DURABLE POWERS
OF ATTORNEY IN ROCHESTER NEW YORK Some Important Questions and Issues that Arise When People Create these Vital Estate Planning Documents
MICHAEL ROBINSON ROCHESTER NEW YORK ESTATE PLANNING ATTORNEY
In our second white paper on durable powers ● ● ● of attorney in New York, we’re going to take a It’s also important to closer look at some important questions and understand that powers of issues that arise when people create these vital attorney are not written in stone. A power of attorney estate planning documents. Because powers of is not a contract, or a will, attorney are so flexible and can be used for a and it is not something that number of purposes, you should never try to creates a permanent create them on your own. You need the advice relationship between the of an experienced attorney to not only tell you principal and the agent. All what the law requires of a power of attorney, powers of attorney but also what options you have, and what you terminate, and they can do might want to do in your particular so in several ways. circumstances. So, to give you a better idea of ● ● ● what kinds of topics you’ll have to consider, let’s take a look at some commonly encountered issues.
DECIDING TO CREATE A DURABLE POWER OF ATTORNEY Even though powers of attorney are excellent estate planning documents, too few people have them. The average person has not created an estate plan, much less taken the time to consider what role a power of attorney might play in that plan. Like other estate planning documents, a power of attorney is something you can choose to create.
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In order to create a power of attorney, you have to create a document that meets specific requirements under New York law. Though your attorney will explain in more detail what these requirements are, failing to meet these requirements is not something you want to do. Powers of attorney largely exist outside of judicial oversight. This means that you don’t need to have your document approved by a judge in order for it to be effective. However, should someone want to challenge a power of attorney in court, the court will have to determine if that challenge is valid. If you create a power of attorney that does not comply with New York requirements, the court could declare that document to be invalid. This will likely cause some big problems for you or your family.
DURABLE AND SPRINGING POWERS When people first hear of durable powers of attorney, they’re often hesitant to create them because they are reluctant to hand over their decision-making authority to someone else. While this delegation of responsibility isn’t as problematic as many people believe it to be, there are some protections you can take that will make sure you retain your abilities for as long as possible. For example, many people choose to create what are known as springing powers of attorney. A springing power of attorney is simply one that takes effect only after a specific event takes place. Many people might choose to create a financial springing power of attorney, for example, that only takes effect once a doctor has declared them to be incapacitated. Once that event takes place, the power of attorney then
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gives the agent named in the document the legal ability to act on behalf of the incapacitated principal. Though New York used to have a specific statutory form that people could use to create a springing power of attorney, that form is no longer necessary. Instead, if you want to create a springing power you will simply include a specific clause in the document that addresses the contingencies or situations that will trigger the agent’s ability to make decisions for you.
YOUR POWER OF ATTORNEY AND YOUR AGENT Deciding to make a power of attorney is important, but just as important is your decision about who you want your agent to be. When you create a power of attorney, you have broad discretion in choosing who will act as your agent. Whether you want to create a power that names an individual, an organization, or selects different agents to have different powers, the choice is entirely up to you. When deciding on an agent, it’s vital that you consider several different factors. For example, let’s say you create a durable financial power of attorney and select your spouse as your agent. While this is perfectly acceptable, it can lead to difficulties. What would happen if you and your spouse are involved in an accident together? If you have named your spouse as your agent and your spouse becomes incapacitated at the same time you do, this will lead to problems.
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Further, though you might trust your spouse above all others, your spouse may not be able to perform the tasks required under the financial power of attorney. For example, if you run a small business and name your spouse as your agent, will your spouse have the ability to step in to manage your business while you are incapacitated? If not, you’ll want to look to someone else who has the necessary skills or experience.
ENDING THE POWER It’s also important to understand that powers of attorney are not written in stone. A power of attorney is not a contract, or a will, and it is not something that creates a permanent relationship between the principal and the agent. All powers of attorney terminate, and they can do so in several ways. First, any principal who maintains mental capacity can choose to terminate a power of attorney at any time. You don’t need a reason to do this, and as long as you inform the agent that you have terminated his or her authority, you can rest assured that your agent will no longer have the legal ability to represent you. Second, all powers of attorney terminate when the principal dies. If you want an agent to represent you or your estate after you are gone, this isn’t really possible. However, you can create other estate planning devices that will allow you to choose your agent to serve as your estate representative if that is your choice. In summation, powers of attorney grant you some significant benefits. To create the power of attorney that you need, and the one that matches your needs, there are several issues you’ll have to closely consider. You will also need to speak to an attorney for advice on what you should, and shouldn’t, do.
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About the Author Clients notice Michael Robinson’s unique approach to his estate planning practice the minute they walk through his office doors. Mike has established a law practice that provides clients with a warm, comfortable and relaxed atmosphere staffed by professionals who believe in providing highly individualized attention. That’s especially important in Mike’s practice, because estate planning is an often personal process reflecting the most cherished hopes and dreams of his clients. “The estate planning we do for our clients,” Mike explains, “often represents the culmination of their life’s work. That’s why we take a personal interest in helping them complete estate plans that suit their needs and that address the unique circumstances of their families.” There’s one last difference clients often remark upon in Mike’s estate planning practice. “Because we concentrate on estate planning exclusively, we have the focus to bring state-of-the-art, cutting-edge estate planning techniques and strategies to a broad range of clients, no matter how diverse.” Mike’s firm has the breadth of expertise to provide its clients with estate plans ranging from the basic to the very sophisticated, including offshore asset protection trusts. His office regularly conducts seminars on estate planning topics throughout the Rochester and Finger Lakes area. Mike has also been a guest speaker on the subject of estate planning before a variety of professional organizations. The Law Office of Michael Robinson, P.C. 196 North Main St. PO Box 417 Naples, NY 14512 www.mrobinsonlaw.com Phone: (585) 374-5210 Fax: (585) 374-9327
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