What you need to know: Guardianships & Conservatorships

When an individual loses their ability to make their own decisions regarding their personal and financial affairs, Michigan law allows for the appointment of a guardian or conservator, or both, to make decisions for an individual in need. Guardianships and conservatorships are appointed through the probate court. The process and requirements for establishing a guardianship and conservatorship are similar. For a guardianship, the court first needs to establish that the individual is incapacitated. MCL 700.1105(a) defines this as an individual who is impaired by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication, or other cause, not including minority, to the extent of lacking sufficient understanding or capacity to make or communicate informed decisions. The court will also need to find that it’s necessary that the incapacitated individual is provided care and supervision on a continuing basis. For a conservatorship, the court must find either that the individual is unable to manage property and business affairs effectively for reasons similar to those listed above or that the individual has property that will be wasted or dissipated unless proper management is provided, or money is needed for the individual's support, care, and welfare (MCL 700.5401).

What is the difference?

In a guardianship, the guardian is appointed to make personal care decisions for the incapacitated person such as for medical treatment and living arrangements. In a conservatorship, the conservator is appointed to manage the financial affairs of the individual. In a guardianship, the person being protected is referred to as a “ward,” in a conservatorship; this person is referred to as a “protected individual.” It’s important to know that a guardian will be able to make end of life treatment decisions for the ward such as placing a “Do Not Resuscitate” order on the individual. The conservator will have all powers over the protected individual’s estate and business affairs.

Is the appointment of a guardian or conservator always necessary?

Seeking out a guardianship or conservatorship should not be the first step when someone is having difficulty in managing their personal or financial affairs. It’s important to analyze the specific facts and circumstances surrounding that individual and decide on the best course of action. Things to consider would be whether the individual would benefit from a limited guardianship or conservatorship, where the guardian or conservator would only manage certain specified aspects of the individual’s affairs. Also, consider whether the individual has already executed a financial or medical power of attorney that appoints someone to manage their health care or finances on their incapacity. The individual may already be receiving care from family members and friends who are adequately assisting them with their daily affairs. Further, it’s not always necessary that both a guardian and conservator be appointed if one or the other is sufficient. Perhaps an individual needs someone to make personal care decisions but has no significant assets; in this case a guardianship may only be necessary. Alternatively, an individual may have significant assets in need of managing but otherwise is being properly cared for; in this case a conservator may only need to be appointed. It’s important to consider the least restrictive means when deciding on how to best protect an individual in need.

If I’m a guardian or conservator, what do I have to do?

The duties for guardians and conservators are different but there are similar aspects. Both a guardian and conservator are considered fiduciaries, meaning that they have a duty of trust and confidence with respect to the individual they are protecting. A guardian is primarily responsible for the ward’s care, custody, comfort, maintenance, and medical care, MCL 700.5314. They also have a duty to consult and visit the ward on a regular basis. A conservator is responsible for managing the assets of the protected individual as well as keeping accurate records of their finances. Shortly after being appointed, the conservator must report an initial inventory to the court listing all the assets and values of the protected individual. Both a guardian and conservator have ongoing duties to report to the court annually regarding the individual’s current personal and financial condition. Before agreeing to be a guardian or conservator, it’s important to review and understand all the duties required and be willing to comply with them.

Conclusion

Guardians and conservators are appointed by the probate court when an individual cannot make their own decisions regarding their personal and financial affairs. Remember that guardians are appointed to manage an individual’s personal care decisions and conservators are appointed to manage a person’s financial affairs. The appointment of a guardian or conservator is not a “one size fits all” solution for an individual needing help managing their affairs. It’s important to consider the person’s specific needs when taking action. If agreeing to become a guardian or conservator for someone, make sure you understand all the duties involved and be willing to comply with them. If you have questions about guardianships or conservatorships, contact Eric M. Froats, estate planning attorney, at Cline, Cline & Griffin,P.C.