Power of Attorney vs. Legal Guardianship: What’s the Difference?
January 23rd, 2012
While power of attorney and legal guardianship can perform similar functions in some cases, they are vastly difference in terms of who is appointed, who does the appointing and how much control the appointed agent or guardian has.
Throughout Ohio, probate attorneys regularly find themselves assisting clients in applying for guardianship for loved ones who've recently become incapacitated. In most cases the loved one would have been better served by choosing the person they wanted to make decisions on their behalf and giving them power of attorney.
Legal Guardianship — What it is and When it's Used
Guardianship is a legal relationship in which a probate court authorizes one person with the power to make personal and/or financial decisions for another person. The person authorized with decision-making power is known as the guardian and the person for whom the decisions are being made is known as the ward. All decisions made by the guardian must be approved by the court.
Legal guardianship is assigned when a person has been determined to lack the capacity to make rational and intelligent decisions on their own, especially in regard to their healthcare or finances. The ward may lack capacity for a number of reasons ranging from being in a coma or suffering injury-related brain damage, or because they are under the age of 18 and don't have parents to make legal, health and financial decisions for them.
Usually it is a family member who applies for guardianship, but it can also be a friend. In some cases, a third party may be appointed guardianship, particularly in the case of finances, if no one close to the ward is deemed appropriate. In Ohio, probate attorneys usually assist people who are applying for guardianship in order to reduce frustration and errors.
In most cases, power of attorney is preferred to legal guardianship because more control is retained by the person being protected. However, if court supervision is needed, guardianship may be more appropriate. Guardianship also gives the guardian court-ordered authority that third parties, like banks, must recognize. Third parties are not required to allow an agent with power of attorney to conduct business on behalf of the principal.
Power of Attorney — What it is and When it is Used
A power of attorney is a legal document created by one person, known as the principal, to give another person, known as the agent, legal power to act on behalf of the principal. The document can grant either general powers or limited powers to act in specific circumstances or over specific types of decisions. Often the powers granted are conditional upon the principal being rendered incapacitated.
Granting decision-making powers to someone through a power of attorney is generally preferred over legal guardianship by Ohio probate attorneys and estate planning attorneys because of the following reasons:
- The principal retains more control over who makes the decisions and what decisions they can make
- Lower costs compared to applying for guardianship (court costs are usually paid for out of the ward's estate)
- No court is involved
- More privacy (all probate court proceedings are public record)
- The principal may revoke the power of attorney at any time as long as they have the mental capacity to do so (guardianship can only be revoked by the court)
Do you want to avoid court-appointed guardianship in the event of incapacity?
The Ohio probate attorney's office of Gudorf Law Group, LLC, can assist in creating a power of attorney. Our staff can also help you pursue legal guardianship for an incapacitated loved one. Call our office at 1-877-483-6730 to schedule a free consultation.