One basic tenet of guardianship law has long been that a guardian (or conservator, or any other fiduciary) is not permitted to change his or her ward’s estate plan. That principle may have shifted slightly, however, as a result of the case of "E.N.," an elderly and mentally infirm gentleman from Indiana.

As E.N.’s mental health deteriorated his wife of 42 years filed for divorce. E.N. moved out of their home and in with his two brothers. He also signed a new will, disinheriting his wife and their two children and leaving his entire estate to his brothers. A year later, as the divorce was getting finalized, he signed another will and once again disinherited his children, leaving everything to his brothers.

A few months later E.N.’s daughter filed to become his guardian. The guardianship court found that E.N. was suffering from dementia and appointed his daughter as guardian.

Indiana law, like that of Arizona, permits a guardian (or, in Arizona, a conservator) to petition the court for authorization to create a trust. Two years after her appointment E.N.’s daughter did just that. She proposed a trust document that named E.N.’s son—her brother—as trustee, and left the trust estate to the two children and their children on E.N.’s death.

E.N.’s two brothers objected. They pointed out that the last two wills he had signed had disinherited his children, and argued that no trust agreement changing the estate plan should be considered. The guardianship judge disagreed, and found that "a reasonable and prudent person would provide the bulk of his estate to his children upon their demonstration of love, concern and care for him, while providing a reasonable allowance to his brothers who assisted him and are now in their retirement years as well." The judge approved the trust, after first directing that it be modified to give E.N.’s brothers each 5% of his estate if they survived him.

The Indiana Court of Appeals upheld the guardianship order approving the trust. The appellate court considered whether the trust arrangement left sufficient assets to provide E.N. care for the rest of his life (it did, since it was for his benefit only until his death), and whether it was fair and appropriate (it was). Because E.N.’s "once-difficult relationships [with his children] were repaired" by the time of his death, but he lacked the ability to once again change his estate plan, the guardianship judge’s approval of the trust was reasonable, said the appeals court. In the Matter of the Guardianship of E.N., August 25, 2006.

One Court of Appeals judge disagreed with the other two. In his view, the new trust was not consistent with E.N.’s existing estate plan, and should not have been approved.

Would you like to subscribe to Elder Law Issues? Simply provide your e-mail address and name below, and click "Subscribe". At the same time, you may choose to also subscribe to The Voice, the newsletter of the Special Needs Alliance.

Privacy note: We do not ever use your e-mail address or name for any purpose other than to send out our subscription-based newsletter. You can rest assured that we will not sell, trade or share this information with any other person or entity. We have no ancillary or associated companies or entities to which we could provide your e-mail address, either.

© 1993-2009 Fleming & Curti, P.L.C.
330 N. Granada Avenue, Tucson, Arizona 85701
520-622-0400 /  FAX: 520-203-0240