March 30, 2024 • 27 mins
Discover the keys to safeguarding autonomy in the face of dementia and the intricate legal decisions that follow. As your Elder Law Coach, I, Todd Whatley, guide you through the murky waters of guardianships and powers of attorney, revealing how a dementia diagnosis impacts legal capacity and the crucial steps to maintain control over personal affairs. This episode unravels the ethical imperatives entwined with preserving one's independence, addressing the invasive nature of guardianships—complete with court interventions and potential loss of rights—and contrasting them with the empowering capacity of powers of attorney.
Embrace the proactive approach as we dissect the legal strategies that ensure immediate effectiveness and autonomy, circumventing the public scrutiny and emotional strain that come with guardianship proceedings. We scrutinize how guardianships can hamper Medicaid planning and the ramifications of state laws like those in Arkansas, all while weighing the risks of appointed guardians and the abuse of powers of attorney. With insights into specific situations where guardianship may be the reluctant yet necessary choice, even in the presence of a power of attorney, this episode is a treasure trove for anyone navigating elder law's complexities.
Check out our new website www.TheElderLawCoach.com.
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Episode Transcript
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Speaker 1 (00:19):
Thank you.
Specialized experience, Whetheryou're an established attorney
looking to refine your expertiseor an emerging lawyer seeking a
successful foray into elder law, this is your masterclass.
Now let's get started with theluminary in the field.
Here's Todd Whatley.
Speaker 2 (00:37):
That's right.
This is the Elder Law CoachPodcast and my name is Todd
Whatley and, as always, I amsuper happy that you have joined
us.
And I just want to say realquick if you have suggestions, I
am very much open tosuggestions.
We are now getting upwards of.
I've stopped counting at 28.
(01:00):
I've stopped doing episodes at28, so we're 29, 30, 31, 32, 33.
So we've done 33 episodes andI'm not running out of stuff.
I could do lots of episodes,but I want to do what you want,
and so if you have questions orif you have topics that you
would like for me to do, pleaseemail me, todd, at
(01:23):
TheOterLawCoachcom, and I wouldlove to take your suggestions
about future topics.
Today I want to talk about oneof the things that is my soapbox
and that is guardianshipsversus power of attorney.
A lot of this is going torelate back to working with a
(01:46):
client with diminished capacity,and that is episode 16.
I would encourage you.
If you have not listened tothat episode, I would suggest
you go back and listen to thatone, and it will explain a lot
of things about my take on.
(02:06):
Can a person sign a power ofattorney or should we do a
guardianship and just a real,very quick summary is just
because someone has largemisconception in the legal
(02:27):
community is that if you havedementia, you can't sign
documents anymore, and that doesnot follow our ethical rules,
and I explain that in detail inepisode 16, so I would encourage
you to go back and listen to it.
So I'm going to make sure weunderstand the differences
(03:06):
between the two so that I caneffectively make my point.
So a guardianship is when aperson has become incapacitated
and typically they have not doneany estate planning documents,
so therefore they do not havepower of attorney.
They do not have anythingsaying.
This person can do things forme and they have now become
(03:29):
incapacitated, so therefore wehave to basically sue them.
We open up a court case againstthe person that is
incapacitated, present theevidence to a judge that this
person is incapacitated and thatthey can no longer make
decisions by themselves, and weneed the court to intervene.
Name a guardian for the ward,okay, and the thing is, this is
(03:55):
just what you ought to do in themedical field and I come from
the medical field.
I was a fiscal therapist forquite a few years before I
became an attorney, and I cantell you if someone is difficult
to deal with, if they have apermanent disability of the mind
(04:17):
, then it's like, oh, we just goget a guardianship, that'll
make everything easier.
And the medical establishmentloves to deal with a guardian.
They know that they're beingsupervised by a judge and
there's typically no funnybusiness and it just makes their
life easier if they can say, oh, this person's the guardian and
(04:38):
they can basically ignore thepatient and just talk to the
guardian and the guardian is theone to make decisions.
It is more work when there is apower of attorney in place and
they just they see it from theirconvenience and say go get a
guardianship.
And please understand, aguardianship is taking the
(05:00):
rights away from a person andgiving it to someone else, and a
judge does that.
Once the person goes throughthe guardianship, they are now a
ward and they do not have theability, typically with a full
guardianship, to make anydecisions whatsoever.
Okay, so we've taken thisperson's autonomy away from them
(05:24):
and we as attorneys aresupposed to look out for the
autonomy of our clients, thefreedoms of our clients.
We don't want the rights takenaway from our clients.
But with an older person with adiagnosis of dementia, it's
just like yep, that's just whatwe're going to do and that is
not what we as attorneys aresupposed to do, and particularly
(05:46):
as elder law attorneys.
We are to protect the rights ofour clients, and you do that
best by having your client do apower of attorney.
Ok, again, go back to episode 16to see when this can occur.
But I'm just saying the powerof attorney is a very simple and
inexpensive, particularly whenyou compare it to a guardianship
(06:10):
document that the person signsin your office.
They decide who's going to bethe guardian.
They still have all of theirrights, they are still able to
make decisions, but they havesomeone out there that can help
them.
And I prefer an immediatelyeffective power of attorney so
(06:30):
that the agent can jump in anddo what needs to be done very
quickly without having to jumpthrough any hoops.
I'm not a fan of springingpowers of attorney because you
have to jump through some hoopsbefore the person can function
as the agent, and sometimesthose hoops can't be done
outside of court, and so we endup in court, which is the whole
(06:52):
purpose of doing the power ofattorney is to avoid court, ok,
so power of attorney givessomeone else the authority to
help the person make decisions.
But the key point is theprincipal, the person who
created the power of attorney,still has their rights, is still
able to do things, and theydon't lose any of their rights.
(07:16):
So circumstances that wouldlead up to a guardianship is the
loss of capacity, either suddenwith a stroke, head injury, car
wreck, some medical procedure.
If their heart stopped and ittook more than just a few
minutes to get them back, theywould have some brain damage,
(07:38):
and so something like thatoccurs and that person quickly
becomes incapacitated.
But typically what we as elderlaw attorneys see is someone
develops dementia and that is aslowly progressing, ongoing
decline of their mentalfaculties.
(07:58):
That is not so clear cut.
It's like, okay, today theyhave capacity, tomorrow they
don't could.
It's like okay, today they havecapacity, tomorrow they don't.
And doing this while the personstill has capacity allows us to
jump in and do what needs to bedone at any point past them,
particularly if you do animmediately effective power of
(08:19):
attorney.
And so under a power of attorney, the, the agent, is to make
decisions that are in theprincipal's best interest.
That's the fiduciary duty.
The agent has a fiduciary dutyto the principal, as does the
guardian has a fiduciary duty tothe ward.
(08:41):
But the difference there is theguardian has to answer to the
judge.
And I think this is one thingthat most medical people don't
understand is when theyrecommend a guardianship.
It's so convenient for them butit's hugely inconvenient for
the family, because aguardianship is a lifetime
(09:03):
commitment with the court unlessthe person regains capacity,
which is very rare, particularlyas an elder law attorney and so
you have a lifetime commitmentwith this court Every year.
I think most states require anannual evaluation or update to
the court of this person, bothfinancially and medically, and
(09:28):
most people want an attorney tohelp them file that.
And so every year you have togo back to the court and you do
this until the person passesaway.
And people don't think aboutthat up front.
It's like, oh, just go get aguardianship, it'll be easy.
Well, it is easy at first onceyou get through the process, but
then the family has to dealwith this for the rest of the
(09:51):
ward's life.
Ok, technically, a guardianshipis to be crafted specifically
for the needs of the ward.
I have seen typically mostattorneys they just file a
general guardianship to saywe're going to take care of
everything.
They don't go through and craftit specifically on the needs of
(10:16):
the ward, because that takestime, that takes effort, that
takes testimony from experts andit's just easier to just do a
complete sweep, which means theward has no rights after the
guardianship is done.
You can do that with a power ofattorney.
Now, I'm a huge fan of verycomprehensive powers of attorney
(10:41):
that allow the agent to dowhatever needs to be done
because of Medicaid planning,scam prevention, things like
that.
That allow the agent to go inand close bank accounts, gift
money, do whatever needs to bedone to protect the principal at
(11:01):
that point, with theunderstanding that those actions
have to be in the best interestfor the ward.
Let's talk about cost.
The cost between doing aguardianship and a power of
attorney is tremendous.
Whatever you charge for a powerof attorney, which is probably
somewhere between $200 and$1,000, I don't know what you
(11:23):
charge, but as an elder lawattorney, if you were doing one
that is very comprehensive andallows us to protect the entire
estate once someone needsnursing home care, you should
charge a fairly substantial sumfor that, and I do a package of
documents financial power ofattorney, health care power of
attorney, living will and aHIPAA release and I charge one
(11:47):
flat fee for those and it'spushing $1,000.
I don't get pushback becausehow I'm presented as this will
allow us to protect your entireestate once you need nursing
home care, or it will allow usto protect as much as possible,
and without the powers in thispower of attorney, we can't do
that and you would loseeverything.
(12:09):
So it's well worth the fee thatI am charging them, which is
probably higher than most peopleWith a guardianship.
I think most attorneys requiresome upfront fee, which is more
than a thousand and sometimes afew thousand, and then typically
based on an hourly rate ifthings go bad and you have to
(12:33):
spend more time in courtfighting or doing whatever, and
so it is very common forguardianships to be many
thousands of dollars.
And again there's that annualfee to submit things to the
judge and get things back outthere and an attorney charges
for that.
Okay, so those are some of thebiggest differences and it's
(13:01):
just.
It's interesting how thathappens.
And then some of the practicalissues between a guardianship
and a power of attorney is manytimes people come to us and say
mom's in the nursing home, we'respending $8,000, $12,000 per
(13:21):
month.
Can we protect her money.
It's like, yes, if we have thepower to do that and if they
have not done a power ofattorney and we need a
guardianship.
Some states do not allowMedicaid planning under a
guardianship, particularly inArkansas.
The guardianship statute saysthe assets of the ward shall be
(13:46):
used for the ward and judgeshave read that as being.
We can't give it away.
If it's to be used for the ward, we have to use it for the ward
.
So therefore you cannot doMedicaid planning in those
situations.
We've had some success, butit's very spotty and it's not a
given.
And so see, if your stateallows that, if the judges are
(14:07):
willing to let you do Medicaidplanning.
But even if they do, to get theguardianship in place and be
able to come up with a plan anddo this, you have to wait on
court schedules and hearings anddifferent things and you can
easily go one, two, three monthstrying to get the processes in
(14:31):
order to do Medicaid planningunder the guardianship, whereas
with a power of attorney you canprobably draft that in a day,
go get the person's signaturethat day, or quickly, or, if
they've already done power ofattorney, you can start Medicaid
planning immediately and manytimes do it within 30 days, so
(14:53):
that the family pays for amonth's worth of nursing home
care as opposed to three or fourmonths, and that's saving, you
know, $10,000, $12,000 per monththat you're able to do that.
And so again, there's just nocomparison between a
guardianship and a power ofattorney and why the power of
(15:15):
attorney just makes sense.
And also, I don't want you todiscount the emotional
involvement here is, you know,with the family having to go
through a guardianship, versusthe process of a power of
attorney.
Guardianships can be veryhumiliating.
(15:36):
You have to present evidence incourt that this person is
incapacitated and sometimes thisperson's doing really bad
things, you know, strippingnaked and running out the door
or going to the bathroom in thefront yard and sexually
assaulting other people.
It can be a very bad process ofpresenting all of this in open
(16:05):
court for this person who usedto be a pillar of the community
and people think great things ofthem, and now you're saying all
these bad things.
That's emotionally devastatingto the client, to the ward and
to the family, and with a powerof attorney, we don't have to
get into that just here.
Do you know who these peopleare?
(16:25):
Do you know who you want tomake financial decisions
decisions for you?
If so, put it in this form,sign it, notarize it.
It's done.
No emotional issues there.
Just sign it and the familyprobably knows who's going to be
the best person to be the agent.
(16:46):
And in court, the judge choosessomeone.
I say they generally do a goodjob, but there could be that
situation where the judge pickedthe wrong person and then
trying to change that is a hugehassle.
So please understand thatguardianship is not the
(17:06):
preferred thing to do and itshould only be done as a very
last resort, when things need tobe done and there is no legal
document in place that allows usto do it.
Okay and just, please, don'tfile guardianship just because
(17:26):
it just seems to make sense.
I've seen cases where there isa power of attorney in place.
Short of, the agent under thepower of attorney needs to be
kicked out and someone elseneeds to be put in.
I mean, I can understand thatis one of those reasons that a
guardianship would be needed,but short of that, it's so much
(17:47):
easier to change your mind to dothings under the power of
attorney.
Now let me end this episodewith a quick.
You know why would youabsolutely need a guardianship,
even if there is a power ofattorney in place.
And I see two situations wherethat comes up when I will refer
someone out for a guardianship,even though I've done a power of
(18:10):
attorney for them.
Number one is if there werewhat I call serial agents,
meaning that mom is very easilyinfluenced, or dad, mom or dad
the principal is very easilyinfluenced by someone else to
change the power of attorney toappoint them.
(18:30):
And so you'll typically seethis with three kids, two or
three kids, and the kids don'tget along and the kids have
different agendas.
Sometimes one of them is reallynot that good of a kid, needs
money and has been living off ofmom.
When the other child, who istrustworthy and does a good job,
(18:51):
gets to be appointed power ofattorney, say I'll be that
attorney.
Mom comes to me and says hey,this one child is stealing money
from me and I need to appointthis person as power of attorney
so they can help me.
Okay, great, that's a goodreason.
Well, we do that power ofattorney.
Well, the kid who was stealingfinds out and says mom, I want
(19:14):
to lose my job, I want to getkicked out of my house, whatever
, I need to be your power, dothat power of attorney.
Well, the kid who was stealingfinds out and says mom, I'm
going to lose my job, I'm goingto get kicked out of my house.
Whatever, I need to be yourpower of attorney.
I'm the one here with you allthe time yeah, because they're
not working.
But I'm the one here with you,I'm the one who cares for you.
My sister's not a good agent.
She's not going to take care ofyou like I am.
(19:34):
Let's go to the lawyer and havethe lawyer name me as your
agent.
Mom's like okay, and so shegoes to a second lawyer and that
attorney, with the informationthat they have, appoints the you
know, let's say the son, as theagent.
Well then everybody finds outoh my God, mom's appointed this
(19:57):
child, the one who steals fromher, as the agent.
Well then everybody finds outoh my God, mom's appointed this
child, the one who steals fromher, as the agent.
And then it changes back, andthen it's just back and forth
and back and forth.
And when mom is so easilypersuaded to change that?
That's the one downside to apower of attorney is it can be
changed as long as the personhas capacity and if there are
attorneys, or even if theydownload a power of attorney off
the internet and have mom signit, theoretically that trumps
(20:21):
the previous power of attorney,and so it's just a problem.
The way we solve that is toopen up a guardianship and let a
judge figure it out.
Ok, so once a judge decideswho's going to do it, that
doesn't get changed so easily.
So that's one situation where Isee, even with a power of
(20:42):
attorney in place, that we needa guardianship.
The other one is if theprincipal I'm where they need to
stay or go where they need togo the agent under power of
(21:04):
attorney can't physically makethis person stay somewhere or go
somewhere.
A principal still has freedoms.
Ok, the a principal still hasfreedoms.
They still can go and do asthey want to do, and you can't
restrain them or kidnap them atthis point.
And so, therefore, if thatperson simply will not go where
(21:26):
they should go or stay wherethey should stay, then a
guardianship may be needed.
Okay, now just a quick practicepointer If this person has a
power of attorney that I've donefor them and they refuse to go
or refuse to stay, I'll tell thefamily hey, call me, let me go
(21:50):
talk to them and, very briefly,I'll tell you how I handle that
is.
I will go to them and say look,ms Jones, I understand that you
want to leave the nursing home.
Yep, I'm leaving, I want to gohome.
There's nothing wrong with me,I can go home.
Well, your family and thedoctors say differently, you
really should stay here.
Well, they don't know whatthey're talking about.
(22:10):
I'm going home.
I'm like okay, ms Jones, youreally should stay here.
And so that's phase one.
It's like well, the doctor andyour family says otherwise, and
sometimes that works, but rarely.
Step two is when she says nope,I'm fine, I'm going home.
You're like okay.
In my mind, step two is hey, ifyou go home and you get hurt,
(22:34):
your daughter is your agentunder the power of attorney, and
if someone decides she let youdo that and she let you get hurt
, they could go after her, whichis not likely, it's actually
very unlikely, but it could bepossible.
You're not lying to yourclients, you're just kind of
exaggerating things a little bit, but it could be possible.
(22:54):
You're not lying to yourclients, you're just kind of
exaggerating things a little bit, but it could happen.
It's like look, you don't wantthem going after your daughter
if you go home and get hurt.
Sometimes that'll work, mosttimes it won't.
She's like I'm not going tofall, I'll be fine, don't worry
about it, I'm going home.
I'm like okay, ms Jones.
The last and final stage is MsJones, you're really not going
(23:15):
home.
Oh yeah, I am.
No, you're not, because if youcontinue to decide that you're
going home, your doctor says youshouldn't, your family says you
shouldn't.
It is well documented that youshould not go home.
You're going to force me to puton a suit and file some
paperwork at the court and I cantalk to the judge this
(23:36):
afternoon, if I need to, andconvince them that you do not
need to go home, and a judge, atleast temporarily, will say you
can't go home, okay, and youwon't go home.
Okay, home, okay.
It'll take two or three days tofight this out in court, but
(23:57):
with testimony from your doctor,testimony from your family,
everything that everyone knows,a judge is going to decide you
can't go home and so, ms Jones,you're not going home.
We can do it, we can do it easy.
You can make me put on a suitand go to court and do all that
stuff, but don't make me do that, just stay here.
Okay, this is what you need todo.
(24:19):
But if you force us, I'll go tocourt and I'll make you stay
here.
And so Ms Jones is like so I'mnot going home.
No, you're not.
She's like okay, and they'llstay okay.
Now, what lawyer would do that?
What lawyer would say oh, she'swanting to leave home, let's
file a guardianship, you'll makemore money.
(24:40):
But is it in the client's bestinterest?
And it's not.
If you can convince them tostay because they're really not
going home, I think you owe itto your client to tell them that
to say home, I think you owe itto your client to tell them
that to say you're not goinghome, don't make me put on a
suit, don't make me do all thisstuff.
You're not going home.
(25:01):
And I think we owe it to ourclients that's in their best
interest to not waste money onthat.
But I've seen it so many timeswhere like, okay, she won't stay
, so let's just file aguardianship and that'll make
them stay.
Again, lifelong commitment, notin the client's best interest,
don't do that.
Go, spend a little bit of time,charge the family for that.
(25:21):
I mean you just save them a tonof time.
I normally don't charge becausethey're my client and I think
this is in their best interestand I'll go do that.
But if you feel like you needto be paid for that, sure, I
think that's a very billableservice that you can bill the
family to pay you to go convincethem not to do a guardianship,
(25:43):
and so I've probably done thatfive or six times over my career
and it worked in all but onesituation, so I would encourage
you to do that.
All right, hopefully I haveconvinced you emotionally and
legally not to do guardianshipsunless it is just absolutely
necessary, but please understandwhat it is and how it involves
(26:06):
your client and it is truly inyour client's best interest to
not go through a guardianshipand I think it's your job to
help prevent that.
All right, thank you so muchfor listening and, as always,
please subscribe and if youwould like to do coaching, I
would love to talk to you.
Give us a call to check out ourbrand new website.
(26:30):
We've updated it, got some coolthings on there, and I would
love to be your coach and giveus a call and I will help you
become a very proficient elderlaw attorney.
All right, we will see you nexttime.
Speaker 1 (26:47):
Thank you for joining this episode of the Elder Law
Coach Podcast.
For those eager to take theirelder law practice to new
heights and are interested inTodd's acclaimed coaching
program, visitwwwtheelderlawcoachcom.
With Todd Whatley by your side,the journey to becoming an
elder law authority has neverbeen more achievable.
(27:07):
Until next time, keep learning,keep growing and stay
passionate about elder law.
Thank you.
Specialized experience, Whetheryou're an established attorney
looking to refine your expertiseor an emerging lawyer seeking a
successful foray into elder law, this is your masterclass.
Now let's get started with theluminary in the field.
Here's Todd Whatley.
Speaker 2 (00:37):
That's right.
This is the Elder Law CoachPodcast and my name is Todd
Whatley and, as always, I amsuper happy that you have joined
us.
And I just want to say realquick if you have suggestions, I
am very much open tosuggestions.
We are now getting upwards of.
I've stopped counting at 28.
(01:00):
I've stopped doing episodes at28, so we're 29, 30, 31, 32, 33.
So we've done 33 episodes andI'm not running out of stuff.
I could do lots of episodes,but I want to do what you want,
and so if you have questions orif you have topics that you
would like for me to do, pleaseemail me, todd, at
(01:23):
TheOterLawCoachcom, and I wouldlove to take your suggestions
about future topics.
Today I want to talk about oneof the things that is my soapbox
and that is guardianshipsversus power of attorney.
A lot of this is going torelate back to working with a
(01:46):
client with diminished capacity,and that is episode 16.
I would encourage you.
If you have not listened tothat episode, I would suggest
you go back and listen to thatone, and it will explain a lot
of things about my take on.
(02:06):
Can a person sign a power ofattorney or should we do a
guardianship and just a real,very quick summary is just
because someone has largemisconception in the legal
(02:27):
community is that if you havedementia, you can't sign
documents anymore, and that doesnot follow our ethical rules,
and I explain that in detail inepisode 16, so I would encourage
you to go back and listen to it.
So I'm going to make sure weunderstand the differences
(03:06):
between the two so that I caneffectively make my point.
So a guardianship is when aperson has become incapacitated
and typically they have not doneany estate planning documents,
so therefore they do not havepower of attorney.
They do not have anythingsaying.
This person can do things forme and they have now become
(03:29):
incapacitated, so therefore wehave to basically sue them.
We open up a court case againstthe person that is
incapacitated, present theevidence to a judge that this
person is incapacitated and thatthey can no longer make
decisions by themselves, and weneed the court to intervene.
Name a guardian for the ward,okay, and the thing is, this is
(03:55):
just what you ought to do in themedical field and I come from
the medical field.
I was a fiscal therapist forquite a few years before I
became an attorney, and I cantell you if someone is difficult
to deal with, if they have apermanent disability of the mind
(04:17):
, then it's like, oh, we just goget a guardianship, that'll
make everything easier.
And the medical establishmentloves to deal with a guardian.
They know that they're beingsupervised by a judge and
there's typically no funnybusiness and it just makes their
life easier if they can say, oh, this person's the guardian and
(04:38):
they can basically ignore thepatient and just talk to the
guardian and the guardian is theone to make decisions.
It is more work when there is apower of attorney in place and
they just they see it from theirconvenience and say go get a
guardianship.
And please understand, aguardianship is taking the
(05:00):
rights away from a person andgiving it to someone else, and a
judge does that.
Once the person goes throughthe guardianship, they are now a
ward and they do not have theability, typically with a full
guardianship, to make anydecisions whatsoever.
Okay, so we've taken thisperson's autonomy away from them
(05:24):
and we as attorneys aresupposed to look out for the
autonomy of our clients, thefreedoms of our clients.
We don't want the rights takenaway from our clients.
But with an older person with adiagnosis of dementia, it's
just like yep, that's just whatwe're going to do and that is
not what we as attorneys aresupposed to do, and particularly
(05:46):
as elder law attorneys.
We are to protect the rights ofour clients, and you do that
best by having your client do apower of attorney.
Ok, again, go back to episode 16to see when this can occur.
But I'm just saying the powerof attorney is a very simple and
inexpensive, particularly whenyou compare it to a guardianship
(06:10):
document that the person signsin your office.
They decide who's going to bethe guardian.
They still have all of theirrights, they are still able to
make decisions, but they havesomeone out there that can help
them.
And I prefer an immediatelyeffective power of attorney so
(06:30):
that the agent can jump in anddo what needs to be done very
quickly without having to jumpthrough any hoops.
I'm not a fan of springingpowers of attorney because you
have to jump through some hoopsbefore the person can function
as the agent, and sometimesthose hoops can't be done
outside of court, and so we endup in court, which is the whole
(06:52):
purpose of doing the power ofattorney is to avoid court, ok,
so power of attorney givessomeone else the authority to
help the person make decisions.
But the key point is theprincipal, the person who
created the power of attorney,still has their rights, is still
able to do things, and theydon't lose any of their rights.
(07:16):
So circumstances that wouldlead up to a guardianship is the
loss of capacity, either suddenwith a stroke, head injury, car
wreck, some medical procedure.
If their heart stopped and ittook more than just a few
minutes to get them back, theywould have some brain damage,
(07:38):
and so something like thatoccurs and that person quickly
becomes incapacitated.
But typically what we as elderlaw attorneys see is someone
develops dementia and that is aslowly progressing, ongoing
decline of their mentalfaculties.
(07:58):
That is not so clear cut.
It's like, okay, today theyhave capacity, tomorrow they
don't could.
It's like okay, today they havecapacity, tomorrow they don't.
And doing this while the personstill has capacity allows us to
jump in and do what needs to bedone at any point past them,
particularly if you do animmediately effective power of
(08:19):
attorney.
And so under a power of attorney, the, the agent, is to make
decisions that are in theprincipal's best interest.
That's the fiduciary duty.
The agent has a fiduciary dutyto the principal, as does the
guardian has a fiduciary duty tothe ward.
(08:41):
But the difference there is theguardian has to answer to the
judge.
And I think this is one thingthat most medical people don't
understand is when theyrecommend a guardianship.
It's so convenient for them butit's hugely inconvenient for
the family, because aguardianship is a lifetime
(09:03):
commitment with the court unlessthe person regains capacity,
which is very rare, particularlyas an elder law attorney and so
you have a lifetime commitmentwith this court Every year.
I think most states require anannual evaluation or update to
the court of this person, bothfinancially and medically, and
(09:28):
most people want an attorney tohelp them file that.
And so every year you have togo back to the court and you do
this until the person passesaway.
And people don't think aboutthat up front.
It's like, oh, just go get aguardianship, it'll be easy.
Well, it is easy at first onceyou get through the process, but
then the family has to dealwith this for the rest of the
(09:51):
ward's life.
Ok, technically, a guardianshipis to be crafted specifically
for the needs of the ward.
I have seen typically mostattorneys they just file a
general guardianship to saywe're going to take care of
everything.
They don't go through and craftit specifically on the needs of
(10:16):
the ward, because that takestime, that takes effort, that
takes testimony from experts andit's just easier to just do a
complete sweep, which means theward has no rights after the
guardianship is done.
You can do that with a power ofattorney.
Now, I'm a huge fan of verycomprehensive powers of attorney
(10:41):
that allow the agent to dowhatever needs to be done
because of Medicaid planning,scam prevention, things like
that.
That allow the agent to go inand close bank accounts, gift
money, do whatever needs to bedone to protect the principal at
(11:01):
that point, with theunderstanding that those actions
have to be in the best interestfor the ward.
Let's talk about cost.
The cost between doing aguardianship and a power of
attorney is tremendous.
Whatever you charge for a powerof attorney, which is probably
somewhere between $200 and$1,000, I don't know what you
(11:23):
charge, but as an elder lawattorney, if you were doing one
that is very comprehensive andallows us to protect the entire
estate once someone needsnursing home care, you should
charge a fairly substantial sumfor that, and I do a package of
documents financial power ofattorney, health care power of
attorney, living will and aHIPAA release and I charge one
(11:47):
flat fee for those and it'spushing $1,000.
I don't get pushback becausehow I'm presented as this will
allow us to protect your entireestate once you need nursing
home care, or it will allow usto protect as much as possible,
and without the powers in thispower of attorney, we can't do
that and you would loseeverything.
(12:09):
So it's well worth the fee thatI am charging them, which is
probably higher than most peopleWith a guardianship.
I think most attorneys requiresome upfront fee, which is more
than a thousand and sometimes afew thousand, and then typically
based on an hourly rate ifthings go bad and you have to
(12:33):
spend more time in courtfighting or doing whatever, and
so it is very common forguardianships to be many
thousands of dollars.
And again there's that annualfee to submit things to the
judge and get things back outthere and an attorney charges
for that.
Okay, so those are some of thebiggest differences and it's
(13:01):
just.
It's interesting how thathappens.
And then some of the practicalissues between a guardianship
and a power of attorney is manytimes people come to us and say
mom's in the nursing home, we'respending $8,000, $12,000 per
(13:21):
month.
Can we protect her money.
It's like, yes, if we have thepower to do that and if they
have not done a power ofattorney and we need a
guardianship.
Some states do not allowMedicaid planning under a
guardianship, particularly inArkansas.
The guardianship statute saysthe assets of the ward shall be
(13:46):
used for the ward and judgeshave read that as being.
We can't give it away.
If it's to be used for the ward, we have to use it for the ward
.
So therefore you cannot doMedicaid planning in those
situations.
We've had some success, butit's very spotty and it's not a
given.
And so see, if your stateallows that, if the judges are
(14:07):
willing to let you do Medicaidplanning.
But even if they do, to get theguardianship in place and be
able to come up with a plan anddo this, you have to wait on
court schedules and hearings anddifferent things and you can
easily go one, two, three monthstrying to get the processes in
(14:31):
order to do Medicaid planningunder the guardianship, whereas
with a power of attorney you canprobably draft that in a day,
go get the person's signaturethat day, or quickly, or, if
they've already done power ofattorney, you can start Medicaid
planning immediately and manytimes do it within 30 days, so
(14:53):
that the family pays for amonth's worth of nursing home
care as opposed to three or fourmonths, and that's saving, you
know, $10,000, $12,000 per monththat you're able to do that.
And so again, there's just nocomparison between a
guardianship and a power ofattorney and why the power of
(15:15):
attorney just makes sense.
And also, I don't want you todiscount the emotional
involvement here is, you know,with the family having to go
through a guardianship, versusthe process of a power of
attorney.
Guardianships can be veryhumiliating.
(15:36):
You have to present evidence incourt that this person is
incapacitated and sometimes thisperson's doing really bad
things, you know, strippingnaked and running out the door
or going to the bathroom in thefront yard and sexually
assaulting other people.
It can be a very bad process ofpresenting all of this in open
(16:05):
court for this person who usedto be a pillar of the community
and people think great things ofthem, and now you're saying all
these bad things.
That's emotionally devastatingto the client, to the ward and
to the family, and with a powerof attorney, we don't have to
get into that just here.
Do you know who these peopleare?
(16:25):
Do you know who you want tomake financial decisions
decisions for you?
If so, put it in this form,sign it, notarize it.
It's done.
No emotional issues there.
Just sign it and the familyprobably knows who's going to be
the best person to be the agent.
(16:46):
And in court, the judge choosessomeone.
I say they generally do a goodjob, but there could be that
situation where the judge pickedthe wrong person and then
trying to change that is a hugehassle.
So please understand thatguardianship is not the
(17:06):
preferred thing to do and itshould only be done as a very
last resort, when things need tobe done and there is no legal
document in place that allows usto do it.
Okay and just, please, don'tfile guardianship just because
(17:26):
it just seems to make sense.
I've seen cases where there isa power of attorney in place.
Short of, the agent under thepower of attorney needs to be
kicked out and someone elseneeds to be put in.
I mean, I can understand thatis one of those reasons that a
guardianship would be needed,but short of that, it's so much
(17:47):
easier to change your mind to dothings under the power of
attorney.
Now let me end this episodewith a quick.
You know why would youabsolutely need a guardianship,
even if there is a power ofattorney in place.
And I see two situations wherethat comes up when I will refer
someone out for a guardianship,even though I've done a power of
(18:10):
attorney for them.
Number one is if there werewhat I call serial agents,
meaning that mom is very easilyinfluenced, or dad, mom or dad
the principal is very easilyinfluenced by someone else to
change the power of attorney toappoint them.
(18:30):
And so you'll typically seethis with three kids, two or
three kids, and the kids don'tget along and the kids have
different agendas.
Sometimes one of them is reallynot that good of a kid, needs
money and has been living off ofmom.
When the other child, who istrustworthy and does a good job,
(18:51):
gets to be appointed power ofattorney, say I'll be that
attorney.
Mom comes to me and says hey,this one child is stealing money
from me and I need to appointthis person as power of attorney
so they can help me.
Okay, great, that's a goodreason.
Well, we do that power ofattorney.
Well, the kid who was stealingfinds out and says mom, I want
(19:14):
to lose my job, I want to getkicked out of my house, whatever
, I need to be your power, dothat power of attorney.
Well, the kid who was stealingfinds out and says mom, I'm
going to lose my job, I'm goingto get kicked out of my house.
Whatever, I need to be yourpower of attorney.
I'm the one here with you allthe time yeah, because they're
not working.
But I'm the one here with you,I'm the one who cares for you.
My sister's not a good agent.
She's not going to take care ofyou like I am.
(19:34):
Let's go to the lawyer and havethe lawyer name me as your
agent.
Mom's like okay, and so shegoes to a second lawyer and that
attorney, with the informationthat they have, appoints the you
know, let's say the son, as theagent.
Well then everybody finds outoh my God, mom's appointed this
(19:57):
child, the one who steals fromher, as the agent.
Well then everybody finds outoh my God, mom's appointed this
child, the one who steals fromher, as the agent.
And then it changes back, andthen it's just back and forth
and back and forth.
And when mom is so easilypersuaded to change that?
That's the one downside to apower of attorney is it can be
changed as long as the personhas capacity and if there are
attorneys, or even if theydownload a power of attorney off
the internet and have mom signit, theoretically that trumps
(20:21):
the previous power of attorney,and so it's just a problem.
The way we solve that is toopen up a guardianship and let a
judge figure it out.
Ok, so once a judge decideswho's going to do it, that
doesn't get changed so easily.
So that's one situation where Isee, even with a power of
(20:42):
attorney in place, that we needa guardianship.
The other one is if theprincipal I'm where they need to
stay or go where they need togo the agent under power of
(21:04):
attorney can't physically makethis person stay somewhere or go
somewhere.
A principal still has freedoms.
Ok, the a principal still hasfreedoms.
They still can go and do asthey want to do, and you can't
restrain them or kidnap them atthis point.
And so, therefore, if thatperson simply will not go where
(21:26):
they should go or stay wherethey should stay, then a
guardianship may be needed.
Okay, now just a quick practicepointer If this person has a
power of attorney that I've donefor them and they refuse to go
or refuse to stay, I'll tell thefamily hey, call me, let me go
(21:50):
talk to them and, very briefly,I'll tell you how I handle that
is.
I will go to them and say look,ms Jones, I understand that you
want to leave the nursing home.
Yep, I'm leaving, I want to gohome.
There's nothing wrong with me,I can go home.
Well, your family and thedoctors say differently, you
really should stay here.
Well, they don't know whatthey're talking about.
(22:10):
I'm going home.
I'm like okay, ms Jones, youreally should stay here.
And so that's phase one.
It's like well, the doctor andyour family says otherwise, and
sometimes that works, but rarely.
Step two is when she says nope,I'm fine, I'm going home.
You're like okay.
In my mind, step two is hey, ifyou go home and you get hurt,
(22:34):
your daughter is your agentunder the power of attorney, and
if someone decides she let youdo that and she let you get hurt
, they could go after her, whichis not likely, it's actually
very unlikely, but it could bepossible.
You're not lying to yourclients, you're just kind of
exaggerating things a little bit, but it could be possible.
(22:54):
You're not lying to yourclients, you're just kind of
exaggerating things a little bit, but it could happen.
It's like look, you don't wantthem going after your daughter
if you go home and get hurt.
Sometimes that'll work, mosttimes it won't.
She's like I'm not going tofall, I'll be fine, don't worry
about it, I'm going home.
I'm like okay, ms Jones.
The last and final stage is MsJones, you're really not going
(23:15):
home.
Oh yeah, I am.
No, you're not, because if youcontinue to decide that you're
going home, your doctor says youshouldn't, your family says you
shouldn't.
It is well documented that youshould not go home.
You're going to force me to puton a suit and file some
paperwork at the court and I cantalk to the judge this
(23:36):
afternoon, if I need to, andconvince them that you do not
need to go home, and a judge, atleast temporarily, will say you
can't go home, okay, and youwon't go home.
Okay, home, okay.
It'll take two or three days tofight this out in court, but
(23:57):
with testimony from your doctor,testimony from your family,
everything that everyone knows,a judge is going to decide you
can't go home and so, ms Jones,you're not going home.
We can do it, we can do it easy.
You can make me put on a suitand go to court and do all that
stuff, but don't make me do that, just stay here.
Okay, this is what you need todo.
(24:19):
But if you force us, I'll go tocourt and I'll make you stay
here.
And so Ms Jones is like so I'mnot going home.
No, you're not.
She's like okay, and they'llstay okay.
Now, what lawyer would do that?
What lawyer would say oh, she'swanting to leave home, let's
file a guardianship, you'll makemore money.
(24:40):
But is it in the client's bestinterest?
And it's not.
If you can convince them tostay because they're really not
going home, I think you owe itto your client to tell them that
to say home, I think you owe itto your client to tell them
that to say you're not goinghome, don't make me put on a
suit, don't make me do all thisstuff.
You're not going home.
(25:01):
And I think we owe it to ourclients that's in their best
interest to not waste money onthat.
But I've seen it so many timeswhere like, okay, she won't stay
, so let's just file aguardianship and that'll make
them stay.
Again, lifelong commitment, notin the client's best interest,
don't do that.
Go, spend a little bit of time,charge the family for that.
(25:21):
I mean you just save them a tonof time.
I normally don't charge becausethey're my client and I think
this is in their best interestand I'll go do that.
But if you feel like you needto be paid for that, sure, I
think that's a very billableservice that you can bill the
family to pay you to go convincethem not to do a guardianship,
(25:43):
and so I've probably done thatfive or six times over my career
and it worked in all but onesituation, so I would encourage
you to do that.
All right, hopefully I haveconvinced you emotionally and
legally not to do guardianshipsunless it is just absolutely
necessary, but please understandwhat it is and how it involves
(26:06):
your client and it is truly inyour client's best interest to
not go through a guardianshipand I think it's your job to
help prevent that.
All right, thank you so muchfor listening and, as always,
please subscribe and if youwould like to do coaching, I
would love to talk to you.
Give us a call to check out ourbrand new website.
(26:30):
We've updated it, got some coolthings on there, and I would
love to be your coach and giveus a call and I will help you
become a very proficient elderlaw attorney.
All right, we will see you nexttime.
Speaker 1 (26:47):
Thank you for joining this episode of the Elder Law
Coach Podcast.
For those eager to take theirelder law practice to new
heights and are interested inTodd's acclaimed coaching
program, visitwwwtheelderlawcoachcom.
With Todd Whatley by your side,the journey to becoming an
elder law authority has neverbeen more achievable.
(27:07):
Until next time, keep learning,keep growing and stay
passionate about elder law.
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