Chapter 9 Powers and Duties of a Conservator

• Library: Guardianships and Conservatorships (2020 Ed.)

CHAPTER 9

POWERS AND DUTIES OF A CONSERVATOR

A. General Powers and Duties

The conservator of an estate of a minor or a disabled person has a general obligation to protect, preserve, and manage the estate. Section 475.130.1, RSMo Supp. 2019. The conservator must invest the estate funds prudently. Id. The conservator has a general obligation to use the degree of care, skill, and prudence that an ordinarily prudent person uses in managing the property of and conducting transactions on behalf of others and to avoid conflicts of interest that impair the conservator’s ability to so act. Id. A conservator who has special skills is under a duty to use those skills in conducting the protectee’s affairs. Id.

The conservator has a general duty to provide for the care of the protectee and to expend the funds of the protectee for that purpose. A court may limit that generalized duty. Section 475.010(3), RSMo Supp. 2019. A “limited conservator” only has the authority to perform the acts and control the assets that the court specifies in its order. Estate of Rogers v. Battista, 125 S.W.3d 334, 340 (Mo. App. E.D. 2004).

But any expenditure made without prior court approval is made at the risk of the conservator that it will not be approved by the court, which causes the conservator to be liable to the estate in the amount of the unauthorized expenditure. In re Mansour’s Estate, 185 S.W.2d 360 (Mo. App. E.D. 1945); Hamiltonian Fed. Sav. & Loan Ass’n v. Reliance Ins. Co., 527 S.W.2d 440 (Mo. App. E.D. 1975). The conservator has the power to perform the following functions without court order:

(1) Settle or compromise a claim against the protectee or the estate agreeing to pay or paying not more than five thousand dollars;

(2) Settle, abandon, or compromise a claim in favor of the estate that does not exceed five thousand dollars;

(3) Receive additions to the estate;

(4) Sell, or agree to sell, chattels and choses in action reasonably worth not more than five thousand dollars for cash or upon terms involving a reasonable extension of credit;

(5) Exchange, or agree to exchange, chattels and choses in action for other such property of equivalent value, not in excess of five thousand dollars;

(6) Insure or contract for insurance of property of the estate against fire, theft and other hazards;

(7) Insure or contract for insurance protecting the protectee against any liability likely to be incurred, including medical and hospital expenses, and protecting the conservator against liability to third parties arising from acts or omissions connected with possession or management of the estate;

(8) Contract for needed repairs and maintenance of property of the estate;

(9) Lease land and buildings for terms not exceeding one year, reserving reasonable rent, and renew any such lease for a like term;

(10) Vote corporate stock in person or by general or limited proxy;

(11) Contract for the provision of board, lodging, education, medical care, or necessaries of the protectee for periods not exceeding one year, and renew any such contract for a like period;

(12) Deposit funds in a bank;

(13) Pay taxes, assessments, and other expenses incurred in the collection, care, administration, and protection of the estate;

(14) Prosecute or defend actions, claims, or proceedings in any jurisdiction for the protection of estate assets;

(15) Execute and deliver all instruments that will accomplish or facilitate the exercise of the powers vested in the conservator; and

(16) On or after August 28, 2009, invest the estate in accordance with the provisions of section 475.190.

Section 475.130.6, RSMo Supp. 2019.

By implication, all acts not exempted require prior court approval. The grant of power to act without court order does not protect the conservator against criticism from the court or other interested party. Therefore, it is always best for the conservator to obtain prior court approval for the expenditures deemed necessary and appropriate from the protectee’s funds. Ongoing expenses can generally be authorized as such, which eliminates the need for specific approval of each ongoing expense. For example, under petition by the conservator, the court can authorize payments not to exceed a given amount for such things as groceries, utilities, nursing home payments, etc. But the conservator should be aware that any nonspecific prior approval would not furnish absolute protection and that the conservator would still be required to account to the court and provide satisfactory proof of the necessity and appropriateness of any of these expenditures. Mansour’s Estate, 185 S.W.2d at 360.

B. Bond

Unless the court finds that a bond is not required for the protection of interested parties, every conservator of the estate of a minor or disabled person must file a bond with surety as fixed by the court. Sections 473.157–473.217, RSMo 2016. As a practical matter, counsel should assume that every matter where a conservatorship estate is opened will require a bond, save for the few exceptions discussed below. Many judges will require proof of the petitioner’s ability to obtain a bond before setting the petition for hearing.

Assets may be deposited by the conservator in a restricted account under an order of the court that the assets cannot be withdrawn from deposit without further order of the court. Section 473.160.2. Under this restriction of assets, the court may reduce the amount of the bond proportionately. Id. Most courts will require that an acknowledgement from the depositary, accepting the restrictions imposed, be filed with the court before an order reducing the bond is entered. If the depositary fails to abide by the court’s order restricting the funds, it may be liable to the estate for any damages sustained as a result of that failure. Section 473.207.5(1), RSMo 2016; see also General Ins. Co. of Am. v. Commerce Bank of St. Charles, 505 S.W.2d 454 (Mo. App. E.D. 1974).

The specific forms and procedures used to restrict accounts vary widely among the circuits. Counsel is advised to check with the appropriate court.

C. Inventory

When a conservator of an estate is appointed, an inventory and appraisement must be filed within 30 days after letters are issued unless a later deadline is requested and approved by the court. Section 473.233.1, RSMo 2016. The inventory is to be made in the same manner and subject to the same general requirements as an inventory of a decedent’s estate. It is to include all property of the protectee, the value of it, and a statement of all encumbrances, liens, and other charges on any item. Id. In addition to the property includible in the inventory in a decedent’s estate, the conservatorship inventory is to include:

· property of which the protectee is a joint tenant or tenant by the entirety;

· all life insurance policies owned by the protectee;

· a statement of all income and benefits that the protectee is or will be entitled to receive; and

· nonprobate transferees designated to receive nonprobate transfers at the protectee’s death.

Section 475.145, RSMo Supp. 2019.

In accordance with § 473.233, the property is to be classified as follows:

(1) Real property, with plat or survey description and the street address or approximate direction and distance from any city or town, and the popular name thereof, if any;

(2) Furniture, household goods, and wearing apparel, but no detailed appraisement or listing of the items thereof is required;

(3) Corporate stocks described by name, number of shares, class of stock;

(4) Mortgages, bonds, notes, and other written evidences of debt, together with interest due thereon, described by name of debtor, recording data, and other identification;

(5) Bank accounts, insurance policies payable to the personal representative, and money;

(6) All

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