In a guardianship, the probate court grants a "guardian" the legal ability and obligation to act for another individual, called the "ward."  The guardianship is created because the ward lacks the legal capacity to act for himself or herself.  This inability may be due to incompetence (either mental or physical), or age (for minors who have no suitable parent to care for them).  This article provides an overview of the different types of guardianships, how they are administered, and how estate planning can be used to minimize the costs normally associated with guardianships.

Q.: Who may serve as a guardian?
A.: Any mentally competent adult who is "interested" in the ward's estate may serve as a guardian.  Typically a close family member or individual who has some relation to the ward will ask the probate court to appoint him or her as a guardian.  The court may appoint a guardian if no one comes forward.

Q.: What is the role of the guardian?
A.: The role of the guardian depends on the type of guardianship established.  Under Ohio law, there are two types of guardianships: a guardianship of the person and a guardianship of the estate.  The guardian of the person must ensure that the ward's health and person (i.e., maintenance) are protected.  The guardian of a minor also will see that the ward receives a proper education.  The guardian of the estate must ensure that the ward's assets are protected, that the ward's debts are appropriately paid, and that the ward's estate is managed in accordance with the law.  An individual may be appointed as guardian of the person and estate at the same time.

Q.: Is it possible to have a limited guardianship?
A.: A guardianship may be general or limited.  Limited guardianships restrict the actions and decisions that the guardian may make on the ward's behalf.  For example, the court may limit a guardian's duties to caring for a minor only until the minor's parent returns from an extended hospital stay.

Q.: My mother is getting older and has been diagnosed with Alzheimer's.  How do I apply to be her personal guardian and the guardian of her estate?
A.: Although each county probate court will have its own local rules governing guardianships, you must make a general application in the probate court of the county where your mother lives.  On the application, you must explain why you think you should be appointed guardian and provide information about your mother and yourself.  A statement from your mother's physician also must accompany your application.  Your mother will be notified that you have applied to become her guardian, and a court-appointed investigator will visit her to discuss the guardianship.  After the investigation, a probate judge or a magistrate will ask you and your mother to appear at a formal hearing, although your mother need not be present if there is a good reason that she cannot attend.  After weighing the evidence, the court will decide whether a guardianship is appropriate.  If you are appointed, you probably will be required to post a bond to guarantee that your mother's assets are protected.

Q.: What would my role be once I'm appointed my mother's guardian?
A.: Shortly after you are appointed as guardian of your mother's estate, you will have to file with the probate court a written inventory detailing your mother's assets and recurring expenses.  You will need the court's approval to make any payments on your mother's behalf.  Recurring monthly expenses can be approved in advance, thereby avoiding monthly filings to pay utility bills, etc.  As a guardian of your mother's person, you also must file a written report (typically every two years) to report on your mother's physical and mental status.  If you do not file this report and other necessary paperwork, the court may provide monetary sanctions or even remove you from your position as guardian.

Q.: Will I receive any payment or compensation for serving as a guardian?
A.: Each local court may set a fee schedule for the guardian, who is usually entitled to fees for the service provided.  If you employ an attorney to assist with the court filings and hearings, the court also must approve the fees to pay the attorney out of the ward's estate.  The court must approve each fee before it is paid.

Q.: When does a guardianship end?
A.: A guardianship will end based on the circumstances under which it was created. When a minor reaches the age of 18, the guardianship will be ended and the ward will receive any assets that the guardian may have held.  Similarly, a guardianship may end when a person dies.  A guardianship for an incompetent person will end when the court rules that the ward is no longer incompetent.

Q.: I'd like to plan ahead for my parents in the event that they are no longer able to care of themselves.  Is there a better alternative than a guardianship?
A.: A guardianship is an excellent way to ensure that a person's personal needs are met and that the ward's assets are protected.  The fact that the court monitors the administration of the guardianship helps ensure that matters are handled in an efficient and orderly manner.  Nonetheless, because guardianships are matters of public record, you may wish to avoid the need for one.  Likewise, your parents may wish to avoid paying a guardian and an attorney.  Accordingly, they should consider one of two generally accepted guardianship alternatives: (1) a living trust, and (2) durable powers of attorney.

If your parents set up a revocable living trust, whomever they name as the trustee of that trust will be able to manage any trust-owned assets.  Accordingly, if your parents were to transfer (or fund) their own trusts during their lifetime, the trust assets may be used for their benefit without the need of court supervision.  This is a highly desirable feature especially if, for instance, you or another close family member is named as successor trustee.  In such a case, the trust assets can be used to meet your parents' needs until the assets are exhausted.

Likewise, your parents may wish to use powers of attorney to ensure that their assets and health care are managed.  Through a health care power of attorney, your parents will name an agent to make health care decisions on their behalf, and without court supervision, if they become incapacitated.

Through a durable general power of attorney, your parents can name an agent to handle legal and financial affairs on their behalf both before and after they become incapacitated.  This is a useful feature, especially for those who do not have funded living trusts.  The agent will see that your parents' legal and financial needs are met, but will not have a duty to account to the court.  If your parents decide a living trust is useful, they also should have a health care power of attorney and a financial power of attorney to address what is not covered through the living trust.

1/5/2007

Law You Can Use is a weekly consumer legal information column provided by the Ohio State Bar Association (OSBA).  This article was prepared by David W. Woodburn, an attorney with the Akron office of Buckingham, Doolittle & Burroughs, LLP.