of an Agent under a Power of Attorney"
We draft powers of attorney every day for clients who appoint their children as alternate agents. Many of these adult children do not know they are being appointed, nor have they been advised of their potential responsibilities. Lawsuits against agents has been increasing in recent years (mainly by siblings who were not in control of the parent's assets against the brother or sister who was named as the agent under the parent's power of attorney) and many agents have unwittingly gotten themselves in trouble.
When you agree to serve as attorney-in-fact under a Power of Attorney you become a fiduciary. A Power of Attorney permits the person named as Agent to act on behalf of the Principal. The Agent is not obligated to serve. Once an Agent accepts responsibility, however, he or she has a duty to act prudently. As a fiduciary, the Agent is held to the highest standards of good faith, fair dealing, and loyalty to the principal. The Agent must always act in the best interest of the principal which sometimes puts them in conflict with their own interests.
Although the Principal has
named an Agent, the Principal may still act for himself or herself
as long as he or she is competent, including revoking the Power
Some banks, brokerage houses,
mutual funds, and insurance companies, may not recognize your
authority unless their own form is signed by the principal. You
should investigate this and have the Principal sign those forms
if he or she is able. Once he or she becomes incapacitated, mentally
or physically, it may be too late to get the signature you need.
Whether or not an Agent is
entitled to a fee for his or her services depends on the Power
of Attorney. If fees are authorized, they should be reasonable.
Remember, the court may later scrutinize them. Keep accurate
time sheets to support your fees.
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