Guardian of the Estate
A guardian is the person or corporation granted the fiduciary duty and responsibility for caring for a ward’s person and/or estate. A guardian of the estate is appointed solely for the purpose of managing the property, estate and business affairs of a person who can no longer manage their own financial affairs.
As part of estate planning, individuals may name someone or a corporation to assume guardianship over their affairs if this assistance becomes necessary. Typically, family members will pursue appointment of a guardian of the estate on behalf of a loved one who no longer has the capacity to manage his or her financial affairs. Often, the situation is made more complicated because there are no estate planning documents in place to provide guidance, and someone must be chosen to accept these duties.
In North Carolina, the probate court appoints guardians. The petitioner must establish the need for protection, the prospective guardian’s qualifications and the extent of the individual’s estate, which the guardian will manage and control. If the court agrees the individual is in need of someone to take over their financial affairs, then it will appoint a guardian of the estate.
Obtaining guardianship can be a complex process and create frustration for petitioners seeking to provide for a loved one’s financial well-being. At the Brady Cobin Law Group, PLLC, our knowledgeable Raleigh guardianship attorneys can guide you through the guardianship process as a plan for the future or if you have an emergency need. We are committed to helping individuals ensure the availability of the care they and their loved ones need.
Whether you need guidance for the future or help with a guardianship appointment now, we are here for you. We’re proud to represent North Carolina families and provide them with thoughtful and caring advice about their futures and the futures of their loved ones. Contact our Cary estate planning law firm at (919) 782-3500 today to schedule a consultation.
Responsibilities of a Guardian of the Estate
What does guardian of the estate mean?
A guardian of the estate manages an individual’s finances and other business matters. This is separate from a guardian of the person, who manages an individual’s personal custody and care. A “general guardian” may be appointed to act as guardian of the estate and guardian of the person.
Separate guardianships might be arranged among family members to share the burden of caring for a relative who lacks capacity. For example, one sibling with a financial background might become the guardian of their parent’s estate and another sibling might assume the duties as guardian of the person because they have a healthcare background or a more nurturing nature.
What are the Duties of the Guardian of the Estate?
Typically, the guardian of the estate has the general power to administer an estate in the best interest of the individual who is no longer managing his or her own business affairs. This includes collecting money owed the estate and paying debts, including taxes, as well as buying or selling property for the good of the estate.
The court order establishing guardianship will outline the specific duties and responsibilities of the appointed guardian of the estate. The petitioner may request limits or other specificities, as necessary.
Under North Carolina law, a guardian of the estate may be allowed to:
- Obtain access to and control all assets of the estate, including digital assets.
- Spend estate income on the person’s behalf and petition the court for prior approval of expenditures from estate principal.
- Borrow money to pay debts, taxes and other claims against the estate, and to mortgage or otherwise encumber portions of the estate as may be required to secure the loan or loans.
- Make investments for the good of the estate.
- Insure the person’s assets against damage or loss, at the expense of the estate.
- Continue any business or venture or farming operation the person was engaged in if reasonably necessary or desirable to preserve the value, including goodwill, of the person’s interest in the business.
- Complete the obligations of any outstanding contracts entered into by the person or refuse to complete the contracts.
- Sue to recover damages for any injury done to any of the ward’s property and accept or reject any offers to settle such suits.
- Vote shares of stock or other securities held by the person or estate.
- Employ attorneys, auditors, investment advisors, appraisers or other professionals to advise or assist in the performance of the duties as guardian of the estate.
Certain financial transactions, such as selling real property or personal property worth more than $5,000, require the court’s approval.
A guardian of the estate of a minor has more restrictions on selling the person’s property and buying property or making investments.
The guardian of the estate is responsible for standard bookkeeping and accounting of the estate’s assets and liabilities. He or she must regularly report to the courts on the status of the estate and how money has been spent to cover the ward’s expenses. A guardian of the estate must also appear for any of the incapacitated person’s legal proceedings.
A guardian of the estate is entitled to be reimbursed out of the person’s estate for reasonable expenses incurred.
When separate people are appointed as guardian of the estate and guardian of the person, they must be able to work closely together. For example, the guardian of the estate may need to transfer money from certain estate accounts to cover expenditures that the guardian of the person makes to provide for the ward’s care.
Who Can Serve as Guardian of the Estate?
An individual must be capable of a guardian’s duties and of legal age (18 years old) to serve as guardian of the estate. The court must decide whether a person is fit to be a guardian. A potential guardian should not have a substantial criminal record or other derogatory issues in their background.
Typically, a guardian is someone who has been close to the incapacitated individual, such as a spouse, adult child, parent, family member or a long-time companion or friend. Particularly for large or complex estates, such as ones that include business interests, it is preferable for a guardian of the estate candidate to have demonstrated financial competency. The guardian of the estate may be a corporation, such as a for-profit business, a nonprofit, a bank, or an attorney.
When possible, the court will follow the expressed desires of the person being protected. This is why we suggest naming a potential guardian in estate planning legal work. Otherwise, as often occurs, when a guardianship is needed, the individual may be incompetent and no longer able to state his or her desires.
If the court finds that a proposed guardian of the estate is not capable of performing the job, it can appoint someone else of its choosing.
The person appointed guardian of the estate must take an oath to fulfill the duties of the position to the best of his or her abilities and in accordance with the law. The guardian must post a bond with the court. The court will set the amount according to the nature and complexity of the guardianship.
Once approved, the clerk of court will issue letters of guardianship that serve as legal proof and authorization of the guardian to act on behalf of the ward.
A guardian who wishes to resign must petition the Clerk of Superior Court for an order authorizing the resignation and must provide a full accounting of the status of the estate. The clerk may remove a guardian who has mismanaged the estate, violated a fiduciary duty or has become insolvent. The clerk must remove a guardian who has been convicted of a felony or judged incompetent or if the clerk finds the guardian to be unsuitable to continue serving.
How We Help Families in Need of a Guardian of the Estate
In many of the guardianship cases handled by our estate planning attorneys at Brady Cobin Law Group, an individual needs someone to begin acting on his or her behalf as soon as possible. Our attorneys can help families compile the paperwork and submit petitions for guardianship of an estate quickly. We’ve worked with families in Raleigh and throughout North Carolina to establish guardianships. We can work to have the clerk of court require the guardian to post the lowest bond available.
In some cases, family members disagree over the need for a guardian or who should serve as guardian of the estate. We bring years of experience in estate planning and elder law to these cases and can work with family members to reach agreements that ensure the best interests of the individual for conservation of their financial holdings.
Our preference is to work with you and the prospective guardian of your estate today as part of your overall estate planning. We can walk both of you through what is required of a guardian of the estate, and the assistance we’ll be able to provide the guardian should the need arise. We can help make sure your affairs are entrusted to someone you want to handle them when the time comes. Documenting your desires today ensures that they will be enacted as you intended in the years ahead.
Contact Our Cary, NC Guardianship Attorneys
The Brady Cobin Law Group can help you prepare for the future. Our experienced and compassionate attorneys can work with you and your family to ensure that someone is in place to serve as guardian of all you have worked for should you become unable to handle your own financial affairs. We can assist with your family’s emergency need to appoint a guardian of the estate. We have established guardianship agreements as part of estate planning and in unexpected situations for families throughout North Carolina.
You can take the necessary steps to ensure the stability of your family’s future today. Phone us at (919) 782-3500 in Cary or contact us online to speak with an experienced guardian of the estate lawyer.