MAY 12, 1997 VOLUME 4, NUMBER 45
One of the issues considered in the 1997 Arizona legislative session was a revision of the law of guardianship and conservatorship. On April 24, 1997, Governor Symington took a break from his otherwise busy schedule to sign Senate Bill 1327 into law. Among the more important changes:
- Guardians of minors now have a specific duty to “become or remain personally acquainted with” the minor for whom they have accepted responsibility. Other duties and powers of guardians of minors have also been spelled out, including the power to consent to the minor’s marriage or adoption, handle small sums of money without the appointment of a conservator, and establish the minor’s place of residence (in Arizona or outside the state).
- A well-drafted power of attorney may nominate the agent as guardian or conservator in the event that the power of attorney proves to be insufficient. Courts have always been willing to consider such nominations, but now the law expressly provides a priority for the person identified in the power of attorney (who will ordinarily, but not necessarily, be the attorney-in-fact named in the same instrument). The nominee in a power of attorney holds third position in the priority list, after a person appointed as guardian or conservator in another jurisdiction and a person nominated by the ward in a document other than the power of attorney.
- Courts have long felt free to ignore the priority list in appropriate cases (where, for example, a spouse has misappropriated property of the ward) and appoint someone lower on the list. Now the authority to bypass the priority list is clearly stated.
- Conservators are now expressly authorized to make gifts from the ward’s estate where there is a prior pattern of gifting. The new law permits such gifts even if there has not been such a pattern, if there are potential tax savings. The requirements in such cases are much more clearly spelled out than in the prior law; Court approval is required, but the factors which the Court (and the conservator) must consider have been listed.
- Bonds are required in all conservatorship cases, and the new law does not change that. However, where the ward is in a care facility and the fixed expenses of care are a substantial portion of the estate, the size of the bond can be reduced to reflect those expenses.
- Private fiduciaries are given clear priority (albeit at the bottom of the list) to serve as guardian and/or conservator. Under the existing law, the authority of private fiduciaries to apply for guardianship and conservatorship, or to be appointed, was assumed but not specifically set out.
- The power (and sometimes duty) of the conservator to support not only the ward but also the ward’s dependents (children and spouses, for example) has been clarified. When the ward is a minor child, the new law expressly permits funds to be used even though expenditures may also benefit the rest of the family, at least in some circumstances. For example, the conservator may consider the “extraordinary custodial responsibilities undertaken by the parent or parents” in making distributions, and might even decide to pay a parent for care-taking which would ordinarily be considered part of the parent’s duties. The new law also provides that payments for minor children may be made even though there is an “incidental benefit to other members of the child’s household.” In other words, if a therapy pool or addition to the home is of significant benefit to the minor, it can be paid for from conservatorship assets even though parents and siblings also gain the use of the pool or building addition.
The new law takes effect in late July. Most of the changes, however, codify principles widely accepted before adoption of this law, and so the new standards will be recognized immediately in most cases.