Oops! She Did it Again.

Oops! She did it again. Britney Spears is back in the media, bringing conservatorships into the spotlight. While Britney’s situation is atypical and somewhat controversial, this article outlines fundamentals of conservatorship, why a conservatorship may be needed and, as is the question in Britney’s case, when a conservatorship can end.

“Conservator” and “guardian” are roles that can be confusing. A guardianship pertains to overseeing daily activities of a person who has been declared legally incompetent. Someone appointed by the court to take care of these types of personal matters can be called a conservator of the person, or more commonly, a guardian. A person under guardianship is called a conservatee, a term referring to an adult who has been deemed incompetent in a court of law.

Someone who has been declared legally incompetent often needs a manager for their financial affairs, sometimes referred to as a financial conservatorship or, simply, conservatorship. The court appoints a conservator of the estate for these matters. Many times, the same person or organization serves as both guardian and conservator. General conservatorship encompasses both the financial conservator and guardianship roles.

Conservatorship laws vary by state; a conservatorship is used for a person who has a mental illness, mental impairment due to aging (dementia, for example) or someone with developmental disabilities and who needs help with their financial matters, basic living needs or both. A conservator can decide where a conservatee lives, the medical care they receive and even determine if the conservatee needs to be transferred to a residential care facility. The conservator can also make decisions on how a conservatee spends funds.

For a conservatorship to be established, a qualified physician or psychiatrist evaluates the person and presents a written report to the court. A court hearing reviews the case, during which the individual being evaluated may present his or her wishes to the court. The conservatorship can be challenged in court by the conservatee or the conservatee’s family members, as Britney recently did.

The conservator is held to a fiduciary standard for all matters pertaining to the conservatorship. A conservator must make decisions with the conservatee’s best interests in mind, must periodically report and provide accounting to the court for all matters related to the conservatee’s care, and keep complete and detailed records of all transactions. For any major decision, such as selling real estate, a conservator must go before the court to present a case. If the court deems the request legitimate, the court grants the conservator a court order to carry out the transaction.

When choosing a conservator, the court usually first considers a person’s spouse/partner, followed by adult children, siblings or any other blood relative who may be able to serve. If there are no competent and willing family members, the court will consider a public or professional conservator. Conservators may need to post a bond, to insure the conservator will not mismanage assets. The cost for posting a bond can be charged from the conservatee’s assets. 

Because conservatorships require court hearings and often lawyers are needed, conservatorships can be expensive and time consuming. Records of conservatorship hearings may be accessed by the public. Conservatorships become necessary when incapacitated individuals do not have either a power of attorney or a healthcare directive, so having up-to-date estate documents can be very important. While everyone hopes to handle his or her affairs until our last breath, it is good to know and be comfortable with the processes that occur if we are not able to.

If you have questions or would like to discuss the specifics of your situation, please contact your relationship manager or a member of our financial planning team.

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Read the Financial Planning Focus November 2021:

• "Act Like an Antique British Car Owner" By Brian Horan, CPWA^® »
• "Don’t Listen to the Carnival Barkers" By Glenn Guard, CFA »
• "Will It, or Won’t It?" By Kristan Anderson, CEBS®, CFP^® »

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