| Alan R. Horvath, Attorney at Law |
Making a Power of Attorney Work for You
What is it?
What does that do for me?
It allows you to delegate responsibility for any or all of your affairs. The person you appoint under a power of attorney
is your agent. They have a fiduciary relationship to you, which means they have a duty to put your interests above
their own. They also have an employee relationship to you, which means they are to follow your instructions.
is your agent. They have a fiduciary relationship to you, which means they have a duty to put your interests above
their own. They also have an employee relationship to you, which means they are to follow your instructions.
A Power of Attorney can be written as a Durable Power of Attorney. This means that it remains in effect even if you are
no longer able to communicate with your agent due to physical or mental infirmity. You can include in your Power of
Attorney detailed instructions as to what you want done in the future. Because your agent owes a fiduciary duty to you,
your wishes, as expressed in your Power of Attorney, can be enforced by the courts.
no longer able to communicate with your agent due to physical or mental infirmity. You can include in your Power of
Attorney detailed instructions as to what you want done in the future. Because your agent owes a fiduciary duty to you,
your wishes, as expressed in your Power of Attorney, can be enforced by the courts.
P.O. Box 81
596 Mountain Ranch Rd.
San Andreas, CA 95249
596 Mountain Ranch Rd.
San Andreas, CA 95249
| Phone: 209 754-5291 Fax: 209 754-5293 |
| ahorvathlaw@sbcglobal.net |
A Power of Attorney is a document you sign that gives another person the power to take legal actions on your behalf.
What if I just want to leave it to my agent's discretion?
You can certainly do this. In fact, most standard form Power of Attorneys do just that. However, such a form can easily
result in too much power being granted and too little direction given. If you provide specific directions, they are
enforceable by a court. If all you provide is authority, then the court has no choice but to assume ANYTHING done by
your agent meets with your approval.
An agent may have to: Pay your bills
Insure that money owed you is received
Arrange for any home care you need
Decide if, when, and where you should be moved if you have problems getting along on your
own.
Your agent will have to be able to access your assets to provide for your needs. He will need to know which assets you
want to reserve if possible, and which are to be used for your expenses. In the lack of any directions, he will just have
to make his own choices.
Not only may you want to give your own directions, a potential agent may be unwilling to assume the responsibilities
involved in an agent relationship without any guidance from you.
result in too much power being granted and too little direction given. If you provide specific directions, they are
enforceable by a court. If all you provide is authority, then the court has no choice but to assume ANYTHING done by
your agent meets with your approval.
An agent may have to: Pay your bills
Insure that money owed you is received
Arrange for any home care you need
Decide if, when, and where you should be moved if you have problems getting along on your
own.
Your agent will have to be able to access your assets to provide for your needs. He will need to know which assets you
want to reserve if possible, and which are to be used for your expenses. In the lack of any directions, he will just have
to make his own choices.
Not only may you want to give your own directions, a potential agent may be unwilling to assume the responsibilities
involved in an agent relationship without any guidance from you.
Doesn't My Living Trust Take Care of This?
Only partly. Your trustee has legal ownership of any assets you have placed in the trust, and authority to use them as
directed by the trust document. If the trust gives no directions either, this just moves the problem from one document
to another. Furthermore, your trustee only has power over the assets in your trust. The trustee has no power to take
actions for you as a person. For example, the trustee can not withdraw funds from an IRA for you if the IRA is not part
of the trust.
directed by the trust document. If the trust gives no directions either, this just moves the problem from one document
to another. Furthermore, your trustee only has power over the assets in your trust. The trustee has no power to take
actions for you as a person. For example, the trustee can not withdraw funds from an IRA for you if the IRA is not part
of the trust.
I'm Perfectly Capable of Taking Care of Matters for Myself
The problem with this argument is that you may be capable of living on your own but still lack legal capacity. Legal
capacity requires both that you understand the implications of the actions you are taking, and are able to adequately
protect your own self interest in dealing with another. This is a subject specific standard, and the more complex the
issue, the easier it will be not to pass the test. If you are one of the lucky folks whose mind remains clear their entire
life, it is true that you will never need to give someone else a power of attorney. However, this is not a particularly
smart gamble. Because a power of attorney creates an agent relationship, you can create such a relationship and
have it just held in abeyance. As long as you are capable of acting for yourself, your instructions to your agent are
to do nothing. It is also possible for you to have the power of attorney only come into effect in the case of your
incapacity. Either way, it is an insurance policy that has no effect as long as it is not needed, and can be vitally
important if it is
capacity requires both that you understand the implications of the actions you are taking, and are able to adequately
protect your own self interest in dealing with another. This is a subject specific standard, and the more complex the
issue, the easier it will be not to pass the test. If you are one of the lucky folks whose mind remains clear their entire
life, it is true that you will never need to give someone else a power of attorney. However, this is not a particularly
smart gamble. Because a power of attorney creates an agent relationship, you can create such a relationship and
have it just held in abeyance. As long as you are capable of acting for yourself, your instructions to your agent are
to do nothing. It is also possible for you to have the power of attorney only come into effect in the case of your
incapacity. Either way, it is an insurance policy that has no effect as long as it is not needed, and can be vitally
important if it is
What Happens if I Need a Power of Attorney but don’t have One?
Either you make do with things as they are, or someone petitions the court on your behalf to set up a conservatorship.
For example, if you owned your home in your own name only, and could no longer live in it, without legal capacity you
would not be able to sell it. Most likely, a family member would be appointed as your conservator, at which point they
could sell your home for you under court supervision.
The problem with this solution is that it may be much more extreme than is necessary or desirable. Once you are
conserved, your conservator assumes a parental responsibility towards you and your property. You no longer have
independent rights to control your life style nor your property.
For example, if you owned your home in your own name only, and could no longer live in it, without legal capacity you
would not be able to sell it. Most likely, a family member would be appointed as your conservator, at which point they
could sell your home for you under court supervision.
The problem with this solution is that it may be much more extreme than is necessary or desirable. Once you are
conserved, your conservator assumes a parental responsibility towards you and your property. You no longer have
independent rights to control your life style nor your property.
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