If you become physically or mentally incapacitated due to injury or illness, who will act on your behalf? Without a health care proxy (HCP), who will consent to surgical procedures for you? Without a living will, how will your doctor know your preferences with regard to end of life decisions? Without a power of attorney (POA), who will handle your finances? How will your relatives access your accounts?
If you have executed a HCP or POA, your appointed agent could act immediately for you. If you can trust an agent to act responsibly, these documents will assist you. Because you require mental capacity to execute them, you should execute them before an emergency occurs.
Too often, however, people do not plan for emergencies. They may lose capacity suddenly in an accident or gradually due to a medical condition. Regardless, family members are left to cope with a crisis. Family members may disagree about what to do. They may not know your wishes. Third parties may be unable or unwilling to deal with people who cannot provide legal documentation. Your banker will not be able to or know how to sort out a family feud.
Without an agent, usually, someone must petition the court for a guardianship on behalf of the allegedly incapacitated person (“AIP”). New York’s Mental Hygiene Law (Article 81) contains the procedure.
A principal can promptly execute a POA or HCP in an attorney’s office or one’s home, but obtaining a guardianship requires judicial intervention and is much more time consuming and expensive. Because a guardian seeks to exercise powers that impact the AIP’s liberty and property, the AIP must be afforded due process.
The petitioner must allege details about the AIP’s incapacity, family tree, assets, and income. The petitioner may seek temporary relief to handle a specific personal or financial task on the AIP’s behalf (e.g., handling a brokerage account containing speculative securities). The petitioner may seek injunctive relief to prevent the AIP from doing irreparable harm to himself or his property if he cannot appreciate the risk (e.g., signing the deed of his house over to a fraudster).
The petitioner files court documents, and the guardianship clerk presents them to the judge. If the papers are satisfactory, the court will appoint a court evaluator and set a hearing date. The evaluator is a disinterested appointee – often, an attorney. The evaluator visits the AIP, speaks to the AIP’s attorney (if he has one), interviews family members, and examines records. The evaluator reports to the court and recommends whether it should appoint a guardian.
An AIP may contest the proceeding. If the AIP does not have an attorney, the court can appoint one. A third party can join the proceeding.
Unless the AIP cannot participate in the hearing in a meaningful way (e.g., due to illness or incapacity), the court expects the AIP to participate. If necessary, the court will schedule the hearing in the AIP’s home or room in a hospital or nursing home.
To obtain a guardianship, the petitioner must meet a relatively high burden of proof (i.e., clear and convincing evidence). This is higher than a “preponderance of the evidence” but lower than “beyond a reasonable doubt.” The petitioner presents evidence, the evaluator submits a report, and the AIP may respond. The court may question the AIP and witnesses, including medical professionals. If the court concludes a guardianship is appropriate, the former AIP will then be referred to as the “incapacitated person” (“IP”) or ward. The ward is no longer allegedly incapacitated because incapacitated would have been proved.
The court will design the guardianship to meet the ward’s specific needs and circumstances. It may cover the ward’s person, property (or a portion of it), or both. The court may grant the guardian less comprehensive powers than the principal may have granted to the agent under a power of attorney. This is important because a guardian or agent will need comprehensive powers to handle sophisticated estate planning and Medicaid planning.
The court may require the guardian to be bonded by a surety company. The agent will have to take a guardianship course approved by the court and report to the court every 90 days. One of these reports is an annual report. In contrast, an agent appointed under a POA does not need to (i) be bonded, (ii) take a course, or (iii) report to the court.
While, the court prefers that a family member serve as guardian, it is not always possible or practical. After the guardian satisfies the legislative and judicial requirements, the court will issue a commission that states the guardian’s authority to act. It is similar to letters testamentary in a probate proceeding and letters of administration in an administration proceeding. If the guardian must close the ward’s accounts and open guardianship accounts, banks and brokerage houses will want to see the commission.
It is quicker, less expensive, and less stressful to sign a POA, HCP, and living will than it is to obtain a guardianship. If you need to obtain or contest a guardianship, need an estate plan, or have to administer an estate, contact The Berson Firm, P.C. to discuss your options.
* Note – Bryan L. Berson, Esq. has taken the Article 81 – Court Evaluator and Guardianship Training approved by the New York court system.
About the Author: Bryan L. Berson, Esq. is an attorney and mediator at The Berson Firm, P.C., a commercial and civil law firm that handles estate administration and planning, real estate, commercial transactions, mediation, and commercial litigation. His e-mail is bberson@bersonfirm.com. His phone number is (631) 517-1055. Connect with The Berson Firm on Facebook and Bryan L. Berson on LinkedIn. The firm’s website is www.bersonfirm.com.
Disclaimer: Constructive Knowledge is published by The Berson Firm, P.C. (the “Firm”). The information contained in this column is provided for informational purposes only. It is not tax or legal advice on any subject matter. No readers, clients or otherwise, should act or refrain from acting on the basis of any content without seeking appropriate legal or other professional advice with respect to one’s particular circumstances. This column reflects a general discussion of the law in New York. It may not accurately reflect the law of other states. The content is general information and may not reflect current legal developments, verdicts, or settlements. The Firm expressly disclaims all liability with respect to acts taken or not taken based on any or all content of this column. This column is Attorney Advertising. IRS Circular 230 Legend: Nothing in this column is intended to be used and cannot be used to avoid U.S. federal, state, or local taxes. It was not written to promote, market, or recommend any tax planning strategy or action. Copyright: All rights reserved. No part of this publication may be reproduced without prior written consent. Readers may share this column through, but not limited to, social networks.
Berson Firm's Constructive Knowledge 
[…] an incapacitated person previously executed a durable or springing power of attorney, someone must petition the court for a guardianship. This is expensive and takes time. The extent of the agent’s powers will depend on the judge’s […]
[…] Health care proxies (“HCP”) and living wills are advance directives. They explain one’s wishes about medical decisions and treatment. A principal can revoke them up until the time the principal becomes incapacitated. Advance directives provide binding instructions about treatment. In the absence of an advance directive, the person’s wishes may not be respected, and someone may need to petition the court for a guardianship to make decisions for the incapacitated pe…. […]
[…] the prospect of working with new owners or the caretakers of disabled owners. Outsiders include guardians, estate representatives, heirs, bankruptcy trustees, angry former spouses, and creditors. An […]
[…] Without a POA, if a person becomes incapacitated, a potential guardian must ask the New York Supreme…. A POA saves a lot of time and money that would otherwise have to be spent on judicial process. A competent principal can revoke a POA or execute a new one. People should execute POAs while they are healthy – before emergencies affect judgment and capacity. […]