There are a wide range of opinions when it comes to issues related to guardianship for incapacitated adults. While most people recognize how important it is that minors and developmentally-challenged persons have someone to represent their interests, there are many who view these guardianships as less than an ideal solution for adults who have been incapacitated due to injury or illness. The fact is that there are other solutions that can help you to avoid the need for guardianship during periods of incapacity, but you need to understand your options before you can make the right choices.
What is Incapacity?
Incapacitation for guardianship purposes refers to being legally unable to manage your own affairs. For some patients, it occurs due to an accident that renders them unable to communicate their wishes or render decisions. For others, it can be due to a sudden illness that leaves them in a state of incoherence or non-responsiveness. It can even be the result of a more prolonged and steady deterioration of mental capacity – as occurs with patients suffering from Alzheimer’s and dementia.
Incapacitated individuals are legally unable to make decisions about their own medical care, financial management, or other important legal and lifestyle matters. That can place family members in an awkward position, since the patients cannot direct their own care or even deal with basic financial matters. Unfortunately, the patient’s family members don’t automatically have any ability to help with those decisions, unless prior arrangements have been made.
What Happens to Assets During Incapacity?
On the financial front, incapacity can have dire consequences. Investments can go unmanaged, resulting in losses that might not have otherwise occurred. This holds true for investment types ranging from real estate to stocks and bonds. In addition, bills may go unpaid, and debts can quickly pile up. Business concerns may be neglected, particularly in cases where the patient is operating a sole proprietorship and there is no clear line of business succession to maintain uninterrupted operation of the company. And since the patient is unable to work, there is no replenishment of lost wealth.
What is Guardianship and When is it Necessary?
Guardianship is a court-supervised process that appoints another party to serve as your representative when you can no longer manage your own affairs. The court can provide that guardian with limited powers to handle only certain tasks and responsibilities, or broad authority to make decisions about your medical and financial needs. As a rule, courts have tried to exercise restraint during guardianship proceedings, since there is a general presumption that the goal is to facilitate as much independence for the incapacitated individual as possible.
Typically, these proceedings are initiated at the behest of family members. In most instances, it is a family member who files for guardianship of a loved one, after it becomes clear that the incapacitated person has no other means for handling his or her affairs. The court considers the filing, calls of evidence of incapacitation, and then reviews possible options for naming a legal guardian. While close relatives are often preferred, the judge is free to name whoever he thinks would make the best guardian for the ward.
Are There Drawbacks to Guardianship?
There is natural reluctance to guardianship, and with good reason. As important as the process can be for protecting certain individuals’ interests, such protections do not come without a cost. In fact, there are several critical disadvantages to guardianship, including:
- Guardianship can be expensive. There are court costs and legal fees to be considered. Guardians themselves may be entitled to compensation for their efforts. And since many guardianships can last for years, those costs can add up over time. For incapacitated persons and their families, it is worth noting that the ward’s estate is responsible for shouldering those costs. Over the course of many years, this burden can eventually consume all but the largest of estates.
- Guardianship involves the loss of certain rights and privileges. For example, an incapacitated person is no longer allowed to vote, sign contracts, or exercise similar rights that require legal competence. Many are not allowed to drive, or exercise similar privileges that could place them or others at risk.
- There’s no guarantee that the guardian will be someone that the patient would have chosen if he had selected his own personal agent. And since courts seldom have all the information they would need to make a perfect decision, this can lead to unreliable guardianships – or even abusive situations in which wards are mistreated or even defrauded.
How Can You Avoid Guardianship?
Of course, guardianship doesn’t have to be your only option to deal with incapacitation. In fact, these guardianship proceedings can be avoided altogether with an effective incapacity plan. To be successful, your plan needs to be in place prior to your incapacitation, and should include the following components:
- A durable financial power of attorney to designate an attorney-in-fact to act in your stead for financial matters. This person can be authorized to do everything from signing checks to investing your securities.
- An advance directive for health care that provides instructions for your medical care. You can also choose to appoint a proxy to act on your behalf when health care decisions need to be made.
- A living will that outlines the type of life-sustaining treatments you are willing to accept.
- HIPAA forms to ensure that the right people can gain access to your medical information when you become incapacitated
If you already have an estate plan and haven’t yet decided to prepare an incapacity plan, the need to avoid guardianship should serve as a powerful incentive to get that planning done. With the help of an experienced incapacity planning attorney, you can create the strategy you need to ensure that your decision-making is protected should anything happen to you. At Michigan attorneys Biddinger & Estelle, PC, our team can help you with incapacity plans that will protect your interests, your family, and your estate from the most negative consequences associated with unwelcome guardianships. To learn more about how we can assist you with solid incapacity plans that protect your future, contact us online or call us today at (989) 872-5601.