Suit against care home reinstated

Thursday, June 5, 2003 | 9:51 a.m.

CARSON CITY -- The Nevada Supreme Court has reinstated a suit against owners of a Las Vegas group care home where an elderly Alzheimer's patient was taken for $453,000 by the home administrator.

The court ruled Tuesday that Equity Enterprises, which owned the Oakleaf group home, had a duty to protect its patients against exploitation.

The case involved Joseph Forte, who at the age of 85 in 2000 was moved into the Oakleaf.

Before his move into the home, Forte was befriended by Richard Smith, who owned and managed Senior Connections that ran several homes including the Oakleaf. Equity Enterprises had contracted with Senior Connections to manage the Oakleaf.

Smith forged the signatures of both Forte and a notary public on a document authorizing Smith to gain access to Forte's bank accounts.

While Forte resided at the Oakleaf, Smith depleted his accounts of about $453,000. Once the money was gone, Smith resigned as administrator and manager of all homes administered by Senior Connections.

Equity Enterprises then assumed full control and began an investigation of Smith's malfeasance based on information provided by other Senior Connections employees. The company reported its findings to police and Smith made a confession, according to the court.

The Clark County Public Administrator was appointed as Forte's guardian and filed suit against Equity Enterprises and its owners.

District Judge Valorie Vega granted a pre-trial summary judgment in favor of the home and its two owners, William Wright and Kay Foster.

In reinstating the case, the Supreme Court said there were genuine issues to be decided in the district court on the duties owed to Forte by Equity Enterprises. It reinstated the case.

Equity Management says it should not be held liable because it delegated the management of the home to Senior Connections. And it said it never had any knowledge that Smith might exploit the elderly.

The court said, "Public policy dictates that the licensee of a group care home cannot delegate away its statutory duties to protect the residents of that home."

Forte claims Equity Management had notice of improper financial transactions by Smith and problems with stolen or forged payroll checks with Senior Connections.

The court said Forte believed Equity Management actually mistrusted Smith, but that issue is to be decided at trial. Judge Vega also dismissed the suit against the two owners with prejudice, meaning it could not be refiled. But the court overruled that and said the dismissal should be without prejudice. That would allow a new action against the two owners.