Living Probate is a court proceeding that occurs in the Probate Court while you are alive versus death probate which may occur at the time of your death. This proceeding is formally known as a guardianship proceeding within the State of Wisconsin. Within this court proceeding, a person petitions the court requesting to be appointed as your legal guardian. There are two types of guardians that must be appointed. The first is the Guardian of the Estate who will have the ability to legally manage your financial affairs, access your financial accounts and sign on your behalf regarding your legal and financial matters. The second is Guardian of the person which is the person who can legally make your health care decisions as it relates to your needed health care treatment.
Any time you are required to go to court, it is not going to be a quick or easy process. Typically, the person seeking to be your guardian will retain an Attorney to begin this process. The initial legal documents needed to commence this proceeding must be forwarded to those individuals that may be affected by your Estate which are known as “Interested Persons”. Many times these individuals are your family matters or legal heirs as the law has defined them. Since you would be incompetent or unconscious during this proceeding, the law, in an attempt to protect your rights, requires another Attorney to be hired to represent you, the incompetent person. This person is known as a “Guardian ad Litem”. A doctor must also do a medial examination and issue his or her professional recommendation as to whether or not you indeed require a Guardian because you are unable to manage your financial and/or health care decisions.
Once all individuals have obtained notice of the court hearing, the Doctor’s report has been submitted to the Court, and the Guardian ad Litem has submitted a report as to his or her recommendation, everyone goes to court to officially go before the Judge to obtain he Judge’s decision as to the person to be appointed guardian. Of course, should anyone object to this individual being appointed guardian, testimony and evidence will be required to prove whether or not is in your best interest to have this person appointed as your guardian or have a guardian appointed at all. Ultimately, it will be the Judge’s decision as to who will serve as your guardian which may be the person that started the proceeding or it may be a professional guardian that the family and you do not know personally.
Needless to say, after two Attorneys are paid, notices have been issued to all interested persons, and the court hearing is held, it can become quite an expensive proceeding. If your guardian is appointed successfully, the guardian must then file an Inventory of all of your assets with the court and then every year thereafter submit an annual accounting to the court.
The purpose of Living Probate, in a nutshell, is to ensure that your legal rights are protected and to allow another individual legally sign on your behalf since you no longer have such an ability. The guardianship proceeding is the only proceeding that allows a Judge to appoint a person that has the ability to sign on behalf of the incompetent individual. This is very similar to the Death Probate process except in this instance you are alive.
It is important to note that this proceeding is easily avoided with the Power of Attorney documents in place. Many times when we hear the term “Estate Planning”, we think that it refers to documentation that is needed at the time of our death. However, what legal document do you need when, due to an incapacitation or severe disability, you are unable to make your own financial and health care decisions? In Wisconsin, the documents that are needed during this frightening time are known as the “General Durable Power of Attorney” and the “Health Care Power of Attorney”.
A General Durable Power of Attorney or a “Financial” Power of Attorney, is a document in which you appoint a person to be your Attorney- in- Fact, also referred to as your financial agent, and act on your behalf to manage your financial affairs at a time that you are unable to do so. A Health Care Power of Attorney is a document in which you appoint an individual to make your health care decisions for you when you are unable to do so. The Health Care Power of Attorney also indicates your beliefs as it relates to artificial life support. These two documents are very important legal documents to have in place and in many instances will avoid the Living Probate process.
All good estate plans will have both Power of Attorney documents in addition to a will or trust. Within these documents, YOU are choosing the person that will have the same powers that the guardian would have but without the long, expensive court proceeding. Many Power of Attorney documents will become effective at the time that two physicians examine you independently and certify in writing that you are unable to make your own decisions regarding your health care and/or finances.
One point that is often confusing is when one person is acting as Attorney- in-Fact or Financial Agent for another individual and that person now dies – is the power of attorney still good? Actually, when the person that signed the power of attorney dies so does the legal validity of that document. Therefore, Power of Attorney documents are only good during the lifetime of the person making such documents. At the time of death, we must then look to another series of documents which are commonly the Last Will and Testament or the Living Trust.
Please share with us any comment or experiences you’ve had within an actual guardianship proceeding or perhaps in implementing a Power of Attorney document. We’d love to hear from you.