Technically, the issue of custody disappears when a child’s parents die. Another adult will take over and raise the bereaved child, but the legal arrangement becomes one of guardianship, not custody. The probate court appoints a guardian to care for the child and a conservator to oversee the management of the financial details of the guardianship. Sometimes, a court may select one individual to serve in both capacities.
When Parents Leave a Will
Parents have the option of naming a guardian for their child in their respective wills. Ideally, parents would write a mutual will nominating one individual, or name the same guardian in their separate wills. This avoids confusion or dispute, because the nomination does not automatically appoint the selected person as the child’s guardian. A court must still approve the parents’ choice. Some states, such as Colorado, allow parents to write a separate document naming a guardian, so they can provide for care of their child even if they don’t leave a will to address distribution of their assets. In either case, probate courts almost invariably honor the parents’ wishes in appointing a guardian, unless the person they've selected is grossly unfit. This might occur if something happened after the parents wrote their will, and the named guardian is incapacitated when they die.
When Parents Don’t Leave a Will
When parents don’t leave a will or an advance directive regarding the care of their child, the court will decide on a guardian based on the best interest of the child. The "best interests" criteria is similar to what a court might use when selecting a custodial parent in a custody fight. Ideally, courts want to move a child into the care of a guardian the child knows very well. This minimizes the disruption in his life at a traumatic time. Family members are usually preferred, and they have the right to petition the court for the appointment. Some states may require a background check or other investigation into the suitability of the guardian.
Management of Inheritances
When a child inherits assets from his deceased parents, the funds are usually devoted to his care. Some parents name separate individuals to care for their child and to oversee his financial needs. A nurturing individual who may be most suited to raising the child might be lacking in financial common sense. Parents have the right to name the same person to both roles, but a court must approve the appointment of the conservator, or asset manager, just as it must approve the guardian. A conservator almost always has to report into the court on a regular basis, giving a detailed accounting of the child’s assets.
Death of One Parent
When parents don’t die together in a common accident or disaster, the surviving parent always retains custody of the child; this is not a guardianship situation. If the parents are divorced, the non-custodial parent assumes full custody. If the parents were never married, the child’s other biological parent can come forward and petition the court for custody. Custody will almost always be granted, unless the court finds him to be unfit. Another individual would be appointed as guardian only if the second parent dies. If the second parent leaves a will naming a guardian, those wishes usually guide the court’s decision. Otherwise, the court might look to the guardian named in the first parent’s will.