NOVEMBER 6, 2002
Advances in health care and in treatment of diseases in our society have resulted in longer life expectancy. Unfortunately, the gains we have made in improving our physical well-being have not been matched with longevity in our mental well-being. For many people, our minds are not keeping up with our bodies. As a result of these factors, many people need increasing levels of support as they age. These individuals begin to rely on others to help them make more of their decisions of daily living. When their mental state reaches a stage that they can no longer manage their financial affairs or provide for their personal needs and safety, surrogate decision makers must make these decisions for them. The surrogate decision makers are usually family members or close, trusted friends. However, many people outlive family and friends necessitating the use of other resources. Those resources may include professional public and private decision-makers. All of these surrogate decision makers must have some source of legal authority for making these decisions for others whether it be written consent of the person needing assistance or through more informal arrangements which develop over time. Often these arrangements include joint ownership of assets and the use of legal documents, such as powers of attorney. If these informal options are not available for some reason, or if third parties are requested to provide services, for example, placement in a care facility, some more formal authority must be obtained by the decision maker. This is usually a court appointed guardian or a conservator.
Guardianships for minors, who are legally incapacitated because of age, are beyond the scope of this article. This article will discuss and explore guardianships for incapacitated adults.
A guardian is a court-appointed surrogate decision-maker who is responsible for a ward's physical well-being. Under Utah law, a guardian may be appointed for any person whose mental capacity or lack of capacity, prevents them from caring for themselves, providing for shelter, food, clothing, medical care or other necessities of life. The incapacitated person is generally referred to as the "ward." The guardian has approximately the same responsibilities for and authority over the ward in a full guardianship appointment, as a parent has for a small child, except a guardian does not have the duty to supply funds to support the ward. However, not all guardianships need be the same. They may be limited to just what is needed for the ward in question. Courts have a duty to try to fashion a guardianship to the least restrictive alternative based upon all the facts and circumstances.
The guardian may be responsible for management of all of the ward's property or may seek the appointment of a conservator to manage the ward's financial affairs. Generally, the guardian is responsible to make decisions about the ward's care, support, health and housing.
Any competent person or suitable institution may be appointed as a guardian of an incapacitated person. The law recognizes the following order of priority: (1) a person nominated by the incapacitated person in a writing executed prior to the person's incapacity; (2) the spouse of the incapacitated person; (3) an adult child of the incapacitated person; (4) the parent of the incapacitated person, including a person nominated by will or an instrument or other writing signed by a deceased parent; (5) any relative of the incapacitated person with whom the incapacitated person has resided for more than six months prior to the filing of the petition; (6) a person nominated by the person who is caring for the incapacitated person or paying benefits to him or (7) a specialized care professional as defined by the law. The legal proceedings necessary for the appointment of a guardian in an uncontested case normally take about three weeks. An emergency temporary guardian may be appointed within a day.
A conservator is a court-appointed surrogate decision maker who is responsible for a ward's financial affairs. Conservators are appointed for individuals who cannot effectively manage their financial affairs and whose property may be wasted or dissipated if proper management is not provided. The ward may, or may not, have a guardian appointed for them, depending upon his capabilities. For example, the ward may still have significant capacity to manage his or her other activities of daily living but just needs help paying bills and managing assets. A conservator acts like a trustee of a trust, managing the ward's financial affairs, investing assets, collecting income and paying bills.
A person may have both a guardian and a conservator appointed for him or her if the circumstances warrant it--a guardian to make decisions of daily living and a conservator to make financial decisions. In appropriate circumstances, the same person may act as both a conservator and a guardian.
DUTIES OF A GUARDIAN:
A guardian is a fiduciary who owes the highest duty of care to the incapacitated person. Like a good parent, the guardian must look out for the ward's best interests while taking into account the ward's needs, wants and desires. The guardian must provide shelter, clothing, medical care, food and all other necessities of life taking into account resources available to the ward, including governmental programs. The guardian does not need to use his or her own funds for the ward's care. The guardian must protect the ward from the ward's poor judgment while allowing the ward to participate in the decision making process to the extent he or she can. If a conservator has not been appointed by the court and there is no one else with authority to manage the ward's assets, the guardian is responsible for the management of the ward's assets as a trustee. This responsibility includes preparing and filing with the court an inventory of the ward's assets and sources of income. The guardian cannot compensate himself for room and board provided to the ward by the guardian without court approval. If the guardian does not want to be responsible for management of the ward's financial affairs, the guardian can request the appointment of a conservator. Annually, the guardian must file a report with the court describing the ward's present status and living arrangements. If the estate of the ward is in excess of $50,000, less the value of a personal residence, the guardian must file a full, formal accounting. For estates smaller than $50,000, the guardian must provide an informal accounting. The accounting must be in conformance with rules provided by the court, reporting the assets and income which have been managed and expended by the guardian during the year. If a conservator has been appointed, the conservator will be responsible for filing the financial report. A guardian may not resign without court approval and a formal discharge.
DUTIES OF A CONSERVATOR:
The conservator is a fiduciary who owes the highest duty of care to the ward in the management and administration of the ward's assets. The conservator must take possession of all the property and income payable to the ward and use such assets only for the ward's benefit. Within ninety (90) days after appointment, the conservator must file an inventory with the court listing all of the assets of the ward that have come into the conservator's possession. The inventory must also be given to the ward if he or she is able to understand and comprehend it, to the ward's guardian, if one has been appointed, to the parents of the ward, if alive, or to the person with whom the ward is residing. Any interested person may also request a copy of the inventory. The term "interested person" is defined as anyone having an interest in the ward or his or her estate, such as family members and creditors. Annually, the conservator must prepare and file an accounting with the court. For estates of $50,000 or more, excluding a residence, the conservator must file a full, formal accounting. For estates of less than $50,000, an informal accounting may be filed. With respect to the management of the property of the estate, the conservator has all of the powers of ownership that the ward had. The conservator steps into the shoes of the ward.
A conservator's duties continue until a final accounting has been filed with the court and the conservator has been discharged by the court. A conservator may not resign without prior court approval and formal discharge.
THE APPOINTMENT PROCESS:
Guardianships: The guardianship appointment process is begun by the filing of a petition for appointment with the district court in which the ward resides. The petition can be filed by any interested person. The person filing the petition is usually one of the persons having priority and the one seeking appointment. However, it is not unusual for a person having an interest and a priority to nominate someone else as guardian. Once the petition has been filed, a special notice of the petition must be personally served on the proposed ward. In addition, notice must be given to the incapacitated person's spouse, parents, adult children, and any person who is serving as a guardian or conservator or who has care and custody of the ward. In a case where none of the above persons can be located, notice must be given to the closest adult relative, if any can be found and any guardian appointed by a will of any parent who has died. Notice must also be given to any person requesting notice.
Since granting a guardianship is a serious deprivation of the ward's personal freedom and rights, strict formal notice and due process of law is required. Due process means an opportunity to be heard and represented. The ward must have legal representation. He or she also has the right to a jury trial, to be present at all proceedings, to examine all witnesses who appear against him/her and to present witnesses in his or her own defense. These procedures are required even though it is clear that a guardian is needed, such as the case in which the proposed ward is hospitalized and is in a coma.
If the ward has an attorney of his or her own choice, that attorney may represent the proposed ward. If the ward has no attorney, the court must appoint an attorney for the ward. If the ward will not or cannot be present in court at the hearing of the petition, the court must appoint a court visitor to meet with the ward and investigate the circumstances of the ward's incapacity and report to the court. Waiver of the visitor or the presence of the ward in court may only be obtained if there is clear and convincing evidence presented to the court that such presence is unnecessary or harmful to the ward. Such evidence may be a letter from the ward's attending physician indicating that the ward's presence would not be useful to the court as the ward could not participate in his own defense or such presence would be detrimental to the ward's health.
The cost of hiring an attorney to represent the ward may be paid out of the ward's estate unless the court finds that the petition is frivolous, in which case the petitioner will be charged with such fees. The court visitor must be paid by the person seeking the guardianship. However, if the guardianship is granted, the guardian can seek court approval for reimbursement of the visitor's fees. While the law requires that the court appoint an attorney for the ward and a court visitor, the court does not name the attorney or the visitor. If the proposed ward does not have counsel of his or her own choice and lacks the capacity to seek or engage an attorney, then it is up to the person seeking guardianship to identify both an attorney for the ward and a visitor and make arrangements for their appointment as part of the hearing process.
The person seeking guardianship or his attorney must identify and contact appropriate legal counsel and a qualified person to act as a visitor. Then, prior to the preliminary hearing of the petition for guardianship, the attorney and visitor must be appointed by the court in sufficient time to allow them to meet with the proposed ward and to evaluate the guardianship proceedings. After the preliminary hearing, if it appears to the court that a guardianship is appropriate, the court will enter an order approving the guardianship and specifying any limitations on the guardian. If the proposed ward and his counsel object to the guardianship at the preliminary hearing, the court will refer the case to the trial calendar. The trial judge will schedule a formal hearing on the petition and a trial will take place to determine if the guardianship is warranted.
In the vast majority of these cases, no trial will be necessary because it will be clear from the facts that the proposed ward needs a guardian and the guardianship is in his or her best interest. The petition for guardianship is usually made later rather than earlier. Unfortunately, in many cases, the incapacitated individual has already suffered some form of physical or financial abuse or loss when proceedings to protect them are undertaken.
Conservatorship: While conservatorship proceedings are substantially identical to guardianship proceedings, since the appointment of a conservator is viewed as less of a deprivation of one's civil rights, there is no requirement that the proposed ward must have an attorney or be interviewed by a court visitor. The law provides that the court may appoint counsel for the ward and may appoint a court visitor if the judge deems it necessary. In any case in which the proposed ward will not be present to consent to the appointment of a conservator, the court will, at a minimum, require the appointment of an attorney to represent the ward in most cases.
ALTERNATIVE DECISION MAKERS:
Powers of Attorney: An individual, as part of an estate plan or in contemplation of his or her incapacity, may identify and appoint someone whom he or she trusts to make both medical and financial decisions through the use of a general durable power of attorney and a special medical power of attorney. So long as the individual had capacity at the time of the creation of the durable power of attorney or medical power of attorney, that power should be recognized and respected by persons dealing with the holder of the power of attorney. However, there is nothing in the law that requires third parties to recognize a durable power of attorney. Thus, a bank or brokerage holding the incapacitated person's funds or investments may refuse to honor a durable power of attorney. This problem becomes more likely if the durable power of attorney is more than a few years old. Many financial institutions and brokerages require "fresh" durable powers of attorney. Some require that powers of attorney be on the institution's forms and refuse to recognize forms that do not meet certain criteria. Medical powers of attorney are somewhat more likely to be recognized as they are presented to health care providers who are more inclined to accept them if they believe the ward no longer has the ability to give informed consent for medical procedures. In such cases, health care providers are looking for someone to take responsibility for the decision making process and are happy to recognize a medical power of attorney.
Trusts: Many people today, as part of their estate planning, create "living" trusts which function during the individual's lifetime. These documents have provisions for naming a successor trustee to manage the trust if the grantor/trustee becomes incapacitated. These successor trustees are similar to conservators but are not subject to court supervision or reporting unless the trust specifically provides those requirements. In most cases, the successor trustee of the trust is not given the authority to make medical care decisions even though it is authorized to pay all medical bills. So although a trust may be a substitute for a conservatorship, it is usually not a substitute for a guardianship. Just because someone has a trust that will pay the bills doesn't mean the trustee has the power to make living and health care decisions.
In Utah, guardianship and conservatorship proceedings are usually fairly simple and speedy, taking only a few weeks to complete. In an emergency, a guardianship can be established within a day. Guardianship and conservatorship proceedings should not be feared or looked upon as something to be avoided. They are effective in giving legal authority to an appropriate substitute decision maker in a relatively short period of time. If anything, they are presently underused and undertaken too late. Too often, incapacitated individuals are physically, emotionally and financially abused prior to the initiation of these protective proceedings. Court oversight and annual reporting requirements are a strong incentive for care providers to provide appropriate care. As a final note, if a person needing a guardian has no one willing to act and no source of income or assets to pay for guardianship services or proceedings, the Utah Office of Public Guardian may be willing to act as guardian. But due to limited funding, the Office may not be able to take all cases. Several attorneys throughout the state, however, have offered to provide free representation of such impecunious individuals. The names of these attorneys may be obtained from the Utah State Bar Pro Bono Coordinator.