What is a Conservatorship?
A conservatorship is created in Tennessee when a court appoints a person or entity to make decisions for someone who cannot make decisions for themselves. Typically, a conservatorship is required when a person does not have a valid power of attorney in place. Without a power of attorney, no one can access the person's financial accounts or effectively manage his or her healthcare. If you believe that establishing a conservatorship is in the best interests of a loved on, take a moment and read through this page to familiarize yourself with the process. Understand that creating conservatorship requires knowledge of the law and we would advise you to seek the counsel of an experienced conservatorship lawyer to assist you in that matter.
Example of a Conservatorship
The most common circumstances in which a conservatorship is needed is when an elderly person develops dementia or Alzheimer's Disease. For example, Bob lives in Clarksville and his family has been noticing that his short term memory has been failing. He often forgets people's names, to do daily chores, bathe, and care for himself. Bob's family takes him to see his doctor and his doctor diagnosed him with dementia. The doctor tells Bob's family that he is unable to make competent decisions for himself and advises his family that he needs a conservatorship. Unfortunately, Bob does not have a power of attorney in place. His family quickly discovers that it is impossible for anyone to access his bank accounts to pay his bills or otherwise manage his financial affairs. They also have a hard time making medical decisions for him. Bob's family decides to consult a conservatorship lawyer who helps prepare the necessary conservatorship paperwork. After the legal process is complete, Bob's daughter is appointed conservator over him and is now able to make both medical and financial decisions for him.
Circumstances When a Conservatorship is Needed
There are many circumstances in which a conservatorship may be necessary. Here are a few examples of those situations:
- An individual does not have valid powers of attorneys. That individual suffers from a disability, whether mental or physical, and cannot make decisions for themselves.
- There is a valid power of attorney in place, but the current person acting as power of attorney is abusing his power and needs to be removed.
- The agent listed in the power of attorney document is unwilling or unable to serve as power of attorney.
- There is a dispute among family members as to the validity of the power of attorney.
- There is an urgent situation such that an emergency conservatorship is required.
Read more on situations in which a parent may be "borderline" in need of a conservatorship.
How Do You Establish a Conservatorship in Tennessee?
There are several steps that are required by statute that must be taken in order to establish a conservatorship in Tennessee. If a family member or friend needs a conservatorship, the person that files a petition to establish a conservatorship must take the following steps:
Physical and Mental Examination
A physician or psychologist must examine the individual and determine whether a conservatorship is needed. Should the examiner find that the person needs a conservatorship, the physician or psychologist must prepare a sworn written statement to that effect and provide the statement to the Court and all parties involved.
File the Petition
Your conservatorship lawyer should prepare a proper petition and file it with the Court. This petition should meeting all the statutory requirements under Tennessee law. The law is very specific as to what goes into this petition, so diligence is critical. Among other requirements, this petition must list the legal rights that will be taken away from the individual and placed in the conservator.
Property Management Plan
If the proposed conservator is going to manage property, then a property management plan must be prepared and filed with the Court. This property management plan must list all assets, income, and usual monthly expenses of the individual. The property management plan will also state a plan for how those assets will be handled. If the petitioner does not know all of the assets and expenses at the time of filing, then the petitioner must later file a property management plan once this information is discovered. Seek the assistance of your conservatorship lawyer in preparing the property management plan.
Guardian Ad Litem
There will likely be a need for a guardian ad litem (GAL) to be appointed for the individual. The GAL is a licensed lawyer and not an advocate for any party. The GAL's job is to investigate this matter independently and determine whether there is a need for a conservatorship. Once the GAL has investigated the matter, the GAL will file a report with the Court expressing her opinion.
Typically, there will also be a requirement that the proposed conservator be bonded. What this means is that the bond serves as insurance for the disabled person. If the conservator runs off to Canada with the money, the bond will cover the money taken by the conservator. The conservator will typically contact an insurance company, fill out an application, provide whatever documentation the insurance company requires, and will be issued paperwork saying that the insurance company has bonded the conservator. That paperwork will be filed with the Court as proof of bond.
The disabled person must be served with a copy of the petition and a summons. Once the GAL is appointed by the Court, the GAL is generally the person that serves the individual. Note that service is a constitutional right owed to the disabled person and the judge cannot establish the conservatorship before service is made.
Attorney Ad Litem
Should the disabled person believe he does not need a conservatorship, he can request the appointment of an attorney ad litem to advocate on his behalf. An attorney ad litem can also be recommended by a GAL or the Court can appoint one on its own.
The Court must hold a hearing on the petition that was filed for the establishment of a conservatorship and hear proof on the issue. Typically, if everyone agrees that a conservatorship should be established then the judge will then enter an order appointing a conservator after a brief hearing. If the hearing is contested, by the disabled individual or any other person, then the Court will have a trial in the matter. At trial, the Court will determine if a conservatorship is warranted and who should be appointed as conservator.
Letters of Conservatorship
If the judge finds that the establishment of a conservatorship is necessary, the judge will instruct the Court clerk to issue Letters of Conservatorship to the conservator. These letters will allow the conservator to access any assets that the individual may have as well as allow the conservator make medical decisions for him.
Tennessee law requires that the conservator prepare and file an accounting of your assets six (6) months after being appointed conservator. After that accounting is filed, the next accounting due will be the following year at the same time. An annual accounting is due each year until the conservatorship is dissolved.
Most conservatorships are uncontested, meaning that all persons involved have no opposition to a conservator being appointed to manage the affairs of the disabled person. However, if the disabled person, family members, or friends file an action and contest the conservatorship the Court must make two decisions:
- Is there a need for a conservator to be appointed? Does the disabled person really need a person appointed to look after their affairs?
- Who should be appointed as conservator?
If the parties are unable to settle their differences, the judge must make a decision on both these issues. This process requires litigation and ultimately a trial on the matter costing each party involved significant legal fees, time prosecuting or defending the case, and stress.
Unfortunately, must like will contests, contested conservatorships are often very emotional proceedings. Many times they pit parent against child, sibling against sibling, or stepparent against stepchild. Both the Court and the conservatorship lawyers involved should encourage the participants to try to settle the case if at all possible.
Conservatorship Frequently Asked Questions
Below are many questions that will help answer basic questions about conservatorships in Tennessee. If these questions do not provide the answers you are looking for, give us a shout. We will be happy to answer any questions you have.
If you have power of attorney, is a conservatorship still needed?
Generally not. If valid powers of attorney are in place, a conservatorship is not needed most of the time. A general power of attorney usually has similar powers that a conservator has. So establishing a conservatorship does not give the fiduciary any more power than he already possesses. When someone contests the validity of the power of attorney a conservatorship could be filed. That conservatorship would seek to remove the agent under the power of attorney from power. A conservatorship may also be a good idea should an power of attorney agent be elderly or sick and the disabled person lacks capacity to execute a new power of attorney.
Who can petition the Court to establish a conservatorship?
Anyone who has an interest in the conservatorship can petition the court to establish the conservatorship, it does not have to be a family member or close friend.
What if the disabled person has no assets, is a conservatorship still needed?
While every situation is different, it is still a good idea to have someone in charge of the disabled person's healthcare and finances, even if they have few assets. Without a conservatorship no one would be able to make decisions for the person.
Is bond still required if there are little to no assets?
Bond can be waived by the Court under the following circumstances:
- The total assets of the disabled person are $10,000.00 or less and the judge finds the expense of a bond outweighs the risk.
- The assets are placed in a bank or other financial institution. The bank and the conservator must have a written agreement that the conservator cannot withdraw funds without Court approval. This agreement must be filed with the Court.
- The assets of the disabled person are deposited with the Court.
If you are not handling the assets of the disabled person, there is no requirement for a bond. So if you are the conservator over the person's heath care, there would not be a need for you to be bonded.
Is a property management plan still require if there are little to no assets?
No. Tennessee law states that if the disabled person has less than $25,000.00 in assets a property management plan is not necessary and can be waived.
Do you need Court approval before you sell any of the disabled person's real estate or other property?
If you are required to have a property management plan, then Court approval is required before any asset valued at $1,000.00 or over is sold. However, if you do not have a property management plan, you do not need Court approval to sell property. Additionally, a motor vehicle may be sold without approval of Court.
Also note, if any asset is subject to control by the terms of a will or trust it cannot be sold. So if a conservator is holding real estate for a loved one that is subject to the terms of a trust, the conservator cannot sell that real estate without Court approval.
What happens if the conservator dies or no longer wishes to serve under the conservatorship?
The conservator may resign at any time, subject to approval of the judge. The Court will set a date out by which the duties of the conservator will end. The Court must then appoint a successor conservator after the resignation of the current conservator.
Can the conservator be compensated?
Under Tennessee law, a conservator can be compensated for the work that they do to care for the disabled person. However, the conservator cannot be paid without approval of Court. The Court must set the compensation. In doing so, the judge will consider the following circumstances:
- The complexity of the disabled person's assets
- The time it takes the conservator to care for the disabled person
- The time the conservator is away from her job
- Whether the conservator's services would have been normally provided without the conservatorship.
Can the disabled person still make decisions for himself/herself?
When a conservatorship is established, the legal rights of the disabled person to make decisions for himself are taken away and placed in the conservator. That means is that the conservator will be responsible for making all major decisions for the disabled person. The disabled person may still make daily decisions for himself, such as what to eat, what to wear, what do do, etc. However, if certain rights have been taken away from the disabled person then that person cannot exercise those rights.
What happens if a person fails to provide an accounting of the conservatorship?
Tennessee law requires the Chancery Court provide you notice when the accounting is due. If you need an extension, Tennessee law allows the Court to grant an extension for the filing of the accounting for good cause. If you continue to fail to file the accounting, the Court clerk will instruct you to appear on a certain date with the accounting. Should you again fail to provide the accounting, the Court will issue a show cause order. The show cause order requires you to appear and explain why you should not be held in contempt. If you ultimately fail to provide an accounting of the conservatorship, the Court can issue a judgment against you personally for the amount that remains unaccounted.
Can a Conservator Change a Will?
A conservator has no power to create, alter, or change a disabled person's will, revocable trust, or other estate planning documents. If the conservator attempts to do so, any changes would be void and ineffectual.
How long does it usually take to establish a conservatorship?
It depends on the type of conservatorship. At a minimum, it usually takes about one month to obtain a permanent, uncontested conservatorship. An emergency conservatorship takes less time. You could usually get approval by the Court the same day you apply for a emergency conservatorship. However, a hearing must be held within 5 days after the Court grants the emergency conservatorship. Under no circumstances can the emergency conservatorship last more than 60 days.
What is the difference between a guardianship and a conservatorship?
In Tennessee, a conservatorship is a court proceeding in which a person's legal rights are taken away from them and are placed in another person or entity. A conservatorship is required when the person can no longer make decisions for themselves. Conversely, a guardianship is a court proceeding in which a person is named to care for a minor's health, assets, education, or other matters.
Contact Conservatorship Lawyer John Crow
If you have a loved one who is need of a conservatorship let us know. Our job is to not only to handle the legal work surrounding the conservatorship, but to also help walk you through questions you may have regarding the entire process. Give Clarksville Conservatorship Attorney John Crow today at 931-218-7800 to schedule an appointment.