Beginning January 1, 2018, Public Act 17-136 allows the guardian of a person with intellectual disability to manage that person’s assets if the assets do not exceed $10,000 in value. The guardian files a petition with the probate court where the protected person resides to obtain such authority. Under prior law, guardians of intellectually disabled individuals were not allowed to assist protected persons with their finances.
Upon receiving the guardian’s petition, the court will give notice of the petition to interested parties. The court will send the notice of the petition to the protected person and the protected person’s spouse, if any. The court will also send notice to the protected person’s parents or children. If the protected person’s parents are deceased, the court must send notice to the protected person’s siblings. If the protected person lives in a facility, the court will notify the person in charge of the facility.
The probate court will also order the Department of Developmental Services (hereinafter “DDS”) to conduct an assessment to determine whether the protected person is able to manage his or her finances. After DDS conducts its assessment, it drafts a report which is then furnished to the Court and all interested parties. Once DDS files its report, the probate court will schedule a hearing on the guardian’s petition.
At the hearing, the court must receive evidence with respect to whether the protected person can manage his or her finances. As with any other proceeding before the probate court, the protected person has the right to be represented by counsel and he or she also has the right to attend the hearing. Nevertheless, the court can exclude the protected person from the hearing if it finds that the testimony or evidence presented would be detrimental to the emotional or mental well-being of the protected person.
For the court to order that the guardian has authority to manage the protected person’s assets, the court must find by clear and convincing evidence that the protected person has no more than $10,000 in assets and that they are unable to manage their finances. The term “unable to manage their finances” means the inability of a person with intellectual disability, to receive and evaluate information or make or communicate decisions to such an extent that the person is unable – even with assistance – to manage his finances. Thus, if the court finds that the intellectually disabled person can manage the assets with the assistance of others, the court will not grant authority to the guardian to manage the assets.
What if the protected person’s assets exceed $10,000? The Court cannot appoint the guardian to manage the funds. Instead, the guardian or another interested party must file a petition for appointment of a conservator of the protected person’s estate. A conservatorship proceeding involves a physician’s evaluation and other requirements making it a more formal proceeding.
What if the guardian is granted authority to manage the protected person’s assets but through inheritance or other means the value of the assets increase beyond $10,000? The guardian has 30 days to inform the Court in writing that the value of the assets exceed the $10,000 limit. The Court will then decide whether the guardian’s authority should be terminated or extended and whether it then becomes necessary to appoint a conservator in place of the guardian.
The new law incorporates certain safeguards to insure that the guardian is acting as a reasonably prudent person. For example, the court can order the guardian to post a bond to secure his faithful performance. In addition, the guardian must file an Inventory of the protected person’s assets within 60 days of his appointment. Finally, the guardian must file periodic accounts with the Court at least once every three years (or more frequently, if required by the Court).
If you have questions related to the new law giving guardians the power to manage assets or about probate matters generally, please don’t hesitate to call the estate planning and probate attorneys at Cipparone & Zaccaro, PC.
