Powers Of Attorney

powers of attorney
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Everybody thinks powers of attorney are just forms to fill in. Powers of attorney give the holder ability to clean out bank accounts, hide resources, withhold needed treatment and extend suffering where permission to cease treatment and comfort measures are refused.

In other words, you (the attorney) should be as careful about explaining and qualifying clients and family for powers of attorney as you are when planning an estate. This means making sure that you remove as much opportunity for undue influence as you can from the process. It means making sure the client is genuinely comfortable with the proposed attorney in fact. It also means exploring various tools to ensure that the attorney in fact is going to have every reason to behave in a fiduciary fashion. It is also critical to establish capacity.

Court dockets in Middle Tennessee testify to the fact that powers of attorney are abused. Complaints cite monies that have disappeared in small and great quantities. I am the plaintiff’s attorney on one that involved the disappearance of over $800,000 through abuse of a power of attorney. Often, the money that is stolen will never be paid back. It is just gone.

Removing undue influence means a certain amount of planning mixed with common sense. Who is the person pushing for the power of attorney? Is it the person who is going to sign it? Is it a child, an old acquaintance, or someone new to the scene? How is the client getting to your office? Yes, you should have a private conference with the person who is signing the documents. Do you really think that the ride home is not going to include the question: “So what did you tell the attorney?” or “What did the attorney tell you?” Trust your intuition. If it seems fishy, it probably is. If you think there might be undue influence, try to find a way to speak to the client in a way that provides some assurance.

Not everyone is qualified to act as an attorney in fact. If they struggle with their finances and write a lot of rubber checks with their own money, there is reason to believe they might do the same with the client’s money. If they have obtained a series of “loans” from mom and dad without ever bothering to pay those loans back, handing them the keys to the accounts with a power of attorney is probably a bad idea. It is probably better to decline the work than to explain your lack of diligence in the witness stand in a later proceeding to recover lost savings.

A popular tool to ensure no funny business is requiring one or more doctors to certify lack of capacity before the power of attorney comes into effect. The tool does nothing to prevent problems aft er the principal is declared to lack capacity. It also ignores the problems that will arise when the principal probably lacks capacity, but believes they are just fine.

Checking to ensure there is adequate capacity is a keystone to a successful power of attorney. An optimal way to ensure capacity is to have the physician certify capacity within a few days of the signing of the documents. Witnesses who know the principal have no stake in the outcome and are trusted by a majority of the family are a good idea where capacity is in question.

It seems a better idea to use surety bonds, private accountings and trust protectors who can remove the attorney in fact and bring bad conduct to the attention of the court and police. Making sure more family members are involved also tends to alert the family to what is happening and prevent potential fraud and conversion.

Larry Wright Advertising

Powers of attorney are wonderful tools for clients and family. They can ensure that a trusted family member is handling business just as well as, or better than the client. They can lift a burden from clients who worry what might happen if they can’t make decisions for themselves.

A power of attorney can help prevent conservatorships and their high costs. In the event a conservatorship becomes necessary, the preferred conservator can even be named in the power of attorney. The judge is required to pay attention to the nomination and probably appreciates it.

Even the best, most artfully craft ed, power of attorney is useless unless it is accessible when needed. I strongly urge clients to take copies of their health care powers of attorney to all of their doctors and hospitals near them to put the documents in the electronic medical records. I also urge clients to take their general powers of attorney to their banks and financial institutions. Banks have been known to refuse to recognize powers of attorney for reasons that defy reason and logic. Best try to fix the issue before it is too late. Karl Warden

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