2550-2557
PROBATE CODE
SECTION 2550-2557
2550. Except as otherwise provided by statute, a guardian or conservator may borrow money, lend money, give security, lease, convey, or exchange property of the estate, or engage in any other transaction under this article only after authorization by order of the court. Such an order may be obtained in the manner provided in this article. 2551. (a) In any case described in Section 2541 or Section 2552, the guardian or conservator, after authorization by order of the court, may borrow money upon a note, either unsecured or to be secured by a security interest or other lien on the personal property of the estate or any part thereof or to be secured by a mortgage or deed of trust on the real property of the estate or any part thereof. The guardian or conservator shall apply the money to the purpose specified in the order. (b) To obtain an order under this section, the guardian or conservator, the ward or conservatee, or any other interested person may file a petition with the court. The petition shall state the purpose for which the order is sought, the necessity for or advantage to accrue from the order, the amount of money proposed to be borrowed, the rate of interest to be paid, the length of time the note is to run, and a general description of the property proposed to be mortgaged or subjected to a deed of trust or other lien. Notice of the hearing on the petition shall be given for the period and in the manner provided in Chapter 3 (commencing with Section 1460) of Part 1. (c) The court may require such additional proof of the fairness and feasibility of the transaction as the court determines is necessary. If the required showing is made, the court may make an order authorizing the transaction. The court in its order may do any one or more of the following: (1) Order that the amount specified in the petition, or a lesser amount, be borrowed. (2) Prescribe the maximum rate of interest and the period of the loan. (3) Require that the interest and the whole or any part of the principal be paid from time to time out of the estate or any part thereof. (4) Require that the personal property used as security or any buildings on real property to be mortgaged or subjected to the deed of trust be insured for the further security of the lender and that the premiums be paid out of the estate. (5) Specify the purpose for which the money to be borrowed is to be applied. (6) Prescribe such other terms and conditions concerning the transaction as the court determines to be to the advantage of the estate. (d) The note and the mortgage or deed of trust, if any, shall be signed by the guardian or conservator. (e) Jurisdiction of the court to administer the estate of the ward or conservatee is effectual to vest the court with jurisdiction to make the order for the note and for the security interest, lien, mortgage, or deed of trust. This jurisdiction shall conclusively inure to the benefit of the owner of the security interest or lien, mortgagee named in the mortgage, or the trustee and beneficiary named in the deed of trust, and their heirs and assigns. No omission, error, or irregularity in the proceedings shall impair or invalidate the proceedings or the note, security interest, lien, mortgage, or deed of trust given pursuant to an order under this section. (f) Upon any foreclosure or sale under a security interest, lien, mortgage, or deed of trust described in subdivision (a), if the proceeds of the sale of the encumbered property are insufficient to pay the note, the security interest, lien, mortgage, or deed of trust, and the costs or expenses of sale, no judgment or claim for any deficiency may be had or allowed against the ward or conservatee or the estate. 2552. (a) The guardian or conservator may give a security interest or other lien upon the personal property of the estate or any part thereof or a mortgage or deed of trust upon the real property of the estate or any part thereof, after authorization by order of the court as provided in Section 2551, for any of the following purposes: (1) To pay, reduce, extend, or renew a security interest, lien, mortgage, or deed of trust already existing on property of the estate. (2) To improve, use, operate, or preserve the property proposed to be mortgaged or subjected to a deed of trust, or some part thereof. (b) If property of the estate consists of an undivided interest in real or personal property, or any other interest therein less than the entire ownership, upon a showing that it would be to the advantage of the estate to borrow money to improve, use, operate, or preserve the property jointly with the owners of the other interests therein, or to pay, reduce, extend, or renew a security interest, lien, mortgage, or deed of trust already existing on all of the property, the guardian or conservator, after authorization by order of the court as provided in Section 2551, may join with the owners of the other interests in the borrowing of money and the execution of a joint and several note and such security interest, lien, mortgage, or deed of trust as may be required to secure the payment of the note. The note may be for such sum as is required for the purpose. (c) No omission, error, or irregularity in the proceedings under this section shall impair or invalidate the proceedings or the note, security interest, lien, mortgage, or deed of trust given pursuant to an order made under this section. 2552.5. For the purpose of this article, if a lease gives the lessee the right to extend the term of the lease, the length of the term shall be considered as though the right to extend had been exercised. 2553. (a) Except as provided in Section 2555, leases may be executed by the guardian or conservator with respect to the property of the estate only after authorization by order of the court. (b) To obtain an order under this section, the guardian or conservator or any interested person may file a petition with the court. The petition shall state (1) a general description of the property proposed to be leased, (2) the term, rental, and general conditions of the proposed lease, and (3) the advantage to the estate to accrue from giving the lease. If the lease is proposed to be for a term longer than 10 years, the petition shall also state facts showing the need for the longer lease and its advantage to the estate. Notice of the hearing on the petition shall be given for the period and in the manner provided in Chapter 3 (commencing with Section 1460) of Part 1. (c) At the hearing, the court shall entertain and consider any other offer made in good faith at the hearing to lease the same property on more favorable terms. If the court is satisfied that it will be to the advantage of the estate, the court shall make an order authorizing the guardian or conservator to make the lease to the person and on the terms and conditions stated in the order. The court shall not make an order authorizing the guardian or conservator to make the lease to any person other than the lessee named in the petition unless the offer made at the hearing is acceptable to the guardian or conservator. (d) Jurisdiction of the court to administer the estate of the ward or conservatee is effectual to vest the court with jurisdiction to make the order for the lease. This jurisdiction shall conclusively inure to the benefit of the lessee and the lessee's heirs and assigns. No omission, error, or irregularity in the proceedings shall impair or invalidate the proceedings or the lease made pursuant to an order made under this article. 2554. (a) An order authorizing the execution of a lease shall set forth the minimum rental or royalty or both and the period of the lease, which shall be for such time as the court may authorize. (b) The order may authorize other terms and conditions, including, with respect to a lease for the purpose of exploration for or production or removal of minerals, oil, gas, or other hydrocarbon substances, or geothermal energy, any one or more of the following: (1) A provision for the payment of rental and royalty to a depositary. (2) A provision for the appointment of a common agent to represent the interests of all the lessors. (3) A provision for the payment of a compensatory royalty in lieu of rental and in lieu of drilling and producing operations on the land covered by the lease. (4) A provision empowering the lessee to enter into any agreement authorized by Section 3301 of the Public Resources Code with respect to the land covered by the lease. (5) A provision for a community oil lease or pooling or unitization by the lessee. (c) If the lease covers additional property owned by other persons or an undivided or other interest of the ward or conservatee less than the entire ownership in the property, the order may authorize the lease to provide for division of rental and royalty in the proportion that the land or interest of each owner bears to the total area of the land or total interests covered by such lease. (d) If the lease is for the purpose of exploration for or production or removal of minerals, oil, gas, or other hydrocarbon substances, or geothermal energy, the court may authorize that the lease be for a fixed period and any of the following: (1) So long thereafter as minerals, oil, gas, or other hydrocarbon substances or geothermal energy are produced in paying quantities from the property leased or mining or drilling operations are conducted thereon. (2) If the lease provides for the payment of a compensatory royalty, so long thereafter as such compensatory royalty is paid. (3) If the land covered by the lease is included in an agreement authorized by Section 3301 of the Public Resources Code, so long thereafter as oil, gas, or other hydrocarbon substances are produced in paying quantities from any of the lands included in any such agreement or drilling operations are conducted thereon. 2555. If it is to the advantage of the estate, the guardian or conservator may lease, as lessor, real property of the estate without authorization of the court in either of the following cases: (a) Where the rental does not exceed five thousand dollars ($5,000) a month and the term does not exceed two years. (b) Where the lease is from month to month, regardless of the amount of the rental. 2556. (a) If it is for the advantage, benefit, and best interests of the estate and those interested therein, the guardian or conservator, after authorization by order of the court, may do any of the following either with or without consideration: (1) Dedicate or convey real property of the estate for any purpose to any of the following: (A) This state or any public entity in this state. (B) The United States or any agency or instrumentality of the United States. (2) Dedicate or convey an easement over any real property of the estate to any person for any purpose. (3) Convey, release, or relinquish to this state or any public entity in this state any access rights to any street, highway, or freeway from any real property of the estate. (4) Consent as a lienholder to a dedication, conveyance, release, or relinquishment under paragraph (1), (2), or (3) by the owner of property subject to the lien. (b) To obtain an order under this section, the guardian or conservator or any other interested person shall file a petition with the court. Notice of the hearing on the petition shall be given for the period and in the manner provided in Chapter 3 (commencing with Section 1460) of Part 1. 2557. (a) Whenever it is for the advantage, benefit, and best interests of the ward or conservatee and those legally entitled to support, maintenance, or education from the ward or conservatee, the guardian or conservator, after authorization by order of the court, may exchange any property of the estate for other property upon such terms and conditions as may be prescribed by the court. The terms and conditions prescribed by the court may include the payment or receipt of part cash by the guardian or conservator. (b) To obtain an order under this section, the guardian or conservator or any interested person shall file a petition containing all of the following: (1) A description of the property. (2) The terms and conditions of the proposed exchange. (3) A showing that the proposed exchange is for the advantage, benefit, and best interests of the ward or conservatee and those legally entitled to support, maintenance, or education from the ward or conservatee. (c) Except as provided in subdivision (d), notice of the hearing on the petition shall be given for the period and in the manner provided in Chapter 3 (commencing with Section 1460) of Part 1. (d) If the petition is for authorization to exchange stocks, bonds, or other securities as defined in Section 10200 for different stocks, bonds, or other securities, the court, upon a showing of good cause, may order that the notice be given for a shorter period or be dispensed with. (e) After authorization by order of the court, the guardian or conservator may execute the conveyance or transfer to the person with whom the exchange is made to effectuate the exchange. (f) No omission, error, or irregularity in the proceedings under this section shall impair or invalidate the proceedings or the exchange made pursuant to an order made under this section.