Both a guardianship and a durable power of attorney are tools that allow for someone to to protect the interests of person unable to act for themselves. Under both, the person exercising power owes a fiduciary duty to the incapacitated person to act in their interests. However, these tools differ in important, meaningful ways.
A guardianship is granted through and supervised by the courts. Due to the extensive legal regulations involved, many states require that someone applying for a guardianship be represented by an attorney. Typically, a relative of an incapacitated person will start guardianship proceedings by filing a petition for guardianship in the probate court. The petition generally must include a list of witnesses and medical evidence from a physician to support the need for a guardian. Beginning the process of filing for guardianship, collecting the necessary evidence, and going through the court proceedings can take a significant amount of time and cost before a guardianship can be finalized.
Even after the granting of the guardianship, the court continues to supervise the operation of the guardianship The guardian must periodically provide reports, accountings, and inventories of all the ward’s assets to the court in addition to performing their duty as guardian.
If the guardianship is granted, the incapacitated person is declared incompetent, to a certain degree. As a result, the ward may lose rights such as the right to drive and the right to vote. Some states may allow for more limited forms of guardianship that may not result in the full loss of the ward’s rights.
Ultimately, the guardian has the authority to act on behalf of the ward in the areas where the ward was found incompetent.
The procedures around a durable power of attorney are much less strenuous, however, there are limitations that people should keep in mind.
Under a durable power of attorney, a person chooses, in advance, who will protect their interests in case of an incapacity. This contrasts with guardianship where no requirement exists that the ward gets to decide who serves as guardian.
An important limitation of a potential durable power of attorney is that the person must have legal capacity to execute the document when the document is drafted and signed. Once the person loses capacity, the option for choosing a durable power of attorney instead of guardianship goes away.
Since different states have different requirements for a durable power of attorney, a durable power of attorney must be drafted by an experienced elder law attorney in the relevant state. The durable power of attorney should be carefully drafted by an attorney for a person’s specific situation.
Additionally, the scope of the authority granted can also be drafted to meet a person’s particular needs and wishes. The power granted could be relatively narrow to equally as powerful as the powers of a full guardianship. The document can also specify when the powers granted become effective.
A durable power of attorney also does not require the ongoing court supervision that exists under guardianship. This greatly reduces the additional time, cost, and effort required under a durable power of attorney compared to guardianship. However, the lack of direct court supervision also increases the potential for dishonest dealings by the person acting with a durable power of attorney going undetected.
Another limitation of a durable power of attorney is that even with a valid durable power of attorney in place, another relative could still initiate guardianship proceedings that could result in the appointment of a guardian other than the person specified in the durable power of attorney. To potentially prevent this from occurring, individuals with a valid durable power of attorney should discuss their wishes with family members to clearly convey their choices and avoid family conflict in case of a potential incapacity.
To discuss either creating a durable power of attorney to protect yourself from a potential incapacity or to seek a guardianship to protect the interests of a relative, please call Martha C. Brown & Associates at (314) 962-0186.