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Drafting effective guardianship orders

In any proceeding requesting the appointment of a guardian and/or conservator, the final order entered by the court must meet certain basic statutory requirements, and should also address any particular circumstances that may affect the scope of the fiduciary’s duties and responsibilities.

Since the statutory framework supports the imposition of the least restrictive alternative, there can be considerable variation in the powers granted to the guardian, the management and decision-making powers retained by the respondent, and the rights preserved or relinquished by the respondent.

Under Virginia Code § 64.2-2009, the court order of appointment shall: “(ii) Define the powers and duties of the guardian or conservator so as to permit the incapacitated person to care for himself and manage property to the extent he is capable.

The Virginia guardianship statutes specifically allow for the appointment of a limited guardian, Code § 64.2-2009, and specifically require a guardian to “encourage the incapacitated person to participate in decisions, to act on his own behalf, and to develop or regain the capacity to manage personal affairs.” Code § 64.2-2019(E). To the extent that the respondent is capable of making some decisions about his personal affairs, the power to make those decisions should remain with the respondent and this should be spelled out in the order of appointment.

The general powers and duties of the guardian are set out in the definitions section of the guardianship statutes (Code § 64.2-2000) and in Code § 64.2-2019. If the petitioner anticipates that the guardian will need one or more of the specific powers requiring specific court permission – i.e., revoking or altering a durable power of attorney, modifying the designation of an agent under an advance medical directive, changing the respondent’s residence to another state, or initiating a change in the respondent’s marital status – that court permission should be contained in the final order appointing the guardian. In drafting the final order, any other powers or authority that will be necessary to the effectiveness of the guardianship should be specifically articulated: the authority of the guardian, beyond the general language of § 64.2-2019, is restricted to “only those powers enumerated in the court order.” Code § 64.2-2011(C). The Guardian could, for instance, be specifically authorized or requested or ordered to keep other family members reasonably informed as to the care and treatment planning of the respondent.

If the guardian is to be given the authority to do a voluntary civil commitment of the respondent under Code § 37.2-805.1, that authority must be expressly granted in the order of appointment, and must be based on a finding “by clear and convincing evidence that (i) the person has severe and persistent mental illness that significantly impairs the person’s capacity to exercise judgment or self-control, as confirmed by the evaluation of a licensed psychiatrist; (ii) such condition is unlikely to improve in the foreseeable future; and (iii) the guardian has formulated a plan for providing ongoing treatment of the persons illness in the least restrictive setting suitable for the person’s condition.” Code § 64.2-2009(C).

The powers of the conservator are spelled out in more detail in the statutes, and include all of the powers set forth in Code § 64.2-105 (formerly § 64.1-57) as well as additional itemized powers and duties set forth in Code §§ 64.2-2021 and 64.2-2022. The conservator, like the guardian, is required to “encourage the incapacitated person to participate in decisions, to act on his own behalf, and to develop or regain the capacity to manage the estate and his financial affairs.” Code § 64.2-2021(C). The statutory powers should be referenced in the order of appointment, but need not be repeated. If any of these statutory powers are to be limited, that must be set out specifically in the order. Code § 64.2-2011(C). If the respondent’s assets include real estate, a specific designation should be made in the order with respect to the conservator’s power to sell the real estate, either with or without further court authorization. If the conservator is given the power to sell real estate, the conservator is responsible for recording the order of appointment in the jurisdiction where that real estate lies. Code § 64.2-2011(B).

The conservator does not have the authority to make gifts from the respondent’s estate in excess of $100 to each donee or $500 in a calendar year, or to make a disclaimer of inheritance on behalf of the respondent, unless that authority is specifically granted in the order of appointment. Code § 64.2-2023. If the order does not specifically authorize the conservator to take these actions, the conservator must institute a separate proceeding to obtain that authority. The separate proceeding requires the appointment of a guardian ad litem for the respondent, notice to heirs or beneficiaries “who would be substantially affected by the proposed gift or disclaimer.” Code § 64.2-2023.

If there are additional powers that are necessary to the effectiveness of the conservatorship, those must also be specifically set out in the order. The conservator could, for instance, be specifically authorized or requested or ordered to investigate any previous financial dealings affecting the respondent that may have been carried out by other family members or third parties, and to take action or request permission of the court to take action based on such investigation.

The petitioner must also give consideration to whether the incapacity of the respondent is likely to be permanent, or whether there is a sufficient likelihood of change in the level of incapacity that the court should revisit the imposition of a guardian and/or conservator at some time in the future. If the incapacity is the result of a traumatic event, for instance, the physician’s evaluation may indicate that the respondent’s condition is likely to improve over the course of the next year. In this situation, it would be appropriate to include in the Order of Appointment language indicating that the matter should be reviewed by the court in a year’s time. If the incapacity is based on a psychiatric disability, the physician’s evaluation may indicate that the prognosis for improvement is good if the respondent receives appropriate treatment. This would also warrant a review of the guardianship or conservatorship after a period of time sufficient to determine whether there has been improvement. The guidance on whether the matter should be set for review at a later date must come from the evaluation report, which is required to contain a prognosis for improvement.

If the incapacity of the respondent is permanent, or the result of a progressive debilitating disease, then the order should so state and the fiduciary appointment will not be for a limited period of time.

If the order indicates that the matter should be reviewed in the future, the petitioner should determine whether the court is placing the matter on the docket at the time the order is entered, or whether the responsibility for scheduling a re-hearing is on the petitioner and/or the fiduciary.

– By Margaret A. O’Reilly, CELA

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