Ohio Guardian's Sale of Medicaid Recipient's House Approved as being In Her Best Interest

A guardian can sell a Medicaid recipient's house even though the mortgage loan was in default, because the mortgage company had not foreclosed on the property and it was in the recipient's best interest to sell the property and retain her Medicaid benefits.  That is the decision of an Ohio Court of Appeals in the case of  Gasper v. Adkins (Ohio Ct. App., 10thDist., No. 17AP-294, Sept. 27, 2018).

Christopher Gasper was appointed guardian of Diantha Adkins, who was in a nursing home and receiving Medicaid benefits. Mr. Gasper petitioned the court to sell Ms. Adkins' house. The company that held the mortgage objected to the sale, claiming the mortgage loan was in default.  The company holding the mortgage argued that the guardian could not sell the property, but the guardian could only sell the ward's right to redeem the property from foreclosure.  The company that held the mortgage had not filed for foreclosure, though, so the company's argument would mean that the ward would have to continue to hold ownership of the property, which the guardian argued threatened the ward's Medicaid benefits. 

The court rejected the mortgage company's argument, found that the sale of the property was in the best interest of Ms. Adkins and authorized Mr. Gasper to execute a deed in lieu of foreclosure. The mortgage company appealed, arguing that the court couldn't authorize the sale of the property free and clear of the mortgage lien without the mortgage company's consent.

The Ohio Court of Appeals, 10th District, affirmed, ruling that the guardian was entitled to sell the property. According to the court, because the mortgage company had not foreclosed on the property, Ms. Adkins was not "divested of legal ownership" at the time Mr. Gasper sought the authority to sell her real estate. The court also held that it was in Ms. Gasper's best interest to sell the property in order to not jeopardize her Medicaid benefits.