Thursday, August 23, 2012
I'm Power of Attorney for my Dad. What are my Duties? Part 2
This is Part 2 of my article “I’m Power of Attorney for my Dad. What are my Duties? [To read Part 1, click here]
As I noted in Part 1, serving as power of attorney (Agent) for someone is serious business. Here are some rules you should follow to keep out of trouble.
1. You must act prudently and reasonably in all actions you take in your role as Agent.
2. Unless otherwise specified in the Power of Attorney, you should avoid all conflicts of interest. Your responsibility is to act in the best interest of the person who signed the document and who has invested this trust in you.
3. You must respect the terms of the document. If you are not given authority to undertake a particular action, you should assume that you cannot take that action. If you identify any ambiguities in the document or if you are uncertain, you should consult with an experienced lawyer. Also, be sure to note any limitations or restrictions on your powers.
4. Unless you are specifically authorized to do so by the Power of Attorney, none of the Principal’s assets should ever be placed in your name. Be sure that none of your assets are mixed with those of the Principal.
5. If you execute any documents on behalf of the Principal, you should specifically indicate that you are acting as the “Agent” for the Principal, and not on your own behalf. For example, you can sign "Howard Jones, as Agent for Rachel Wilson" or "Howard Jones, POA for Rachel Wilson." In these examples, Howard Jones in the Agent and Rachel Wilson is the Principal.
6. You should maintain careful and complete records of all steps you take on behalf of the Principal. It is important that you retain receipts and maintain good records of all checks written, other disbursements made, all liabilities of the Principal with which you have involvement or knowledge, all income and other assets you receive, and all actions you take on behalf of the Principal. The maintenance of such records minimizes the possibility that you will be exposed to liability.
7. You have the right to reasonable compensation for your services. If you decide to claim compensation, you should be sure to maintain careful records indicating how much you have been paid and the documentation that justifies such compensation.
8. Maintain close communication with the Principal. Even if there has been a determination that the Principal is incapacitated, make your best efforts to talk with the Principal about the actions you are taking. You may also need to talk with the Principal’s family members, physician, professional advisors, and other interested persons on the Principal’s behalf.
If ever you are acting as an Agent and are not sure you are doing the right thing, seek out professional advice not only to protect the Principal, but to protect yourself.