In my last post, I wrote about how Mike had purchased a power of attorney for elderly father, Robert, who has dementia, from a legal forms website, Legal Whirl. Now that it had come time to use the power of attorney in order to sign Robert’s name to sell the home, the title company processing the transaction was rejecting the power of attorney due to concerns about Robert’s capacity and other technical problems with the document.
Mike and his mother, Shirley, very much wanted to sell Shirley and Robert’s home so that they could move to a senior living facility, where there would be staff able to assist with Robert’s care. Now they may be unable to close on the sale of the home since Robert has dementia, could not sign his name, and the power of attorney Mike downloaded for $65.00 was not being accepted.
In an ideal world, Robert would have planned ahead for the possibility that he might become unable to make his own financial decisions by making a properly drafted power of attorney and/or revocable trust in advance. With those legal instruments, Robert could have designated Shirley, Robert, or another person of his choice to make any such financial decisions, including selling his home. He could have also included instructions on under what circumstances he would be agreeable to moving to such a facility.
Mike met with an elder law attorney, who offered an alternate solution. When an adult can no longer make their own financial decisions, due to dementia or other age-related health conditions, and there are no incapacity planning documents already in place, we will have to rely on the probate court protective proceedings. In Robert’s case, right now he just needs someone to have legal authority to sign his name to the deed and other documents necessary to sell his home. As such, instead of obtaining a full conservatorship, which is an ongoing legal protective proceeding that can be quite complex, the attorney suggests that Shirley or Mike might file a petition for a protective order to obtain the legal authority to sell the home on Robert’s behalf. The difference between a proceeding to obtain a protective order is that it is typically a one-time occurrence, unlike an ongoing conservatorship.
The request for a protective order will need to be filed in the probate court in the county in which Robert and Shirley reside. The attorney will need to draft documents explaining to the court why it is in Robert’s best interest to sell the home. The documents prepared for the real estate closing may need to be provided to the court. The probate court judge may issue a protective order regarding an individual’s estate and affairs if the court determines both of the following situations exist:
F irst, the individual is unable to manage property and business affairs effectively for reasons such as mental illness, mental deficiency, physical illness or disability, or disappearance.
Second, the individual has property that will be wasted or dissipated unless proper management is provided, or money is needed for the individual’s support, care, and welfare or for those entitled to the individual’s support, and that protection is necessary to obtain or provide money.
After the probate court judge makes those two determinations, the court, without appointing a conservator, may authorize, direct, or ratify a contract, trust, or other transaction relating to the protected individual’s property and business affairs, if the court determines that the transaction is in the protected individual’s best interests. In this case, the protective order would need to provide that Shirley or Mike can sign Robert’s name on all of the documents necessary to sell the home.
Since this transaction will help Robert get the care he needs and his wife, Shirley, is in agreement with it, there is a very good chance the court will grant the request for the protective order. However, it may be several weeks before the court date can be held, due to legal notice requirements, so the real estate closing may have to be delayed. There will be attorney fees, with most elder care attorneys in Michigan handling this type of matter on an hourly attorney fee basis. It may take 10 to 20 hours total between meeting with Mike and Shirley, reviewing the real estate documents, drafting the probate court documents, and attending and conducting the probate court hearing. This delay and expense could have been avoided had Robert planned ahead for the possibility of his incapacity. Since he did not, his family will need to rely on this second best solution. One of the main functions of the probate court is to deal with these types of situations when people do not have the right estate and incapacity planning in place.
Mike and Shirley decide to go ahead with the protective order proceeding. Six weeks later, they attend court with their attorney, and the judge grants Shirley the authority to sign any documents to sell the home on Robert’s behalf. Then Shirley is able to complete the sale of the home and she and Robert move to the senior care facility.