Because a guardianship involves a profound loss of freedom and dignity, state laws require that such arrangements be imposed only when less restrictive alternatives have been proven to be ineffective. You may suspect a loved one is starting to fail, or possibly elder abuse is taking place but what can you do? Anything? The answer is a definite “yes”! Certain preventive measures may be appropriate to minimize the chances that an elderly person will become a dangerous risk to himself/herself or a victim of financial and physical exploitation.
A Power of Attorney, Also Known as Durable Power of Attorney (POA)
A power of attorney is the grant of legal rights and powers by a person (called the “principal”) to another (the “agent” or “attorney-in-fact”). The attorney-in-fact stands in the shoes of the principal and acts for him or her on financial, business, health care decisions and/or personal matters. In most cases, even when the power of attorney is immediately effective, the principal doesn’t intend for it to be used unless and until he or she becomes incapacitated. A power of attorney is the most effective and least costly alternative to a court sanctioned guardianship. Fredrick P. Niemann, an attorney of 30 years often advises his clients to have a comprehensive power of attorney prepared which addresses not only financial issues, but such seldom thought of issues such as life care planning, personal decision planning, medical and health care planning and long term care planning to preserve and protect a lifetime of savings and income from the skyrocketing costs of institutional care.
Especially as between a husband and wife or a parent and adult child, the law does not delegate legal decision making in favor of a spouse or child in the absence of a written power of attorney, guardianship or conservatorship. It’s a shock to clients when I tell them they can’t legally make decisions for their sick spouse or adult incapacitated child. Often, we must take extraordinary steps to solve the problem by a legal filing with the Superior Court known as guardianship which could have been avoided by a qualified and comprehensive legal document called a Durable Power of Attorney (POA).
Consider recommending the individual execute a new power of attorney (POA) appointing a reliable relative or friend as agent, designate a trusted person to serve as the representative payee to handle the client’s Social Security or other public or pension funds, or establish a trust if the client has significant assets. Because there are few checks and balances built into the representative payee system, the selection should be made with great care. If a power of attorney is drafted, include provisions to minimize the chances of exploitation, such as limiting the amount of money that can be transferred by the agent, allowing transfers of money only into a trust or an account that benefits the elderly person, require regular written accountings and related documentation for transactions made under the power, or require that the principal be notified before a significant transaction is completed. Consider drafting a contract, signed by the attorney-in-fact, that covers accountings, payment for services, documentation, and other precautions to limit the possibility of abuse.
After exploitation has occurred, your options are limited. Taking the above actions may help to minimize further exploitation. You may want to consider filing criminal charges or civil proceedings against the perpetrator of the exploitation. Theft is not limited to robbing a bank at gun point.
Learn the Alternatives to Guardianship in New Jersey
Representative or Protective Payee
This is a person appointed to manage Social Security, Veterans’ Administration, Railroad Retirement, public assistance or other state or federal benefits or entitlement program payments on behalf of an individual. The representative or protective payee acts much like an attorney-in-fact, but for the limited purpose of a program.
Conservatorship
Protecting A Person’s Finances and $$$ With Filing For Guardianship
In some states like New Jersey, a proceeding to protect the finances of an adult is called a “conservatorship.” Like a guardianship, a conservatorship is a court-supervised arrangement for a person who cannot handle his or her own final affairs (called the “conservatee”). The person appointed to oversee the affairs of another is called the “conservator.”
A conservatorship can cover the “estate” only (meaning the conservatee’s financial matters). In New Jersey, it does not cover the “person” (meaning the conservatee’s physical well-being) or a “conservatorship of the person”.
A conservatorship proceeding in New Jersey must be voluntary, where the person needing assistance (called the “conservatee”) petitions the probate court to appoint a specific person (the “conservator”) to manage his or her affairs.
If the proceeding becomes involuntary, for example, when the proposed conservatee opposes having someone appointed to oversee his or her affairs, then an involuntary guardianship is required. When the proceeding is involuntary, it goes before a judge for a trial to determine if the proposed conservatee has the capacity to handle his or her own affairs.
Revocable Trust
A revocable or “living” trust can also be set up to hold a person’s assets, with a relative, friend or financial institution serving as trustee. Or the older person can be a co-trustee of the trust with another individual who will take over the duties of trustee should the older person become incapacitated.
Moving money to a protective trust makes a lot of sense. It’s a secure way to manage and protect a vulnerable person’s savings and income.
Learn the Protective Actions You Can Take to Prevent or Minimize Elder Abuse and Exploitation
FILE A PROTECTIVE COMPLAINT IN SUPERIOR COURT IN LIEU OF A GUARDIANSHIP ACTION
There is a seldom used but potentially effective alternative to guardianship which can address elder financial exploitation much faster and with less focus on the legal competency of the victim. Guardianship requires proof that the abused person is incapacitated, meaning not in their right mind. A protective proceeding does not. What must be demonstrated is that the elderly person is subject to the influence of a predator (family member, “friend”, caregiver, spouse, etc.) and is being exploited and, therefore, needs protection. Filing such a legal action does not require two doctors’ reports, medical proof and the other formalities of a guardianship or conservatorship proceeding. But it does require some examples (proof) of exploitation and/or abuse that warrants a court’s protective order.
Power of the Court to Order a Protective Arrangement
The statutory reference to protective arrangements can be found at N.J.S.A. 3B:12-1. The law states, “If it is established that a minor, an incapacitated person or an alleged incapacitated person or a person not yet in being has property or an interest therein which may be wasted or dissipated or that a basis exists for affecting the property or interest and affairs of a minor, an incapacitated person or an alleged incapacitated person or person not yet in being, or that funds are needed for the support, care and welfare of the minor, incapacitated person or alleged incapacitated person or those entitled to be supported by him, the court may, [subject to the appointment of a guardian ad litem and upon notice to the guardian ad litem], without appointing a guardian of the estate, authorize, direct or ratify any single or more than one transaction necessary or desirable to achieve any security, service, care or protective arrangement meeting the foreseeable needs of the minor, incapacitated person or alleged incapacitated person or those dependent upon him.” Yes, that is the exact text from the statute. It is quite a mouthful, isn’t it?
This statute clarifies the court’s authority to address the immediate needs of an (alleged) incapacitated person. It establishes procedures for the appointment of a general guardian, a limited guardian of the person, estate or of both, a special guardian or a temporary pendent lite guardian who would act on behalf of the incapacitated person with regard to his medical, financial, educational, legal or vocational needs. It also specifically sets forth the powers and duties of the guardian, when a bond must be furnished by a guardian and when reasonable compensation for services would be granted to a guardian. The substitute also expands the current reporting procedures for guardians.
Protective complaints can be quite effective. It gets you into court quickly, it often intimidates and immediately stops predators from further stealing. If you’re interested in discussing this option, I welcome you to call me toll-free at (855) 376-5291 or email me at fniemann@hnlawfirm.com.
Office of the Public Guardian and Adult Protective Services
An adult guardianship may be desirable or necessary for a victim who has lost capacity. New Jersey provides for a “public guardianship,” that is, court appointment of a public official or agency to serve as guardian of an incompetent person, usually when no private person or agency is available or willing to assume this responsibility. You may find that a public guardianship is the only route available to provide ongoing assistance if or when you are unable to maintain continued involvement or there are insufficient assets to pay for a professional guardian.
A guardian can be authorized to make legal, financial and health care decisions for the ward. Depending on the terms of the guardianship, the guardian may be given decision-making power over only those areas in which the incapacitated person is unable to make responsible decisions. This is called a limited guardianship. Especially important is the appointment of a guardian of the property which gives the guardian powers over the person’s finances including banking, social security, veteran’s benefits, paying bills, borrowing or loaning money and whatever to buy or sell real estate and stock accounts.
PROTECTIVE ACTION TO PREVENT OR MINIMIZE DOMESTIC VIOLENCE
When an elderly person is a victim of domestic violence, the individual should consult New Jersey’s domestic violence laws (see page title “NJ laws on Elder Abuse”) It may be possible to obtain a temporary restraining order or domestic violence injunction, or to commence a separate maintenance or divorce proceeding, depending upon the elderly person’s wishes.
Fredrick P. Niemann Esq.
Contact Fredrick P. Niemann, Esq. to discuss the many alternatives to guardianship under NJ law. You’ll find him easy to talk to and very understanding of the day-to-day issues you are confronting. Call him toll-free at (855) 376-5291 or e-mail him at fniemann@hnlawfirm.com.
He welcomes your calls and inquiries and you’ll find him very approachable and easy to talk to.
Written by Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a New Jersey Guardianship Attorney