Adult children sometimes find themselves caught between respecting their elderly parent’s romantic relationship and protecting the parent from financial exploitation. The parent might be dating someone new who suddenly appears to control all financial decisions. Large sums of money disappear from accounts that sat stable for decades. The parent makes uncharacteristic purchases or loans significant amounts to the new partner. Family members who try to express concern find themselves cut off from contact with their loved one.
Texas guardianship law allows courts to appoint guardians when adults become incapacitated and cannot manage their own affairs. However, courts cannot appoint guardians simply because family members disagree with an elderly person’s choices. The law requires clear and convincing evidence that the person is incapacitated and that alternatives to guardianship won’t work. Courts must balance protecting vulnerable adults from exploitation against respecting their autonomy and right to make their own decisions—even decisions that family members consider foolish.
What evidence establishes that someone is financially exploiting an incapacitated person rather than simply helping manage their affairs with permission? How do courts evaluate claims that a romantic partner has isolated an elderly person from family and is mismanaging their money? When does helping someone with finances cross the line into exploitation? A recent Texas appellate decision, In re Guardianship of Thrash, No. 04-19-00104-CV, 2019 WL 6702238 (Tex. App.—San Antonio Dec. 4, 2019, no pet.) (mem. op.), provides an opportunity to examine how courts evaluate evidence of financial exploitation in guardianship proceedings.
Facts & Procedural History
Thrash was a millionaire who owned a successful automotive repair shop. He started dating Laura Martinez around 2009. By 2012, Laura moved into the apartment above Thrash’s shop with him. Over time, friends and family members grew concerned that Laura was isolating Thrash from them and spending large amounts of his money.
In 2016, Thrash and Laura—along with two of Laura’s adult children, Jose and Michelle—moved into a home Thrash bought for approximately $750,000 in cash. According to several longtime friends, Thrash’s purchase of the home was highly unusual. Thrash was known as a fiscally conservative person who had lived for years in a modest apartment above his shop. Friends grew suspicious of Laura, who didn’t allow Thrash to have his own phone. All social and business calls had to go through her cell phone.
In 2017, a guardianship specialist for the Texas Health and Human Services Commission initiated guardianship proceedings after receiving an anonymous report that Laura was mishandling Thrash’s assets. The application for appointment of temporary and permanent guardian alleged that Thrash, who was seventy-nine years old, suffered from Alzheimer’s disease, was diabetic, and needed daily insulin. The application further alleged that under Laura’s influence, Thrash had recently changed his will to list Laura and members of her family as beneficiaries, executed a statutory durable power of attorney in Laura’s favor, and revised his business plan to name Laura as the successor-owner of his shop.
The application was supported by a report from Dr. Michael Garcia, a neuropsychologist. Dr. Garcia opined that Thrash showed signs of degenerative dementia and was unable to handle his personal and financial affairs without assistance. Also attached were affidavits from the guardianship specialist and an Adult Protective Services supervisor who had investigated the anonymous report. The APS supervisor testified that Frost Bank branch employees saw Laura coaching Thrash at the bank numerous times.
The court investigator’s report stated that Thrash had diabetes, Parkinson’s disease, hypertension, and Alzheimer’s disease—all requiring daily medication that Laura administered. The investigator also reported that Thrash’s spending habits had changed significantly since his relationship with Laura began. A review of bank records showed he spent large sums of money in 2016 and transferred a great deal of money from Frost Bank—where he had banked for more than forty years—to Bank of America.
Laura told the investigator she had been in a romantic relationship with Thrash for eight years and didn’t mishandle his assets. She said Thrash made mortgage payments on the home she owned when they started dating and she planned to pay him back when she sold her home. Laura said Thrash had opened an account at Bank of America because friends told them Frost Bank wasn’t a good bank. When asked why Thrash didn’t have a cell phone, Laura indicated Thrash constantly lost it.
The investigator met privately with Thrash, who wanted to know who started the guardianship. Thrash said he could handle his own money and didn’t need a guardian. He stated he put Laura on his Bank of America account and wanted her to handle all the bills. When asked about the new home purchase, he indicated the home cost $230,000 and didn’t believe it was approximately $750,000. Later that day, he called to say he had made a mistake about the price. Thrash told the investigator he lent Laura $50,000, which she would pay back after selling her home. He also indicated he didn’t know how much money Laura was spending.
Sandy Sullivan, senior vice president in charge of fraud management for Frost Bank, testified that employees at Thrash’s branch location brought his accounts to her attention after noticing unusual transactions. Beginning in 2016, Thrash started using his money market account to pay business expenses—expenses previously paid with his business account. His money market account drastically depleted, shrinking from more than $300,000 to approximately $107,000 in three months. It was unclear whether Thrash was aware of how Laura was managing that account because Laura was filling out all his bank paperwork. Sullivan testified that Laura had presented the bank with a power of attorney asking to be added to Thrash’s accounts, but the bank refused to honor it because Thrash had previously told branch employees he didn’t want Laura added to any accounts.
The probate court appointed attorney Bassler as temporary guardian of Thrash’s person and estate. Over the next year, Bassler provided updates about Thrash’s health and estate. Tonya Barina, Thrash’s great-niece, filed an application to be appointed permanent guardian. Laura filed a response arguing a permanent guardianship was unnecessary because the power of attorney was available as a less restrictive means. She asked the court to appoint her guardian if the court determined appointment was necessary.
In May and July 2018, the probate court held hearings on Barina’s application. The court heard testimony from attorney Robert Augsburger—who prepared Thrash’s recent power of attorney and will—Laura, Thrash, Bassler, Barina, and some of Thrash’s family members. The court also had before it the investigator’s report, two medical reports, transcripts from earlier hearings, and the guardianship specialist’s affidavit.
On November 15, 2018, the probate court signed an order appointing Laura guardian of Thrash’s person and Barina guardian of Thrash’s estate. Barina and Laura filed competing motions for new trial. On January 29, 2019, after a hearing, the probate court signed orders denying Laura’s motion for new trial and granting Barina’s motion for new trial. The court appointed Barina guardian of Thrash’s estate and Mary Werner guardian of Thrash’s person, removing Laura entirely from the guardian role.
Laura and her adult daughter Brittany appealed. They argued the evidence was legally and factually insufficient to support the probate court’s finding that Thrash was incapacitated and that the court abused its discretion in appointing permanent guardians.
What Must Courts Find Before Appointing a Guardian?
Texas law establishes specific findings courts must make before appointing guardians. Understanding these requirements helps explain what evidence matters in guardianship proceedings.
Before appointing a guardian, courts must find by clear and convincing evidence that: (1) the ward is an incapacitated person; (2) it is in the best interest of the ward to have the court appoint a guardian; (3) the rights of the ward or the ward’s property will be protected by the appointment of a guardian; and (4) alternatives to guardianship and supports and services available have been considered and determined to be infeasible.
The Texas Estates Code defines an “incapacitated person” as an adult who, because of a physical or mental condition, is substantially unable to provide food, clothing, or shelter for themselves, care for their own physical health, or manage their own financial affairs. This definition focuses on functional abilities rather than diagnoses. Someone might have dementia but still retain sufficient capacity to manage affairs with minimal assistance. Conversely, someone might have relatively mild cognitive impairment but be substantially unable to manage finances due to exploitation by others.
A determination of incapacity must be evidenced by recurring acts or occurrences within the preceding six-month period, not by isolated instances of negligence or bad judgment. This requirement ensures courts don’t appoint guardians based on single poor decisions. Everyone makes occasional bad choices. Incapacity requires a pattern of behavior demonstrating substantial inability to manage affairs.
The “clear and convincing evidence” standard is higher than the “preponderance of evidence” standard used in most civil cases but lower than the “beyond reasonable doubt” standard in criminal cases. Clear and convincing evidence produces a firm belief or conviction about the truth of the allegations. This heightened standard reflects the serious nature of guardianships, which strip adults of fundamental rights to make decisions about their own lives and property.
What Evidence Showed Thrash Was Incapacitated?
The Thrash court reviewed extensive evidence supporting the incapacity finding. This evidence fell into several categories that together demonstrated Thrash’s substantial inability to manage his financial affairs.
Medical evidence formed the foundation of the incapacity finding. Dr. Garcia’s report stated that Thrash exhibited “degenerative dementia of the Alzheimer’s type” and that his neurocognitive capacities warranted legal intervention. Dr. Garcia noted Thrash scored “moderately to severely impaired” on the dementia rating scale test. His verbal reasoning abilities were “borderline” and his perceptual-organizational abilities were “mildly impaired.” Dr. Garcia concluded Thrash understood most task directions with repetition but was unable to comprehend complex tasks without assistance.
A second psychiatrist, Dr. Faber, performed a psychiatric capacity examination. Dr. Faber reported that Thrash had Parkinson’s disease, hypertension, dementia, and Alzheimer’s disease with moderate severity. He indicated there was no possibility of improvement in Thrash’s condition. Dr. Faber concluded Thrash showed deficits in both short- and long-term memory functions and couldn’t solve problems, reason logically, grasp abstract principles, interpret idiomatic expressions, or break down complex tasks. He found Thrash was unable to make responsible decisions for himself, including decisions about managing a personal bank account, administering medications, consenting to medical treatment, or regarding marriage. Dr. Faber concluded Thrash was “totally without capacity to care for himself or to manage his property.”
These medical reports established that Thrash suffered from progressive conditions affecting his cognitive function. The reports didn’t simply diagnose dementia—they explained specifically how the conditions impaired Thrash’s functional abilities to understand complex financial matters and make informed decisions.
Evidence of changed spending patterns demonstrated Thrash’s inability to manage finances. The record showed Thrash’s spending and account usage changed dramatically starting in 2015-2016. Before dating Laura, Thrash lived modestly in an apartment above his shop despite being a millionaire. He maintained the same bank accounts for over forty years and paid business expenses from his business account.
After Laura entered his life, Thrash made several large, uncharacteristic purchases. In 2015, he purchased a $106,000 Corvette that he gave to Laura. In 2016, he bought a house for approximately $750,000 in cash. When asked about the purchase, Thrash initially told the investigator the house cost $230,000—a dramatically incorrect figure. Although he later called to say he made a mistake about the price, his initial confusion about such a significant purchase suggested he didn’t fully understand the transaction.
Thrash’s use of bank accounts changed in ways that depleted his assets. He started using his money market account—which had maintained a balance over $300,000—to pay business expenses that should have been paid from his business account. Within three months, the money market account shrank to approximately $107,000. This represented a loss of nearly $200,000 from unusual account usage.
Thrash transferred money from Frost Bank, where he had banked for more than forty years, to Bank of America. When the investigator asked why, Laura said friends told them Frost Bank wasn’t good. This explanation seemed inconsistent with Thrash’s decades-long banking relationship and suggested Laura was making decisions about account changes.
Evidence of loans and payments to Laura and her family showed questionable financial transactions. Thrash gave Laura $50,000 described as a loan she would repay when she sold her home. Thrash paid Laura’s mortgage while they lived together in the house he purchased. Members of Laura’s family started appearing on Thrash’s business payroll in 2015, despite Thrash previously having only one employee. Thrash paid an IRS debt incurred by Laura’s ex-husband.
These transactions might seem reasonable if Thrash fully understood them and had the capacity to evaluate whether they served his interests. However, combined with medical evidence of his cognitive impairment, the transactions suggested Laura was directing financial decisions that benefited her and her family.
Bank employee observations provided additional evidence. Sullivan testified that when Laura brought Thrash to the bank, she filled out all his paperwork and didn’t allow him to speak with bank employees. Employees saw Laura coaching Thrash. Bank employees didn’t believe Thrash understood the financial paperwork Laura had him sign. These observations suggested Thrash wasn’t making independent financial decisions even when he appeared to be signing documents.
The bank’s refusal to honor Laura’s power of attorney was significant. Laura presented a power of attorney asking to be added to Thrash’s accounts. However, the bank refused because Thrash had previously told branch employees he didn’t want Laura added to any accounts. This contradiction suggested either Thrash was confused about his wishes or Laura was trying to gain account access against Thrash’s actual preferences.
What Evidence Showed Laura Was Isolating Thrash?
Beyond financial evidence, the record showed Laura isolated Thrash from longtime relationships. This isolation pattern is common in financial exploitation cases. Isolating the vulnerable person makes it harder for concerned family members or friends to intervene or even detect the exploitation.
The court investigator reported that Laura maintained a “black list” of individuals with whom Thrash had longtime relationships who she prevented from talking to Thrash. This included business associates Thrash had worked with for years and his longtime attorney. The existence of such a list suggested deliberate efforts to control who could access Thrash.
Thrash didn’t have his own cell phone. All phone calls—both social and business—went through Laura’s phone. When the investigator asked why, Laura said Thrash constantly lost his phone. However, this explanation seemed inconsistent with Thrash’s prior history of successfully managing a business and maintaining relationships for decades.
Family members testified about inability to contact Thrash. Iris Brigman, Thrash’s sister, testified that when Thrash became involved with Laura, it became hard to call Thrash or visit him at his home. Linda Gruntorad and Donna Galvanauska, Thrash’s stepdaughters, testified they maintained good relationships with Thrash until about 2013 when he became involved with Laura. They testified Thrash told them Laura wanted him to help pay her bills, marry her, and change “a lot of things in his life,” including his will.
Tonya Barina, Thrash’s great-niece who applied to be guardian, testified that once Laura came into Thrash’s life, she wasn’t allowed to visit Thrash and hadn’t visited him in more than three years. Even business associates confirmed they couldn’t speak to Thrash privately.
This pattern of isolation served Laura’s interests by preventing people who knew Thrash well from observing changes in his condition or questioning financial decisions. It also prevented Thrash from receiving input from people who might have helped him understand he was being exploited.
How Did Laura Defend Her Conduct?
Laura offered explanations for the financial transactions and relationship patterns that the probate court ultimately rejected. Understanding her defenses helps explain why courts evaluate credibility and weigh conflicting evidence.
Laura testified she had a happy and caring relationship with Thrash. She said she informally handled Thrash’s medical and financial affairs at his request before receiving powers of attorney. Laura explained she took Thrash to doctor appointments, routinely took business calls, and took Thrash to a new attorney for estate planning documents at Thrash’s request.
Regarding unusual financial activity, Laura offered explanations for various transactions. She said Thrash started selling investment properties and depositing large sums into his Frost Bank accounts because he was saving to buy a “gingerbread house”—a house that cost significant money. She said Thrash expressed interest in speaking to Fidelity Investments to get better returns on his money.
Laura explained that her ex-husband worked at Thrash’s shop and Thrash was helping him become responsible with money. She said Thrash “piggybanked” pieces of her ex-husband’s paycheck to help him save and pay an IRS debt. She also explained that some credit card invoices paid by the Frost Bank account were to pay contractors who did repairs to the automotive shop.
Attorney Augsburger, who prepared estate planning documents for Thrash in 2016, testified that he met with Thrash privately twice. Laura drove Thrash to appointments but didn’t sit in the meetings. Augsburger testified that during private consultations, Thrash indicated he wanted to take care of Laura. At Thrash’s request, Augsburger prepared powers of attorney and a will making Laura the sole beneficiary with her children as remainder beneficiaries.
Tom Bassler, the temporary guardian, testified that once appointed, he met with Thrash weekly. Laura continued caring for Thrash’s daily needs, and Thrash appeared happy and well taken care of by Laura. Bassler testified he didn’t see evidence that Laura converted Thrash’s assets to her own. He noted the new house was one story and safer for Thrash compared to his previous apartment with metal steps. Bassler testified the house appeared to be a real estate investment given that Thrash sold several properties before buying it.
Thrash himself testified that he wanted to live with Laura and didn’t need anyone intruding on his life. This testimony about Thrash’s preferences carried some weight, though courts must consider whether an incapacitated person’s expressed wishes result from undue influence or lack of understanding.
Why Did the Court Reject Laura’s Defenses?
The probate court heard Laura’s explanations but ultimately found them insufficient to overcome evidence of financial exploitation and isolation. As the exclusive judge of witness credibility, the trial court could disbelieve testimony even if uncontradicted.
The court could reasonably find that Laura’s explanations didn’t account for the dramatic change in Thrash’s financial behavior. While Laura claimed Thrash wanted to buy an expensive house, the purchase was completely inconsistent with his prior decades of modest living. The fact that Thrash initially thought the $750,000 house cost only $230,000 suggested he didn’t understand the magnitude of the purchase.
Laura’s explanation that Thrash wanted to help her ex-husband become responsible with money didn’t explain why this “help” involved paying the ex-husband’s IRS debt or why members of Laura’s family suddenly appeared on Thrash’s business payroll. These transactions primarily benefited Laura’s family rather than Thrash.
The bank employees’ observations contradicted Laura’s claim that Thrash was making independent financial decisions. If Thrash truly understood and directed the financial transactions, why was Laura filling out all his paperwork and not allowing him to speak with bank employees? Why did employees observe her coaching him? These observations suggested Laura was controlling rather than simply assisting.
The pattern of isolation couldn’t be explained by innocent motives. Even if Thrash preferred spending time with Laura, maintaining a “black list” of people he couldn’t contact seemed controlling rather than protective. Not allowing Thrash to have his own phone prevented him from making independent contact with family and friends.
Evidence that Laura continued mismanaging Thrash’s finances even after the temporary guardianship was established undermined her claims of good faith. Bassler gave Thrash a $5,000 monthly allowance, and Laura used $2,100 of it to pay the mortgage on her own home. She continued this practice until she sold her home in February 2018. This use of Thrash’s money for Laura’s benefit occurred while the guardianship proceeding was pending and after concerns about financial exploitation had been raised.
The court also could consider that Laura didn’t produce any medical evidence controverting the reports concluding Thrash lacked capacity. She relied primarily on her testimony about Thrash’s wishes and Thrash’s own statements that he was happy. However, an incapacitated person might express happiness with a situation while lacking capacity to understand they’re being exploited.
The Takeaway
The Thrash case demonstrates how courts evaluate conflicting testimony about whether financial transactions result from an incapacitated person’s genuine wishes or from exploitation. Even when the proposed ward testifies they’re happy with the arrangement and want the alleged exploiter to continue managing their affairs, courts can find this testimony results from the person’s incapacity to understand they’re being exploited rather than from informed consent. Anyone concerned about potential financial exploitation of an elderly family member should document the person’s spending patterns before and after the suspected exploiter entered their life, gather evidence about isolation from family and friends, and seek medical evaluations addressing the person’s capacity to manage finances and resist undue influence. Courts have authority to appoint guardians even over the proposed ward’s objection when clear and convincing evidence shows the person is incapacitated and being exploited.
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