When a California probate court establishes a conservatorship, the conservator is charged with managing the conservatee’s person and/or estate in the conservatee’s best interests. The large majority of professional fiduciaries and family members who become conservators discharge their duties faithfully. Occasionally, however, a conservator may exploit the relationship for personal gain.
Over the past year, conservatorships increasingly have been in the spotlight. Perhaps responding to the hype, the California Legislature is considering legislation, Assembly Bill 1194, that aims to strengthen protections against abuse. In this blog post, we provide a summary of some key features of AB 1194 and how the bill, if enacted, may affect California conservatorships.
Abusive Conservatorships on a Screen Near You
As discussed in one of our recent posts, #FreeBritney fans allege that pop diva Britney Spears’ co-conservators needlessly have prolonged her conservatorship for personal gain. Some fans go so far as to claim that the conservators have taken control of Britney’s assets by drugging her against her will.
Speculation regarding Britney’s conservatorship remains a hot topic in the news and has been the subject of the BBC documentary “The Battle for Britney: Fans, Cash and a Conservatorship” and the New York Times documentary “Framing Britney Spears”.
Netflix joined the bandwagon with its recent movie, “I Care a Lot,” in which professional fiduciary Marla Grayson colludes with a local doctor to isolate elders in nursing homes so that Grayson can drain their assets and sell their homes. Actress Rosamund Pike, who plays Grayson, won a Golden Globe Award for her role in the film. We won’t provide spoilers here, but the movie (a “comedy, crime, thriller,” not a documentary) suggests that conservators can be conniving predators.
The Professional Fiduciary Association of California has responded to the movie with an informational website about California conservatorships, observing that the “State of California has, both through the Courts and County agencies, safeguards in place that would make what is depicted in the film I Care a Lot impossible.”
Legislature Reacts to Potential Problems with AB 1194
The #FreeBritney movement and “I Care a Lot” have grabbed the Legislature’s attention. Both were mentioned in the Assembly’s Judiciary Committee’s Bill Analysis of AB 1194 on April 27, 2021, and were cited to illustrate why the California Legislature is taking protective measures.
According to the analysis, while “I Care a Lot” is “clearly a work of fiction,” AB 1194 seeks to implement legislation that is long overdue. In 2006, the Legislature passed the 2006 Omnibus Conservatorship and Guardianship Reform Act. This legislation was intended to overhaul parts of the conservatorship system, but many measures were not funded. Now, with the perceived risk of abusive conservatorships, the Legislature appears poised to implement some of these measures.
Here are some of the ways that AB 1194, as currently drafted, would reshape the conservatorship system.
Increasing Court Oversight
AB 1194 would increase court supervision of conservatorships.
Under existing law, a judge may establish a conservatorship based on the probate court’s investigation and evidence presented by the parties. While medical information is usually included, it is not strictly required under the current version of Probate Code section 1826.
However, under the proposed amendment to Probate Code section 1826, the probate investigator’s report would require a medical evaluation in a petition for appointment of a temporary or general conservator, including at least one report from the proposed conservatee’s primary physician. This new requirement would require the court to consider medical opinion in reaching a decision.
Separately, AB 1194 would make investigations more thorough and extensive. One key feature of the bill – under the proposed amendment to Probate Code section 2260.6 – would require the court investigator to conduct more thorough investigations by interviewing the proposed conservatee’s friends, neighbors, and relatives.
Such measures will provide probate judges with more information when considering conservatorships, but may delay court consideration of conservatorships and increase their already-substantial costs.
Penalizing Abusive Conservators
The bill also would empower courts with new powers to penalize abusive conservators.
Proposed Probate Code section 2112 would allow the a probate court to impose a civil penalty on misbehaving conservators, up to $5,000 for professional fiduciaries and $1,000 for non-professional fiduciaries. The penalty is to be paid to the conservatee. No similar penalty exists under current California law.
In addition, when a fiduciary commits abuse, the court will be required to report the abuse to the Professional Fiduciaries Bureau under proposed Probate Code section 2653(b)(3). And under proposed Business and Professions Code section 6584.5, the Professional Fiduciaries Bureau, which operates under the California Department of Consumer Affairs, “shall” immediately revoke a professional fiduciary’s license issued if the licensee has been found by the court to have either abused, or breached a fiduciary duty to, a conservatee under the fiduciary’s care.
Limiting Fees of Conservators
Finally, AB 1194 would further regulate the fees a conservator may recover for their services.
Under the proposed amendment to Probate Code section 2623, any expense or compensation of a conservator must be just, reasonable, and in the best interest of the conservatee. Existing Probate Code section 2623 only requires that the expense is “just and reasonable.” By adding the “best interest of the conservatee” requirement, the bill aims to ensure that the actions actually benefit the conservatee.
The last key change comes in the proposed amendments to Probate Code sections 2623(b) and 2641. Under existing Probate Code section 2623(b) and Probate Code section 2641, a conservator may not be compensated from the estate for any costs or fees incurred in unsuccessfully opposing a petition made by or on behalf of the conservatee unless the court finds that the opposition was in “good faith” based on the best interests of the conservatee.
Proposed amended sections 2623(b) and 2641(b) eliminate the “good faith” exception altogether. Instead, if the court reduces or denies compensation to the conservator, the conservator shall not be compensated for fees and costs incurred in defending the objection. This measure may encourage conservators to “accept a haircut” in the fees and costs they seek instead of litigating the issue.
To what extent are the measures in AB 1194 necessary to address fiduciary abuse? Will the reforms slow down needed conservatorships, lead to greater litigation, and/or discourage well-intentioned people from becoming professional conservators?
Stay tuned as AB 1194 moves through the Legislature in the weeks ahead.