Using real people in fiction

During the semester in 'Creative Writing: Non Fiction' we have learnt that you have to be careful when you write about family members and friends, yet you need to also recognise your role as a writer and be brave and tell the stories you need to tell. As I am also doing 'Creative Writing: Genre Fiction' I have been wondering how this relates to the writing of fiction. I am currently working on a low-fantasy work for uni in which I want to use a real character from history- a painter and schizophrenic named Richard Dadd. I wrote about Dadd in my story but was unsure if I should change his name. I don't want to infringe on his rights and his families rights... but he is dead and from the 1800s. This then makes me pose the question as to how long someone has to be deceased to make it OK to use their name in your fictional writing? His circumstances and background fit so well into my piece that I wanted to keep his name and background true to reality. My tutor said that I can use his real name if I don't 'soil' it by making him evil, and a murderer. But he was a murderer... so would he really mind? Then there is always the risk of making his character the antagonist and getting haunted by his ghost. Though that would make a good story for non-fiction if it happened...