Conservatorships and Substituted Judgments | Guardianships


A conservatorship is a probate court proceeding for a living person who does not have the capacity to manage his or her own affairs. There are two types of conservators. One is a conservator of the estate, who handles financial matters for the conservatee. The other is a conservator of the person, who makes decisions for the conservatee in personal matters, such as medical care, choice of residence and with whom they may associate.

If you want to avoid a conservatorship for yourself
as you get older, and want to save your family
the expense of establishing a conservatorship,
please go to our Estate Planning page
to learn about setting up a living trust.

If you are interested in establishing a conservatorship for a family member who may no longer be able to manage his or her own affairs, read below for further information.


Conservator representation:

Inventory and accounting to be rendered by the conservator
File the petition for approval of the accounting with the court
Petition the court to approve all actions taken by the conservator
Petition to terminate the conservatorship and, if necessary, open a probate estate, upon the conservatee’s death

Conservatorships

Longer life spans have increased the need for conservatorships as many older people can no longer manage their own affairs, particularly if they have had strokes or suffer from Alzheimer’s disease or other forms of dementia. If a senior in this situation has not established a trust and durable powers of attorney, it may be necessary to petition the court to appoint a conservator.

Sometimes elderly people who carefully planned their estates many years earlier suddenly revoke those documents when they suffer from dementia. They may believe that their children want to steal their money and put them away in a nursing home. They may also come under the undue influence of friends or strangers who seek to take advantage of their diminished mental capacity. This may result in adversarial proceedings that use up the last of the senior’s resources.

In the case of a conservatorship, the court appoints an independent attorney from its probate volunteer panel to interview the proposed conversatee and learn the facts. The court may also ask for a report from a court investigator. Relying on the investigator’s and the independent attorney’s reports, the court decides whether a conservatorship should be established.

Conservatorships usually become necessary when an older individual has done no estate planning. Estate planning documents in most cases make conservatorships unnecessary. For example, if an estate planning document specifies a Durable Power of Attorney for financial and health care matters, an agent will be in place to make decisions for the individual once he or she becomes incapacitated. Please go to our Estate Planning page for further information.

Benefits of Substituted Judgment

A substituted judgment gives the conservator the power to execute estate planning documents on behalf of the conservatee. It allows the conservator to establish a living trust and pour-over will for an incapacitated individual, and to execute Powers of Attorney for health care and financial management. If the conservatorship only concerned financial matters, it may then be terminated because it is no longer needed.

A substituted judgment can result in significant savings for beneficiaries. If the conservatee did no estate planning, necessitating the establishment of a conservatorship, assets will need to be probated upon the conservatee’s death at great expense to the beneficiaries. Petitioning the court to permit the transfer of the assets into a trust while the conservatee is still alive avoids probate and results in tremendous savings to the estate, both in terms of attorney fees and estate tax planning relief. For example, the trustee will be able to use up annual gift tax exclusions and make larger gifts. Other measures, such as the formation of a family limited partnership and use of valuation discounts, may result in substantial tax savings to estates.


Guardianships

A guardianship is the equivalent of a conservatorship for a minor. It is a probate court proceeding to appoint a guardian to handle financial matters for the minor. It usually does not involve the minor’s personal matters as those are determined by parents or family courts.

For example, minors who receive a large insurance settlement may need a guardian to manage the funds until they turn 18. The guardian renders accountings to the court every two years. When the minor turns 18, a petition to terminate the guardianship is filed with the court and the individual receives the money.

Please contact us for assistance with the following matters:

Filing petitions for conservatorships and guardianships
Establishing conservatorships and guardianships

Mortensen Law Office
Tax, Trust & Probate Attorneys, P.C.
22807 Lyons Avenue
Newhall, California 91321
(661) 799-9225

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