My brother made his wife, in his will, to be his guardian. Does this automatically make her his legal guardian or does a court order it?

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No, she does not have guardianship. She has power of attorney - he has given her the authority to act for him. She retains that authority until his death (the "durable" part), and if or when he loses mental capacity and can't act for himself, she takes charge of decisions.

Guardianship is more of a nuclear option. For example, if a DPOA wasn't being used properly then somebody else could apply to the court for guardianship which would then override the DPOA.

What's the situation you're having to deal with?
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It depends on the wording of the document. My mom's POA was valid the day it was signed and I acted for her for many years simply because it was convenient for both of us. Some documents specify that they only become valid when the grantor becomes incompetent. Lack of competency usually needs to be affirmed by qualified doctors.
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My mistake, I meant he nominated his wife in the durable power of attorney to be his guardian. My question is does that mean she automatically has guardianship of him or does the matter still have to be decided by a judge in court?
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Yes, I agree.

Your brother would have appointed an executor to carry out the wishes stated in his will.
It is possible that at the same time he drew up another document to give his wife Power of Attorney, Health Proxy or a similar authority during his lifetime.

It is quite usual for married couples to get all of this important family admin. out of the way in one go, and create mirror wills and powers of attorney so that either can act for the other as the need arises. In a good, stable marriage it's just a practical approach.

What your brother won't have done is nominate a guardian, specifically. A guardian is a person appointed or confirmed by a court, and will be either somebody who has applied for guardianship or somebody selected by the court to take responsibility for a person who can't act for himself and needs to be protected.

Does your brother need someone to act for him, and you're not sure if your SIL has the legal powers she needs to do that?
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I think you are muddled up about the process. A Will only comes into play after death. A POA (power of attorney) is a document that grants another person the ability to act on your behalf during your lifetime. Sometimes a POA only comes into force after you have been proven to be incompetent and  sometimes they are in force the moment the ink is dry, but since the person who is granting the power is still competent at that point they obviously have the final say about any decisions that need to be made. Legal Guardianship should not be needed unless someone failed to appoint a POA or there is some question of malfeasance on the part of the POA.
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Such request should not be placed in a Will, as a Will only becomes active after the person dies.

I would highly recommend that your brother and his wife make an appointment to talk with an Elder Law Attorney to see what is the best route to take. The wife can be her husband's Power of Attorney when the time comes when he is unable to make decisions for himself. There are also other legal documents that the Attorney can explain.
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