Power of Attorney Obligations to Family Members Explained
While it may be a difficult decision to take action against the agent with power of attorney over your loved one because they are family, failing to act could put your loved one in harm’s way. If you are an agent, it would be best to understand your rights and limitations under the power of attorney to not only prevent familial conflicts, but to avoid ending up in court for violating your duties.
Read Keystone’s guide to learn not only how to be an effective attorney-in-fact, but also what to do if a family member with power of attorney is abusing their authority.
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Has a family member been granted power of attorney over your parents? Have you been granted power of attorney over another family member?
A person may give a family member power of attorney to help them manage their financial or medical affairs, but if this family member proceeds to commit power of attorney abuse, the consequences can be much worse than if the agent had been someone outside the family.
For example, in addition to the agent suffering legal repercussions for their actions, their relationships with family members may become strained. This, of course, does not mean a family member should not be designated as a loved one’s agent. There are many situations in which granting a family member power of attorney is the best choice.
Whether you or another family member has been given power of attorney, it’s crucial you minimize the potential for conflict by fulfilling all your power of attorney obligations to family members and remaining within the confines of your authority. Learn how to handle a wide array of situations involving a family member with power of attorney over another family member from this article by Keystone Law Group on power of attorney obligations.
What Is a Power of Attorney?
A power of attorney is a legal document you sign to allow another person to act or make decisions on your behalf. The person who grants the power of attorney is called the principal, whereas the person who is granted power of attorney is called the attorney-in-fact or agent.
Most people draft powers of attorney as precautionary measures to take effect when they become incapacitated, but a power of attorney can also take effect immediately and be executed for more mundane reasons, such as granting another adult the authority to carry out business transactions on your behalf while you are out of the country on an extended vacation.
Agents are fiduciaries, which means that they have a duty to act in the principal’s best interests. As such, they must be careful to abide by the terms of the power of attorney and remain within the bounds of their authority.
While powers of attorney can be personalized to meet the needs of the principal, they generally fall under one of two categories: financial power of attorney or medical power of attorney. The agent’s rights and limitations will be determined by the type of power of attorney they’ve been granted.
Powers of attorney can also differ in terms of when they go into effect. A durable power of attorney takes effect upon signing and remains in effect for the principal’s lifetime (unless the power of attorney is revoked). A nondurable power of attorney takes effect upon signing as well, but it only will remain in effect for a specific period, until its purpose is served or the principal becomes incapacitated. A springing power of attorney doesn’t take effect until the principal is incapacitated, but the agent will need to be presented with documentation from the principal’s doctors to confirm their incapacitation before they can start acting as their agent.
As a probate firm, we mostly handle cases surrounding powers of attorney for incapacitated family members.
Can a Family Member Be a Power of Attorney?
For many people, family members are the most obvious choices for attorneys-in-fact, as they typically can be trusted to have the principal’s best interests at heart.
Though keep in mind that even family members can do wrong, so if you are the loved one of someone who is incapacitated and under a power of attorney, don’t assume their family member is always taking the right actions on their behalf. Play an active role in your loved one’s life by keeping tabs on their attorney-in-fact and asking them questions about the decisions they’re making. If something seems off, consider discussing your concerns with a probate lawyer.
In general, powers of attorney can be given to any adult with the capacity to contract, regardless of that adult’s relation to the principal. The full list of requirements for attorneys-in-fact can be found in California Probate Code sections 4200-4207.
Can More Than One Family Member Have Power of Attorney?
If you are wondering how many family members can have power of attorney, you may be surprised to learn that there is no limit to the number of agents a principal can designate. If a principal believes giving power of attorney to multiple family members would better serve their interests, it is within their rights to designate as many agents as they’d like. And they don’t have to be family members, either.
For example, a person may give financial power of attorney to a business partner and medical power of attorney to their spouse. Or they could give their spouse and children equal powers of attorney over their financial and medical matters.
Remember that giving multiple family members the same powers of attorney could be problematic if the family members tend to disagree with one another, as unanimous consent may be needed for a decision to be made on behalf of the principal, unless the power of attorney document provides otherwise. On the other hand, multiple attorneys-in-fact mean that every decision will receive more consideration.
Can a Family Member Challenge a Power of Attorney?
The short answer is yes. Family members can challenge a power of attorney in court. If a family member believes that the power of attorney document was signed when the principal did not have capacity or was procured by undue influence, an action can be filed to declare the power of attorney document invalid.
Family members can also petition the court to revoke an existing power of attorney document if the court finds that the principal is incapacitated and the agent has violated their fiduciary duties. It could be argued that revoking the power of attorney would be in the principal’s best interests.
In order to challenge the power of attorney, family members will need to file a petition with the court that explains their reasons for contesting the power of attorney. Family members should be prepared with alternatives for protecting the incapacitated principal should the court grant their petition to overturn the document. For example, a family member could volunteer to become the principal’s conservator.
It should be mentioned that anyone who has a personal relationship with the principal can contest the power of attorney if the principal is incapacitated; it does not have to be a family member. Though contesting a power of attorney can be difficult, so it is best to work with a lawyer during the process.
Power of Attorney Rights & Limitations
An attorney-in-fact’s responsibilities, rights and limitations are determined by the terms of the power of attorney and the type of power of attorney they’ve been granted. For example, an agent with financial powers of attorney would not be authorized to make medical decisions on behalf of the principal, even if they are the principal’s family member.
Whether a person has power of attorney over a family member or a business partner, their fiduciary obligations will be largely the same. This is because at the end of the day, all attorneys-in-fact are bound to their fiduciary duties. While it’s possible an agent may perform their duties with more care if a family member is involved, the agent’s relation to the principal holds no significance in the eyes of the law.
Financial Power of Attorney Rights & Limitations
The rights conferred on an agent will depend on the terms of the specific power of attorney document. However, if you have financial power of attorney (also known as a general power of attorney) over a family member, it generally means you can act on their behalf anytime the issue at hand is financial or legal in nature.
For example, you would typically have authority to pay their bills, taxes, rent and everyday expenses. You likely would also be able to manage and grow their assets. Lastly, you’ll generally be permitted to hire an attorney on their behalf to enforce or defend claims for them.
Pay attention to whether or not the power of attorney is durable. In California, financial powers of attorney are not durable by default, so if the principal becomes incapacitated, you can only act as their agent if the document is durable.
The most common rights of financial powers of attorney include:
- Accessing the principal’s financial accounts and documents
- Making financial and legal decisions on behalf of the principal
- Hiring third-party professionals (such as lawyers and CPAs) to assist with power of attorney responsibilities
- Litigating on the principal’s behalf in court
- Making safe investments of the principal’s assets
- Using the principal’s assets to benefit the principal
- Taking a reasonable fee for the time and effort spent on power of attorney responsibilities
The most common limitations of a financial power of attorney include:
- Making medical decisions on behalf of the principal
- Using the principal’s assets for personal gain
- Making risky investments of the principal’s assets
- Commingling the principal’s assets with the assets of others
- Making decisions or transactions on behalf of the principal without keeping records of them
- Taking an excessive fee for the time and effort spent on power of attorney responsibilities
It is important to keep in mind that the terms of your power of attorney may be unique, so if you are unclear on what they mean, it is a good idea to review them with a POA lawyer.
Medical Power of Attorney Rights & Limitations
If you have medical power of attorney (also known as a health care power of attorney) over a family member, it usually means you can act on their behalf anytime the issue at hand is medical in nature. For example, you may have to consent to medical treatments for the principal, take them to their doctor’s appointments, and provide them with their medications.
The most common rights of a medical power of attorney include:
- Making decisions about the principal’s medical treatments
- Consenting to surgeries and other procedures on behalf of the principal
- Deciding which medications the principal should take
- Selecting medical providers, treatment and assisted-living facilities for the principal
- Choosing the principal’s caregiver
- Making decisions about end-of-life care
- Bringing medical claims on the principal’s behalf
The most common limitations of a medical power of attorney include:
- Making financial or legal decisions on the principal’s behalf
- Consenting to electroconvulsive therapy on the principal’s behalf
- Hospitalizing the principal for mental illness
- Withholding necessary medication, treatment or care
- Consenting to an abortion on the principal’s behalf
When it comes to a person’s health care, maintaining thorough records is a must. Suppose that the principal has to switch providers. If you do not have a record of all the medical decisions you’ve made on behalf of the principal, their provider may have to start from scratch with their treatment, which could prove detrimental to the principal’s health.
If you know that you’ve been designated as a family member’s health care agent, it’s recommended you arrange a time to speak to them about their wishes and needs so you will know what to do in the event they lose capacity.
Tips for Avoiding Conflict as Power of Attorney for an Incapacitated Family Member
No one wants to see conflict within their family, so it’s worth taking steps to avoid it when acting as power of attorney for an incapacitated family member. Keep on reading to learn our most useful tips.
Keep Family Informed
When a loved one starts to lose competence, it can affect the whole family, or at the very least make them concerned. No one would blame them for checking in on their loved one under the power of attorney to ensure their financial and personal affairs are being properly managed.
To keep family members at ease, it’s a good idea to share relevant information with them about the decisions you’re making on the principal’s behalf whenever doing so is appropriate. For example, if you have medical powers of attorney, you should probably discuss any medical procedures the principal may need with the family prior to consenting to them. Likewise, if you have financial powers of attorney and plan to sell the principal’s home, it would be recommended for you to notify the principal’s family prior to finalizing the sale.
While attorneys-in-fact are not always obligated to keep family members informed of the decisions they’re making for the principal, doing so can go a long way in thwarting potential conflicts.
Maintain Thorough Records
Having powers of attorney over an incapacitated family member means that you have some or most aspects of that person’s life in your hands. As such, it is not just a good idea to keep a record of the decisions you make on their behalf, but it is your duty.
For example, if you are a loved one’s financial attorney-in-fact, it would be justified for you to be making withdrawals from their bank accounts for, say, paying their medical expenses or rent. But how would their family members know from looking at their bank statements whether the withdrawals were for the benefit of the principal or for your own benefit?
The only way they could know for sure is if you were to show them detailed records of the financial transactions you’ve made with the principal’s assets. To keep things organized, keep a file with receipts, contracts and any other documents that can provide confirmation of your activities.
Discuss Decisions With a Lawyer & Family Members
It can be difficult to know the scope of your authority under a power of attorney, so getting a lawyer involved when a challenging decision needs to be made can help keep both you and the principal protected. Furthermore, working with a lawyer can help the family rest assured that you are doing your due diligence when making important decisions.
Involving family members in decisions about the principal is also crucial. Even if you ultimately decide to go in a different direction than what some family members would have preferred, the fact that you heard their concerns can keep a difference of opinions from turning into a full-blown conflict.
Step Down if You Cannot Serve
It may seem obvious, but if you have power of attorney over an incapacitated family member, and no longer have the time or willingness to serve, it would be preferable for you to step down as their attorney-in-fact rather than remain in the role. Once you step down, any alternate agent designated in the power of attorney would have authority to step in and take your place.
Family members cannot override the decisions of their loved one’s attorney-in-fact, no matter what their relation to the principal is.
The principal granted the person designated as their attorney-in-fact the power to make important decisions about their life or finances because they trusted them, so for a family member to override the attorney-in-fact’s decisions would mean they are disregarding the principal’s wishes for their own life.
On the other side of the coin, if the attorney-in-fact for an incapacitated principal is acting irresponsibly or causing harm to them, their family can try to override the agent’s decisions by filing a petition with the court to try to have the power of attorney revoked.
If the family member seeking to override the power of attorney wishes to step in to make decisions for their incapacitated loved one, they may need to seek conservatorship over them. For questions about how to get a conservatorship, it’s recommended you consult with a probate lawyer.
A family member can attempt to revoke a loved one’s power of attorney by filing a petition with the court, but they can do this only if their loved one lacks capacity.
For a family member’s revocation claim to be successful, their petition should make a convincing case about why it would not be in the principal’s best interests for the power of attorney to remain active. It’s also a good idea to be prepared with an alternative should the court proceed with voiding the power of attorney. For example, you could volunteer to act as your loved one’s conservator.
When a principal has capacity, only they have the authority to revoke their power of attorney. They can do this by signing a formal revocation in front of a notary, destroying all copies of the power of attorney document or signing a new power of attorney that revokes the prior instrument.
If the principal is not incapacitated, family members can try sharing their concerns about the attorney-in-fact with the principal in hopes the principal will revoke the power of attorney; however, that decision ultimately will be up to the principal.
Whether it’s within the authority of a person with power of attorney to keep the principal’s family away depends on the circumstances.
For example, if the agent has reason to believe the principal’s family is trying to unduly influence the principal or steal from them, they may be justified in keeping the principal isolated from their family.
On the other hand, if family members are merely trying to spend quality time with the principal and don’t have ulterior motives for doing so, then an agent keeping family away would likely be regarded as unjustified.
If you are a family member who is being kept away from a loved one by their agent, you should get in touch with a lawyer as soon as possible to investigate the matter. If the agent is not providing the proper care or oversight to your loved one, they may be trying to keep you away to prevent you from noticing their negligence.
Similarly, if you are an agent who is planning to keep the principal’s family away, you may want to check with a lawyer to find out whether your reasons for doing so are valid. If you are operating on a hunch that the principal’s family could steal from them, for example, that may not fly. However, if you have proof that the principal’s family was trying to unduly influence the principal into changing their estate plan, then it may be within your rights to limit the principal’s contact with their family.
Whether an agent with power of attorney can evict a family member from a property owned by the principal depends on several factors. For example, is the principal residing in the property rent-free? Are they in violation of the terms of their lease? Has their lease expired?
If a family member is residing in one of the principal’s properties without paying rent, or if the family member is in violation of the terms of their lease, or if their lease has expired but they are refusing to move out, then the agent with power of attorney will need to file an eviction action with the court with help from a lawyer to remove them from the property.
Keep in mind that eviction rules are not different for family members. A state’s eviction laws apply, regardless of a tenant’s relation to the owner of the property.
Yes, you can choose a private professional fiduciary to serve as your attorney-in-fact if you would prefer a neutral third party over someone you know to preside over your health care or finances.
By selecting a neutral third party over a family member, you not only can keep your family members on good terms with one another, but you can leave important decisions about your life in the hands of professionals who make these sorts of decisions for a living. Furthermore, these professionals are unlikely to allow emotions to influence their decisions in the same way family members might.