Monday, December 28, 2015

Due process in appointing a guardian for an adult

Among our most cherished rights, as American citizens, are the freedom of choice as to our movements, to be free to go where and when we wish, and the right to control and use our worldly possessions as we see fit. To place another in control of our person and our possessions deprives us of these basic rights. The law permitting such deprivation should be strictly construed and all requirements of the law strictly complied with.
Justice Carlton Mobley for the Supreme Court of Georgia in the unanimous opinion in Boockholdt v. Brown, 224 Ga. 737, 739, 164 S.E. 2d 836, 838 (1968).

Thursday, April 9, 2015

How to terminate an adult guardianship or conservatorship in Georgia

Guardianships and conservatorships, by and large, are not often terminated because, in most cases, the adult ward is of advanced age or disability and the need for a guardian and conservator will continue until death. However, in cases of mental illness or in cases of catastrophic injuries from which a ward may recover significantly, it may be appropriate to end the guardianship when the need for a guardian abates.

In fact, the law contemplates ending guardianships and removing the guardian. In the procedures to appoint a guardian or conservator for an adult, the Official Code of Georgia makes references to finding the expected duration that the adult ward will need protection, even though the appointment is always permanent (except for an emergency appointment). The Code also explicitly gives an adult ward the right to be restored to capacity at the earliest possible time, suggesting that a guardian or conservator should monitor the ward’s health and anticipate termination at some point.

In Georgia, the petition to terminate an adult guardianship or conservatorship is called a “petition for restoration of an individual formerly found to be in need of a guardian and/or conservator.” The procedure to terminate the appointment of a guardian or conservator is much like the same procedure to appoint one in the first place:

(1) A petition must either be filed by two people or by one person with an affidavit from a physician, psychologist, or clinical social worker. The petition must include certain information and give notice to certain interested persons. (2) The probate court must review the petition to determine if there is probable cause to support it. (3) Finding probable cause, the probate court must appoint a professional to evaluate the adult ward. (4) The evaluator must file a report, and the probate court must again determine whether there is probable cause to schedule a hearing. (5) Upon this second finding of probable cause, the probate court must schedule a hearing to determine whether the adult ward’s rights are to be restored.

There is one big difference, though: The burden of proof to remove a guardian is lower than that to appoint one. Appointing a guardian or conservator requires "clear and convincing evidence," but removing one only requires a "preponderance of the evidence." However, wards wishing to restore their rights should still be cautioned that they should prepare their case well — with the help of a lawyer — because if their petition is denied, then they may be restricted from filing another petition for two years. (The two-year limit also applies to a court’s denial to appoint a guardian.)

Article: "Protecting the Protected: Overseeing Adult Guardianship"

This article highlights common procedural infirmities that plague the establishment of adult guardianships and conservatorships nationwide, along with brief examples of abuse: “Protecting the Protected: Overseeing Adult Guardianship,” by Judy McKee and Sean M. Douglass. It is a few years old but still very relevant.

Saturday, May 10, 2014

More Chapter 7 lien stripping in Georgia

The Eleventh Circuit Court of Appeals this past week affirmed the lien strip which was allowed in the Malone case (case no. 12-61289 in the Bankruptcy Court for the Northern District of Georgia). This appeal was styled Wilmington Trust, Nat'l Assoc. v. Malone. It relies on the earlier McNeal opinion which is now published at 735 F.3d 1263.

This is a big deal because lien stripping in Chapter 7 is now more firmly established in Alabama, Florida, and Georgia. This procedure allows the lien of a second mortgage to be completely removed from a property when the value of the property is less than the debt owed on the first mortgage. Until recently, it was only available in Chapter 13 cases. It was rarely allowed anywhere in the country in Chapter 7 cases until recently, even though there were strong theoretical arguments that they should be allowed in Chapter 7.

Read more about lien stripping here: "Can I Get Rid of Second Mortgages and Liens in Chapter 7 Bankruptcy?" (Nolo.com.) (Keep in mind that the McNeal decision is now published.)

Tuesday, July 23, 2013

Form letters to send to debt collectors

The Consumer Financial Protection Bureau has published five form letters that consumers may use to correspond with debt collectors. These letters help consumers use their rights under the Fair Debt Collection Practices Act for purposes such as verifying a debt, disputing a debt, or requesting that a collector cease contact with the consumer.

Tuesday, April 16, 2013

Chapter 7 lien stripping in Georgia

Stripping off a second mortgage in Chapter 7 bankruptcy has come to Georgia. Nationwide, it has been generally understood that a wholly unsecured second mortgage can be stripped off in a Chapter 13 case but not in Chapter 7. Law professor types have argued that there is no theoretical reason that the concept should not apply in Chapter 7, and the courts might be coming around.

The concept is this: A lot of homes these days are "underwater," or worth less than the amount of debt against them. In some cases where there are two mortgages, the home might be worth less than the amount of the first mortgage. The first mortgage holder has senior priority, and then the holder of the second mortgage (such as a home equity line of credit) has junior priority. If a first mortgage is $200,000, and the second mortgage is $25,000, but the house is only worth $199,000, then the second mortgage is wholly unsecured. In Chapter 13 bankruptcy, the debtor can use a procedure to strip off this lien, meaning that it can be voided so that the debtor can keep the house and never have to pay back the second mortgage.

This procedure is now tentatively available in Georgia. The Eleventh Circuit Court of Appeals, whose territory includes Georgia, allowed something like this in a case called In re McNeal, Case No. 11-11352 (filed May 11, 2012 in the 11th Cir.). One Georgia bankruptcy judge has followed this reasoning in another case called In re Malone, Case No. 12-61289 in the Bankruptcy Court for the Northern District of Georgia. However, the Eleventh Circuit did not publish its opinion, meaning that in the court's rules this case cannot be used as precedent to bind lower courts to its holdings in that decision. Neither is the Northern District of Georgia bound by any of its own decisions. This means that Chapter 7 lien stripping might be available on a case by case basis, at least until the Eleventh Circuit or the Supreme Court of the United States squarely addresses the issue.

For further reading: 11th Circuit Allows Mortgage Lien Stripping in Chapter 7 Cases (Nolo's Bankruptcy, Debt & Foreclosure Blog).