As the population ages, there is an increasing number of seniors who, through illness or just plain old age, become unable to manage their own affairs. An important part of estate planning is arranging for the management of one's finances and medical decisions upon incapacity. But even with such planning, in some cases, a disgruntled family member may seek to remove the personal rights of a relative and be appointed as their legal guardian in a public and expensive court proceeding. In these cases, the court will sometimes appoint an outsider as guardian. In guardianship proceedings, all parties involved are paid from the assets of the incapacitated person - the court-appointed examining committee, court-appointed lawyers, lawyer for the petitioner, etc.
Under Florida law, the court is charged with finding the "least restrictive alternative" to a guardianship. Powers granted to a fiduciary in typical estate planning documents, such as living trusts and powers of attorney, are thought to be less restrictive alternatives to a guardianship. But sometimes a court will supersede the authority the client has granted in his or her estate planning documents.
So what can be done to preserve a client's wishes with respect to his or her estate planning documents? Here are a few thoughts:
Florida law authorizes the execution of a preened guardian declaration, whereby one may declare one's choice of guardian if the need arises, and creating a legal presumption that the person named should be appointed. The existence of such a declaration lessens the potential for a disgruntled family member to obtain a position of authority over the finances of an incapacitated person.
Generally, a settlor (creator) of a living trust may amend or revoke the trust during his or her lifetime. Including provisions in a living trust to suspend the settlor's powers in the event of incapacity avoids the necessity of a guardianship court to remove the incapacitated person's powers in such case.
One may appoint a family member, friend or other person (or even a bank) as an agent under a power of attorney to handle one's financial affairs in the event of incapacity. Each state's laws are different, and Florida's Durable Power of Attorney statute was completely overhauled in 2011. Under Florida law, an agent under a power of attorney only has the specific powers authorized in the document. Therefore, it is important to have a comprehensive and up-to-date, Florida Durable Power of Attorney drafted by an estate planning attorney.