What is a Conservatorship?
Conservatorships have gained notoriety lately as Britney Spears’ court battles over her father’s appointment as her conservator have made their way into the public eye. But what exactly is a conservatorship and when is one appropriate?
In New Jersey, a conservatorship is a voluntary legal arrangement whereby an individual, such as a parent or adult child, or entity, such as a bank or trust company, (the “Conservator”) is appointed by the court to manage the financial affairs of a person with capacity (the “Conservatee”) who has requested such assistance. Conservatorships are fully voluntary and cannot be imposed by a court if the Conservatee objects. A conservatorship is appropriate for a person who is mentally competent, but has a difficult time managing their affairs due to memory, cognitive, or mental health issues, or if that person has diminished decision-making abilities.
A conservatorship is more formal than a power of attorney ("I GOT THE POWER"), whereby the Principal appoints a person to act as their Agent as to financial matters, and is less comprehensive than a guardianship, whereby a court appoints a guardian of the person, property, or both, of an individual who is declared to be mentally incapacitated by the court. A Conservator is limited to managing the financial assets of the Conservatee and, unlike a guardian, the Conservator does not have the power to make medical decisions on behalf of the Conservatee. For a more in-depth discussion on guardianships, see our November 2020 Newsletter, "When is a Guardianship Appropriate?"
The Conservator is given powers by the court to act on behalf of the Conservatee and is therefore obligated to act in the best interest of the Conservatee. The court oversees the actions of the Conservator and can request a judicial accounting of the Conservator’s actions at any time. Oversight by the court adds a layer of protection for the Conservatee and, provided that the Conservatee is still competent, he, she, or they can apply to the court to revoke and/or modify the conservatorship at any time.
If you or someone in your life needs assistance managing their affairs if can be difficult to know where to begin. When assisting a person who cannot manage their finances, there is a balance to be struck between preserving a person’s autonomy and protecting them from harm by way of neglect, abuse, and/or fraud. Contact us if you would like to discuss whether a power of attorney, conservatorship, or guardianship may be appropriate in your unique situation.
