Dear Mr. Premack, my father is an agent on the permanent power of attorney for my aunt, who is now suffering from severe Alzheimer’s disease. He is in order and wants to give me his rights under permanent authority. His concern is that his sister will survive him. He makes me the executor of his estate. My aunt has no spouse or children. If permanent power of attorney cannot be transferred, what should be done to give my aunt a new permanent power of attorney despite her mental incapacity? – LA
There are a few options to consider in this situation, but all of them depend on what your aunt’s existing permanent power of attorney says. She signed it when she was mentally able and hopefully hired a skilled lawyer to write it for her. If she used a form from the internet, the pages she signed are likely missing.
First, their permanent authority should be written to include successors. In other words, “I am appointing my brother Louis Sr. as an agent. If Louis dies, incapacitates, or resigns, I will replace my nephew Louis Jr. “If there is such a clause, your father could have his lawyer write a resignation document to be attached to your permanent power of attorney. After his resignation – because your aunt said so in her actual signed permanent power of attorney – you would take over the authority because she selected you for this job.
I am of course assuming that such a clause is included and that it has named you as its successor. If she has included such a clause, but names her neighbor as her successor, you are still powerless. If she did not include such a clause at all, you are still powerless.
Second, if your permanent power of attorney was signed after September 2017, when the law was changed, it may contain a provision that allows your agent to delegate the power to someone of his choice. If so, your father could delegate certain transactions to you. You could act as his assistant, but you would not be his replacement.
Even if her permanent power of attorney was signed after September 2017, your aunt’s attorney may not be aware of the change in the law. The attorney may not have added authority to delegate. It must be expressly granted in the permanent power of attorney actually signed before an authority to transfer exists.
Third, if her permanent power of attorney was signed after September 2017, your aunt’s attorney may have included a provision allowing your father (as her representative) to elect a successor. This authorization must also be expressly granted in the permanent power of attorney actually signed. If it exists and it gives him that authority, he could legally hand the reins over to you as a substitute agent. If the determination does not exist in your permanent authority, you are still powerless.
Fourth, it is possible that your aunt’s seasoned attorney may have included a provision in her permanent power of attorney that enables the agent to build a living trust in her favor and to transfer her wealth into that trust. Part of establishing a trust is determining who will act as the manager (trustee) of the trust. If such a clause is in their permanent power of attorney and your father uses it to establish and fund a trust, he can appoint you as a trustee. They would then manage all of the assets that were transferred to the trust. You would still not be an agent under her permanent power of attorney, so certain important functions (such as responsibility for filing your income taxes) would still be entrusted to your father as her agent.
If your permanent power of attorney does not allow any of the previous four decisions, your father could step down as an agent and you could go to court to become their guardian. Guardianship is slow, expensive, and overseen by the judicial system. So it really is the last and worst option available.
Paul Premack is a certified senior law attorney, handling wills and trusts, probate and senior legal issues. He is admitted to the bar in Texas and Washington. View previous right columns or submit free questions about these legal issues through www.Premack.com.
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