Rule Impacts Report

Probate

 RULE  AFFECTS  SUMMARY AND IMPACT

Rule 7

R-11-0023
AOC Contact: Nancy Swetnam

Superior Court

Judges

Summary: This change amends Rule 7(A)(1)(c) to include, within the definition of "confidential document," budgets that are filed in conservatorship estates.

Impact: A confidential document shall not be maintained as part of the public record of a probate case. See Probate Rule 7(C).

Effective: 2/1/2012


Rule 8

R-11-0023

AOC Contact: Nancy Swetnam

Superior Court

Judges
Clerks

Summary: Rule 8(B) is amended to allow for dismissal of a petition that commences a probate case when service has not been completed within 120 days of the filing date. The court, upon motion or sua sponte and with notice to the petitioner, may dismiss the petition without prejudice if service of a notice and petition is not made upon all required persons as prescribed by Title 14 within 120 days after the filing of the initial petition. Time for service may be extended if the petitioner shows good cause for failure to serve within the allowed time.

Impact: Courts need to monitor cases for compliance with the 120-day service deadline if the court intends to dismiss petitions sua sponte.

Effective: 2/1/2012


Rule 10

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

10(C)(4) - Duties Regarding Minor’s Death, Adoption, Marriage or Emancipation

Summary:
This new subpart to Rule 10 adds to the duties of court-appointed fiduciaries by setting forth notification requirements. A court-appointed guardian is required to notify the court within ten days of a minor ward’s death, adoption, marriage, or reaching the age of majority. If the ward did not have a conservator, the guardian is also required to provide the court and former ward with a list of the ward’s known assets.

Impact:
In the event of termination of a guardianship under this provision, the court will need to assure that a written list of assets has been filed with the court and provided to the former ward.

Effective:
2/1/2012

   

10(D)(1) - Duties Relating to Counsel for Fiduciaries

Summary: This new addition to Rule 10 requires a fiduciary’s attorney to encourage the fiduciary to take actions, for which the fiduciary has authorization and competence, on his or her own, rather than having the attorney act on the fiduciary’s behalf. The intent is to minimize legal expenses.

Impact: The court should consider this provision when reviewing bills for attorneys’ fees and when reviewing accounts filed by fiduciaries.

The Court also adopted changes to Rule 31, Rules of the Supreme Court to authorize licensed fiduciaries to perform specified services without the assistance of counsel.  Examples include preparation and filing of the annual account by the fiduciary.  Amendments to ACJA § 7-202 are being drafted to incorporate these provisions.

Effective: 2/1/2012

   

10(E)(1)-(2) - Duties of Counsel for Subject Person of Guardianship/Conservatorship Proceedings; Duties of Guardian Ad Litem

Summary:
These new subsections establish initial and subsequent training requirements for any attorney who serves as a court-appointed attorney or guardian ad litem for an adult ward or an adult protected person. The attorney complete a training course prescribed by the Supreme Court and then must file a certificate of completion with the court making the appointment. Attorneys who serve long term must complete additional training every five years and file a certificate of completion with the appointing court.

Impact: The Supreme Court will prescribe the training course (currently under development) and will issue certificates of completion. Appointing courts must be aware of the training requirements and monitor for compliance.

Effective: 9/1/2012

   

10(F)(1)-(2) – Duties of Investigators

Summary:
These new subsections establish initial and subsequent training requirements for any person who is to be appointed as an investigator pursuant to A.R.S. §§ 14-5303(C), 14-5407(B), or 36-540(G). Training must be completed prior to appointment. The Supreme Court will prescribe the training course, and the investigator must file a copy of the certificate of completion with the appointing court. Persons who continue to serve as court-appointed investigators must complete additional training every five years and file a certificate of completion with the appointing court.

Impact: The Supreme Court will prescribe the training course (currently under development) and will issue certificates of completion. Appointing courts must be aware of the training requirements and monitor for compliance.

Effective: 9/1/2012

   

10(G)(1)-(3) – Remedies for Vexatious Conduct; Definitions

Summary:
This new addition to Rule 10 creates remedies that the court can apply against a person who engages in vexatious conduct in a probate case. The rule defines "court-appointed attorney," "fiduciary," and "vexatious conduct" for purposes of this section. The remedies permitted under this provision are in addition to any other civil remedy or any other provision of law.

Impact: Information only.

Effective: 2/1/2012


Rule 10.1

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Prudent Management of Costs.

Summary:
This new rule establishes the fiduciary’s duty, in Title 14 proceedings, to prudently manage costs, preserve assets, and protect against incurring costs that exceed the benefit to the ward, protected person, decedent’s estate or trust, except as otherwise directed by a governing instrument or court order. The fiduciary must disclose to the court and to all persons entitled to notice if the fiduciary has a reasonable belief the cost of compliance with a court order will exceed the probable benefit to the ward, protected person, or decedent’s estate or trust. If appropriate, the court shall enter or modify orders to protect or further the best interest of ward, protected person, decedent’s estate or trust against projected costs that exceed benefits. Further, the court may order that the guardian ad litem, fiduciary, or attorney obtain competitive bids for goods and services.

Impact:
This new rule further provides that market rates for goods and services are a proper, ongoing consideration for the fiduciary and the court during the initial court appointment of a fiduciary or attorney, a hearing on a budget objection, or a request to substitute a court-appointed fiduciary or attorney.

Effective:
2/1/2012


Rule 15.1

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Appointment of Guardian Ad Litem.

Summary:
A party requesting appointment of a guardian ad litem shall make the request by motion. The motion must explain why the appointment of a GAL is necessary or advisable, and what if any special expertise is required of the GAL. The court’s appointing order must set forth the scope of the appointment, including reasons for and duration of the appointment, rights of access, and applicable terms of compensation. The court may enter an order authorizing the guardian ad litem, upon appointment, to have immediate access to the person and all medical and financial records, including records and information that are otherwise privileged or confidential. A custodian of any relevant record must, upon receipt of a certified copy of the order, provide access to records authorized by the court.

Impact:
Information only.

Effective:
2/1/2012


Rule 15.2

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges
Clerks
Administrators

New rule: Involuntary Termination of Appointment; Other Remedies for Non-Compliance; Dismissal; and Sanctions.

15.2(A) - Dismissal of probate, special administration or subsequent administration proceedings for lack of prosecution

Summary:
Two years after case initiation, the court is required to issue notice of impending dismissal unless specific statements, petitions, or orders identified in the rule have been filed. The Clerk of Court or the court administrator, whoever is designated by the presiding judge, must promptly notify parties, heirs and devisees whose addresses are in the court file, and any others demanding notice of the impending dismissal. Ninety days after issuance of the notice, the court shall dismiss the case without prejudice and terminate the appointment of the personal representative or special administrator without a hearing unless any one of specified documents designated in the rule have been filed. Termination of the appointment does not discharge the fiduciary from liability or exonerate any bond. The court may extend the time periods in this rule for good cause.

Impact: The court must monitor aging cases and send notice of impending dismissal at the appropriate time. The Clerk or Court Administrator, whoever is designated by the presiding judge, must notify the appropriate persons of the impending dismissal. The court must continue to monitor the case for 90 days after notice is sent and dismiss it without prejudice if no action has been taken by the fiduciary.

Effective: 2/1/2012

   

15.2(B) - Termination of minor guardianship case

Summary:
The Clerk of the Court or the court administrator, whoever is designated by the presiding judge, is required to close a minor guardianship case filed pursuant to A.R.S. §§ 14-5201 to -5212, when the minor reaches majority, is adopted, marries, or dies. Unless a petition has been filed pursuant to A.R.S. § 14-5303, the court must set a status hearing not less than 90 days before the minor’s 18th birthday if the court has reason to believe the minor has a disability or impairment that necessitates appointment of a guardian after the minor’s 18th birthday.

Impact: The Clerk of the Court or the Court Administrator, whoever the presiding judge designates, must monitor the case for any of these events. The court must evaluate the case to determine whether the minor has a disability or impairment that may necessitate appointment of a guardian for an adult. The status hearing must be set not less than 90 days before the minor’s 18th birthday to determine whether a petition for appointment of a guardian for an adult should be filed.

Effective: 2/1/2012

   

15.2(C) - Remedies for non-compliance by guardian or conservator of an adult

Summary:
If a guardian or conservator fails to comply with Title 14 requirements, court rules, or court orders, the court may enter orders to ensure compliance or protect the best interests of the ward or protected person. Possible remedies are delineated in the rule.

Impact: Information only.

Effective: 2/1/2012

   

15.2(D) -(F) – General involuntary termination; effect of dismissal; dismissal authority

Summary:
If no action or hearing occurs within six months of case initiation, the court shall issue a notice that the case will be administratively dismissed in 90 days without hearing unless, prior to that date, the initiating party files a request for action or a status report describing remaining matters for resolution. The court must provide the notice to all parties, persons entitled to notice of the commencement of the case, and any person who filed a demand for notice.

Unless otherwise ordered by the court, the order dismisses all pending matters in the case without prejudice, but it does not dismiss, vacate, or set aside any final order approving accountings or other actions of a person appointed under Title 14.

The court’s authority to issue notices, dismiss cases, and terminate appointments may be performed by court administration or by electronic process.

Impact: Courts must monitor case activity and send the notice of administrative dismissal to the appropriate persons at the proper time. Continued monitoring is necessary to determine whether the case should be terminated after 90 days if there has been no action.

A process should be in place so court administration or an appropriate electronic process can perform the tasks of issuing notices, dismissing cases, and terminating appointments.

Effective: 2/1/2012


Rule 18

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges
Clerks

Summary: This rule is amended to add subsection (C), which allows a party to file by the response deadline a "notice of repetitive filing." A motion or petition is repetitive if it requests the same or substantially similar relief to what was requested within the preceding twelve months by the movant or petitioner, and if the subsequent motion or petition does not describe in detail a change in circumstance that supports the requested relief. The court may summarily strike a repetitive motion, without hearing, on its own initiative or following receipt of a notice of repetitive filing.

Impact:
The Clerk must be aware that the filing of a notice of repetitive filing stays the time to respond or object to the alleged repetitive filing until further order of the court. Court evaluation is necessary as it may summarily strike a repetitive motion sua sponte or following receipt of a notice of repetitive filing.

Effective: 2/1/2012


Rule 19

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: This rule is amended to add conditions regarding appointment of an attorney. Absent good cause, a party cannot nominate a specific attorney to represent the ward except if the attorney has an existing or prior attorney-client relationship with the ward. Unless otherwise ordered by the court, an attorney who has an existing attorney-client relationship with the nominated or appointed fiduciary cannot be appointed as attorney for the ward.

Impact:
Information only.

Effective: 2/1/2012


Rule 22

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges
Clerks

22(C)(1)-(4) - Restricted accounts

Summary:
Every order appointing a conservator, guardian, or personal representative must include the following language: "Warning: This appointment is not effective until the letters of appointment have been issued by the Clerk of the Superior Court." Every order appointing a conservator or a personal representative or that is entered pursuant to A.R.S. § 14-5409 must plainly state any restrictions on the fiduciary’s authority to manage the estate’s assets. If the restriction affects the fiduciary’s ability to manage monetary assets, the order and any letters that issue must contain specific warning language that requires deposit of funds in interest-bearing, federally insured accounts of institutions doing business in Arizona and that requires a certified order of the superior court to withdraw principal or interest. A fiduciary is required to file a proof of restricted account for every restricted account within 30 days after the order or letters are first issued. An attorney who represents a fiduciary, ward, protected person, or insurance company and who is the recipient of proceeds that will be restricted for the benefit of a minor, incapacitated person, or protected person, must ensure that the restricted account has been set up correctly. The attorney must file a proof of restricted account form executed by an authorized representative of the financial institution within 30 days after issuance of letters or entry of a single transaction order.

Impact:
The court must ensure that required language regarding restrictions is on every appointment order. If the court restricts the fiduciary’s ability to manage the estate’s monetary assets, the court must ensure that specific warning language restricting deposits to federally insured accounts appears on the order; likewise, the Clerk of the Court must ensure that the same warning language appears on any letters that issue. The court must monitor restricted accounts to ensure that the proof of restricted account forms have been timely filed by the appropriate persons.

   

(D)(1)-(2) - Restricted real property

Summary:
Orders and letters of appointment of a guardian or conservator or pursuant to A.R.S. § 14-5409 must state any restrictions on the authority of a conservator or a personal representative to sell, lease, encumber, or convey real property of the estate. If the fiduciary’s authority to manage real estate is restricted, the order must include specific language, which is set down in the rule.

Impact:
Courts must ensure that the appointing order states any restrictions on the fiduciary’s authority to manage accounts or real property. Clerks of Court must ensure that any letters issued contain the specific language regarding restricted accounts as set forth in the rule. The required language for the Court orders and the letters can be found in Rule 22(C)(2) regarding restricted accounts and in Rule 22(D)(2) regarding conveyance limitations.

Effective: 2/1/2012


Rule 26

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges
Clerks

Summary: Subsection (B) is amended to state that if the court has restricted a fiduciary’s authority, the Clerk of the Court may not issue letters of appointment without including language restricting that authority.

Subsection (E) is new, and it requires conservators to file and record a certified copy of letters of appointment with the county recorder in all counties in any state where the estate owns real property. The conservator must file a copy of the recorded letters with the appointing court within 30 days after the county recorder has issued the recorded conservator’s letters.

Impact: Clerks of Court must ensure that letters of appointment contain any ordered restrictions. They must also ensure that if the estate owns real property, the conservator has filed with the court a recorded copy of the letters.

Effective: 2/1/2012


Rule 26.1

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Written Findings on Appointment

Summary:
A person with higher priority for appointment as a guardian or a conservator but who was passed over can make a written request for a specific finding no later than 10 days after entry of the order that appointed a person of lower priority. The court must make a specific finding of good cause why the higher priority person was not appointed.


Impact: Upon written request, the court must make specific findings regarding its choice of fiduciary.

Effective: 2/1/2012


Rule 27.1

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges
Clerks

New Rule: Training for Non-Licensed Fiduciaries

Summary:
A person who is neither a licensed fiduciary nor a financial institution must complete a Supreme Court-approved training program before letters of appointment can be issued, except if appointed pursuant to §§ 14-5310(A), 14-5401.01(A) or 14-5207(C) or unless otherwise ordered by the court. If a non-licensed fiduciary is appointed because of an emergency, the training must be completed within 30 days of appointment or before permanent appointment of the fiduciary, whichever is earlier. The court can extend the time for good cause. "Financial institution" is defined for purposes of this rule.

Impact: The Supreme Court must approve training programs. Clerks of Court must confirm compliance before issuing letters of appointment.

Effective: 9/1/2012


Rule 28

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: This rule concerning pretrial procedures deletes a reference to Rule 16(g) of the Arizona Rules of Civil Procedure and substitutes a corresponding reference to amended Rule 29 of the probate rules.

Impact: Information only.

Effective: 2/1/2012


Rule 29

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: This rule title is changed from Arbitration to Alternative Dispute Resolution. In a contested matter, the court can order alternative dispute resolution (ADR) or arbitration. If ordered, arbitration is subject to Rules 73-77, Arizona Rules of Civil Procedure. The court, sua sponte or on motion, may direct the parties to participate in one or more ADR processes. The rule creates duties for the parties in a contested matter to confer about ADR. The parties must attempt in good faith to agree on an ADR process and report to the court the outcome of their conference within 15 days after it occurs. The parties may also request the court to conduct a conference to consider ADR procedures.

Impact: Information only.

Effective: 2/1/2012


Rule 30

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: "Inventories" is changed to "inventory" and "accounting" to "account", consistent with the applicable Arizona Revised Statutes. The provision on inventory includes a reference to A.R.S. § 14-5418(A). Unless otherwise ordered by the court, the conservator’s account must be prepared in the format prescribed in the ACJA.

Impact: The Supreme Court will develop and adopt a new ACJA section related to forms.

Effective: 9/1/2012


Rule 30.1

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Financial Order

Summary:
A fiduciary appointed as conservator for an adult must institute and follow a budget, as set forth in Rule 30.3, unless otherwise ordered by the court. The budget is filed no later than the date the inventory is due and thereafter, with each conservator's account. The court can limit expenditures or require the conservator to proceed in any other lawful manner for the protected person’s best interests. After a conservator is appointed, the court may discharge the protected person’s attorney if the cost of continued representation exceeds the probable benefit to the protected person. Until discharged, the attorney has continuing duties to review the conservator’s inventory, budgets, and accounts and to notify the court of any concerns.

Impact: Court review of budget.

Effective: 9/1/2012


Rule 30.2

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Sustainability of Conservatorship

Summary:
This new rule requires a conservator to conduct a sustainability calculation, using a good faith projection based on reasonably available information, and to disclose this information when filing an inventory, an account, or following a material change of circumstances. If there are insufficient assets to sustain the estate, given the protected person’s age and medical condition, the conservator must disclose a plan for managing expenses of the estate. The format for the sustainability disclosure is set forth in the ACJA. This disclosure is not required in a conservatorship for a minor unless otherwise ordered by the court. The comment to this rule illustrates how the calculation should be done.

Impact: The court may consider the sustainability calculation when entering orders. The Supreme Court will develop and adopt a new ACJA section related to forms.

Effective: 9/1/2012


Rule 30.3

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

New Rule: Conservatorship Estate Budget

Summary:
This new rule requires the conservator to file an initial budget and with subsequent accounts. The budget format is to follow a form prescribed in the ACJA. The conservator must provide copies to persons entitled to notice. The conservator must file an amended budget if projections exceed a threshold to be prescribed by the Arizona Judicial Council and as set forth in the instructions for the conservator’s budget in the ACJA. Interested persons can file written objections to budget. The court can overrule the objection, order the conservator to reply, or set a hearing. The court can order the budget to be accepted in absence of objection. The court, sua sponte or on motion, shall approve, disapprove, or modify the budget to further the protected person’s best interests.

Impact: The court must review the budget and consider approval, disapproval, or modification to further the protected person’s best interests. The Supreme Court will develop and adopt a new ACJA section related to these instructions. The Arizona Judicial Council will prescribe a threshold.

Effective: 9/1/2012


Rule 33

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: A fiduciary who is seeking compensation must give written notice of the basis for the compensation as required by A.R.S. § 14-5109. (A.R.S. § 14-5109(a) provides in part that "the statement must provide a general explanation of the compensation arrangement and how the compensation will be computed.") When determining reasonable compensation, the court must follow statewide fee guidelines set forth in the ACJA. Compensation payable to attorneys or guardians ad litem from the estate of a ward or protected person is waived if not submitted in compliance with ARS § 14-5110, which describes a deadline for a compensation claim.

Impact: The court must follow the statewide fee guidelines set forth in ACJA. Review compensation requests for compliance with ARS § 14-5110. The Supreme Court will develop and adopt a new AJCA section for the statewide fee guidelines.

Effective: 9/1/2012


Rule 38

R-11-0023
AOC Contact: Nancy Swetnam
Superior Court

Judges

Summary: Forms 5 through 9 as prescribed in the ACJA meet the requirements of these rules. Unless otherwise ordered by the court, forms 5 through 8 are the exclusive method for presenting such matters to the court. Form 9 may be used by a conservator only if authorized to do so. The instructions included with forms 5 through 9 supplement the rules and have the same force and effect as the rules. In addition, the Supreme Court Order adopting these new Probate Rules directed that existing Probate Forms 1 through 4, as contained in Rule 38, will be moved to the new ACJA section.

Impact: Monitor compliance with use of the mandated forms. Judges will review the information provided in these forms when reviewing the inventory, budget and accounts.

Effective: 9/1/2012