Swine Flu and Power of Attorney

Just a side note then I will get to the topic of power of attorneys. I have always found it interesting as an estate planning attorney to hear those triggering events that cause individuals to call our office for trusts and wills. A lot of time it is a vacation to another country, air travel, or a tragedy in a family with the problems that occur and the ones that have to handle the mess wanting to get their affairs organized.

The title of this post? As you may have guessed, someone has called our office because of their concern that the Swine Flu will come and they want their affairs in order before it does. I won't comment on the media circus caused by this "potential epidemic", but it reminded me that people seem to need some event in their life to do wills and trusts. Good or bad, it just seems a part of my practice.

Power of Attorney:

I will often get asked why I have a dislike for power of attorney. I want to clarify this, I do like power of attorneys as a minor player in an entire estate plan, but using a power of attorney in lieu of a trust is bad planning. Period.

Here's why: when an individual that is an agent under a power of attorney uses the document to transact some personal business on behalf of the principal (the person they are agent for), too often the institution, whether a bank or a brokerage firm, will either respond that the power of attorney does not address the activity the agent is wanting to perform or the power of attorney has expired. Both excuses are inaccurate however, since firstly, well done power of attorneys will have a general clause to the effect that the agent can perform "...all other tasks necessary for the benefit of the principal" or other like language. And secondly, the statute in Arizona specifically states that the power of attorney document DOES NOT expire unless an expiration date is provided in the document. So the issue isn't' the law. The issue is the institution's own policies. Unfortunately, these issues seem to arise when we need the document the most, when the person we are caring for cannot sign on their own behalf. Changing the power of attorney in order to list the specific activity the institution is wanting to see or creating a power of attorney that is brand new is no longer an option. If you have ever been across the counter from a banker and tried to get them to do something they don't want to, you can understand the frustration and futility of those agents stuck in that situation.

For the above reasons, while I still like power of attorneys as part of entire plan, I still much prefer trusts. Trusts continue to be accepted and honored by these institutions with the successor trustees having much fewer instances of problems trying to transact business or get information on behalf of the individual the trust was created to protect.