Our firm specializes in issues of alternate decision-making. Our clients often assist family members with decision-making. Whether it is an aging parent or a child with a disability, these informal arrangements are common. However, sometimes a more formal legal solution is necessary. If the person’s mental capacity is in question, or if a bank or nursing home requires legal paperwork, the family must seek out an expert in the field.
There are two major options for a family facing personal care or financial challenges. The first is a durable financial power of attorney, which is a written document that gives an agent broad power to act. The power of attorney must be executed when the person is competent. If the disabled person never planned for incapacity, or if the incapacity came about very quickly (through a brain injury or stroke, for example), a court order appointing a guardian or conservator is needed.
A guardianship and a conservatorship are each separate legal entities that are established by court order. They are court-authorized relationships whereby one person assumes responsibility for the care, property, and finances of another. A guardianship or conservatorship is appropriate when a person’s decision-making capacity is so impaired that the person is unable to care for his or her own personal safety or to provide for his or her necessities.
A conservator is responsible for managing the ward’s finances. The conservator takes control of the ward’s assets and uses them on behalf of the ward. The conservator must pay bills and balance the ward’s checkbook. The conservator may have to sell a house or liquidate a major asset to pay for long-term care.
A guardian is responsible for the ward’s needs other than financial matters. The guardian can direct where the ward will live and whether the ward needs to move to a more restrictive environment. The guardian makes decisions about medical treatment, educational or vocational services, and personal care.
Although the judicial system is involved, the entire proceeding is more collaborative than adversarial. Generally, it is a fairly straightforward process to demonstrate incapacity and appoint a guardian or conservator. However, guardianships and conservatorships completely take away or severely limit the ward’s decision-making authority. They are also more time-consuming and costly than alternative methods, because the court requires annual reporting and prior approval for expenditures. Because of this, guardianships and conservatorships should only be used when there are no other options.