What is the difference between a guardian and a conservator?

The nutshell explanation is a guardian is responsible for the care of an incapacitated person’s health, personal care, and living arrangements.  A conservator is responsible for the person’s money and property.  Of course, that is a gross over simplification.  There are instances where a guardian handles money and instances when a conservator makes personal decisions for the protected person.  There are separate statutes covering incapacitated adults from those designed to protect minors, but the principals and procedures are fairly similar.  In this article, we will discuss the laws for incapacitated and protected adults and leave minors for another day.

The need for a guardian, a conservator, or both can arise in several ways.  Perhaps, an aging adult develops Alzheimer’s or dementia and is no longer capable of rational decisions.  Perhaps, an adult child suffered brain damage in an accident, or a family member is severely mentally ill and has lost contact with reality. Brain tumors, drug overdoses, meningitis and other serious illnesses can leave a devastated family to cope with an incapacitated adult.  

In the unfortunate event you find yourself caring for an incapacitated adult, the first question you will need to answer is this.  Does the family member need a guardian, or a conservator, or both?  If the family member’s only income is social security or SSI, a guardian may be sufficient.  If the family member can live alone and care for his or her personal needs but does not have the capacity to manage financial affairs, a conservator may be required.   In many instances both a guardian and conservator are required when the incapacitated person can neither care for himself nor his property.  The subject of a guardianship hearing is referred to as an “incapacitated person.”  The subject of a conservatorship is referred to as a “protected person.”

Establishing and Handling a Guardianship

The Petition and Hearing

All the guardianship and conservatorship statutes are found in Title 14 of the Arizona Revised Statutes.  The statutes spell out the entire process.  They dictate who can apply to be a guardian or conservator; they detail the application process and procedures to be followed.  The statutes also explain the duties of a guardian or conservator and include safeguards to protect the rights and property of the  incapacitated adult.  A guardian may be a family member, a fiduciary, or someone the incapacitated adult has previously nominated in a written document.

A parent, with an incapacitated adult child, can transfer his or her guardianship upon death with a Will or other signed writing.  However, other family members have the right to object and to require a court to determine the best candidate.  The same idea holds true for the spouse of an incapacitated adult.  The spouse can use a Will or other signed writing to transfer guardianship.  Family members have the right to object and demand a court hearing.  

In most cases, guardians are appointed by the court after an investigation and a court hearing.  It is not a slam dunk process.  The court procedure provides safeguards to protect the rights of the incapacitated person.  The procedure is set out in A.R.S. § 14-5303.  Any interested party may file a Petition to be appointed as guardian of the alleged, incapacitated adult.  The Petition must be filed in the county where the incapacitated person lives.  The Petition requires a lot of detailed information such as the reason the Petitioner wants to be guardian, the name of the closest living family member, a description of the property owned by the incapacitated adult and its value.  It must also include a statement about the reason the Petitioner believes a guardian is needed.  A lot more information is required, but these are the highlights.  

When the court receives a Petition for Guardianship, it sets a hearing date.  The court also appoints an attorney to represent the alleged incapacitated person (unless he or she already has a private attorney).  The court also appoints an investigator who interviews the alleged incapacitated adult and files a report.  If the subject of the Petition does not have a personal physician or psychiatrist, the court will appoint a physician to examine him.  The examining physician or nurse then files a report with the court containing an opinion about the need for a guardianship and whether the alleged incapacitated person is incapacitated.   At the hearing, the judge decides if a guardian is necessary.  If so, the judge decides if the Petitioner is a suitable candidate.  

Before being appointed as a guardian or a conservator, the Petitioner must submit a sworn affidavit stating whether the Petitioner has ever been convicted of a felony in any jurisdiction, stating the Petitioner’s relationship to the proposed ward, and whether the Petitioner has ever been removed from being a guardian or conservator.  Other information is required to be in the affidavit, but these are some of the key issues.  

Duties and Requirements of the Guardian

Being a guardian means you are accountable to the court for everything you do and all the decisions you make.  Basically, the guardian of an incapacitated adult has all the same rights, duties and obligations that a parent of a minor child has.  The incapacitated adult is referred to as a “ward” of the guardian.  The guardian is entitled to custody of the ward and to make decisions about where the ward will live.  That includes the right to place the ward in a group home or institutional setting.  The guardian is obligated to take reasonable care of the ward’s possessions and to secure appropriate medical care, psychological care and social services for the ward.  The guardian makes medical decisions and consents to medical procedures or services needed by the ward.  The court may require the guardian to be bonded, depending on the relationship and circumstances.

Every year, the guardian must submit a report to the court.  The report, which is also sent to family members and the ward’s attorney, must contain detailed information about the ward’s health and condition, where the ward lives, how often the guardian sees the ward, a report from the ward’s physician or nurse practitioner, changes in the ward’s condition and other information. If the guardian is handling Social Security or other income, he or she will need to account for how the money was spent.   If the guardian no longer wishes to serve, or if the guardian becomes incapacitated or dies, the court will address the issue of a replacement.

Petitioning for and Handling a Conservatorship

A conservator has all the same duties and obligations as the Trustee of an Estate.  (A.R.S. §14-5417).  The Petition and notice provisions are similar to those for a guardian.  (A.R.S § 14-5404 and 14-5405). The court’s criteria for appointing a conservator are different from the criteria for appointing a guardian.  The court must determine if the subject of the Petition is unable to manage his or her estate and financial affairs effectively because of mental or physical illness, drug or alcohol addiction, incarceration, detention by a foreign power, or disappearance.  If the person is incapacitated, missing or incarcerated and that person’s property will be dissipated or wasted without a competent manager, the court will likely grant a Petition for Conservatorship.  The conservator may be a family member, someone appointed in writing when the protected person was competent, a bank, a public fiduciary or other financial entity.

The Petitioner must supply the court with a full set of fingerprints and allow the court to perform a background check.   The Petition for Conservatorship requires detailed information about the subject of the Petition, and about the Petitioner’s interest in becoming a conservator.  It also requires information about the estate the Petitioner is seeking to protect.  Notice must be given to all interested parties.  The court will appoint an attorney to represent the subject of the Petition and may have the subject examined by a physician or mental health professional.  An investigator is also appointed to interview the subject and, perhaps, family members and friends.     The subject is entitled to be present at the hearing and to testify or cross examine witnesses. If the court grants the Petition, the new conservator files papers accepting the role of conservator and gets Letters of Conservator that authorize him or her to handle all the protected person’s financial affairs.

Once a conservator is appointed, the court assumes the role of monitor by requiring accounting reports from the conservator every year.  Unless the conservator is a bank or other financial institution, the court will likely require the conservator to furnish the court with a bond.  The conservator must be bonded for the aggregate value of the protected person’s estate.  If the conservator mishandles the estate, the bond will be used to reimburse the protected person.  Professional conservators like banks, lawyers or fiduciaries are entitled to seek compensation for their services.  The amount of compensation is determined by the court.  Family members may ask to court for compensation, but the request is seldom granted unless the estate is large and complex.

Within 90 days after appointment, the conservator must submit an inventory of the estate to the court.  The inventory needs to be detailed and contain the fair market value of each asset.  Then, each year after appointment, the conservator submits an annual report to the court.  The annual report must describe all activity in the estate over the previous year.  It must list property and investments bought and sold, gains and losses, improvements made to real property, etc.  

The protected person or other interested parties may petition the court to terminate the conservatorship.  The court will conduct a hearing and decide if the protected person has recovered from his or her disability and is now capable of managing financial affairs.  This may happen when an alcoholic or drug addict goes into recovery and remains sober.  The conservatorship may also be terminated by court procedure if the protected person dies. If conservator dies or becomes incapacitated, or if the conservator no longer wishes to serve, a substitute may be appointed by the court.