There are four categories of persons (and entities) that are eligible to serve as an article 81 guardian in New York – lay guardians, independent guardians, corporate guardians (both not-for-profit and for-profit), and public agency guardians.
Lay guardians include family and friends of the Incapacitated Person (IP) or Person in Need of a Guardian (PING).
Independent guardians are individuals who are certified to serve as a court-appointed guardian pursuant to Part 36 of the Rules of the Chief Judge. Most independent guardians are attorneys.
Corporate guardians include not-for-profit organizations and for profit corporations. For-profit corporations can only serve as guardian of the property management, not personal needs.
Certain public agencies can also be appointed article 81 guardian.
Lay guardians are usually family or friends of the IP or PING.
Judges have a strong preference for appointing a lay guardian over any other type of guardian as long as they are qualified.
However, if no family is qualified or there is familial infighting, courts will often look to the Part 36 list for an independent guardian to serve.
When a court determines that the incapacitated person’s family or friends are unsuitable to serve as guardian or there are no family or friends available to serve as guardian, the court will often appoint an independent guardian.
The vast majority of independent guardians are appointed from the Part 36 Fiduciary Eligibility List. Part 36 of the Rules of the Chief Judge governs judicial appointments made by judges and justices of New York’s Unified Court System.
Part 36 provides for the establishment of a list of qualified applicants for each category of appointment, including the appointment of a guardian pursuant to Mental Hygiene Law Article 81. Part 36 requires that the court make all appointments (with exceptions) from the appropriate list. Judges have discretion in the selection of appointees from the list, meaning they can choose who they like off the list, and do not have to select appointees in any particular order.
In fact, as part of the Part 36 list enrollment process, appointees provide a description of any special skills and interests they have so that judges can select a fitting person as independent guardian. For example, a court-appointed guardian who is also a commercial real estate lawyer may be an appropriate selection for a very wealthy incpaciated person with a complex portfolio of income-producing real estate holdings.
As noted, there is an exception to the rule that the appointee must be chosen from the Part 36 list. Pursuant to Section 36.2(b)(2), a court may select an appointee not enrolled on the Part 36 list “upon a finding of good cause, which shall be set forth in writing and shall be filed with the fiduciary clerk at the time of the making of the appointment.”
There are generally three types of corporate guardians:
- Not-for-profit guardians;
- Not-for-profit community guardians; and
- For-profit corporate guardians.
There are numerous non-profit and charitable organizations which courts appoint to serve as article 81 guardians.
For example, Project Guardianship (formerly part of the Vera Institute for Justice) and Bronx Community Guardianship Network, Inc. are appointed by judges to serve as guardian of the person and property of the IP or PING.
These organizations can be granted the same powers as any other guardian and can serve persons living in the community, in assisted living facilities, or in rehabilitation and nursing home facilities.
Not-For-Profit Community Guardians
Nonprofit community guardian programs are a special type of not-for-profit organization that has a contract with a local social services official to serve as guardian for IPs and PINGs who are living in the community. This means that these organizations cannot serve as an article 81 guardian for persons who live in a hospital or “residential facility”, like a nursing home, on a long-term basis. In practice the “local social services official” is the Commissioner or other head of the local Department of Social Services.
When Adult Protective Services (which is part of DSS) identifies a client that it believes needs a guardian, DSS will petition for the appointment of an article 81 guardian for its client. The petition will nominate a community guardian program to serve.
New York law is serious about limiting these organizations to serving IPs and PINGs in the community only. Pursuant to 18 NYCRR 457.12(d)(2) a contract between a local social services official and a community guardian program must provide that the community guardian program will petition the court to relinquish its duties as guardian if a person for whom it is appointed as guardian enters a hospital or residential facility with the expectation of a long-term stay which will exceed six months and there is no anticipation of a return to the community. Residential facilities include nursing homes, certain alcoholism or substance abuse treatment facilities, certain community residences, family care homes, or other community care facilities for the mentally disabled, and certain adult care facilities.
For-Profit Corporate Guardians of the Property
For-profit corporations can be appointed guardian, but can only serve as guardian of the property management. MHL 81.19(a)(3) expressly prohibits any corporation that is not a not-for-profit corporation from serving as guardian of the personal needs.
At the outset, it should be noted that such appointments are extremely uncommon. I personally have never worked on a case where a for-profit organization was appointed guardian of the property (although corporations of all types are routinely appointed as trustees by courts in New York).
MHL 81.19(a)(2) authroizes “a social services official, or public agency authorized to act in such capacity which has a concern for the incapacitated person” to serve as an article 81 guardian. Like for-profit guardians, such appointments are rare.
There are instances where the Public Administrator is appointed guardian (See In re HYLTON, 2005 N.Y. Misc. LEXIS 8310, 233 N.Y.L.J. 4). There are also reported cases where a social services official is appointed guardian.
Practitioners should be aware of the eligibility requirements of MHL Art. 81 guardians, and the types of guardians available, in order to nominate the most suitable type of guardian for the IP or PING.