What is a "guardian of the estate"? A guardian is a person (or, in some cases, an association or corporation) appointed by an Ohio probate court to take responsibility for a legally incompetent person, known as a ward, and/or the ward's property, or estate. Legal incompetence can arise in a number of ways. A child who is not yet an adult is legally incompetent, no matter how bright they may be. For the purposes of this article, though, when we talk about someone who is legally incompetent, we are referring to an adult, perhaps someone who has developed dementia or suffered a traumatic injury that makes them incapable of tending to their own business.
A person can nominate someone to serve as their guardian in the event that they become incapacitated, but only the Probate Court can appoint a guardian. If you are appointed as a guardian of the estate, what are your duties?
First and foremost, you must prepare and file with the probate court a thorough inventory of all of the ward's property, both real and personal. If there is rental property, you must include the yearly rent for the property in the inventory. The probate court may also require you to file evidence in support of the inventory. The inventory must be filed within three months after your appointment as guardian. This deadline is very important; a guardian who fails to file this inventory within thirty days after the probate court has notified them of the expiration of the three-month window will be removed and replaced as guardian.
As guardian, your overarching responsibility is to manage the estate for the ward's best interest; that is, you are bound to do what is best for your ward, not what is best for you or anyone else. Every action you take on behalf of the estate should be taken with this in mind.
If your ward has any legitimate debts, it is your responsibility to pay them out of the assets of the estate. If anyone owes your ward a debt, collecting that debt is likewise your duty. If there are any suits against your ward, it is your job to mount a defense (obviously, with an attorney's help, as needed). You will also need to be alert to whether there is any cause to bring a lawsuit on behalf of your ward (say, for instance, if his or her incapacity was caused by a car accident that was someone else's fault). If it would be in the ward's best interest to file suit, you must do so. Guardians are also responsible for settling claims for damage to the ward's person or property.
Because a guardian's duty is to administer the ward's estate for the ward's best interests, if you are acting as guardian of the estate, you must file periodic accountings of your actions on behalf of the estate with the probate court. Ohio state law requires accounts to be filed at least every two years, but local rules may require them more frequently; for instance, Montgomery County Probate Court requires annual accounts. If the guardianship is terminated for any reason, a final account must be filed within 30 days of the termination.
The probate court is, technically, the superior guardian of the ward. Consequently, the guardian is obligated to obey all orders of the probate court regarding the ward and their estate, even if duties imposed by the orders aren't specifically enumerated in Ohio statute.
Guardians of the estate are, unless otherwise provided by law required to file a Guardian's Bond with the probate court prior to their appointment. This bond is conditioned on the guardian's honest and faithful discharge of their duties.
The amount of the bond required is typically double the likely total value of the ward's personal property and annual income, including income from rental property. The probate court may also order an additional bond on the motion of an interested party, or on its own motion.
Exceptions to the bond requirement are if the document nominating the guardian dispenses with the bond requirement, or if the guardian deposits the ward's personal property into a custodial depository. If bond is required, however, and the guardian fails to file the bond or pay renewal premiums on the bond, the guardian may be removed.
In the coming weeks, we'll be discussing more about Ohio guardianships in this space, including management of the estate, guardian and attorney fees, and termination of guardianship.