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ISLAND SUN - JANUARY 8, 2016
Adurable power of attorney (DPOA) is an important
document that everyone should have as a part of his
or her estate planning portfolio. Generally speaking,
the grantor of a durable power of attorney names someone
who can legally act for the grantor in any number of ways.
The person who is granted the power to act is known as
the “attorney-in-fact” or “agent.” For simplicity’s sake in this
column I’m going to refer to the grantee of the power as the
The DPOA may allow the agent to write checks to pay bills,
sign deeds, complete beneficiary designations, enter into and/or enforce contracts,
open accounts, close accounts, and direct investments among other things.
DPOAs cease upon the grantor’s death. In other words, they are no longer
effective. The “durable” in the name durable power of attorney means that the
powers survive the grantor’s incapacity. A general power of attorney, in contrast,
would cease if the grantor should become incapacitated such as through dementia
or Alzheimer’s disease. Most estate plans use the DPOA since the thought is that
the power holder would only act if the grantor of the power couldn’t.
Under Florida law, one can name an agent under a DPOA, and then if that
agent is unable or unwilling to serve, another agent can be named as an alternate.
It might look something like this: “I hereby name my wife Patti as my attorney-in-
fact and if Patti is unable or unwilling to serve then I name my daughter Gabrielle
to so serve.”
I almost always try to persuade my clients from naming successor DPOA agents
in the same document.
Why? Even though they are legal under the relatively new Florida statute on
point, successor DPOAs are very difficult to use from a practical standpoint.
Consider the fact that any bank, financial firm or broker who is acting under
a DPOA is suspicious of the document from a liability standpoint. Consider the
scenario where my daughter Gabrielle walks into my financial advisor’s office
holding the DPOA and says “I need to transfer $20,000 out of my father’s money
market account today.”
My financial advisor looks at the DPOA, worried that if it is not authentic he
could be liable for following Gabi’s direction. So he asks Gabi, “Why are you using
the power? Can I call your dad to see if this is okay?”
“Dad’s in the hospital and isn’t able to talk. I need to write some checks to pay
a bunch of his bills and that is why I am here,” Gabi answers him.
My financial advisor then reads the DPOA and points to the first line that says
my wife Patti is the first power holder and not Gabi.
“It says here that your mother is the first power holder and that you can only
act if she can’t,” he says.
“My mom is out of the country and can’t take care of these things now,” Gabi
“I’m sorry,” my financial advisor says, “I have to be very careful as I may have
a lot of liability here if for some reason you aren’t supposed to act,” he says. “I’m
going to have to give this to my firm’s legal department to sort out.”
Gabi, worried that she won’t be able to pay my bills on time is frustrated. “How
long will this take?” she asks.
“I don’t know,” my financial advisor replies.
From there the whole thing can become a circus. The attorney for the financial
firm may say that they need written proof that Patti can’t act or that she is
unwilling to act. It can take days if not weeks to resolve.
So what’s the alternative? What I normally suggest is that each person you wish
to name as your agent under a DPOA have a separate DPOA document that just
names them individually. While there is a possibility that if you have two different
parties acting under a DPOA that they are in conflict with one another, I will tell
you anecdotally from personal experience that I haven’t seen much (if any) of that
in my practice.
With that said, if you name more than one party as a DPOA in separate
documents it is wise to tell the individuals you are naming of the fact that each has
a separate power, and that your expectation is for them to work together and to
consult one another. Or if you prefer that one only act when the other couldn’t,
that would be a verbal arrangement.
Remember that anyone acting as an agent under a DPOA has a fiduciary duty
to the grantor of the power. They should only be acting in the grantor’s best
interests. If you fear that someone you name won’t do that, or won’t work in
conjunction with another as you would request, then I would say that you probably
shouldn’t be naming that person in such a powerful document to begin with.
©2016 Craig R. Hersch. Learn more at www.sbshlaw.com.
The Problem With Successors Named
In A Durable Power Of Attorney
by Craig R. Hersch, Florida Bar Board Certified
Wills, Trusts & Estates Attorney; CPA
Building and designing custom homes on Sanibel & Captiva for over 25 years.
State Certified General Contractor License# CGC A05420
CUSTOM RESIDENTIAL CONSTRUCTION
CUSTOM RESIDENTIAL DESIGN
PLANS THROUGH PROJECT COMPLETION
CUSTOMER SERVICE ORIENTED TEAM
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