Posts Tagged ‘wards’

Arizona Legislature Adopts Probate Changes

APRIL 25, 2011 VOLUME 18 NUMBER 15
Last week the Arizona Legislature adjourned for the year. Just before closing down the session legislators adopted a number of new measures dealing with probate court, trusts and especially guardianship and conservatorship matters. Most of the bills passed by the legislature are still awaiting the Governor’s signature, but all are expected to be signed and to become law on July 20, 2011 (except that at least one of the new laws will be delayed until December 31, 2011). Among the ones affecting our clients:

House Bill 2211. This new law clarifies that some guardians have the power to admit their wards to inpatient mental health treatment. That authority has long existed, but has been difficult to actually implement. The new law aims to make it easier for guardians, and to clarify that the guardian also has the authority to consent to continuing medical treatment during and after admission. As was the case before the new law, this kind of authority requires a special court proceeding at the time of the guardianship hearing (or later, if mental health issues arise), and the mental health authority has to be renewed every year.

House Bill 2402. Two apparently unrelated issues are addressed in this new bill. First, the legislature has created a procedure for suspension of the driving privileges for someone who has had a guardian appointed. Second, this new law inserts a relatively simple way of appointing a guardian and/or conservator — at least initially — for the subject of a civil commitment proceeding. Under prior law both issues were unclear, leading to the oddity that the judge who heard extensive testimony about a patient’s mental illness and need for a guardian and/or conservator could do nothing about that need. Similarly, the ability of the court to suspend a ward’s right to drive had been uncertain, though prior law implied that the court might have that power.

House Bill 2403. Arizona’s legislature adopted the Arizona Trust Code (a version of the Uniform Trust Code), after a couple of false starts, three years ago. Each year since then the legislature has been asked to tinker with the provisions, and it has consistently agreed. This year’s technical corrections are mostly minor, and hard to work up much excitement about — but they are improvements.

House Bill 2424. Though this bill started life as a comprehensive revision of guardianship and conservatorship, it concluded its legislative odyssey as a stripped-down version. As adopted, it simply creates a Probate Advisory Panel to address needed improvements in the guardianship and conservatorship process. The Panel will include two guardians (of a child or sibling), two conservators (of a parent), one public fiduciary, one private fiduciary, one attorney, one judge and a clerk of court.

Senate Bill 1081. Arizona has long allowed you to name a guardian for your minor children in your will, and to let that person be appointed in a summary proceeding if no one objects. This new law permits a similar proceeding for your incapacitated spouse or adult child. The bill spells out a mechanism for lodging the nomination after your death, and requires notice to the allegedly incapacitated spouse or child. If they do not object, the guardianship can issue automatically.

Senate Bill 1499. This new legislation is the most far-reaching of the bills listed here. It was adopted in response to a series of articles in Phoenix-area newspapers about alleged abuses and huge fees in guardianship and conservatorship proceedings. Of the bills listed here, this is the only one which does not become effective on July 20 — it takes effect on December 31, 2011, to give practitioners some time to figure out what changes will need to be made. Among the provisions of Senate Bill 1499:

  • Several changes attempt to address abuse of the legal process. Arbitration is encouraged and can be required. Repetitive filings can be sanctioned. In general terms, the losing party in a contested proceeding can be assessed costs and attorneys fees to be paid to the ward or estate.
  • Any guardian, conservator, or attorney who intends to seek payment from the ward’s estate will need to provide a description of how the fee will be calculated. That information must be provided with the first filing in the proceeding. Any billing must be given to the conservator within four months of the work being done or the fees will be deemed waived.
  • Wards will now have the right to request a new guardian or conservator, and the court must approve the change if it is in the ward’s best interest. A change of guardian or conservator does not require a finding that the current fiduciary has done anything wrong — this provision permits the change based on the ward’s wishes rather than misbehavior of the fiduciary. Any other interested person (a family member, for instance) may also request the change, with the same result.
  • The ward’s right to name his or her own choice of guardian and/or conservator is strengthened. The person named in a power of attorney, for instance, should ordinarily be one of the highest-priority candidates for appointment, unless there is evidence that that person has acted inappropriately.
  • As before, a conservator must file an inventory of the protected person’s assets. Now the conservator must attach a consumer credit report to that inventory.
  • The subject of a conservatorship and other interested persons can now request that the conservator let them review financial and billing records as often as monthly.

In addition, Senate Bill 1499 makes a number of other, less significant, changes. Fiduciaries and their attorneys, and anyone involved in a contested guardianship or conservatorship proceeding, needs to review the new law to see how it will affect new and existing proceedings, and what changes need to be made in reporting and practices.

Ward Should Be Allowed To Express Wishes, Hire Counsel

APRIL 11, 2005  VOLUME 12, NUMBER 41

When the legal system takes over decision-making and care of an incapacitated adult, there is a struggle between competing goals. It is important to provide adequate protection and supervision, but it is also important to maintain the ward’s personal autonomy and self-determination. It is often difficult to decide how much latitude to give to an incapacitated ward. Even the court system charged with overseeing that balancing act can sometimes be too restrictive.

Sheri Rosengarten was the subject of a guardianship in Pennsylvania. Before the onset of her mental illness she had established a revocable living trust naming herself and her brother David as co-trustees. Unfortunately, her brother had mismanaged her trust assets after she became incapacitated, and so her personal and legal affairs were in some disarray.

The court appointed a non-family member, lawyer Susan B. Smith, to serve as Ms. Rosengarten’s guardian (of both her person and estate—what would be called a guardian and conservator in Arizona). Thereafter Ms. Smith began to manage Ms. Rosengarten’s personal and financial affairs, although assets in her living trust were being managed by her father as successor trustee.

Because Ms. Rosengarten was in an assisted living facility, her guardian decided it was time to sell her residence and add the proceeds to the assets under management. Ms. Rosengarten objected (as did her father), thinking that she might some day be improved enough to return to her home. In the meantime she thought it made sense to rent the house out—perhaps as a group home that could be tailor-made for her as her condition improved.

Although the court had appointed an attorney to represent Ms. Rosengarten in the guardianship proceeding, she wanted to choose a different attorney and argue against the sale of her home. The court, however, refused to hear from the lawyer she had hired, insisting that the attorney previously appointed could represent her interests. After a brief hearing the judge ordered that Ms. Rosengarten’s home should be sold, and the proceeds delivered to Ms. Smith rather than held in her living trust.

The Pennsylvania Superior Court (that state’s intermediate appellate court) reversed the trial judge’s holdings and remanded the case back to the trial court. Once she had raised the argument that she was no longer incapacitated, said the appellate judges, the first question to be addressed was whether a guardianship was still necessary. At that hearing Ms. Rosengarten should of course be allowed to choose her attorney unless it could be shown that she lacked capacity to even enter into a lawyer-client relationship, and her wishes should be respected to the fullest extent possible. Estate of Rosengarten, March 24, 2005.

Probate Court May Bypass Ward’s Choice Of Conservator

MAY 19, 2003 VOLUME 10, NUMBER 46

When a person is no longer able to manage his or her own affairs, it may be necessary for a court to appoint a guardian (of the person) or conservator (of the estate). Who should be appointed? In most states the courts start from the presumption that family members should serve—but the highest priority usually goes to the person selected by the incapacitated person. That is not always the way things turn out, however.

There are at least three ways an incapacitated person might have input on the selection of a guardian or conservator. Once a petition is filed an attorney, a court investigator or the court itself might ask the proposed ward who he or she prefers to have act as guardian and/or conservator. In some cases the ward might have expressed a preference well before the need ever arose. And in some states, simply signing a durable power of attorney is taken as a preference by the signer for who should be appointed if the need later arises.

All three standards applied to Karla Iwen, a Minnesota woman. She had named her son Heinz Iwen as her agent in a durable power of attorney, and had specifically included a request that he be appointed if a conservatorship was ever contemplated (at the time Minnesota used the term “conservatorship” to encompass both personal and financial matters, but has since adopted the same language used in Arizona–guardianship is over the person, conservatorship over the estate). She also told the court that she wanted Heinz appointed.

The reason the issue even came before the probate court was that her other son, Thomas, had filed a petition to be appointed as her conservator. He had watched her decline while living at home, and was concerned for her safety and welfare. He did not think his brother Heinz was taking good care of their mother, and he cited the presence of mouse droppings in her bedding, a dead mouse in her fireplace, and the fact that she could not climb the stairs to the only bathroom in her home.

At the conclusion of the all-day hearing on the brothers’ competing requests to be appointed, the judge decided instead to name Karl Bushmaker, an independent professional, as guardian and conservator. Heinz appealed, arguing that his mother’s choice should be given first priority. The Minnesota Court of Appeals agreed, but nonetheless upheld the appointment of a professional.

The priority given to the ward’s preference to serve as guardian and conservator is just a priority, ruled the appellate court, and not a guarantee. When the ward’s best interests require appointment of someone else, the probate court is permitted—and indeed required—to deviate from that priority. Evidence of the living conditions at Ms. Iwen’s home supported appointment of someone else. Matter of Iwen, May 6, 3003.

Arizona law agrees with the Minnesota result. Under the guardianship and conservatorship statutes in Arizona, the probate court is specifically instructed to consider the proposed ward’s choice of guardian and conservator, whether made in a document previously signed or by current statement of the ward. The court is, however, permitted to bypass the ward’s choice if it determines that doing so would be in the ward’s best interest. It is because of the Arizona statute that powers of attorney prepared by Fleming & Curti, PLC, usually include a provision nominating the agent to serve as guardian and/or conservator if it should ever become necessary to involve the court in the process of selecting or supervising a fiduciary.

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