Powers of Attorney for Property Should be Taken Seriously

In the Chicago Tribune a letter to columnist “Dear Annie” illustrates important concerns about Powers of Attorney for Property. Below is a link to the story.

Her children sold her house and possessions

Briefly, an 80 year old woman was in the hospital for a very serious illness and she was not expected to survive. Fortunately, she did recover.  Unfortunately, she learned that her children – acting under a Power of Attorney for Property she had given them – sold her house, took her possessions they wanted and then sold rest.

Many people think of a Power of Attorney for Property as a simple, standard, routine document that is part of their estate plan.  As this story illustrates it is not simple, not routine and shouldn’t be standard. A Power of Attorney for Property can have serious implications.
 
The implications can be limited.  For example, a Power of Attorney for Property can be narrowed to limit the authority to very specific types of transactions.  This might be appropriate if the purpose is to give someone only the authority to pay bills while you incapacitated but not sell your house or other possessions.

Depending upon your personal situation a broad Power of Attorney might be appropriate.  In the story the woman complains about how her children sold her house at an auction.  It is possible that the woman did not have any other significant assets besides her house; that her medical expenses were large and the only way to pay them was to sell the house quickly.  

In the situation where the only way to pay the bills is to sell the house then a very limited Power of Attorney would not have worked well.  In that situation the children would have needed to ask a judge to appoint a guardian.  A guardianship proceeding is neither quick nor inexpensive.
 
Another concern is trust.  The person you give Power of Attorney obviously should be someone you trust to act in your best interest – even when it is contrary to their self interest.  If you are not fortunate enough to have someone who meets that standard then that is another reason to consider limiting the scope of the Power of Attorney for Property.

A Power of Attorney for Property is not a simple “fill in the blank” document.  It should be tailored to a person’s individual needs.

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