"From time to time, it is my intention to write posts here about my experiences and observations as a licensed professional fiduciary, teacher and observer of the world of probate. My intention at the outset is to write about two main topics. First I want to write about being a fiduciary in a variety of settings. Second, I intend to write about the challenges faced by the elderly, including the many ways in which they are abused as they begin to lose the capacity to manage their own lives and must depend on the good will, honesty, and care of others.
The word “fiduciary” comes from the same root at fidelity. A fiduciary is a person who acts for the benefit of another. A fiduciary steps into the shoes of another and does for that other person what they no longer can do for themselves – a form of surrogate. As such, a fiduciary must look out for the interests of the others to whom they owe a fiduciary duty even if that is incompatible with or contrary to the fiduciary’s own interests.
In California, fiduciaries act in three main types of situations; conservatorships or guardianships, trust administration, or decedent’s estate administration. The laws governing all of these roles are found primarily in the Probate Code and are overseen by the probate judges of the Superior Court in each California County.
A conservatorship is a court proceeding in which the court has made a finding that an individual lacks capacity to manage his or her personal life and/or finances. In that situation, the court appoints a “conservator” to manage the affairs of the “conservatee,” the individual found to lack capacity. The conservator of the person is appointed by the court to manage the personal affairs of the conservatee. This role often includes, for example, finding appropriate caregivers to help the conservatee continue to live at home, and making all the necessary arrangements to make that possible. Depending on the level of incapacity of the conservatee, as determined by the court, the conservator of the person might also be responsible for making medical decisions for the conservatee. The conservator of the estate is the person appointed by the court to manage the conservatee’s assets and day to day finances. In many cases, the conservator of the person and estate is the same individual, but in some cases these two rolls are divided between different individuals who must then work together for the benefit of the conservatee. Guardianships, in California, are concerned with the care of minors. The guardian of the estate would be responsible for managing the assets and finances of the minor and the guardian of the person would be responsible for the personal care of the minor. As with a conservatorship, the guardian is appointed by the court and mustaccount to the court periodically regarding their efforts on behalf of the minor or “ward.”
The person responsible for administering a trust, is called the “trustee,” and owes a fiduciary duty of utmost good faith, trustworthiness and fidelity toward the beneficiaries of the trust being administered. The job of the trustee is to carry out the instructions of the person who established the trust as stated in the trust and any amendments to it. In many instances, trusts are not supervised by the courts. In that situation, the trustee carries out the instructions of the trust, providing information and accountings to the beneficiaries showing that he or she is abiding by the terms of the trust. A trust, and the trustee, might become subject to court supervision if, for example, there was a great deal of conflict among the beneficiaries such that judicial supervision was advisable. Some trusts are established by court order and are then usually subject to court supervision from their inception.
When someone makes reference a “probate case” they are usually referring to the administration of a court case whose purpose is to gather and distribute the estate of a person who has died in accordance with the instructions contained in their will, if they had one, or in accordance with rules established in the Probate Code where a person dies without a will.
Each of the roles assumed by licensed professional fiduciary described here are potentially complicated and controversial, requiring a high degree of knowledge and experience to fulfill. In many cases, a professional fiduciary becomes involved in these proceedings when family members or others are unable to manage the levels of complexity and discretion required in being a fiduciary.
My intention in future blog posts is to write about events and observations that illustrate aspects of the job of being a fiduciary. Before becoming a fiduciary, I thought, as I suspect many do, that probate was a dull and uninteresting area of the law. My experience of the world of probate is that it is anything but dull and/or boring! Probate cases are where you see the whole range of human nature. Probate is involved with major upheavals in the lives of families and individuals. These proceedings involve births and deaths, the management of assets and money in times of crisis, and elderly people declining
in body and mind and the struggles to deal with the transfer of responsibility that often accompanies those changes. In those moments of crisis, fiduciaries see individuals at their best and also at their worst, but always challenging and interesting.
More later... stay tuned."