Avoiding Conservatorship

Avoiding Conservatorship

There are two court procedures for incapacitated adults. One is called conservatorship of the person and it designates a conservator who determines where the conservatee will live and helps with personal decisions. One is called conservatorship of the estate and it designates a conservator who manages the assets of the conservatee.

Both these procedures require court petitions and attorneys fees to be incurred. Bonding fees are required because  the conservator of the estate is bonded. Court investigators and doctors are involved in ascertaining whether or not a conservatorship is necessary.  Additional attorney and accountant fees are incurred each year when the conservator reports back to the court and accounts for what has happened.

Sometimes people who are close relatives of the incapacitated person are given priority in being appointed as conservator even though the conservatee would have rather designated someone else. This happens when the conservatee (incapacitated person) fails to state in writing his or her wishes.

A conservatorship of the estate can be avoided by creating a revocable living trust but only to the extent that the Creator’s assets have been transferred (ie re-titled) into the trust. The trust states a succession of trustees, for example the husband and wife who set it up, succeeded by the one of them who can still act, succeeded by the first designated successor, succeeded by the second designated successor…

The trusteeship (ie the management of assets of the trust) changes on three different events: death,resignation and incapacity.

Death is proven with a death certificate. Resignation is proven with a written resignation. In my trusts, incapacity is proven by the letters of two of the Creator’s doctors.

If the assets have been transferred into the revocable trust and if the Creator later becomes incapacitated, Conservatorship can be avoided because the designated successor trustee will take office upon obtaining the two doctors letters documenting the Creator’s incapacity and will manage the trust assets for the benefit of the incapacitated Creator.


About randyspiro

I am a super lawyer in California with dual specialization in Estate Planning and Taxation.
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