Mcle Self-study Article 2022 Legislation: New Laws That Trust and Estate Practitioners Should Know
| Publication year | 2023 |
Written by Matthew Owens, Esq.* and Ciarán O'Sullivan, Esq.**
The Executive Committee of the Trusts and Estates Section of the California Lawyers Association ("TEXCOM") has continued its work monitoring and commenting on bills affecting our practice area as they proceed through the Legislature. This article briefly summarizes the new laws that will be most important to trust and estate practitioners. As will be seen, reforming the conservatorship law continued to be a major preoccupation of legislators in the second half of the just-finished two-year legislative cycle. Practitioners in the areas of elder law, probate conservatorships, and LPS conservatorships must be mindful of the many new requirements imposed on them as a result of legislation enacted in the last two years.
A. Assembly Bill No. 2288 (2021-2022 Reg. Sess.) (Choi) (AB 2288) Advance Health Care Directives: Mental Health Treatment
Status: Chaptered June 20, 2022 - Secretary of State - Chapter 21, Statutes of 2022
This bill amends Probate Code, sections 4615 and 4617 to clarify that health care decisions, within the meaning of the Health Care Decisions Law, include decisions regarding mental health. It also makes concomitant changes to the statutory form advance health care directive ("AHCD") contained in section 4701. Finally, the requirement that the AHCD must either be witnessed by two individuals or notarized is made more prominent on the statutory form. This bill is a response to the growing awareness that many Californians will experience a mental health crisis at some point during their lifetime, and that an overburdened hospital emergency room is not the best environment in which health care professionals may need to ascertain the wishes of a patient with respect to mental health care services. Additionally, the bill is a response to a nationwide trend recognizing the benefits of advance instructions regarding psychiatric treatment. Standalone mental health specific directives known as Psychiatric Advance Directives ("PADs"), which are viewed as beneficial because they promote conversations with a patient about preferences with respect to mental health well before the need arises, have been implemented by 25 other states. California has not fully embraced this trend.
While this bill does not standardize PADs in California, it clarifies that an AHCD can be used for mental health care and treatment by making slight changes to the model AHCD form.
B. Senate Bill No. 1005 (2021-2022 Reg. Sess.) (Wieckowski) (SB 1005) Conservatorships: Sale of Personal Residence
Status: Chaptered July 1, 2022 - Secretary of State - Chapter 91, Statutes of 2022
This bill amends Probate Code, sections 2463, 2540, 2541, 2541.5, and 2591 to impose the requirements set forth in Probate Code, sections 2352.5, 2540, 2541, and 2541.5, on a conservator who seeks the partition of a conservatee's property, including the conservatee's personal residence.
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This bill closes a loophole in the Probate Code that sidesteps our Legislature's intent to protect the homes of California conservatees. Understanding the value of living at home, our Legislature enacted statutory protections to prevent the unnecessary sale of a conservatee's home-referred to as the personal residence—as many California conservatorships involve elderly conservatees who live at home or could return home after a limited stay at a hospital or facility.
The personal residence of a conservatee when a conservatorship proceeding begins is presumed to be the least restrictive appropriate residence, and a conservator cannot sell a conservatee's present or former personal residence unless, among other things, the court finds by clear and convincing evidence that the conservator demonstrated a compelling need to do so for the benefit of the conservatee.
While the statutory scheme previously safeguarded the sale of the conservatee's personal residence, it did not always protect against the disposition of the conservatee's personal residence. The Probate Code empowers a conservator to bring an action for or agree to the partition of a conservatee's property, which may include the conservatee's personal residence, and almost always results in a sale (rather than a physical division). Before this bill, the Probate Code did not explicitly impose the same protective restrictions on a conservator who pursued the partition of a conservatee's personal residence as it did on a conservator who sold the conservatee's personal residence. This omission created a loophole in the law and a vulnerability in our Legislature's efforts to protect the personal residences of California conservatees. This bill closes that loophole by imposing the same restrictions in the partition context.
C. Assembly Bill No. 2338 (2021-2022 Reg. Sess.) (Gipson) (AB 2338) Health Care Decisions: Surrogates
Status: Chaptered September 29, 2022 - Secretary of State - Chapter 782, Statutes of 2022
This bill adds Probate Code, section 4717 to accomplish two important purposes that may help avoid confusion with respect to who may make health care decisions for persons unable to make those decisions themselves. First, it establishes an order of priority as to the various persons with existing authority to make such decisions for the patient. Second, it identifies the persons whom the health facility may designate to make health care decisions where there are no existing persons with such authority.
Existing law, Probate Code, section 4711, allowed for the designation of a surrogate to make decisions on behalf of a patient, by notifying the health care facility during treatment. It also gave that surrogate priority over a nominated agent in an AHCD during the treatment. The new section 4712 provides that in the event of the incapacity of the patient, the persons with priority to make decisions for the patient are, in the following order, namely: (i) the surrogate nominated pursuant to section 4711, (ii) the agent under the AHCD, and (iii) the conservator or guardian of the patient.
Only about 30% of adults presently have AHCDs, and questions have arisen about who can make health care decisions for a patient if a patient who now lacks capacity has not executed an advance health care directive or has not named a surrogate. Section 4712 provides that the health care facility or its designee may choose a surrogate to make health care decisions on its behalf, as appropriate. The chosen person must be: (i) an adult, (ii) who has demonstrated special care and concern for the patient, (iii) is familiar with the patient's personal values and beliefs, and (iv) is reasonably available and willing to serve. The bill then provides a list of persons, without a priority, from whom the surrogate can be chosen, namely: (i) the spouse or domestic partner of the patient, (ii) an adult child of the patient, (iii) a parent of the patient, (iv) an adult sibling of the patient, (v) an adult grandchild of the patient, or (vi) an adult relative or close personal friend.
The aforementioned persons are those whom the various health care facilities were already, in practice, recognizing as the persons who should make decisions for incapacitated persons, and consequently the new statute serves as a helpful clarification of the law.
D. Senate Bill No. 1024 (2021-2022 Reg. Sess.) (Jones) (SB 1024) Replacement of an Incapacitated or Deceased Professional Fiduciary
Status: Chaptered September 27, 2022 - Secretary of State - Chapter 612, Statutes of 2022
Commencing January 1, 2024, this bill authorizes the appointment of a professional fiduciary practice administrator to act as a temporary professional fiduciary when a professional fiduciary either becomes incapacitated or dies and a vacancy exists. The procedure is similar to the practice-administrator procedure used for deceased or incapacitated attorneys.
The petition seeking appointment of the practice administrator may be filed by a conservator, agent under a power of attorney for asset management, representative of the estate, trustee of a trust, or an interested person. Notice of the hearing on the petition for appointment of the professional fiduciary practice administrator as temporary successor must be given to all persons entitled to notice in
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each of the matters that are the subject of the petition. The court may then appoint the professional fiduciary practice administrator and require the professional fiduciary practice administrator to file a surety bond in each matter in which that person is appointed temporary successor.
The appointment of the professional fiduciary practice administrator must terminate, in each of the matters in which the professional fiduciary practice administrator was appointed as a temporary successor, 45 days after entry of the order appointing the professional fiduciary practice administrator. The court has discretion to extend the time limit for good cause.
The professional fiduciary practice administrator is entitled to compensation from the assets of the matter in which the administrator is appointed. The professional fiduciary practice administrator must provide written notice to all interested parties to advise them concerning the necessity and process for the appointment of a permanent successor.
E. Assembly Bill No. 1663 (2021-2022 Reg. Sess.) (Maienschein) (AB 1663) Conservatorship Bill
Status: Chaptered September 30, 2022 - Secretary of State - Chapter 894, Statutes of 2022
Assembly Bill 1663 embraces a national trend of affording greater autonomy to adults with disabilities, for whom limited conservatorships are sometimes created, while also reflecting a recent scrutiny of California conservatorship law generally. It does so by amending sections 416.17 and...
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