CONSERVATORSHIP

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Introduction

In Arizona, a person judicially appointed to manage the financial affairs of another person is called a "Conservator."

The legal proceeding is called a "Conservatorship." Conservatorships are governed by the provisions of A.R.S. §14-5401 and the statutes that follow it.

The person whose financial affairs are managed is called the "protected person," sometimes also known as the "ward."

An individual, or a corporation with general power to serve as a trustee, may be appointed Conservator for a protected person. Generally, there is an order of priority for those who may be considered by the court for appointment. The establishment of a Conservatorship restricts the protected person's powers over financial decisions.

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Basis for Appointment

A Conservator may be appointed for a minor if the court determines that a minor owns money or property that requires management or protection which cannot otherwise be provided or has or may have affairs which may be jeopardized or prevented by his minority or that funds are needed for his support and education and that protection is necessary or desirable to obtain or provide funds.

A Conservator may be appointed for an adult if the court finds that the person to be protected:

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Difference Between Guardianship and Conservatorship

While a guardianship is a proceeding to appoint a person to take care of another person and handle his or her personal affairs, a Conservatorship is a court proceeding to appoint an individual (or a corporation with trustee powers), to manage the financial affairs of a minor or other person who can no longer manage his or her own property or financial matters. Generally, the Conservator does not make decisions about the personal care of the individual. However, a Conservator may assume the duties of a guardian if appointed Conservator of the estate of an unmarried minor, where no one has parental rights, and no guardian has been appointed.

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The Appointment Process

A Conservator is appointed by filing a petition for the appointment of a Conservator with the court. The petition may be filed by the person to be protected, any person interested in the estate, affairs or welfare of the protected person such as a parent or guardian, or any person adversely affected by improper management of the property and affairs of the protected person.

Notice of the time and place of the proceeding is given to the person to be protected, the spouse, or if none, the parents of the protected person. The person to be protected is entitled to be present at the hearing. The proposed protected person is entitled to have a jury decide the matter, rather than a judge, if he or she so desires.

If an emergency exists, a Conservator can be appointed quickly, with short notice to the involved parties. If the Court is satisfied that it is necessary for the best interests of the protected person, a Conservator may be appointed with no notice at all. The emergency appointment must be limited to a relatively short time, and must be followed by notice to the protected person and an opportunity to be heard after the appointment. The emergency appointment must also be followed by a regular application for appointment of a Conservator.

Because a Conservatorship is a court supervised proceeding, there may be substantial costs in establishing it, such as court filing fees, legal fees, investigator's fees and Conservator's fees. A Conservatorship is a public proceeding and the protected person's assets, income and expenses become a matter of public record.

The Conservatorship may be a cumbersome method of managing a person's financial affairs, since the Conservator must return to court for approval of certain transactions, such as the sale of real property, borrowing money, setting up a trust, etc. These formal court hearings require additional attorney's fees and create delays in completing these transactions.

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Rights Protected

The person to be protected must be represented by counsel, either the person's own counsel or counsel appointed by the court. The court must also appoint a physician to examine the proposed protected person. In addition, a "visitor" is appointed to interview the proposed protected persons and to submit a report to the court before the hearing. The visitor reports back to the court with an opinion on whether or not the appointment of a Conservator is justified.

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Duties of the Conservator

Within ninety (90) days of appointment, the Conservator must file an inventory of the estate of the protected person with the court. Annually, on the date of appointment, the Conservator must file an accounting of the administration of the estate with the court. A Conservator has the powers and responsibilities of a fiduciary and is held to the standard of care applicable to a trustee, that of a prudent person dealing with property of another.

The Conservator has the power to collect all the protected person’s assets, pay bills, make investments, etc. A Conservator has power to invest funds of the estate and to distribute money reasonably necessary for the health, support, care, education, welfare or benefit of the protected person, those legally dependent on the protected person, or those members of the protected person's household who are unable to support themselves. The Conservator must pay from the estate all of the just and proper claims against the estate and against the protected person. The Conservator must seek court supervision for major transactions, such as the purchase or sale of real property, borrowing money or making gifts of assets.

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Termination

A Conservatorship terminates upon the death of the protected person, upon a court determination that the minority or disability of the protected person has terminated, or upon the removal or resignation of the Conservator. Upon termination, title to the assets passes to the former protected person, or if he or she is deceased, then as provided by the protected person's Will or by law if there is no Will. The Conservator winds up the affairs of the estate, including the preparation and court approval of the final accounting.

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Arizona Revised Statutes

14-5401. Protective proceedings.

Upon petition and after notice and a hearing in accordance with the provisions of this article, the court may appoint a conservator or make another protective order for cause as follows:

1. Appointment of a conservator or other protective order may be made in relation to the estate and affairs of a minor if the court determines that a minor owns money or property that requires management or protection which cannot otherwise be provided or has or may have affairs which may be jeopardized or prevented by his minority or that funds are needed for his support and education and that protection is necessary or desirable to obtain or provide funds.

2. Appointment of a conservator or other protective order may be made in relation to the estate and affairs of a person if the court determines both of the following:

(a) The person is unable to manage the person's estate and affairs effectively for reasons such as mental illness, mental deficiency, mental disorder, physical illness or disability, chronic use of drugs, chronic intoxication, confinement, detention by a foreign power or disappearance.

(b) The person has property which will be wasted or dissipated unless proper management is provided, or that funds are needed for the support, care and welfare of the person or those entitled to be supported by the person and that protection is necessary or desirable to obtain or provide funds.

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14-5401.01. Temporary conservators; appointment; notice; hearings.

A. If a person in need of protection has no conservator and an emergency exists or if an appointed conservator is not effectively performing the duties of a conservator and the estate or affairs of the protected person are found to require immediate action, the person in need of protection, the protected person or any person interested in that person's estate or affairs may petition for a finding of a need for interim protection and for the appointment of a temporary conservator. No finding and appointment may be made without notice, pursuant to section 14-5405, except as provided in subsection B of this section.

B. The court may enter a finding of a need for interim protection and may appoint a temporary conservator without notice to the proposed protected person or the proposed protected person's attorney if all of the following conditions are met:

1. It clearly appears from specific facts shown by affidavit or by the verified petition that immediate and irreparable injury, loss or damage will result before the proposed protected person or that person's attorney can be heard in opposition.

2. The petitioner or the petitioner's attorney certifies to the court in writing any efforts that the petitioner or the attorney has made to give the notice or the reasons supporting the claim that notice should not be required.

3. The petitioner files with the court a request for a hearing on the petition for the appointment of a temporary conservator.

4. The petitioner or the petitioner's attorney certifies that notice of the petition, order and all filed reports and affidavits will be given to the proposed protected person by personal service within the time period the court directs but not more than seventy-two hours after entry of the order of appointment.

C. Unless the proposed protected person is represented by independent counsel , the court shall appoint an attorney to represent that person in the proceeding on receipt of the petition for temporary appointment. The attorney shall visit the proposed protected person as soon as practicable and shall be prepared to represent that person's interests at any hearing on the petition.

D. Every order finding a need for interim protection and appointing a temporary conservator granted without notice expires as prescribed by the court but within a period of not more than thirty days unless within that time the court extends it for good cause shown for the same period or unless the attorney for the proposed protected person consents that it may be extended for a longer period. The court shall enter the reasons for the extension on the record.

E. The court shall schedule a hearing on the petition for a finding of the need for interim protection and the appointment of a temporary conservator within the time specified in subsection D of this section. If the petitioner does not proceed with the petition the court, on the motion of any party or on its own motion, may dismiss the petition.

F. If the court orders the appointment of a temporary conservator without notice, the proposed protected person may appear and move for its dissolution or modification on two days' notice to the petitioner and to the temporary conservator, or on such shorter notice as the court prescribes. The court shall proceed to hear and determine that motion as expeditiously as possible.

G. The hearing on a petition for the appointment of a temporary conservator shall be held in the same manner as a hearing on a preliminary injunction. The court may order the hearing on the petition for appointment of a permanent conservator to be advanced and consolidated with the hearing of the petition for temporary appointment. If the court does not order this consolidation any evidence received on a petition for temporary appointment that would be admissible at the hearing on a petition for a permanent appointment becomes part of the record and need not be repeated at a later hearing. This subsection does not limit the parties to any rights they may have to trial by jury.

H. After notice and a hearing, if the court finds that a temporary conservator is necessary and the provisions of this section have been met, the court shall make an appointment of a temporary conservator for a specified period of time of not more than six months unless the court extends this time period for good cause shown.

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14-5402. Protective proceedings; jurisdiction of affairs of protected persons.

After the service of notice in a proceeding seeking the appointment of a conservator or other protective order and until termination of the proceeding, the court in which the petition is filed has:

1. Exclusive jurisdiction to determine the need for a conservator or other protective order until the proceedings are terminated.

2. Exclusive jurisdiction to determine how the estate of the protected person which is subject to the laws of this state shall be managed, expended or distributed to or for the use of the protected person, the protected person's dependents or other claimants.

3. Concurrent jurisdiction to determine the validity of claims against the person or estate of the protected person and questions of title concerning any estate asset.

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14-5403. Venue.

Venue for proceedings under this article is:

1. In the county in this state where the person to be protected resides whether or not a guardian has been appointed in another place.

2. If the person to be protected does not reside in this state, in any county where he has property.

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14-5404. Original petition for appointment or protective order.

A. The person allegedly in need of protection, any person who is interested in that person's estate or affairs including that person's parent, guardian or custodian, or any person who would be adversely affected by lack of effective management of that person's estate and affairs may petition for the appointment of a conservator or for any other appropriate protective order.

B. The petition shall set forth, to the extent known:

1. The interest of the petitioner.

2. The name, age, residence and address of the person allegedly in need of protection.

3. The name, address and priority for appointment of the person whose appointment is sought.

4. The name and address of the guardian, if any, of the person allegedly in need of protection.

5. The name and address of the nearest relative of the person allegedly in need of protection known to the petitioner.

6. A general statement of the estate of the person allegedly in need of protection with an estimate of its value , including any compensation, insurance, pension or allowance to which the person is entitled.

7. The reason why appointment of a conservator or any other protective order is necessary.

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14-5405. Notice in conservatorship proceedings.

A. In a proceeding for the appointment or removal of a conservator of a protected person or person allegedly in need of protection, other than the appointment of a temporary conservator or temporary suspension of a conservator, notice of the hearing shall be given to each of the following:

1. The protected person or the person allegedly in need of protection if that person is fourteen years of age or older.

2. The spouse, parents and adult children of the protected person or person allegedly in need of protection, or if no spouse, parents or adult children can be located, at least one adult relative of the protected person or the person allegedly in need of protection, if such a relative can be found.

3. Any person who is serving as guardian or conservator or who has the care and custody of the protected person or person allegedly in need of protection.

4. Any person who has filed a demand for notice.

B. At least fourteen days before the hearing notice shall be served personally on the protected person or the person allegedly in need of protection and that person's spouse and parents if they can be found within the state. Notice to the spouse and parents, if they cannot be found within the state, and to all other persons except the protected person or the person allegedly in need of protection shall be given in accordance with section 14-1401. Waiver of notice by the protected person or the person allegedly in need of protection is not effective unless the protected person or the person allegedly in need of protection attends the hearing.

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14-5406. Protective proceedings; request for notice; interested person.

On payment of any required fee, any interested person who desires to be notified before any order is made in a guardianship or conservatorship proceeding, including any proceeding subsequent to the appointment of a guardian pursuant to section 14-5313, or subsequent to the appointment of a conservator pursuant to section 14-5416, may file a demand for notice with the clerk of the court in which the proceeding is pending. The person demanding notice shall mail a copy of the demand to the guardian and the conservator if one has been appointed. A demand is not effective unless it contains a statement showing the interest of the person making it and the person's address, or that of the person's attorney, and is effective only as to matters occurring after the filing. Any governmental agency paying or planning to pay benefits to the person to be protected is an interested person in protective proceedings.

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14-5407. Procedure concerning hearing and order on original petition.

A. On the filing of a petition for appointment of a conservator or any other protective order because of minority, the court shall set a hearing date on the matters alleged in the petition. If, at any time in the proceeding, the court determines that the interests of the minor are or may be inadequately represented, it shall appoint an attorney to represent the minor. If the minor is at least fourteen years of age the court shall consider the choice of the minor.

B. On the filing of a petition for appointment of a conservator or any other protective order for reasons other than minority, the court shall set a hearing date. Unless the person to be protected has counsel of his own choice, the court shall appoint an attorney to represent him. If the alleged disability is mental illness, mental deficiency, mental disorder, physical illness or disability, chronic use of drugs, or chronic intoxication, the court shall appoint an investigator to interview the person to be protected. On petition by an interested person or on the court's own motion, the court may direct that an appropriate medical or psychological evaluation of the person be conducted. The investigator and the person conducting the medical or psychological evaluation shall submit written reports to the court before the hearing date.

C. In any case where the veterans administration is or may be an interested party, a certificate of an authorized official of the veterans administration that the person allegedly in need of protection has been found incapable of handling the benefits payable, on examination in accordance with the laws and regulations governing the veterans administration, is prima facie evidence of the necessity for appointment of a conservator.

D. The person allegedly in need of protection is entitled to be present at the hearing, to be represented by counsel, to present evidence and to cross-examine witnesses, including any court appointed examiner and investigator. The issue may be determined at a closed hearing if the person allegedly in need of protection or that person's counsel so requests.

E. After the hearing, upon a finding that a basis for the appointment of a conservator or any other protective order has been established, the court shall make an appointment or other appropriate protective order.

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14-5408. Permissible court orders.

A. The court has the following powers which may be exercised directly or through a conservator in respect to the estate and affairs of protected persons:

1. While a petition for appointment of a conservator or any other protective order is pending and after a preliminary hearing and without notice to others, the court has power to preserve and apply the estate of the person allegedly in need of protection as may be required for that person's benefit or the benefit of that person's dependents.

2. After a hearing and upon determining that a basis for an appointment or any other protective order exists with respect to a minor without other disability, the court has all those powers over the estate and affairs of the minor which are or might be necessary for the best interests of the minor, the minor's family and members of the minor's household.

3. After a hearing and upon determining that a basis for an appointment or any other protective order exists with respect to a person for reasons other than minority, the court has, for the benefit of the protected person and members of that person's household, all the powers over his estate and affairs which the protected person could exercise if present and not under disability, except the power to make a will or to make gifts other than those authorized by this section.

4. After notice and a hearing the court may authorize the conservator to make gifts on behalf of the protected person out of the estate of the protected person to donees and in amounts that are consistent with the protected person's best interests and intentions. In determining if these gifts are in the protected person's best interests the court shall consider:

(a) The protected person's estate plan, if any.

(b) The protected person's pattern of prior gifts, if any.

(c) The potential tax savings that would result if a gift were authorized.

(d) The size of the estate.

(e) The protected person's income and expenses.

(f) The physical and mental condition and life expectancy of the protected person.

(g) The likelihood that the protected person's disability may cease.

(h) The likelihood that the protected person would make the gift if the person were able to consent.

(i) The ability of the protected person to consent to the proposed gifts.

B. An order made pursuant to this section determining that a basis for appointment of a conservator or other protective order exists has no effect on the capacity of the protected person.

C. To encourage the self-reliance and independence of a protected person, the court may grant the protected person the ability to handle part of the protected person's money or other property without the consent or supervision of the conservator. This may include allowing the protected person to maintain appropriate accounts in any bank or other financial institution.

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14-5409. Protective arrangements and single transactions authorized.

A. If it is established in a proper proceeding that a basis exists as described in section 14-5401 for affecting the estate and affairs of a person the court, without appointing a conservator, may authorize, direct or ratify any transaction necessary or desirable to achieve any security, service or care arrangement meeting the foreseeable needs of the protected person. Protective arrangements include, but are not limited to, payment, delivery, deposit or retention of funds or property, sale, mortgage, lease or other transfer of property, entry into an annuity contract, a contract for life care, a deposit contract, a contract for training and education, or addition to or establishment of a suitable trust.

B. When it has been established in a proper proceeding that a basis exists as described in section 14-5401 for affecting the estate and affairs of a person the court, without appointing a conservator, may authorize, direct or ratify any contract, trust or other transaction relating to the protected person's financial affairs or involving the protected person's estate if the court determines that the transaction is in the best interests of the protected person.

C. Before approving a protective arrangement or other transaction under this section, the court shall consider the interests of creditors and dependents of the protected person and, in view of the protected person's disability, whether the protected person needs the continuing protection of a conservator. The court may appoint a special conservator to assist in the accomplishment of any protective arrangement or other transaction authorized under this section who shall have the authority conferred by the order and serve until discharged by order after report to the court of all matters done pursuant to the order of appointment.

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14-5410. Who may be appointed conservator; priorities.

A. The court may appoint an individual or a corporation, with general power to serve as trustee, as conservator of the estate of a protected person subject to the requirements of section 14-5106. The following are entitled to consideration for appointment in the order listed:

1. A conservator, guardian of property or other like fiduciary appointed or recognized by the appropriate court of any other jurisdiction in which the protected person resides.

2. An individual or corporation nominated by the protected person if the protected person is at least fourteen years of age and has, in the opinion of the court, sufficient mental capacity to make an intelligent choice.

3. The person nominated in the protected person's most recent durable power of attorney.

4. The spouse of the protected person.

5. An adult child of the protected person.

6. A parent of the protected person, or a person nominated by the will of a deceased parent.

7. Any relative of the protected person with whom the protected person has resided for more than six months prior to the filing of the petition.

8. The nominee of a person who is caring for or paying benefits to the protected person.

9. A private fiduciary, professional guardian or conservator or the veterans' service commission.

B. A person listed in subsection A, paragraph 4, 5, 6, 7 OR 8 of this section may nominate in writing a person to serve in that person's place. With respect to persons having equal priority, the court shall select the one it determines is best qualified to serve. The court, for good cause, may pass over a person having priority and appoint a person having a lower priority or no priority.

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14-5411. Bond; exception.

A. Except as otherwise provided in subsection B, the court shall require a conservator to furnish a bond conditioned upon faithful discharge of all duties according to law, with sureties as it shall specify. Unless otherwise directed, the bond shall be in the amount of the aggregate capital value of the property of the estate in the conservator's control plus one year's estimated income minus the value of securities deposited under arrangements requiring an order of the court for their removal and the value of any land which the fiduciary, by express limitation of power, lacks power to sell or convey without court authorization. For good cause shown the court may reduce or eliminate the bond to the extent of regular fixed expenses paid for the benefit of the protected person. The court in lieu of sureties on a bond may accept other security for the performance of the bond, including a pledge of securities or a mortgage of land.

B. A bond is not required of a conservator which is a national banking association, a holder of a banking permit under the laws of this state, a savings and loan association authorized to conduct trust business in this state, a title insurance company qualified to do business under the laws of this state, a trust company holding a certificate to engage in trust business from the state superintendent of banks or the public fiduciary.

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14-5412. Terms and requirements of bonds.

A. The following requirements and provisions apply to any bond required under section 14-5411:

1. Unless otherwise provided by the terms of the approved bond, sureties are jointly and severally liable with the conservator and with each other.

2. By executing an approved bond of a conservator, the surety consents to the jurisdiction of the court which issued letters to the primary obligor in any proceeding pertaining to the fiduciary duties of the conservator and naming the surety as a party respondent. Notice of any proceeding shall be delivered to the surety or mailed by certified mail to the address listed with the court at the place where the bond is filed and to the address as then known to the petitioner.

3. On petition of a successor conservator or any interested person, a proceeding may be initiated against a surety for breach of the obligation of the bond of the conservator.

4. The bond of the conservator is not void after the first recovery but may be proceeded against from time to time until the whole penalty is exhausted.

B. No proceeding may be commenced against the surety on any matter as to which an action or proceeding against the primary obligor is barred by adjudication or limitation.

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14-5413. Acceptance of appointment; consent to jurisdiction.

By accepting appointment, a conservator submits personally to the jurisdiction of the court in any proceeding relating to the estate that may be instituted by any interested person. Notice of any proceeding shall be delivered to the conservator, or mailed to him by registered or certified mail at his address as listed in the petition for appointment or as thereafter reported to the court and to his address as then known to the petitioner.

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14-5414. Compensation and expenses.

A. If not otherwise compensated for services rendered, any investigator, accountant, lawyer, physician, conservator or special conservator appointed in a protective proceeding is entitled to reasonable compensation from the estate. If the court pays for any of these services it may charge the estate for reasonable compensation. The clerk shall deposit monies it collects in the probate fund pursuant to section 14-5433.

B. Compensation payable to the Arizona veterans' service commission, when acting as a conservator of the estate of a veteran or a veteran's surviving spouse or minor child or the incapacitated spouse of a protected veteran, shall not be more than five per cent of the amount of monies received during the period covered by the conservatorship. A copy of the petition and notice of hearing shall be given to the proper officer of the veterans' administration in the manner provided in the case of any hearing on a guardian's account or other pleading. No commission or compensation shall be allowed on the monies or other assets received from a prior conservator nor upon the amount received from liquidation of loans or other investments.

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14-5415. Death, resignation or removal of conservator.

The court may remove a conservator for good cause, upon notice and hearing, or accept the resignation of a conservator. After his death, resignation or removal the court may appoint another conservator. A conservator so appointed succeeds to the title and powers of his predecessor.

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14-5416. Petitions for orders subsequent to appointment.

A. Any person interested in the estate or affairs of a person for whom a conservator has been appointed may file a petition in the appointing court for an order:

1. Requiring bond or security or additional bond or security, or reducing bond.

2. Requiring an accounting for the administration of the estate of the protected person.

3. Directing distribution.

4. Removing the conservator and appointing a temporary or successor conservator.

5. Granting other appropriate relief.

B. A conservator may petition the appointing court for instructions concerning the fiduciary's responsibility.

C. Upon notice and a hearing the court may give appropriate instructions or make any appropriate order.

D. When a surety of a conservator desires to be released from responsibility for future acts, the surety may apply to the court for a release. The court shall proceed in the same manner as in a proceeding under section 14-3604, subsection B. Notice shall be given to the conservator as provided in section 14-5413.

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14-5417. General duty of conservator.

In the exercise of his powers, a conservator is to act as a fiduciary and shall observe the standard of care applicable to trustees as described by § 14-7302.

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14-5418. Inventory and records.

A. Within ninety days after appointment, a conservator shall prepare and file with the court an inventory of the estate owned by the protected person on the date of the conservator's appointment, listing it with reasonable detail and indicating the fair market value as of the date of appointment of each item listed.

B. The conservator shall provide a copy of the inventory to the protected person if the protected person can be located, has attained the age of fourteen years, and has sufficient mental capacity to understand these matters, and to any parent or guardian with whom the protected person resides. The conservator shall keep suitable records of the conservator's administration and exhibit the records on request of any interested person.

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14-5419. Accounts.

A. Every conservator must account to the court for the administration of the estate not less than annually on the anniversary date of qualifying as conservator and also on resignation or removal, and on termination of the protected person's minority or disability, except that for good cause shown upon the application of an interested person, the court may relieve the conservator of filing annual or other accounts by an order entered in the minutes.

B. The court may take such action as is appropriate upon filing of annual or other accounts. In connection with any account, the court may require a conservator to submit to a physical check of the estate in the conservator's control, to be made in any manner the court may specify.

C. An adjudication allowing an intermediate or final account can be made only upon petition, notice and a hearing. Notice must be given to:

1. The protected person.

2. A guardian of the protected person if one has been appointed, unless the same person is serving as both guardian and conservator.

3. If no guardian has been appointed or the same person is serving as both guardian and conservator, a spouse or, if the spouse is the conservator, there be no spouse or the spouse is incapacitated, a parent or an adult child who is not serving as a conservator.

4. A guardian ad litem appointed for the protected person, if the court determines in accordance with section 14-1403 that representation of the interest of the protected person would otherwise be inadequate.

D. An order, made upon notice and a hearing, allowing an intermediate account of a conservator, adjudicates as to the conservator's liabilities concerning the matters considered in connection therewith. An order, made upon notice and a hearing, allowing a final account adjudicates as to all previously unsettled liabilities of the conservator to the protected person or the protected person's successors relating to the conservatorship.

E. In any case in which the estate consists, in whole or in part, of benefits paid by the veterans administration to the conservator or the conservator's predecessor for the benefit of the protected person, the veterans administration office which has jurisdiction over the area is entitled to a copy of any account filed under chapter 5, article 4 of this title. Each year in which an account is not filed with the court, the conservator shall, if requested, submit an account to the appropriate veterans administration office. If such an account is not submitted as requested, or if it is found unsatisfactory by the veterans administration, the court shall, upon receipt of notice thereof, require the conservator forthwith to file an account with the court.

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14-5420. Conservators; title by appointment.

A. The appointment of a conservator vests in the conservator title as trustee to all property or to the part specified in the order of the protected person, presently held or thereafter acquired, including title to any property previously held for the protected person by custodians or attorneys in fact. An order specifying that only part of the property of the protected person vests in the conservator creates a limited conservatorship.

B. The appointment of a conservator is not a transfer or alienation within the meaning of general provisions of any federal or state statute or rule, regulation, insurance policy, pension plan, contract, will or trust instrument, imposing restrictions upon or penalties for transfer or alienation by the protected person of the person's rights or interest.

C. Except as otherwise provided by law, the interest of the protected person in property vested in a conservator is not transferable or assignable by the protected person.

D. Property vested in a conservator by this section and the interest of the protected person in that property are not subject to levy, garnishment or similar process other than by an order issued in the protective proceeding as provided in section 14-5428.

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14-5421. Recording of conservator's letters.

Letters of conservatorship are evidence of transfer of all assets, or in the case of a limited conservatorship, the part specified in the letters, of a protected person to the conservator. An order terminating a conservatorship is evidence of transfer of all assets subject to the conservatorship from the conservator to the protected person, or the person's successors. Subject to the requirements of general statutes governing the filing or recordation of documents of title to land or other property, letters of conservatorship and orders terminating conservatorships shall be filed or recorded in the county where the property of the protected person is located to give record notice of title as between the conservator and the protected person.

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14-5422. Sale, encumbrance or transaction involving conflict of interest; voidable; exceptions.

Any sale or encumbrance to a conservator, his spouse, agent or attorney, or any corporation or trust in which he has a substantial beneficial interest, or any transaction which is affected by a substantial conflict of interest is voidable unless the transaction is approved by the court after notice to interested persons and others as directed by the court.

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14-5423. Persons dealing with conservators; protection.

A. A person who in good faith either assists or deals with a conservator, on the basis of a copy of letters certified by or under the direction of the court or an officer thereof within sixty days of the transaction, is protected as if the conservator properly exercised the conservator's power and even though the authority of that person as conservator has been terminated. The fact that a person knowingly deals with a conservator does not alone require the person to inquire into the existence of a power, the propriety of its exercise, or the current authority of the conservator, except that restrictions on powers of conservators which are endorsed on letters as provided in section 14-5426 are effective as to third persons. A person is not bound to see to the proper application of estate assets paid or delivered to a conservator.

B. The protection expressed in this section extends to any procedural irregularity or jurisdictional defect that occurred in proceedings leading to the issuance of letters. The protection expressed in this section is not a substitution for that provided by comparable provisions of the laws relating to commercial transactions and laws simplifying transfers of securities by fiduciaries.

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14-5424. Powers of conservator in administration.

A. Subject to the limitations provided in section 14-5425, a conservator has all the powers conferred herein and any additional powers conferred by law on trustees in this state. In addition, a conservator of the estate of an unmarried minor, as to whom no one has parental rights, has the duties and powers of a guardian of a minor described in section 14-5209 until the minor attains the age of majority or marries, but the parental rights so conferred on a conservator do not preclude appointment of a guardian as provided by article 2 of this chapter.

B. A conservator, without court authorization or confirmation, may invest and reinvest funds of the estate as would a trustee.

C. A conservator, acting reasonably in efforts to accomplish the purpose of the appointment, may act without court authorization or confirmation to:

1. Collect, hold and retain assets of the estate including land in another state, until, in the conservator's judgment, disposition of the assets should be made. Assets may be retained even though they include an asset in which the conservator is personally interested.

2. Receive additions to the estate.

3. Continue or participate in the operation of any business or other enterprise.

4. Acquire an undivided interest in an estate asset in which the conservator, in any fiduciary capacity, holds an undivided interest.

5. Invest and reinvest estate assets in accordance with subsection B of this section.

6. Deposit estate funds in a state or federally insured financial institution including one operated by the conservator.

7. Acquire or dispose of an estate asset including land in another state for cash or on credit, at public or private sale, and manage, develop, improve, exchange, partition, change the character of or abandon an estate asset.

8. Make ordinary or extraordinary repairs or alterations in buildings or other structures, demolish any improvements and raze existing or erect new party walls or buildings.

9. Subdivide, develop, or dedicate land to public use, make or obtain the vacation of plats and adjust boundaries, adjust differences in valuation on exchange, partition by giving or receiving considerations and dedicate easements to public use without consideration.

10. Enter for any purpose into a lease as lessor or lessee with or without an option to purchase or renew for a term within or extending beyond the term of the conservatorship.

11. Enter into a lease or arrangement for exploration and removal of minerals or other natural resources or enter into a pooling or unitization agreement.

12. Grant an option involving disposition of an estate asset, or take an option for the acquisition of any asset.

13. Vote a security, in person or by general or limited proxy.

14. Pay calls, assessments and any other sums chargeable or accruing against or on account of securities.

15. Sell or exercise stock subscription or conversion rights and consent, directly or through a committee or other agent, to the reorganization, consolidation, merger, dissolution or liquidation of a corporation or other business enterprise.

16. Hold a security in the name of a nominee or in other form without disclosure of the conservatorship so that title to the security may pass by delivery, but the conservator is liable for any act of the nominee in connection with the stock so held.

17. Insure the assets of the estate against damage or loss, and the conservator against liability with respect to third persons.

18. Borrow money to be repaid from estate assets or otherwise, advance money for the protection of the estate or the protected person, and for all expenses, losses, and liability sustained in the administration of the estate or because of the holding or ownership of any estate assets, and the conservator has a lien on the estate as against the protected person for advances so made.

19. Pay or contest any claim, settle a claim by or against the estate or the protected person by compromise, arbitration, or otherwise and release, in whole or in part, any claim belonging to the estate to the extent that the claim is uncollectible except that personal injury or wrongful death claims shall be compromised pursuant to subsection D of this section.

20. Pay taxes, assessments, compensation of the conservator and other expenses incurred in the collection, care, administration and protection of the estate.

21. Allocate items of income or expense to either estate income or principal, as provided by law, including creation of reserves out of income for depreciation, obsolescence or amortization, or for depletion in mineral or timber properties.

22. Pay any sum distributable to a protected person or dependent of the protected person, without liability to the conservator, by paying the sum to the distributee or by paying the sum for the use of the distributee either to the guardian of the distributee or, if none, to a relative or other person having custody of the person.

23. Employ persons, including attorneys, auditors, investment advisors or agents, even though they are associated with the conservator, to advise or assist the conservator in the performance of administrative duties, act upon their recommendation without independent investigation and, instead of acting personally, employ one or more agents to perform any act of administration, whether or not discretionary.

24. Prosecute or defend actions, claims or proceedings in any jurisdiction for the protection of estate assets and of the conservator in the performance of fiduciary duties.

25. Execute and deliver all instruments which will accomplish or facilitate the exercise of the powers vested in the conservator.

D. A conservator may act with court approval to compromise a personal injury or wrongful death claim for a protected person. The conservator may act with court approval to release an alleged tortfeasor if the release is in the best interest of the protected person. If the conservator obtains an order of approval for compromise from a court of competent jurisdiction, the compromise may be in exchange for a lump sum amount or an arrangement that defers the receipt of part or all of the consideration for the compromise until after the protected person reaches majority and may involve a structured settlement or the creation of a trust on the terms that the court approves for any protected person.

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14-5425. Distributive duties and powers of conservator.

A. A conservator may expend or distribute income or principal of the estate without court authorization or confirmation for the support, education, care or benefit of the protected person and the person's dependents in accordance with the following principles:

1. The conservator shall consider recommendations relating to the appropriate standard of support, education and benefit for the protected person made by a parent or guardian, if any. The conservator may not be surcharged for sums paid to persons or organizations actually furnishing support, education or care to the protected person pursuant to the recommendations of a parent or guardian of the protected person unless the conservator knows that the parent or guardian is deriving personal financial benefit therefrom, including relief from any personal duty of support, or unless the recommendations are clearly not in the best interests of the protected person.

2. The conservator shall expend or distribute sums reasonably necessary for the support, education, care or benefit of the protected person and the person's dependents with due regard to:

(a) The size of the estate, the probable duration of the conservatorship and the likelihood that the protected person, at some future time, may be fully able to be wholly self-sufficient and able to manage business affairs and the estate.

(b) The accustomed standard of living of the protected person and the person's dependents.

(c) Other funds or sources used for the support of the protected person.

3. With respect to the affairs and estate of a minor, the conservator shall also consider the following factors in making estate distributions:

(a) The financial responsibility and financial resources of the parents of the child.

(b) Extraordinary custodial responsibilities undertaken by the parent or parents as the result of the child's physical or mental condition and the effect of these extraordinary responsibilities on appropriate gainful employment of the parent.

(c) The physical and mental condition of the child and the child's medical and educational needs. Any incidental benefit to other members of the child's household derived from a distribution is not a disqualifying factor.

(d) If the child is permanently and totally disabled, the standard of living the child should reasonably expect to enjoy given the financial resources available to the child.

4. The conservator may expend funds of the estate for the support of persons legally dependent on the protected person and others who are members of the protected person's household, who are unable to support themselves, and who are in need of support. If benefits are being paid by the veterans administration to the conservator, such income may be expended only for the support of the protected person and the person's spouse and minor children, except upon petition to and prior order of the court after a hearing.

5. Funds expended under this subsection may be paid by the conservator to any person, including the protected person, to reimburse for expenditures which the conservator might have made, or in advance for services to be rendered to the protected person when it is reasonable to expect that they will be performed and where advance payments are customary or reasonably necessary under the circumstances.

6. A conservator, in discharging the responsibilities conferred by a court order and this section, shall implement the principles described in section 14-5408 to the extent possible.

B. When a minor who has not been adjudged disabled under section 14-5401, paragraph 2 attains majority, the conservator, after meeting all prior claims and expenses of administration, shall pay over and distribute all funds and properties to the former protected person as soon as possible.

C. When the conservator is satisfied that a protected person's disability, other than minority, has ceased, the conservator, after meeting all prior claims and expenses of administration, shall pay over and distribute all funds and properties to the former protected person as soon as possible.

D. If a protected person dies, the conservator may deliver to the court for safekeeping any will of the deceased protected person which may have come into the conservator's possession or deliver the will to the personal representative named in the will. If the will is delivered to the personal representative named in the will, a copy of the will shall be filed with the court in the conservatorship proceeding. If the will is filed with the court the conservator shall inform the personal representative or a beneficiary named therein that the conservator has done so, and retain the estate for delivery to a duly appointed personal representative of the decedent or other persons entitled thereto. If after forty days from the death of the protected person no other person has been appointed personal representative and no application or petition for appointment is before the court, the conservator may apply to exercise the powers and duties of a personal representative so that the conservator may proceed to administer and distribute the decedent's estate without additional or further appointment. The conservator may include in such an application a request to probate the will of the deceased protected person. On receipt of an application, the registrar, after making the findings required pursuant to section 14-3303, shall issue a written statement of informal probate and shall endorse the letters of the conservator. The registrar may also enter the will of the deceased protected person to probate. The statement of the registrar under this section shall have the effect of an order of appointment of a personal representative as provided in section 14-3308 and chapter 3, articles 6 through 10 of this title, except that the estate in the name of the conservator, after administration, may be distributed to the decedent's successors without prior re-transfer to the conservator as personal representative.

E. If a protected person dies, and on reasonable inquiry the conservator is unable to locate any person specified in section 36-831, subsection A, paragraph 1, 2 or 3 willing to assume the duty of burying the body of the decedent or making other funeral and disposition arrangements, the conservator may make reasonable burial or other funeral arrangements, the cost of which is a charge against the estate.

F. The estate of a deceased protected person is liable for any unpaid expenses of the conservator's administration, and such expenses are a lien on property transferred by the conservator to the decedent's personal representative.

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14-5426. Enlargement or limitation of powers of conservator.

A. Subject to the restrictions in section 14-5408, subsection A, paragraph 4, the court may confer on a conservator at the time of appointment or later, in addition to the powers conferred on him by sections 14-5424 and 14-5425, any power which the court itself could exercise under section 14-5408, subsection A, paragraphs 2 and 3. The court may, at the time of appointment or later, limit the powers of a conservator otherwise conferred by sections 14-5424 and 14-5425, or previously conferred by the court, and may at any time relieve him of any limitation. If the court limits any power conferred on the conservator by section 14-5424 or 14-5425, the limitation shall be endorsed upon his letters of appointment.

B. Upon appointment of a conservator for a protected spouse, the court may determine whether the spouse's share of community property shall be managed by the conservator or by the other spouse. If the court determines that the community property shall be managed by the other spouse, and if the protected spouse is the husband, the wife may become the manager of the community property during the conservatorship and may dispose of community personal property in the interests of the community.

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14-5427. Preservation of estate plan.

In investing the estate, and in selecting assets of the estate for distribution under section 14-5425, subsection A, in utilizing powers of revocation or withdrawal available for the support of the protected person, and exercisable by the conservator or the court, the conservator and the court shall take into account any known estate plan of the protected person known to them, including the will, any revocable trust of which the person is settlor, and any contract, transfer or joint ownership arrangement originated by the protected person with provisions for payment or transfer of benefits or interests at the person's death to another or other persons. The conservator may examine the will of the protected person.

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14-5428. Claims against protected person; enforcement.

A. A conservator must pay from the estate all just claims against the estate and against the protected person arising before or after the conservatorship upon their presentation and allowance. A claim may be presented by either of the following methods:

1. The claimant may deliver or mail to the conservator a written statement of the claim indicating its basis, the name and address of the claimant and the amount claimed.

2. The claimant may file a written statement of the claim, in the form prescribed by rule, with the clerk of the court and deliver or mail a copy of the statement to the conservator.

A claim is deemed presented on the first to occur of receipt of the written statement of claim by the conservator, or the filing of the claim with the court. A presented claim is allowed if it is not disallowed by written statement mailed by the conservator to the claimant within ninety days after its presentation. The presentation of a claim tolls any statute of limitation relating to the claim until thirty days after its disallowance.

B. A claimant whose claim has not been paid may petition the court for determination of his claim at any time before it is barred by the applicable statute of limitation and, upon due proof, procure an order for its allowance and payment from the estate. If a proceeding is pending against a protected person at the time of appointment of a conservator or is initiated against the protected person thereafter, the moving party must give notice of the proceeding to the conservator if the outcome is to constitute a claim against the estate.

C. If it appears that the estate in conservatorship is likely to be exhausted before all existing claims are paid, preference is to be given to prior claims for the care, maintenance and education of the protected person or his dependents and existing claims for expenses of administration.

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14-5429. Personal liability of conservator.

A. Unless otherwise provided in the contract, a conservator is not personally liable on a contract properly entered into in the conservator's fiduciary capacity in the course of administration of the estate unless the conservator fails to reveal the representative capacity and identify the estate in the contract.

B. The conservator is individually liable for obligations arising from ownership or control of property of the estate or for torts committed in the course of administration of the estate only if the conservator is personally at fault.

C. Claims based on contracts entered into by a conservator in a fiduciary capacity, on obligations arising from ownership or control of the estate, or on torts committed in the course of administration of the estate may be asserted against the estate by proceeding against the conservator in the conservator's fiduciary capacity, whether or not the conservator is individually liable therefor.

D. Any question of liability between the estate and the conservator individually may be determined in a proceeding for accounting, surcharge or indemnification, or other appropriate proceeding or action.

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14-5430. Termination of proceeding.

The protected person, the conservator or any other interested person may petition the court to terminate the conservatorship. A protected person seeking termination is entitled to the same rights and procedures as in an original proceeding for a protective order. The court, upon determining after notice and a hearing that the minority or disability of the protected person has ceased, shall terminate the conservatorship. Upon termination, title to assets of the estate passes to the formerly protected person or to the person's successors. The order of termination shall provide for expenses of administration and shall direct the conservator to execute appropriate instruments to evidence the transfer.

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14-5431. Payment of debt and delivery of property to foreign conservator without local proceedings.

Any person indebted to a protected person, or having possession of property or of an instrument evidencing a debt, stock or chose in action belonging to a protected person may pay or deliver to a conservator, guardian of the estate or other like fiduciary appointed by a court of the state of residence of the protected person, upon being presented with proof of his appointment and an affidavit made by him or on his behalf stating both:

1. That no protective proceeding relating to the protected person is pending in this state.

2. That the foreign conservator is entitled to payment or to receive delivery.

If the person to whom the affidavit is presented is not aware of any protective proceeding pending in this state, payment or delivery in response to the demand and affidavit discharges the debtor or possessor.

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14-5432. Domiciliary foreign conservator; powers of local conservator.

If no local conservator has been appointed and no petition in a protective proceeding is pending in this state, a domiciliary foreign conservator may file with a court in this state in a county in which property belonging to the protected person is located certified copies of his appointment and of any official bond he has given. Thereafter, he may exercise as to assets in this state all powers of a local conservator and may maintain actions and proceedings in this state subject to any conditions imposed upon non-resident parties generally.

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