Liza Horvath, Senior Advocate: An alternative to conservatorship

By Liza Horvath

Question: After the Britney Spears situation shined a light on the powers that a court appointed conservator has and how easy it would be to abuse someone by getting a conservatorship, I am lying awake at night worried sick that if I lose even a little capacity, someone could get a conservatorship over me and steal all my money and even control where I live. I have also seen the movie, “I Care a Lot” where a professional woman took advantage of elderly people by using conservatorships, stripping their assets and placing them in nursing homes! What can the average person do to protect themselves against this happening? Who can I trust?

Answer: The situations you share, the highly publicized Britney Spears case and that movie which, I am sorry to say, was based on true events, do present nightmarish situations. I understand your worry.

Before addressing your concerns, however, it should be noted that some court conservatorships are often desperately needed and are the right solution for certain situations. I had the situation where a client was losing capacity and continued to borrow money from friends and then demand that I pay them back from her trust funds. The lenders could have brought suit against her for the funds absent a conservatorship – which is what we eventually put into place. We of course paid back the loans and I admonished her friends not to lend her any more money. The conservatorship protects someone like this against future lawsuits for her actions.

Conservatorships can be cumbersome, however, and due to the court’s involvement, are public in nature. They are expensive, restrictive and invasive. Having a trust, power of attorney for finances and an Advance Health Care Directive in place can obviate the need for a court conservatorship. Good estate planning is your first line of defense.

On Jan. 1, California adopted Assembly Bill No. 1663 which makes reforms to probate and conservatorship law and offer a less-restrictive alternative by way of “Protective Proceedings.” According to an article written by Klaus Gottlieb, Esq., published in the Winter 2023 California Lawyers Association Trust & Estates Quarterly, “California joins an increasing number of states that have made less-restrictive alternatives to conservatorship a legislative priority. Supported Decision Making is one of them. The idea is that adults with a disability, which could include dementia, retain their autonomy and make their own decisions, albeit with support.”

Supported Decision Making can be an informal arrangement, such as your son helping you continue to make sound decisions or can be memorialized in a written SDM agreement. Like any legal arrangement, attorneys generally support having such an agreement fully documented.

With an SDM agreement, the signer of the agreement (you in this case), can continue to act independently. There appear to be some shortcomings in the legislation which need to be worked out like should the SDM be compensated; are third parties, such as doctors or banks, required to accept the decision maker’s decision; and the big one, is the decision maker held to a fiduciary standard? These legal amendments are new and educational programs for attorneys, individuals, courts and the public need to be developed. However, once solidly in place, a supported decision-making scenario would seemingly provide for a better alternative than the current court conservatorships.

Liza Horvath has over 30 years of experience in the estate planning and trust fields and is a licensed professional fiduciary. Liza currently serves as president of Monterey Trust Management. This is not intended to be legal or tax advice.

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Liza Horvath, Senior Advocate: An alternative to conservatorship