Will Preparation for Individuals Lacking Testamentary Capacity

• Publication year: 2004
• Pages: 93

33 Colo.Law. 11 Colorado Lawyer 2004.

2004, August, Pg. 93. Will Preparation for Individuals Lacking Testamentary Capacity

Vol. 33, No. 8, Pg. 11

The Colorado Lawyer
August 2004
Vol. 33, No. 8 [Page 93]

Specialty Law Columns
Estate and Trust Forum
Will Preparation for Individuals Lacking Testamentary Capacity
by Spencer J. Crona, Martha L. Ridgway, Herbert E. Tucker

This column is sponsored by the CBA Trust and Estate Section The column focuses on trusts and estate law topics, including estate and trust planning and administration, elder law probate litigation, guardianships and conservatorships, and tax planning

Column Editor:

David W. Kirch, of David W. Kirch, P.C., Aurora - (303) 671-7726, dkirch@qwest.net.

About The Authors:

This month's article was written by Herb Tucker, Denver, a shareholder of Wade Ash Woods Hill & Farley, P.C. - (303) 322-8943, htucker@wadeash.com; Spencer Crona, Denver, a senior associate with the same firm - (303) 322-8943, scrona@wadeash.com; and Martha Ridgway, Lousville, a partner in Ridgway, Romeo & Vincent, LLC - (303) 604-6030,

mridgway@elderlawcolorado.com.

A version of this article was first published in the Colorado Bar Association Trust and Estate Section newsletter, Council Notes (March 2004).

The Colorado Uniform Guardianship and Protective Proceedings Act authorizes a court-appointed special conservator to create a will for the respondent/protected person. This article describes the statutory context, basis, and protocol for exercise of that power, scope of the court's authority for review of such exercise, and legal implications of a conservator-created will.

Since January 1, 2001, a Colorado conservator has had authority to make a will for a protected person, irrespective of the protected person's testamentary capacity. The protocol prescribed by CRS § 15-14-411 facilitates conservator creation of a will, with court oversight, despite the existence of testamentary incapacity. Thus, the statute may be used to further the testamentary desires of a cognitively disabled person under conservatorship who lacks testamentary capacity, as well as to protect his or her fundamental property interests.

If properly followed, the CRS § 15-14-411 protocol effectively eliminates lack of testamentary capacity as a ground to contest a will after the death of the protected person/testator.1 Nonetheless, other grounds for contesting the court-approved will may still be viable after the protected person's death. Further, depending on the protected person's health condition, he or she could regain capacity and revoke the court-approved will or execute a new will.

This article addresses the concept of conservator will preparation for individuals lacking testamentary capacity. It reviews the statutory history of the issue and provides an overview of the rationale for this particular section of the Colorado Probate Code ("Code").2 The article uses a hypothetical case study to illustrate what the Code affords to a person who lacks testamentary capacity but has ascertainable preferences as to testamentary disposition of his or her estate. It discusses the procedure for preparing a will for a protected person lacking testamentary capacity, which includes court approval following proper notice and a hearing.

Statutory Context for
Will Approval

The Colorado Uniform Guardianship and Protective Proceedings Act ("CUGPPA")3 was enacted as part of the Code.4 Before the CUGPPA went into effect on January 1, 2001, a conservator was prohibited from creating wills for protected persons. The common law uniformly held that a guardian or conservator could not make a will for his or her ward,5 and the Uniform Probate Code codified that holding.6

Pre-2001 Will Powers

Prior to the CUGPPA, although a conservator lacked the power to make a will, permissible powers included will substitutes. This included the power to enter into contracts (presumably life insurance contracts to change insurance beneficiaries) and the power to enter into both revocable and irrevocable trusts, which may extend beyond the life of the protected person.7 In addition, Colorado courts had permitted use of the Code to:

1) Create trusts with dispositive provisions contrary to the intestacy statute;

2) Manage and dispose of minors' personal injury settlements;

3) Substitute a trust for a will for the post-death protection of assets of a disabled successor;

4) Effectuate traditional marital deduction and exemption equivalent planning; and

5) Substitute a trust for a will to take advantage of changes in the law regarding the design for generation-skipping transfers.8

Through the exercise of the principle of substituted judgment, a court could adjust or modify the estate plan of a protected person to take into account changes in circumstances, changes in tax law, and the evolving best interest of the protected person. The fact that the substantive standard of capacity for testation is lower than for appointment of a guardian or conservator supports the previous distinction between the court's jurisdiction involving inter vivos versus testamentary dispositions.

Specifically excluded in the pre-2001 law's court powers regarding protected persons are all dispositions made by will according to: (1) the statutory provisions governing power to make wills; (2) authority of a court to conduct the affairs of a protected person; and (3) voidability of sales, encumbrances, and transactions undertaken by protected persons.9 This is because a will is ambulatory and does not "speak" until death. At the time of death, a will may be set aside if the testator is shown to have been incompetent at the execution of the will or induced into signing by fraud, undue influence, or coercion.10

Historically, courts of protection (regarding guardianships and conservatorships) have avoided making findings as to the protected person's testamentary capacity. This offers one explanation as to why the Code, pre-CUGPPA, excluded the power to make a will for a disabled person from the otherwise plenary powers of the conservatorship scheme. It also clarifies why inventive estate planners have found it difficult to invoke the existing protective jurisdiction of the court to obtain pre-mortem determinations of testamentary capacity.11

The Code provided, in pertinent part:

. . . the court has for the benefit of this person and members of his household, all the powers of his estate and affairs which he could exercise if present and not under disability, except the power to make a will. These powers include . . . power to make gifts . . . [and] to create revocable or irrevocable trusts of property of the estate which may extend beyond his disability or life. . . .12 (Emphasis added.)

Thus, the former Code adopted an expanded Colorado perspective on the Uniform Probate Code II ("UPC II")13 on the question of the limited gifting powers of the conservator.

The 2001 CUGPPA

The CUGPPA contains specific authorization for a conservator to make a will.14 This represents an explicit and affirmative statement of the Colorado legislature effecting a clear expansion and new direction of conservatorship authority in state law.15 The CUGPPA thus affirms the fundamental civil rights of allegedly incapacitated persons or those allegedly in need of protection.16 Such persons might not otherwise execute a valid will pursuant to substantial testamentary capacity criteria set forth in a seminal Colorado case, Breeden v. Stone.17 However, the CUGPPA consistently endows such persons with a mechanism to devise their estates.

CRS § 15-14-411 facilitated for such persons a fulfillment of one of the Code's underlying purposes: to discover and make effective the intent of a decedent in distribution of his or her property.18 The Code should be construed liberally to effect such purposes.19 The CUGPPA also empowers a conservator to access, and to take into account, the protected person's estate plan in the context of "investing an estate, selecting assets . . . for distribution, and invoking powers of revocation or withdrawal . . . exercisable by the conservator."20 The CUGPPA is part of the current Code.

Worth noting in this connection is an observation about a directive consistently expressed throughout the National Conference of Commissioners on Uniform State Laws' version of an updated uniform conservator-guardian statute, the Uniform Guardianship and Protective Proceeding Act ("UGPPA"), adopted in 1999. That pertinent section of the UGPPA Comments (issued to guide interpretation of the UGPPA) states, "Such access is essential for the conservator to carry out the obligation . . . to consider the protected person's views when making decisions." (Emphasis added.) Thus, the ascertainment and consideration of the protected person's views and desires is a touchstone mandate, consistently expressed throughout both the uniform law and Colorado's version of it, the CUGPPA, including at CRS § 15-14-411(3):

The court, in exercising or in approving, a conservator's exercise of the powers listed in . . . this section, shall consider primarily the decision the protected person would have made, to the extent that the decision can be ascertained. To the extent the decision cannot be ascertained, the court shall consider the best interest of the protected person. (Emphasis added.)

Nevertheless, the last sentence of CRS § 15-14-411(3) is unique to Colorado and is not part of the UGPPA. Also added to CRS...