Most Arizona residents assume that they will be able to manage their assets until they die. Unfortunately, life is filled with unpleasant surprises, such as a serious illness, a traffic accident, or a crippling injury. Any of these events can deprive a person of the ability to properly oversee their assets.
Luckily, the Arizona legislature has created four different types of offices that are intended to act on behalf of persons who are unable to manage their own affairs. Each of these offices is designated as a fiduciary, that is, a person who bears a unique duty to use very high care in managing the assets in his care.
As such, whether the office is a guardian, conservator, personal representative, or public fiduciary, the person occupying the office is deemed to owe a special duty of care to the person whose assets are being managed; that duty is commonly called a “fiduciary duty.”
A guardianship is established when a judge determines that a person is totally incapacitated. The usual cause of such a disability is physical or mental illness, an accident or a neurocognitive disorder. A guardianship can be very intrusive and will usually be established only if all other alternatives have been exhausted.
A conservator is appointed in the limited circumstance where a person is unable to manage financial affairs. The conservator is empowered to act for the conservatee in any and all financial matters. The conservator will usually be given access to the conservatee’s bank accounts and other financial assets. The conservator must make regular reports to the court on all transactions affecting the assets of the conservatee.
A personal representative is appointed by the court to take possession of and manage the assets of a deceased person. A personal representative can be nominated in the deceased person’s will or be appointed by the court if no such person has been nominated.
A public fiduciary serves as a court-appointed guardian, conservator or personal representative of an estate if no one else is available to serve. Each Arizona county has a public fiduciary whose duties are virtually identical to those of a privately appointed fiduciary. The only significant difference is the degree to which a public fiduciary’s duties and authorities are defined by state law.
Solid advice from an estate planning lawyer may be helpful
Anyone who is considering an estate plan involving a trust or similar arrangement will be required to appoint a person to serve as a fiduciary to administer the trust assets. A consultation with a knowledgeable estate planning lawyer will help ensure that a properly qualified person is chosen for the position.