It is a common and frustrating situation. You’ve done everything right: Your parent created a trust, named you as trustee and signed a power of attorney naming you as their agent. Then your parent becomes incapacitated and suddenly you’re told you may need to go to court and seek a conservatorship.
Your first reaction is usually: Why? Don’t I already have legal authority?
The answer lies in understanding the limits of each role.
Different roles, different powers: Being a trustee gives you authority over assets titled in the trust, such as trust bank accounts, investments and real property. But your authority stops there. If an asset was never transferred into the trust – like a retirement account, vehicle or certain financial accounts – you may not have control over it as trustee.
As an agent under a power of attorney, you can act on your parent’s behalf for financial matters, but only to the extent the document allows and third parties accept it. And that’s where problems often arise.
When power of attorney isn’t enough: In theory, a properly drafted power of attorney should avoid court involvement. In practice, institutions sometimes refuse to honor it. Banks may claim the document is “too old,” doesn’t meet internal requirements or lacks specific authority for a transaction.
A power of attorney also does not give you court-backed authority to resolve disputes or override challenges from others. If your parent is incapacitated and you encounter obstacles, your authority may be limited.
You may need a conservatorship if:
• Financial institutions refuse to honor your power of attorney
• There are assets outside the trust you cannot access
• There is family conflict or accusations of wrongdoing
• Your parent is vulnerable to financial exploitation
• You need clear authority for care or placement decisions
What a conservatorship does: A conservatorship is a court-supervised process where a judge appoints someone to manage the personal and/or financial affairs of an incapacitated adult. Unlike a power of attorney, a conservatorship provides clear, enforceable authority. Third parties must recognize it. It also allows you to make decisions that may not be explicitly covered in existing documents, including housing, care and protection from undue influence.
When should you file? Timing matters. You should consider filing when you are hitting roadblocks that prevent you from properly caring for or protecting your parent. Warning signs include repeated refusals from institutions, unpaid bills despite your efforts, cognitive decline, family disputes or urgent decisions that cannot wait.
If everything is working smoothly with the trust and power of attorney, you likely do not need a conservatorship. But when those tools break down, court involvement becomes necessary.
A trust and power of attorney are essential, but not foolproof. Conservatorship is not a failure of planning; it is sometimes the only way to obtain clear legal authority when problems arise.
Send your questions to ccolan@colanlegal.com and use “Alpine Mountaineer estate planning question” as the subject. We’ll answer your questions in our upcoming issues.
This article is provided by your local estate planning attorney, Corina Colan. The Law Office of Corina I. Colan / (909) 265-3315 / www.colanlegal.com
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