Thursday, September 22, 2011

Financial Powers of Attorney Cont.--Part 3

In Wilson Rawl's Where the Red Fern Grows, Billy says of his small hunting dog Little Ann, "Dynamite comes in little packages." Financial powers of attorney are as dangerous as dynamite in terms of their potential consequences for ill. Inadequate financial powers of attorney are at the heart of numerous expensive and painful probate cases. Financial powers of attorney are as important as revocable trusts and deserve as much attention.

In an article written by Linda S. Whitton, titled "Durable Powers as an Alternative to Guardianship: Lessons We Have Learned" (37 Stetson L.Rev. 2007), Ms. Whitton states there are three things to understand about durable powers of attorney when being used as an alternative to guardianship.

  1. A Power of Attorney is Only as Effective as the Willingness of Third Parties to Accept It.

  2. A Power of Attorney is Only as Protective as the Agent is Trustworthy.

  3. A Power of Attorney will Not Prevent Family Power Struggles of the Principal's Assets.
In this blog, we will address the third point made by Ms. Whitton.

We disagree with Ms. Whitten's third point. We disagree based on our firm's experience. Yes, Ms. Whitton is correct that a power of attorney in itself will not make controlling family members suddenly loving, giving individuals. However, a well-drafted power of attorney that requires regular accountings and encourages constant communication can keep the urge to control from ranging out of control.

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