By Margaret Browning
A common refrain from estate planning attorneys is: “Do whatever you can do to stay out of probate court.” The usual reasons given are that it is costly to go to court and that disputes in probate court can take a long time to be resolved.
Estate planning attorneys recommend advance planning by designating who will be a person’s decision-maker if they become incapacitated, and what type of treatment the person would want in various situations. A Power of Attorney and/or a Patient Advocate Designation is recommended to ensure a smooth transition of decision-making authority when a person is no longer able to speak for themself. However, if a person becomes incapacitated and does not have a Power of Attorney and a Patient Advocate Designation, guardianship and conservatorship are the appropriate legal method to empower a surrogate decision-maker. Guardianships grant authority over the person, including their finances, if the finances are limited to typical household management. If a person has substantial or complicated assets, the court can appoint a conservator, whose responsibilities are limited to financial authority.
Even for those who have done advance planning, consulted an attorney, decided what type of care they want to receive, and decided who will make their decisions for them, things sometimes do not turn out as planned. When it comes time for the appointed agent to step in to make the medical and financial decisions, they may not be willing (or able) to take on the responsibility. By the time the agent is asked to assume the role of surrogate decision-maker, they may be ill or may have died.
On the other hand, if the appointed agent is available and willing to assume the responsibility of making the medical and financial decisions, problems may arise because there is no check or balance on the person’s authority. For example, the person now has access to the person’s money without court oversight. Other family members may suspect mishandling of funds if the agent has a sudden change in lifestyle. Most family members would not know what to do if they suspect financial exploitation by the power of attorney or the trustee of a trust. Also, the agent may have an incentive to withhold medical treatment if they are a beneficiary.
Professional guardians often get appointed when a person has no family, has family members who are fighting over money or the treatment plan, or where misappropriation of assets have been proven. All guardians, whether they be family or a professional, report to the court. Guardians must file an annual report that describes the health of the ward, the ward’s living arrangement, the type and frequency of medical and/or mental health treatment, the activities the ward is involved in for recreation, employment, and socialization.
Guardianships may also be limited in scope. If a ward only needs someone to assist in specific areas such as medical treatment or placement, the court can limit the authority of the guardian such that the ward retains the ability to make decisions in the other aspects of their life. Additionally, a guardian is obligated to consult with a ward when making decisions.
Another method of oversight includes guardianship reviews. The probate courts are mandated to send someone every three years to meet with the ward to determine that their needs are being met.
If a ward is unhappy with the guardian’s decisions, the ward can call the court to voice their concerns. The court will schedule a hearing to give the ward an opportunity to present their complaints and have the guardian explain the rationale for their decisions. If the ward feels that the guardian is not acting in their best interest and wants someone else to serve as their guardian, they can request a modification of the guardianship.
The probate court will usually hold a preliminary hearing to identify the issues and understand each party’s position. If the judge is not able to resolve the matter, he or she will schedule an evidentiary hearing and appoint an attorney to represent the ward. The appointed attorney may file a Petition to Modify the Guardianship. The probate court has continuous authority to review the actions of the guardian and, if appropriate, to remove the guardian and appoint someone else to serve.
Also, other people may contact the court to request a hearing to review the guardian’s decisions. Any interested person (as defined by the court rules), such as, but not limited to, a family member, a case manager, a therapist or a doctor, may file a petition to challenge the actions of the guardian. If there is evidence of financial misappropriation, the court has authority to surcharge the fiduciary. The court frequently orders a bond which acts as an insurance policy to protect the assets of the ward against theft by the guardian or conservator. When theft is proven, the surety will issue a check for the amount of money stolen, subject to the limits of coverage of the bond, and the money goes back into the ward’s account. The surety may then seek to collect from the fiduciary, but they take the risk of the fiduciary being uncollectible.
While most people do not relish the idea of having to have a guardian or a conservator, they should take comfort in the fact that if it is needed, there is court oversight and there are methods to correct wrongdoing by the fiduciary.
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Margaret Browning is the CEO of Browning & Associates PC. She can be reached at mb.browninglaw@gmail.com. Her column is reprinted with permission from the Washtenaw County Bar Association, which first published it in the newsletter Res Ipsa Loquitor.
A common refrain from estate planning attorneys is: “Do whatever you can do to stay out of probate court.” The usual reasons given are that it is costly to go to court and that disputes in probate court can take a long time to be resolved.
Estate planning attorneys recommend advance planning by designating who will be a person’s decision-maker if they become incapacitated, and what type of treatment the person would want in various situations. A Power of Attorney and/or a Patient Advocate Designation is recommended to ensure a smooth transition of decision-making authority when a person is no longer able to speak for themself. However, if a person becomes incapacitated and does not have a Power of Attorney and a Patient Advocate Designation, guardianship and conservatorship are the appropriate legal method to empower a surrogate decision-maker. Guardianships grant authority over the person, including their finances, if the finances are limited to typical household management. If a person has substantial or complicated assets, the court can appoint a conservator, whose responsibilities are limited to financial authority.
Even for those who have done advance planning, consulted an attorney, decided what type of care they want to receive, and decided who will make their decisions for them, things sometimes do not turn out as planned. When it comes time for the appointed agent to step in to make the medical and financial decisions, they may not be willing (or able) to take on the responsibility. By the time the agent is asked to assume the role of surrogate decision-maker, they may be ill or may have died.
On the other hand, if the appointed agent is available and willing to assume the responsibility of making the medical and financial decisions, problems may arise because there is no check or balance on the person’s authority. For example, the person now has access to the person’s money without court oversight. Other family members may suspect mishandling of funds if the agent has a sudden change in lifestyle. Most family members would not know what to do if they suspect financial exploitation by the power of attorney or the trustee of a trust. Also, the agent may have an incentive to withhold medical treatment if they are a beneficiary.
Professional guardians often get appointed when a person has no family, has family members who are fighting over money or the treatment plan, or where misappropriation of assets have been proven. All guardians, whether they be family or a professional, report to the court. Guardians must file an annual report that describes the health of the ward, the ward’s living arrangement, the type and frequency of medical and/or mental health treatment, the activities the ward is involved in for recreation, employment, and socialization.
Guardianships may also be limited in scope. If a ward only needs someone to assist in specific areas such as medical treatment or placement, the court can limit the authority of the guardian such that the ward retains the ability to make decisions in the other aspects of their life. Additionally, a guardian is obligated to consult with a ward when making decisions.
Another method of oversight includes guardianship reviews. The probate courts are mandated to send someone every three years to meet with the ward to determine that their needs are being met.
If a ward is unhappy with the guardian’s decisions, the ward can call the court to voice their concerns. The court will schedule a hearing to give the ward an opportunity to present their complaints and have the guardian explain the rationale for their decisions. If the ward feels that the guardian is not acting in their best interest and wants someone else to serve as their guardian, they can request a modification of the guardianship.
The probate court will usually hold a preliminary hearing to identify the issues and understand each party’s position. If the judge is not able to resolve the matter, he or she will schedule an evidentiary hearing and appoint an attorney to represent the ward. The appointed attorney may file a Petition to Modify the Guardianship. The probate court has continuous authority to review the actions of the guardian and, if appropriate, to remove the guardian and appoint someone else to serve.
Also, other people may contact the court to request a hearing to review the guardian’s decisions. Any interested person (as defined by the court rules), such as, but not limited to, a family member, a case manager, a therapist or a doctor, may file a petition to challenge the actions of the guardian. If there is evidence of financial misappropriation, the court has authority to surcharge the fiduciary. The court frequently orders a bond which acts as an insurance policy to protect the assets of the ward against theft by the guardian or conservator. When theft is proven, the surety will issue a check for the amount of money stolen, subject to the limits of coverage of the bond, and the money goes back into the ward’s account. The surety may then seek to collect from the fiduciary, but they take the risk of the fiduciary being uncollectible.
While most people do not relish the idea of having to have a guardian or a conservator, they should take comfort in the fact that if it is needed, there is court oversight and there are methods to correct wrongdoing by the fiduciary.
————————
Margaret Browning is the CEO of Browning & Associates PC. She can be reached at mb.browninglaw@gmail.com. Her column is reprinted with permission from the Washtenaw County Bar Association, which first published it in the newsletter Res Ipsa Loquitor.
