The Guardianship / Fiduciary office is responsible for monitoring the filing of initial and annual accounts by Article 81 guardians and the review of examinations of accounts made by Court Examiners, who are charged by Article 81 with the review of the guardians’ accounts for accuracy, propriety, etc. This process is overseen by the Appellate Division, First Department.
Annual accounts and examinations of accounts are filed in the office. Copies of appointing orders, fee orders and other orders of relevance to the appointment, powers and compensation of the guardian are sent to the us by Justices or their staff. The Guardianship / Fiduciary office staff enter relevant data from these orders, accounts and reports into a comprehensive guardianship database, which is accessible to Justices and court personnel concerned with guardianship matters. The database has the capacity to record and report on all case milestones, appointing orders, fee awards, annual financial summaries and fiduciary compliance.
Court Examiners are attorneys and accountants with expertise in guardianship law and fiduciary accounting who are designated by the Presiding Justice of the Appellate Division to examine reports filed by guardians. The list of Court Examiners is established and maintained by the Appellate Division who supply us with the list of approved court examiners. Upon the submission of a proposed Order and Judgment Appointing a Guardian, the Guardianship / Fiduciary office insert the name and address of the court examiner to be appointed on the particular case. The OCE maintains the list of Court Examiners. Court Examiners are randomly designated in a particular case by the clerks when the Order/Judgment is forwarded to the Judge for determination.
The Order and Judgment appointing a guardian details the duties, obligations and powers of the guardian of the person and the powers of the guardian of the property. The guardian must "qualify" immediately after the receipt of the Order and Judgment. To qualify, the guardian must file with the County Clerk a bond (unless waived by the court) and oath and designation of Clerk. Within five days thereafter, a commission must be issued by the County Clerk. The commission is typically prepared by the guardian, his/her attorney or the petitioner’s attorney. In some instances, the court may allow a combined Order and Judgment and Commission (see form discussed above). As noted, the guardian must comply with Parts 36 and 26 of the Rules of the Chief Judge and file the requisite fiduciary forms. The guardian should be thoroughly familiar with the terms of the order and should seek clarification when necessary.
Shortly after the guardian’s appointment, the Court Examiner will contact the guardian to review the guardian’s duties and obligations. The Examiner will typically request a copy of the order of appointment and/or commission, the Court Evaluator’s report and other documentation relevant to the guardianship. The guardian or his/her attorney must serve copies of all reports and applications for fees or other relief on the Examiner. The guardian must cooperate with the Court Examiner at all times. The guardian-Examiner relationship is not intended to be adversarial. However, the Examiner has the power to recommend to the court a reduction in guardian compensation or removal of the guardian when warranted.
Pursuant to Section 81.32 of the Mental Hygiene Law, Court Examiners are required to examine and report on initial and annual accounts filed by guardians. The initial reports are filed and reviewed by staff in The Guardianship / Fiduciary office. A copy of the initial report shall be mailed to the court examiner. The law requires the guardian to file an initial report within ninety (90) days of receiving a commission.
The filing of initial report and annual reports is monitored by the Guardianship / Fiduciary office and Court Attorney / Special Referee’s who have been assigned the department. The Court Attorney / Special Referee’s monitor the timely filing of proposed Orders / Judgments, accounts (initial, annual, final ) and any other order directed by a guardianship Judge. Failure to comply with an order of the court will result in an appearance at a compliance conference before the Court Attorney / Special Referee’s. The Court Attorney / Special Referee’s will make recommendations to the assigned Judge for removal for failure to comply with court orders. The Court Attorney / Special Referee’s mission is to provide assistance guardians and court examiners who have been appointed to oversee the person and property of the incapacitated person.
The initial report must include proof of guardianship education and steps taken to fulfill guardianship requirements. If the guardian has been granted powers with respect to property management, the guardian must include in this report a complete inventory of resources over which the guardian has control, the location of any will, and the plan for management of such property. If the guardian has been granted powers regarding personal needs, the guardian should indicate the dates of visits to the ward, what the guardian has done to provide for the ward’s personal needs and a plan for meeting those needs. If the initial report includes any recommendations concerning the need to change any powers authorized by the court, the guardian must apply to the court within ten days of the filing of the report on notice to all persons entitled to notice. The initial report is filed with the Guardianship / Fiduciary office, floor 6M .For further information, please see Section 81.30 of the Mental Hygiene Law.
Article 81 requires the guardian to file an annual report with the court by May 31st of each year. The report should be filed with the Guardianship / Fiduciary office, floor 6M, and can be submitted any time after January 1st. A copy must be served on the Court Examiner assigned to the guardianship, the IP, the surety and, if the IP is in a nursing home or other rehabilitative facility, the director of the facility and the Mental Hygiene Legal Service.
The first annual report should cover the period beginning on the date the guardian was commissioned and end on December 31st of that year. All subsequent reports must cover the previous calendar year from January 1st through December 31st. The report includes a financial accounting, a social and medical summary and a current medical report from a qualified professional who has evaluated the ward within the three months prior to the filing of the annual report. See Section 81.31 of the Mental Hygiene Law for further information.
The financial section of the annual report should include the following schedules of financial activity: Principal Received; Additional Principal Received; Realized Increases on Sale of Property; Unrealized Increases; Income Received; Disbursements; Realized Losses on Sale of Property; Unrealized Losses; and Account Summary. Some accounts include real and personal property in a separate schedule.
The guardianship training program will provide detailed information on the preparation of the annual account. If needed, additional help should be sought from an attorney, an accountant or the Court Examiner. The Court Examiner will reject the account if it is not in proper form.
The annual account will be reviewed by the Court Examiner and the guardian will be examined under oath concerning financial and personal matters relevant to the guardianship. (Pursuant to a memorandum from the Clerk of the Court, Appellate Division, First Department, that took effect May 5, 1991, in all estates with assets up to $50,000, the examination will be made every two years. In estates with assets of over $50,000, the examination will be made annually.) The examiner will require back-up documentation, such as cancelled checks, brokerage statements, bank statements, bills, invoices, receipts, etc. to audit the account. It is therefore incumbent upon the guardian to maintain accurate records of all financial activity. Additionally, the Examiner will request a copy of any order awarding guardian compensation, attorney and accounting fees, the purchase or sale of real property or any other order pertinent to the guardianship. As a rule, guardians should not take compensation or pay legal or accounting fees without court authorization.
The Examiner will submit a completed report to the with the Guardianship / Fiduciary office, floor 6M. The report will include a proposed order confirming the report, a summary of the guardianship, including the medical and social condition of the IP, and details regarding the appointment of the guardian, a financial summary of the accounting period, a review of all income and disbursements, recommendations for actions to be taken by the guardian, a verified transcript of the guardian’s testimony, copies of the order and judgment appointing the guardian and orders approving fees and commissions and a copy of the guardian’s annual account and recent medical evaluation.
The staff of the with the Guardianship / Fiduciary office, floor 6M, will review the Examiner’s report and proposed order and forward it to the assigned Justice for their determination.
Pursuant to Section 81.33 of the Mental Hygiene Law, a guardian may request permission or be required to file an intermediate or final account.
