know that the ElderLawAnswers database now contains summaries of more than 2,000 fully searchable elder law decisions dating back to 1993? To search the database, click here.