CRENSHAW v. STATE

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Court of Appeal, Third District, California.

Kaukauna CRENSHAW, Plaintiff and Appellant, v. STATE of California, et al., Defendants and Respondents.

No. C009365.

Decided: January 13, 1992

Thomas M. Witte, Sacramento, for plaintiff and appellant. Daniel E. Lungren, Atty. Gen., Robert L. Mukai, Chief Asst. Atty. Gen., Charlton G. Holland, Asst. Atty. Gen., Dennis Eckhart, Darryl F. Mansfield, Deputies Atty. Gen., for defendant and respondent.

Plaintiff Kaukauna Crenshaw appeals from the declaratory judgment in favor of defendants, State of California, Department of General Services, and Department of Social Services, which found the Foster Family Home and Small Family Home Insurance Fund did not provide coverage for the death of Crenshaw's child while in a community care facility licensed as a group home.   We affirm.

FACTUAL AND PROCEDURAL BACKGROUND 1

Crenshaw's daughter, Candace Patterson, died on May 9, 1988, while residing at a licensed community care facility on Everglade Drive in Sacramento.   The facility, Jack N' Dears, Ltd., was licensed as a group home;  the license was held by a corporation.   Jeri Hart–Johnson operated the facility;  she also ran a licensed small family home in her residence on Hillsdale Boulevard in Sacramento.

Crenshaw filed a claim against Jack N' Dears, Ltd. with the Foster Family Home and Small Family Home Insurance Fund (the Fund).   The claim was denied.   The Office of Insurance and Risk Management found Candace Patterson died in a group home, and that the Fund covered only foster family homes and small family homes.

Crenshaw and the owners of Jack N' Dears, Ltd. filed a declaratory relief action, seeking a declaration that the Fund covered Candace's death.   Both plaintiffs and defendants moved for summary judgment.   Defendants failed to provide a separate statement of undisputed facts and failed to oppose plaintiffs' motion.   The court declined to rule on the motions for summary judgment and the case proceeded to trial.

Only defendants presented witnesses at trial.   William Jordan from the Community Care Licensing Division of the Department of Social Services explained the difference between the three categories of community care facilities for children.   Foster family homes and small family homes are in the residence of the licensee.   They provide care to children whom the placing authority has determined will benefit from substitute parenting.   Foster family homes are responsible for neglected, abused or abandoned children.   Small family homes take care of children who are developmentally or physically disabled.   Group homes provide a more structured environment for children who are not yet ready for family home placement.

David Feinberg of the Foster Care Rates Bureau testified that licensed group homes receive reimbursement for the purchase of liability insurance to cover the children in the group home.   He further testified that Jack N' Dears, Ltd. received a reimbursement for insurance.

The court found in favor of the defendants and denied the declaratory relief requested.   The court found that Jack N' Dears, Ltd. was a group home and that to qualify as a foster family home or small family home, the licensee must be a resident of the home.

Crenshaw moved to vacate the judgment and for a new trial.   This motion was denied.   Crenshaw then appealed.

DISCUSSION

Crenshaw contends that although Jack N' Dears, Ltd. was licensed as a group home, it met the statutory definition of a small family home in Health and Safety Code section 1502, and therefore Crenshaw's claim should be covered by the Fund.2

The Fund was established in 1986, “to pay, on behalf of foster family homes and small family homes, as defined in Section 1502, claims of foster children, their parents, guardians, or guardians ad litem resulting from occurrences peculiar to the foster-care relationship and the provision of foster-care services.”  (§ 1527.1.)   The Fund must pay these claims or reimburse the foster family home or small family home for the damages.  (§ 1527.2.)   Crenshaw's claim is covered by the Fund if Candace Patterson was a foster child and Jack N' Dears, Ltd. was a foster family home or a small family home.   Crenshaw asserts both of these conditions were met.   Defendants contend neither were.

We look first to whether Candace was a foster child.   For purposes of the Fund, a “ ‘foster child’ means a person under 19 years old who has been placed in the care and supervision of licensed foster parents.”  (§ 1527, subd. (c).)  “ ‘Foster parent’ means the person, and including his or her spouse if the spouse is a resident of the same household, providing care, custody, and control of a foster child in a licensed foster family home or licensed small family home, as defined in Section 1502 of the Health and Safety Code.”  (§ 1527, subd. (d).)  Candace was a foster child covered by the Fund only if she was in a licensed foster family home or a licensed small family home, as defined in section 1502.

Section 1502 does not define “licensed foster family home” and “licensed small family home,” but only defines the facilities without the adjective “licensed.”   A foster family home is defined as a residential facility in the foster parents' residence.  (§ 1502, subd. (a)(5).)   Since Jeri Hart–Johnson did not reside at the Everglade facility, it cannot be considered a foster family home.   However, this residence requirement is not included in section 1502's definition of a small family home.  “ ‘Small family home’ means any residential facility providing 24–hour care for six or fewer foster children who have mental disorders or developmental or physical disabilities and who require special care and supervision as a result of their disabilities.”  (§ 1502, subd. (a)(6).)   Crenshaw contends that Jack N' Dears, Ltd. met this definition of a small family home because it provided full-time care to no more than six of these children, and its license was so limited.   Defendants assert it was not a small family home because Candace was not a foster child and there was no foster-care relationship.   Defendants claim a foster-care relationship only arises when care is provided in the foster parents' home.   If the occurrence does not arise from the foster-care relationship, the Fund is not liable.  (§ 1527.3, subd. (b).)

The statutory definitions alone do not answer whether Candace Patterson was a foster child covered by the Fund;  instead the definitions simply create a circle.   Candace Patterson was a foster child if she was in a licensed small family home.   A small family home by definition cares for a limited number of foster children with certain disabilities.   Since coverage depends on the child's status, which in turn depends on the status of the facility in which she resided, we must determine whether that facility was a “licensed small family home.”

The Fund covers only children in foster family homes and small family homes that are “licensed.”   The Department of Social Services is empowered to adopt regulations to designate the categories of licensure for community care facilities.  (§ 1530.)   Its regulatory scheme provides for three licensing categories of community care facilities for children:  group homes, small family homes, and foster family homes.  (Cal.Code Regs., tit. 22, § 80000, ch. 5, 4 and 7.5.)   These regulations define a small family home differently than section 1502;  the regulations include a residence requirement.   “ ‘Small Family Home’ means any residential facility in the licensee's family residence providing 24–hour a day care for six or fewer children who are mentally disordered, developmentally disabled or physically handicapped and who require special care and supervision as a result of such disabilities.”   (Cal.Code Regs., tit. 22, § 80001, subd. (s)(2) (former subd. (a)(45).)   A group home is a “facility of any capacity which provides 24–hour nonmedical care and supervision to children in a structured environment with such services provided at least in part by staff employed by the licensee.”  (Cal.Code Regs., tit. 22, § 80001, subd. (g)(1) (former subd. (a)(29).)

Under the regulations, the Jack N' Dears, Ltd. facility on Everglade Drive would be classified as a group home.   Accordingly, it received a license as a group home.

Crenshaw objects to this analysis to determine coverage by the Fund.   She argues that the statutory definition of section 1502 does not require the facility to be in the licensee's residence, and that this definition rather than the one in the regulations controls for purposes of determining coverage by the Fund.   Relying on Addison v. Department of Motor Vehicles (1977) 69 Cal.App.3d 486, 138 Cal.Rptr. 185, she claims the Department of Social Services exceeded its statutory authority by imposing a residence requirement for coverage by the Fund.   She does not dispute that the Department could require the facility to be in the licensee's residence to receive a license as a small family home, although nothing in the statute indicates that is what the Legislature intended.3  She concedes the Legislature granted the Department such authority to impose this requirement for licensing purposes.   She objects to the residence requirement only in the context of coverage by the Fund.

Crenshaw's argument seeks to differentiate between the designation of a small family home for licensing purposes, which provides the home must be the licensee's residence, and for coverage purposes, in which it need not be.   However, the statutory scheme establishing the Fund makes clear that only claims by foster children or their parents or legal guardians are covered (§§ 1527.1, 1527.2), and only children in a “licensed small family home” are considered foster children (§ 1527, subds. (c) and (d)).   It follows that the Legislature intended a connection between the licensing of community care facilities and coverage by the Fund.   Crenshaw urges the only connection is that the facility must have a license.   She argues that “licensed small family home” does not mean “licensed as a small family home”;  instead, it means any facility which has a license and meets the definition of section 1502, subdivision (a)(6).   We must now determine which interpretation of “licensed small family home” is correct.

“The fundamental rule of statutory construction is that the court should ascertain the intent of the Legislature so as to effectuate the purpose of the law.  [Citations.]”  (Select Base Materials v. Board of Equal. (1959) 51 Cal.2d 640, 645, 335 P.2d 672.)   Other rules of statutory construction guide our interpretation.   The statute should be interpreted in a reasonable, common sense, practical and nontechnical way that is consistent with its apparent purpose and results in “wise policy rather than mischief and absurdity”;  and to “ ‘ “take into account matters such as context, the object in view, the evils to be remedied, the history of the times and of legislation upon the same subject, public policy, and contemporaneous construction.” ’ ”   (DeYoung v. City of San Diego (1983) 147 Cal.App.3d 11, 18, 194 Cal.Rptr. 722.)

In enacting legislation to create the Fund, the Legislature was concerned with the special financial burden the insurance crisis placed on foster parents.   This burden was caused by the inability of foster parents to obtain liability insurance to cover foster parent activities;  insufficient payments to foster parents to cover the cost of extra insurance;  and the increasing number of actions filed against them.  “The Legislature finds and declares that foster parents are a valuable resource providing a needed important service to the citizens of California.   The Legislature further recognizes that the current insurance crisis has adversely affected some foster family homes and small family homes in three ways:  (a) homeowners' and tenants' insurance is unavailable to foster parents in some locales or available coverage excludes foster parent activities;  (b) in some locales, foster parents are unable to obtain liability coverage for actions filed against them by the foster child or the child's parents or legal guardian.   In addition, the monthly payment made to foster family homes and small family homes is not sufficient to cover the cost of obtaining this extended coverage and there is no mechanism in place by which foster parents can recapture this cost;  (c) foster parents' personal resources are at risk as a result of foster children and their parents filing an increasing number of claims against them.   Therefore, the Legislature is providing interim relief to address these problems.”  (Stats.1986, ch. 1330, § 1, p. 4690.)

When the Fund was created in 1986, the Department had already adopted its licensing regulations, including the residence requirement for a small family home.   If the Legislature intended to limit coverage by the Fund to foster parents providing care in their homes, it was not necessary to make this limitation explicit if the Legislature intended the licensing requirements to be included by its reference to a “licensed small family home.”   We recognize that in designating the facilities covered by the Fund, the Legislature referred to the definitions of section 1502, rather than to the licensing definitions.   However, the intent of the Legislature is best carried out by using the licensing definitions to determine what constitutes a “licensed small family home.”

The concerns of the Legislature were not as applicable to a separate community care facility as to services provided in the licensee's home.   The reference to homeowners' and tenants' insurance suggests the Legislature was concerned only with facilities in private residences.   The Legislature made no finding as to the availability of liability insurance to a corporate entity, such as Jack N' Dears, Ltd., operating a group home.   Further, the reimbursement for insurance costs that is available to group homes eliminates the need such facilities would have for the Fund.   With the reimbursement, group homes do not face the financial burden the Legislature sought to ease in creating the Fund.

A reasonable and practical interpretation of “licensed small family home” suggests the Legislature indeed intended the designation of a facility to be the same for licensing and coverage purposes.   In delegating authority to the Department of Social Services to designate the licensing categories, the Legislature left to that agency the definition of a “licensed small family home.”   The Department distinguishes between family homes in the licensee's residence and group homes with a paid staff.   The former are to act as substitute parents for foster children;  the latter care for children who need more structure in their lives.   This distinction is consistent with the legislative goal of establishing the Fund to provide insurance for those who care for foster children in their home.

In order to further the express legislative purpose of the Fund, we conclude its coverage extends only to community care facilities licensed either as foster family homes or as small family homes.   Since Jack N' Dears, Ltd. was licensed as a group home, the Fund does not cover Crenshaw's claim arising from her daughter's death in such facility.

DISPOSITION

The judgment is affirmed.

I concur.   Plaintiff's claim of coverage must fail for two reasons.   First, her daughter died in a facility licensed as a group home and group homes are not covered by the Foster Family Home and Small Family Home Insurance Fund.   Second, plaintiff's daughter was not a foster child at the time of her death and hence did not come within the terms of the Fund in any event.

The Fund provides coverage only for claims arising out of a foster-care relationship in what are called “foster family homes” and “small family homes.”  “The fund, subject to this article, shall pay, on behalf of foster family homes and small family homes, any claims of foster children, their parents, guardians, or guardians ad litem for damages arising from, and peculiar to, the foster-care relationship and the provision of foster-care services, or shall reimburse foster family homes and small family homes for those damages.”  (Health & Saf.Code, § 1527.2.)

It is undisputed that plaintiff's daughter died at the facility known as Jack 'N Dears, Ltd.   This facility was owned and operated by Jack 'N Dears, Ltd., a California corporation.   It was licensed by the Department of Social Services, in accordance with the applicable provisions of the Health and Safety Code, and departmental rules and regulations, as a “group home.”   Under this license, Jack 'N Dear, Ltd. was authorized during the period in question “to operate and maintain a group home” at 8699 Everglade Drive in Sacramento.   The license was not transferable and was granted only for ambulatory children, ages six through seventeen years, with a total capacity of six children.

A group home is one of several types of community care facilities licensed by the Department of Social Services.   It is defined in departmental regulations as “any facility of any capacity which provides 24–hour nonmedical care and supervision to children in a structured environment with such services provided at least in part by staff employed by the licensee.”  (Cal.Code Regs., tit. 22, § 80001, subd. g.(1), emphasis added.)   Thus, group homes are not categorically limited to six children and under appropriate circumstances may exceed that number.   In contrast, as the majority notes, a “small family home,” under both the statute and the regulations, is a facility limited to providing care “for six or fewer children” who require special care and supervision because of their disabilities or handicaps.  (Health & Saf.Code, § 1502, subd. (a)(6);  Cal.Code Regs., tit. 22, § 80001, subd. s. (2).)  Similarly, a “foster family home” is statutorily defined as a facility providing for the care of “six or fewer foster children” in the residence of the foster parent.  (Health & Saf.Code, § 1502, subd. (a)(5).)   Consequently, a group home facility, with the potential for more than six children, does not qualify as small family home or a foster family home and hence cannot fall within the ambit of the Fund.

But the distinction between these disparate facilities is not just in their names and capacity limitations.   A group home is an entirely different animal in the kingdom of community care facilities.   Separate and distinct regulations govern group homes, small family homes and foster family homes.   From these diverse regulations come differing requirements for licensing, for the continuing operation of the facilities (e.g., for staff/child ratios, for personnel, for health, food and personal services) and for their physical environments.  (Cf. Cal.Code Regs., tit. 22, § 84000 et seq. with § 83000 et seq. and § 87000 et seq.)   In addition, different rates of public compensation have been established for these separate types of facilities.  (Cf. Cal.Dept. of Social Services, Manual of Policies and Procedures, Operations (April 1989) § 11–402 with §§ 11–401 and 11–403;  see also Health & Saf.Code, § 1501, subd. (b)(7).)   Because of these structural and organizational differences, the Fund was designed for only small foster-care facilities, not for group homes.

In any event, in order to recover against the Fund, plaintiff must establish all of the following elements:  (1) Her daughter was a foster child;  (2) she has a claim for her daughter's death resulting from occurrences peculiar to the foster-care relationship and the provision of foster-care services;  and (3) the claim is to be paid on behalf of either a “foster family home” or a “small family home.”  (Health & Saf.Code, §§ 1527.1 & 1527.2.)

Aside from the other requirements, plaintiff cannot satisfy the first element.   Her daughter was not a foster child because she did not have a foster parent.   A “foster child” is defined as “a person under 19 years old who has been placed in the care and supervision of licensed foster parents.”   (Health & Saf.Code, § 1527, subd. (c).)  A foster parent, in turn, is defined as “the person, and including his or her spouse if the spouse is a resident of the same household, providing care, custody, and control of a foster child in a licensed foster family home or licensed small family home, as defined in Section 1502 of the Health and Safety Code.”  (Health & Saf.Code, § 1527, subd. (d).)  A foster family home in turn means “any residential facility providing 24–hour care for six or fewer foster children which is owned, leased, or rented and is the residence of the foster parent or parents, including their family, in whose care the foster children have been placed.”  (Health & Saf.Code, § 1502, subd. (a)(5), emphasis added.)   By regulation, a similar requirement of residency is imposed upon the foster parent in a small family home.  “ ‘Small Family Home’ means any residential facility in the licensee's family residence providing 24–hour a day care for six or fewer children who are mentally disordered, developmentally disabled or physically handicapped and who require special care and supervision as a result of such disabilities.”  (Cal.Code Regs., tit. 22, § 80001, subd. s.(2), emphasis added.)   In this case, no foster parent provided the care, custody and control of plaintiff's daughter, much less resided with her in a foster family home or in a small family home.   Jeri Hart–Johnson, the claimed foster parent, neither provided the care for the daughter nor resided with her.   Instead, her care was provided by a corporation, not by a resident foster parent.   As noted, the daughter received her care in the facility at Jack 'N Dears, Ltd., 8699 Everglade Drive, a facility licensed as a “group home” to a corporation.

It is true that Jeri Hart–Johnson was issued a license to operate a small family home.   But that was at 6500 Hillsdale Boulevard and plaintiff's daughter did not die in that facility.   The short of all this is that the daughter was not a foster child.   She was instead a resident of licensed group home operated by a corporation.

The purpose of the Fund is to provide an insurance fund for foster parents.   That purpose would be frustrated if recovery against the Fund were permitted in this case.   When facilities are licensed as group homes, instead of being covered by the Fund, they receive state reimbursement for the purchase of liability insurance to cover the children in the group home.   Jack 'N Dears, Ltd. received such a reimbursement.   Moreover, the Fund serves to protect foster parents against lawsuits.   Under the statute, no person can bring a lawsuit against a foster parent unless a claim has been rejected or, if paid, the damages exceed the claim payment.  (Health & Saf.Code, § 1527.6, subd. (d).)  In sum, this Fund protects foster parents and not corporate operators of large group homes.   Accordingly, plaintiff's quarrel should be with Jack 'N Dears, Ltd. and not the Fund.

FOOTNOTES

1.   Defendants objects to the inclusion in Crenshaw's appendix in lieu of a clerk's transcript of several documents from Crenshaw's lawsuit against the owner and operator of Jack N' Dears, Ltd.   Since these documents are not a part of this case, we have not considered them in reaching our decision.

2.   All further undesignated section references are to the Health and Safety Code.

3.   Section 1530.5 requires the Department to consider foster family homes as private residences in establishing regulations.   It does not require small family homes to be treated as private residences in the regulations, suggesting the Legislature did not intend to limit small family homes to facilities in the licensee's residence.

MARLER, Associate Justice.

DAVIS, J., concurs.

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