Become guardian of complex estate?

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Topic Author
CommitmentDevice
Posts: 109
Joined: Tue Apr 02, 2019 3:25 am

Become guardian of complex estate?

Post by CommitmentDevice »

I'd appreciate your help thinking through whether or not to become the guardian of my grandma's estate.

We're pretty sure guardianship is necessary
  • My grandma is incapacitated and being financially exploited by one of her current powers of attorney. Her other powers of attorney are somewhat incapacitated. I've filed a complaint with adult protective services. We've met with an attorney to explore our options.
There are decent arguments as to why it should be me
  • Most of the other family members either aren't trustworthy, aren't capable, or aren't available.
  • I'm most in favor of a neutral third party as guardian. That said, my grandma's children are distrustful of handing control to someone outside of the family and they would probably resist any external appointment.
For this thread, I'd like to focus on evaluating whether or not I should volunteer for the role (either just me or as a co-guardian with another family member), with the alternatives being pushing for a neutral 3rd party or stepping back and allowing for the perpetuation of the status quo.

I'm energized by the prospect of being guardian for the following reasons:
  • Protect my grandma from further financial exploitation.
  • Bring healing to a multi-generational wound. Poor estate planning and management has been a source of family stress and strife for decades and I like the idea of being able to help fix an entrenched problem.
  • Building a highly efficient estate management system sounds like a fun challenge :D
I'm fearful of being guardian for the following reasons:
  • I'd be putting myself in the middle of a nasty family system
  • My grandma owns 8 houses held in a revokable trust. :shock: So this means either overseeing the sale of the houses (a ton of work and capital gains tax hit) or hiring a property manager (A lot of work and decent amount of ongoing hassle). There would be additional streamlining of bank accounts necessary, etc, but the real estate presents the lions share of the work to be done.
  • The regular work of guardianship... income, bill pay, bookkeeping, taxes, reporting.
  • There is an opportunity cost to my time, both in terms of my career and my responsibilities to my immediate family. My spouse doesn't think it is a good idea because it would be a big sacrifice for us with little benefit.
Thoughts? Questions? Suggestions? I'm grateful for your advice.
deikel
Posts: 1177
Joined: Sat Jan 25, 2014 7:13 pm

Re: Become guardian of complex estate?

Post by deikel »

I will be a little sarcastic to get the point across if you will excuse:

- your wife says no - end of story right there....
- you seem to think you know better then other people and with that attitude you are wading into a multi generational wound - your effort will be poorly remunerated if at all on top of it - the classic definition of a thankless task.

I will have a wild guess and say this is on your wife's side of the family ? If so, she knows best, see above. Even if it is on your side, see above.

As an aside, if there is an estate already set up and defined by estate rules (?), you might not have as much freedom to operate as you think. A Guardian of an estate has to 'maintain and protect the estate', however, depending how the estate was formed and established and based on what legal document that happened (e.g. a will), there may be severe restrictions to you when it comes to selling property in particular - before you really consider this, check what the underlying legal documents for the estate are.

This seems a no brainer to me to have outside 3rd party (estate lawyer) do the managing of this estate and yes appoint a property manager. Everyone might loose a little inherited money because of the fees involved, but everyone gains the assurance that a) things are done right for your grandma first and foremost and will be inherited in fair ways afterwards. No one gets sued afterwards and no one steps into legal minefields either.
Everything you read in this post is my personal opinion. If you disagree with this disclaimer, please un-read the text immediately and destroy any copy or remembrance of it.
Gill
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Location: Florida

Re: Become guardian of complex estate?

Post by Gill »

Why are you seeking a guardianship for her property when she has a revocable living trust? Discuss with the attorney the possibility of placing the remainder of her assets in the trust and having a corporate trustee act as trustee of the trust. That would be the "neutral third party" you are seeking. A corporate trustee is impartial, permanent, always available, experienced in managing such arrangements and has the ability to manage complex situations such as you describe. You already have the framework in place with the RLT. I urge you to use it.
Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal
Carefreeap
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Re: Become guardian of complex estate?

Post by Carefreeap »

deikel wrote: Thu Oct 15, 2020 9:34 am I will be a little sarcastic to get the point across if you will excuse:

- your wife says no - end of story right there....
- you seem to think you know better then other people and with that attitude you are wading into a multi generational wound - your effort will be poorly remunerated if at all on top of it - the classic definition of a thankless task.

I will have a wild guess and say this is on your wife's side of the family ? If so, she knows best, see above. Even if it is on your side, see above.

As an aside, if there is an estate already set up and defined by estate rules (?), you might not have as much freedom to operate as you think. A Guardian of an estate has to 'maintain and protect the estate', however, depending how the estate was formed and established and based on what legal document that happened (e.g. a will), there may be severe restrictions to you when it comes to selling property in particular - before you really consider this, check what the underlying legal documents for the estate are.

This seems a no brainer to me to have outside 3rd party (estate lawyer) do the managing of this estate and yes appoint a property manager. Everyone might loose a little inherited money because of the fees involved, but everyone gains the assurance that a) things are done right for your grandma first and foremost and will be inherited in fair ways afterwards. No one gets sued afterwards and no one steps into legal minefields either.
+1

As someone who has tried to play the family hero to a dysfunctional dynamic more than once, I will warn you it won't work out well. People in dysfunctional relationships seem to enjoy the chaos and drama. Have professionals handle it so you're not the bad guy and you keep the relationships that you want.

Good luck!
Every day I can hike is a good day.
Topic Author
CommitmentDevice
Posts: 109
Joined: Tue Apr 02, 2019 3:25 am

Re: Become guardian of complex estate?

Post by CommitmentDevice »

Great advice - thank you!
* Listen to my wife
* Hire professionals / corporate trustee
* Avoid trying to be a hero / target for family chaos and drama

I'll try and steer things towards courts appointing a neutral third party.
Topic Author
CommitmentDevice
Posts: 109
Joined: Tue Apr 02, 2019 3:25 am

Re: Become guardian of complex estate?

Post by CommitmentDevice »

Update:
I discussed this with all family members and they understood my decision to not want to be guardian.
Given the choice between continued financial exploitation, and going with a professional guardian, they've decided they're willing to stomach going with the latter.
Much work ahead, but a clear (and more tolerable) path forward. :beer
Gill
Posts: 6976
Joined: Sun Mar 04, 2007 8:38 pm
Location: Florida

Re: Become guardian of complex estate?

Post by Gill »

"Stomach" going with a professional guardian? My guess is that a professional guardian/trustee will save you more than it will cost by efficient and experienced management of your grandmother's affairs.
Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal
Broken Man 1999
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Re: Become guardian of complex estate?

Post by Broken Man 1999 »

CommitmentDevice wrote: Thu Oct 15, 2020 12:51 pm Update:
I discussed this with all family members and they understood my decision to not want to be guardian.
Given the choice between continued financial exploitation, and going with a professional guardian, they've decided they're willing to stomach going with the latter.
Much work ahead, but a clear (and more tolerable) path forward. :beer
OP, I think you dodged a bullet. Sounds like a nest of vipers. A shame, for sure.

Hope your family can find professional expertise. Since you hinted there was hinky stuff going on, your grandma will be better served, and the estate will be better protected.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain
J295
Posts: 2797
Joined: Sun Jan 01, 2012 11:40 pm

Re: Become guardian of complex estate?

Post by J295 »

CommitmentDevice wrote: Thu Oct 15, 2020 11:24 am Great advice - thank you!
* Listen to my wife
* Hire professionals / corporate trustee
* Avoid trying to be a hero / target for family chaos and drama

I'll try and steer things towards courts appointing a neutral third party.
Good. You can help without being the captain of the ship. Good luck.
johnnyc321
Posts: 99
Joined: Wed Jan 04, 2017 9:24 pm

Re: Become guardian of complex estate?

Post by johnnyc321 »

Gill wrote: Thu Oct 15, 2020 9:56 am Why are you seeking a guardianship for her property when she has a revocable living trust? Discuss with the attorney the possibility of placing the remainder of her assets in the trust and having a corporate trustee act as trustee of the trust. That would be the "neutral third party" you are seeking. A corporate trustee is impartial, permanent, always available, experienced in managing such arrangements and has the ability to manage complex situations such as you describe. You already have the framework in place with the RLT. I urge you to use it.
Gill
Guardianship law is very state specific. It is very likely that a guardianship/incapacity case will be necessary to have a court invalidate the power of attorney. That's the only method in Florida absent a revocation but if she is incapacitated, she cannot revoke it. If everything is moved to the trust, the agent could still demand withdrawals. So my guess is that this will eventually end up in court regardless.
bsteiner
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Joined: Sat Oct 20, 2012 9:39 pm
Location: NYC/NJ/FL

Re: Become guardian of complex estate?

Post by bsteiner »

johnnyc321 wrote: Thu Oct 15, 2020 4:34 pm
Gill wrote: Thu Oct 15, 2020 9:56 am Why are you seeking a guardianship for her property when she has a revocable living trust? Discuss with the attorney the possibility of placing the remainder of her assets in the trust and having a corporate trustee act as trustee of the trust. That would be the "neutral third party" you are seeking. A corporate trustee is impartial, permanent, always available, experienced in managing such arrangements and has the ability to manage complex situations such as you describe. You already have the framework in place with the RLT. I urge you to use it.
Gill
Guardianship law is very state specific. It is very likely that a guardianship/incapacity case will be necessary to have a court invalidate the power of attorney. That's the only method in Florida absent a revocation but if she is incapacitated, she cannot revoke it. If everything is moved to the trust, the agent could still demand withdrawals. So my guess is that this will eventually end up in court regardless.
I would expect that to be the case in most if not all states. If there's either a power of attorney or a revocable trust, and everyone is cooperative, you shouldn't need a guardianship. But in this case there's a concern with the agent under the power of attorney. While guardianships are cumbersome, a guardianship is the way to get rid of the agent.

My experience with outside guardians hasn't been as good as what others have had. If the original poster is willing to serve, and can get along with the rest of the family, and no one else in the immediate family objects, I think that's preferable.

In that regard, I had a case a few years ago where the children didn't talk to each other, and the court appointed a nonprofit agency as guardian. After the mother died, the children (through separate counsel) brought claims against the guardian. However, the court, having appointed the guardian because the children couldn't cooperate, wasn't interested in our claims.
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