This is another installment concerning the topic of bonds for guardians. In this installment, we will discuss how guardian bonds sometimes are “increased” or “decreased.”
Throughout the course of a long term guardianship, the guardian may come into control of additional liquid assets. This could occur in a number of ways, but it often happens when the guardian sells real property or liquidates a large asset owned by the obligee. In such an event, the court often requires the guardian to file an additional bond in the increased amount of the liquid assets. The original bond and the additional bond together total the amount of liquid assets the guardian now controls. As a result, the surety will charge a higher premium to reflect the additional bond.
By contrast, the guardian sometimes needs to spend a large sum of the obligee’s money. As long as the expenditure is approved by the court, the judge will often allow the guardian to file a reduced bond in the amount of the original bond minus the large expenditure. Decreased guardian bonds benefit the guardian because he or she pays a smaller premium for the bond.
Mental Hygiene Law Article 81 regulates guardianship appointments in the state of New York.