This is a continuation of our Estate Planning Series posted the 4th Wednesday of the month. Below are portions of an interview with Elder Law Attorney, Richard Tizzano located in Poulsbo, WA.
JASON PARKER: I would like to get some clarification on what each one of these documents is and what its purpose is. So what exactly is the power of attorney for financial matters, and why does somebody need it?
RICHARD TIZZANO: You would be authorizing someone to assist you with financial matters. It does not limit or take away your ability to control and manage your own finances, but it allows someone else to participate. That can be done in a few different ways. You can have someone not be appointed until some event happens where you become incapacitated, and in that scenario, the authority would be springing into effect when you were deemed to be incapacitated, either you had some accident or at some point your dementia is at a level where the doctor is willing to say, “No, you’re not able to manage your own affairs.”
Or it can be effective immediately when you sign the document. I recommend people consider that first, because it makes it much easier for a person to receive help from the person he or she trusts. The document doesn’t have to be given out immediately when the person signs it, but the person has it, and if something unforeseen happens, then the person named, who is aware he or she has been named, can come and get the document and act on the person’s behalf.
The more typical scenario is where someone begins to become more frail or have a bad day or whatever and needs somebody to take care of something, and if the document is effective immediately when it was signed, the person needing help can just give the other person the document and ask him or her to go take care of the matter with the financial institution. The same goes with a power of attorney for medical. The person can go talk to the doctor or access records immediately. The person does not have to have a determination of incapacity just to effectuate the document.
JASON: Who do people usually list as their power of attorney?
RICHARD: They usually list their spouses first and then a child they may trust or a child who may have a specific ability as an accountant or physician or something, and then after that, it is friends or neighbors.
JASON: Do you have a specific example of a time when somebody had a power of attorney and it really helped him, or a time when somebody probably should have had a power of attorney, and it really handicapped him because he didn’t have that type
RICHARD: I can combine it into one story that will make you aware of the shortcomings of a power of attorney. A son came in whose his dad was failing. He felt like his dad really needed to be in a nursing home, but his dad didn’t want to go. The son had power of attorney for his father, and said as much to his dad, thinking he could force his dad to go. His dad got angry and said, “Well, I’m revoking the power of attorney.”
That is one of the aspects of a power of attorney; unless it is agreed to by all parties or opposed by the court, it’s revocable at any time. I tell people when they sign it, if the agent or attorney-in-fact doesn’t do what you want him to do, you can always fire him. So the dad fired the son, and the son felt powerless and said, “Well, I’d like to get a guardianship of my dad.”
I explained to him that even if he were named as the guardian for his dad, he wouldn’t have the authority to force his dad to do what he doesn’t want to do. He would, however, have the authority to control his father’s checkbook and his finances, and the court action would cut off his father’s ability to access his own finances.
In Washington, we have what’s called “the right to rot,” which gives his dad the ability to decide what kind of care he wants or doesn’t want. Even if the court deems him to be incompetent, you can’t impose a level of care on him that he doesn’t want unless there is an imminent danger to him or others, and that is a pretty high standard. If he doesn’t want to take his medication, doesn’t want to go to the nursing home, and wants to sit in front of the TV and eat bonbons and drink beer, he can do whatever he
wants to do.
Having to have guardianship is a consequence of not having a power of attorney, but having a guardianship does not necessarily solve all the problems that come along with it. So, if someone does not have a power of attorney, whether it is for medical or healthcare, and he or she gets to the place where he is not able to care for himself, a guardianship has to be appointed.
I get people who come in occasionally and say, “Well I noticed my neighbor isn’t taking the garbage out, and the mail is piling up in the mailbox. I went and visited him, and he seemed to be okay, but something’s just not right.” So we try to find out where the person’s kids are or who the person is connected to. Sometimes there’s nobody around, and it’s either the neighbor, or the sister-in-law in Arizona trying to figure out how she’s going to manage as the guardian for her sister-in-law up here who has to find someone locally who can assist her in that guardianship.
If you are one of those people now in need, but you don’t have any powers of attorney because there was really nobody who was close enough to you that you wanted to select, or you just didn’t know you needed a power of attorney, and then you get to the place where you need help, without those simple documents, it is going to require a guardianship before the court. The court will have to make a determination whether you are or you’re not competent to manage your own affairs. If you’re not, then the court will choose the most logical person who can step in and do that on your behalf, and if there is no obvious person like a relative or close friend, then it will assign a professional guardian who would have to step in at that point and fill that role.
The opinions and information voiced in this material are not intended to provide specific advice or recommendations for any individual. Please consult a licensed estate planning attorney BEFORE taking any action.
Luce, Lineberry & Kenney ps
Attorneys at Law
John Kenney, LLM
17791 Fjord Dr NE Suite 154
Poulsbo, WA 98370-8482
Sherrard, McGonagle, Tizzano
Richard C. Tizzano, PS
19717 Front Street
PO Box 400
Poulsbo, WA 98370
A WORD OF CAUTION!Estate planning and the laws around this subject are unique to the state in which you live. Because most of the people I serve are here in Washington State, I focused on the issues in Washington State. Obviously if you are reading this outside of Washington State, you should consult with an expert estate planning attorney in your area.