Protecting Assets of the Elderly or Disabled with a Conservatorship

A Conservatorship is a legal process, which gives authority over a loved one’s finances and business affairs. The person who is the caretaker is called the conservator, and the person who is being taken care of is called the conservatee.

While a valid power of attorney document can authorize the power of attorney holder to accomplish some of a conservator’s tasks, it cannot prevent the ill person from contracting, conveying property or marrying. For example, a patient with Alzheimer’s disease may become subject to fraud from unscrupulous persons. He or she could have given a valid power of attorney while still able, but then married and give property to a new spouse. In this situation, the probate code provides that a Conservatorship may be established, and the conservator may ask the court to set aside any contract entered into by the ill conservatee. The advantage of the Conservatorship is that it can safeguard against fraud and protect the privacy and the assets of the ill person.

The establishment of a Conservatorship has three basic effects:

• It shifts the responsibility of making financial and personal care decisions from the disabled individual to the Court appointed conservator.
• It imposes significant limitations on the ability of the conservatee to take actions affecting finances or personal care.
• It provides a certain degree of protection for the conservatee’s interests from fraud, misappropriation of funds or neglect.

Courts will only grant a Conservatorship if you cannot take care of yourself or your affairs and if you have made no arrangements for your care. If you have made adequate provisions, the court will not disturb your arrangements. Thus, a properly prepared estate plan can enable you to avoid a Conservatorship proceeding over you or over your estate.

Conservatorship proceedings can be very expensive and the cost of the legal proceedings and the cost of paying a Conservator are taken out of your assets, assets you might need for your care. Compared to the cost of a Conservatorship proceeding, the cost of planning ahead with a good estate plan is money well spent. But, if you did not plan ahead, at least this vehicle exists for the court to make sure someone is appointed to protect your interests.

Case Studies: Protecting Elderly and Disabled Individuals

Case Study 1: Safeguarding John’s Assets From Financial Exploitation

John, an elderly individual diagnosed with Alzheimer’s disease, fell victim to fraudulent activities despite having a valid power of attorney. He remarried and transferred property to his new spouse. A Conservatorship was established to protect John’s assets and set aside any contracts entered into during his vulnerable state.

Case Study 2: Ensuring Financial Security for Sarah, a Disabled Individual

Sarah, unable to manage her own affairs due to a disability, had made no prior arrangements for her care. Through a Conservatorship proceeding, the court appointed a conservator to safeguard Sarah’s interests and allocate the necessary resources for her well-being.

Case Study 3: Preserving Mark’s Estate and Interests

Mark, an elderly individual with no estate plan in place, faced potential financial risks and loss of privacy. To avoid a costly Conservatorship proceeding, Mark engaged in comprehensive estate planning, allowing him to maintain control over his assets and ensure his interests are protected.