Part I. Guardianship and Conservatorship Decision Making for Incapacitated Adults.
Part 1. Powers of Attorney.
Hi, I am Mark Biernath. I am an estate planning attorney here, in Atlanta area. Today we are going to be looking at planning for your incapacity. In particular, we are going to be looking at some benefits and limitations of powers of attorney and revocable living trusts. And then we are going to move into a discussion, an extended discussion, on guardianship. We will start our discussion with powers of attorney. It’s important to understand that individuals can only grant decision making authority for themselves, they cannot grant decision making authority for another person. For instance, a parent cannot grant to a cousin, or a nephew, or an aunt, or uncle the decision making authority regarding an adult child of theirs, and in Georgia anyone over the age of 18 is considered an adult. So, in order for us to look at these issues we are going to go to a seminar that I recently conducted up in Summerville, Georgia. SEMINAR: When we deal with incapacity? It matters when incapacity started. And incapacity is a legal definition, we are going to get to what it means in a little bit, but everybody kind of has a sense as what incapacity means. We are going to look at what the court looks at, in a little bit. But the age of the onset of a disability matters. If the incapacity is from the childhood, so below the age of 18, then if you have children below the age of 18, by law they are incapacitated. Isn’t that nice to know? As a minor they do not have capacity to enter into a contract, some things like that, which is a problem for like a child star, you know, they might want to sign a million dollar contract with Disney and they can’t. So, the court has to be involved in these things. But for our purposes if the disability, the condition that is resulting in incapacity, starts before age 18, you are limited with what you can do. If it starts after 18, there are some things you can do so long as you do it before the actual incapacity starts. When we are going through this, think in terms of not only your child or a loved one you are thinking about who has a disability, but think also about yourself because this is a situation where anyone of us at any given time could suddenly find themselves incapacitated. Alzheimer’s is one of the more common ones. Getting wacked on the head is another one. Being in a car accident and ICU is another one. All these things can happen to anyone of us. So, don’t just be focused on your special needs child, think also about yourself as we go through this. So, we are going to talk about what we can do in advance, the advanced planning or using powers of attorney or trust, and then if we don’t have that as an option we are going to talk about guardianship and conservatorship. Durable power of attorney is a document which allows your agent, and an agent is somebody who you empowered to act on your behalf when you are either unavailable or incapacitated. Common powers of attorney are like if you want to do a closing and you are not actually going to be there for the closing you can sign a power of attorney to allow someone to act on your behalf for that closing. That’s a pretty common thing that people are aware of it. Powers of attorney can be either broad or narrow. That closing power of attorney is a very narrow one, it’s for one transaction, on one day, at certain and specific time. Once that day expires, once that transaction expires, once some event happens, that power of attorney disappears. Or it can be very broad. The statutory form is very broad and simply says anything that I am able to do I want somebody else to be able to do on my behalf. Trouble with a really broad definition like that is a bank might not really think that that’s a valid power of attorney, even though it’s in the statute, there is no law that requires them to accept this and they might say, you know, we don’t know if you actually intended this person to do this transaction because the power of attorney says just anything that I can do. And so we sometimes will see a situation where a bank will refuse to use a power of attorney or accept the power of attorney simply because they don’t think that the principal, that’s the person who grants the power, that that principal actually envisioned doing this particular transaction. So, broad thing is what I can do, my agents are allowed to do; the narrow is to perform that specific item. Georgia does not presently have a law that requires any financial institution to accept the power of attorney. We are moving in that direction. The new Guardianship Code which came on-line probably about two years ago now specifically defers to powers of attorney. So, a judge must inquire if there are any powers of attorney in place and if so give those powers of attorney deference. But the bank can still say, we don’t think these are valid anymore, we are not going to accept them. And it is pretty simple why they do that. Usually, it is a good business for them to accept powers of attorney and allow people to transact business that way, and generally what we find is that if you have a closer personal relationship with your banking partner it is going to happen, they are going to do it. You get to a less personalized banking situation, the more likely they are not going to accept it. Usually what I find with a bank is they say, well, we will accept power of attorney so long as it is on our form, here. Trouble is, the power of attorney is not durable, which means if you become incapacitated it’s no longer good. Most people are doing this in case they become incapacitated. And the other is usually there is some time frame, time limit on that power of attorney, usually what I see is 30 days. In this section we discussed some of the issues related to a financial power of attorney. In the next section we are going to focus more on healthcare decisions and Georgia’s new Advance Directive for Health Care. So, please join us.