By Brian Starr, attorney at law
What is a Conservator? A conservator is a person who is appointed by the court to conserve the assets of another.
What is a Protected Person? A protected person (called a conservatee in other states) is a person who is legally in need of a conservator. Arizona courts often refer to the protected person as a Ward.
What is an Agent? An Agent is a person appointed under a Power of Attorney.
Does every person who fits the legal definition of a protected person need a conservatorship? No, not if they have provided for the effective management of their assets and investments through a trust or a Durable General Power of Attorney.
Who may be appointed as Conservator? A.R.S. Section 14-5311 says that any qualified person may be appointed, but establishes a hierarchy of those who have priority for appointment. The nominee of an incapacitated person has a higher priority than a person's spouse. Of course, this can be an issue if the nomination took place long before the person became married.
Is a Conservator personally financially responsible for the ward? A conservator does NOT become financially responsible for his ward by virtue of becoming conservator.
What are the general powers and duties of a conservator?
- File an inventory of the protected person's property within 90 days.
- Account at least annually. The conservator's first accounting shall reflect all activity relating to the conservatorship estate from the date the conservator's letters were first issued (regardless of whether this was a temporary or permanent appointment) through and including the last day of the ninth month after the date the conservator's permanent letters were issued. For purposes of calculating the due date, the court is going to use the date of the minute entry authorizing letters to be issued. The accounting must be filed with the court on or before the anniversary date of the issuance of the conservator's permanent letters. Subsequent annual accountings are to cover the period beginning nine months after the issuance of permanent letters (or rather when the minute entry authorized such issuance) for the following year, and so forth for each year. The due date is on the anniversary date of the issuance of the permanent letters (or again when the minute entry authorized letters to be issued).
- Protect assets, investing assets according to the Prudent Investor Rule.
- AVOID SELF-DEALING AND CONFLICT OF INTEREST
Can a protected person under a conservatorship bind himself to contracts or debts or transfer his own property? When the court imposes a conservatorship, it does not necessarily make a finding that the ward is "incompetent". If it made such a finding, the ward could probably still make contracts purchase necessities of life, if he was otherwise able to make and understand such contracts. However, contracts for non-necessities would probably be void.
It is good practice for conservators to record a copy of their letters of conservatorship with the county recorder. Under A.R.S. Section 14-5421, this will have the effect of transferring title to all of the ward's property to the conservator so that the ward can no longer transfer the property himself.
If the ward is married and the spouse is the conservator, how does the court treat the finances? The spouse will probably be required to file a bond. The court may waive annual accountings.
What is the process of appointing a Conservator?
- Petition for appointment of Guardian or Conservator or both. Be sure to follow the newly created Arizona Probate Rules. Be especially careful about properly filing documents containing confidential information (such as account numbers and social security numbers).
- Petition for Appointment of Attorney, Physician and Court Investigator.
- Notify Attorney, Physician and Court Investigator that they have been appointed.
- Notify relatives of the pendency of the action.
- Schedule the hearing on Conservatorship.
- Apply for appropriate bond in a conservatorship case.
- If the case is not contested, prepare an order for the Judge to sign and present evidence at the non-contested evidentiary hearing.
- Once the order is signed, file your bond and get the Clerk of the Court to issue "Letters."
- File a conservatorship inventory.
How do you get one appointed in an emergency? There is a process for appointing a Conservator in the case of a real emergency. It can take place within 24 to 48 hours. The emergency must generally constitute a clear and present threat that the protected person's finances will be wasted or dissipated unless a Conservator is appointed.
What do I do when the protected person dies? The conservator is generally required to file a final accounting of the protected person's estate within 90 days of the date of the protected person's death. There is an exception to this rule, but we recommend that only an attorney determine if that exception applies.
How does a conservatorship end? Conservatorships end upon a court order terminating the conservatorship, usually due to the end of the incapacity or death of the protected person. The conservator's authority to act as conservator can be converted into an authority to act as Personal Representative of the incapacitated person's estate if proper application is filed with the court.
The incapacitated person or any other interested person may apply to terminate the conservatorship or to replace the conservator. At the conclusion of the conservatorship, the conservator will ordinarily be required to file a final account, which must be approved by a judge.
Who ultimately pays for the establishment of the conservatorship? Once the conservatorship is successfully established, the Conservator, subject to Court approval, can reimburse himself the reasonable cost of attorney's fees and administrative expenses from the estate of the incapacitated person.
Disclaimer: The information contained in this article is made available for general informational purposes only, and is not intended to constitute specific legal advice or to be a substitute for advice from qualified counsel. For that reason, you should not act or refrain from acting based on any information in this article without first obtaining advice from professional counsel qualified in the applicable subject matter and jurisdictions.