extended family

Transparency is usually the best case, so make that choice wisely.

If you decide to choose a family member for power of attorney, remember to consider the possibility of a family feud, according to Considerable.com in “How to assign power of attorney without sparking a family feud“.

Start by understanding exactly what is meant by power of attorney, how it functions within the estate plan and how siblings can all be involved to some degree with the family’s decision-making process.

Power of attorney is a term that gives an individual, or sometimes, individuals, the legal authority to act on behalf of someone else. It is used when a person, usually a parent or a spouse, is unable to make decisions for themselves because of illness or injury. It must be noted that power of attorney relates to financial and legal decisions. There are methods to address making decisions for another person for their health care or end-of-life decisions, but they are not accomplished by the power of attorney (POA).

It should be noted that there is a distinct difference between power of attorney and executor of the estate. Power of attorney is in effect while the person who has granted the authority is alive, but unable to act on their own behalf. The executor of the estate assumes responsibility for managing the estate after the individual has died, through the probate process. While they are two different roles, they are often held by the same person, usually an adult child who is responsible and has good decision-making skills.

The general power of attorney refers to the person who has the authority to handle financial, business or private affairs. If a parent grants power of attorney to one of their children, that child then has the authority to act on behalf of the parent.  More than one person can be appointed power of attorney at one time, either to act in succession or to act together.

Trouble starts if the relationship between siblings is rocky, or if major decisions are made without discussions with siblings.

It’s not easy for siblings when one of them has been granted the power of attorney. That means the other siblings must accept the inherent authority of the chosen sibling to make all decisions for their parent. The sibling with the power of authority will have a smoother path if he/she is sensitive to how this makes the others feel.

“Mom always liked you best,” is not a sentence that should come from a 50-year-old, but often childhood dynamics can reappear during these times.

Remember that the power of attorney is also a fiduciary obligation, meaning that the person who holds it is required to act in the best interest of the parent and not their own. If the relationship between siblings is not good, or there’s no transparency when decisions are made, things can get bumpy.

Here are some tips for parents to bear in mind, when deciding who should be their power of attorney:

  • Understand the power that is being given to another person.
  • Make sure the person who is to be named POA understands the entire range of responsibilities he or she will have.
  • The siblings who have not been named will need to understand and respect the arrangement. They should also be aware of the potential for problems, keeping their eyes open and being watchful without being suspicious.

Some families appoint two siblings as a means of creating a “checks and balances” solution. This can be set up so that the agents need to act jointly, where both agree on an action, or independently, where each has the full authority to act alone. In some cases, this will lessen the chances for jealousy and mistrust, but it can also prolong the decision-making process, and creates the potential for situations where the family is engaged in a deadlock, preventing important decisions from being made.

An estate planning attorney can advise you on creating an estate plan that fits your particular circumstances and can include choosing a power of attorney.

Reference: Considerable.com (July 10, 2019) “How to assign power of attorney without sparking a family feud

Mr. Amoruso concentrates his practice on Elder Law, Comprehensive Estate Planning, Asset Preservation, Estate Administration and Guardianship.