A conservator of an estate is responsible for prudently managing the personal and financial affairs of an adult (protected person, conservatee) who lacks the mental competence to handle their own affairs. Once appointed as a conservator, your fiduciary duty is to manage the estate’s assets for the conservatee’s benefit.
Types of Conservatorships
Depending on the needs of the conservatee, the court may appoint a conservator of the person, a conservator of the estate, or both types of conservatorships.
A conservator of the person is appointed to supervise and manage the personal affairs of a protected adult. They are responsible for ensuring that the conservatee has food, clothing, and healthcare and that they are living in a safe environment. A conservator of the person is responsible for health and safety. They are not typically responsible for managing a conservatee’s financial affairs.
A conservator of the estate is responsible for handling a conservatee’s financial affairs. The same person may be appointed to serve both roles.
The court appoints a conservator in response to a petition. A spouse, a family member, or even an outside interested party may submit a petition to the court. Anyone requesting to act as a conservator must file a separate petition. If no one is available, the court may appoint a private professional fiduciary to serve in this capacity.
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The Role and Responsibilities of a Conservator of the Estate
The court appoints a conservator of an estate to manage the financial affairs and assets of the conservatee. A qualified physician must evaluate the individual and independently determine the individual’s mental capacity. If an individual is incapacitated, they may be unable to effectively manage their own affairs.
A conservator has the following responsibilities:
- File an initial inventory and accounting of the conservatee’s assets with the court as soon as possible after being appointed conservator.
- Manage the conservatee’s income, assets, property, and government benefits by prudently investing their money, paying bills and taxes, and maintaining appropriate insurance policies.
- Keep detailed financial records of all transactions made on behalf of the conservatee. File annual accountings with the court detailing all transactions.
- Obtain permission from the court before selling real estate, making financial gifts, or making risky investments. In California, conservators are required to follow the Uniform Prudent Investor Act as well as Probate Code 2574, which restricts investments to government bonds and exchange-traded securities.
- Recover any assets or debts owed to the conservatee.
Conservatorship Duration
Conservatorships can be short-term, temporary, or permanent.
If an adult has a medical condition that incapacitates them but they are expected to recover, the court may appoint a short-term conservator. This individual will step in and address any specific physical or financial needs that cannot wait until the person recovers. Certain conditions may limit conservatorship authority.
A permanent conservatorship lasts for the duration of a person’s life. If a protected adult no longer needs or wants a conservator to act on their behalf, they must present their case in court and petition for the conservatorship’s revocation.
Conservatorship vs. Power of Attorney
Like a conservatorship, a power of attorney is a legal designation that allows an individual to make legally binding decisions for another person. Both a conservatorship and a power of attorney can have varying scopes and durations.
Unlike a conservatorship, an individual grants power of attorney to another person. They may grant power of attorney to anyone and revoke it when it no longer serves their needs.
A person must be of sound mind when appointing a power of attorney. Individuals may choose to appoint a power of attorney to prepare for their own potential incapacitation. If you decide to appoint a power of attorney and empower them to make financial, healthcare, or other decisions on your behalf, an appropriately executed power of attorney supersedes a conservatorship.
It is essential to understand the roles and responsibilities of a conservator. Before accepting this fiduciary role, consult with your attorney to ensure that you fully understand your obligations and the potential risks associated with them. A conservator must never use a conservatee’s resources for their own benefit. However, they may be paid for their work on the conservatee’s behalf.
To protect yourself as a conservator, you must keep detailed records of all transactions and seek a court order before making any significant decisions.
If you have questions about how you can protect yourself and your loved ones if you become mentally incapacitated, contact us to learn how to protect your assets and property with a comprehensive set of estate planning tools.
You can schedule a call with us or reach us directly at 855.631.3457 to learn more about how to best plan today to protect those most important to you.
