No one wants to admit that a day might come when they can’t handle their own financial or health care matters, however, not planning ahead could lead to extra expense, less input and ultimately involvement of the court. I have had many clients come to my office regarding an elderly parent who, due to advanced age and illness, could no longer take care of their own financial and health care needs. This happens way too often and once a person no longer has capacity to sign legal documents, the only option is to go to court and request a Guardianship and/or Conservatorship. Planning ahead is the key.
What is a Power of Attorney? A power of attorney is a legal document where one person (the principal) authorizes another (the agent) to act on their behalf. There are financial powers of attorney which allow your agent to make decisions regarding your real and personal property and healthcare powers of attorney which allow your agent to make decisions regarding your health care needs.
Your power of attorney can be broad in scope, giving your agent the ability to make any and all financial and personal decisions for you (a General Power of Attorney) or you can limit your agents authority by specifying the types of decisions you would like them to make on your behalf (a Limited Power of Attorney). A healthcare power of attorney allows you to specify the type of care that you would like to receive and to what extent you would like care in situations such as a terminal illness or coma.
Powers of attorney allow you to direct who you would like to make decisions for you, at what point they are allowed to make decisions and to what extent. Without powers of attorney in place, your family members would have to petition the court to obtain the authority to make decisions on your behalf. This is undesirable as the person(s) appointed by the court and the decisions made might not necessarily be the ones that you would have chosen for yourself, it becomes public record and the guardian/conservator must file annual accounts with the court.
What are Guardianships and Conservatorships?
Guardianship gives a person (the guardian) the power to make medical and personal decisions for another (the ward). A Conservatorship gives a person (the conservator) the power to make financial decisions for another (the ward). Both are legal relationships where a family member or friend initiates the proceedings by a filing a petition in the Probate Court in the county where the individual resides. Following a court hearing, if the Judge agrees that the individual is unable to handle his or her healthcare/personal matters or financial matters, a guardian and/or conservator will be appointed. In both cases, the person appointed will have to report to the court on an annual basis.
A power of attorney is a relatively low cost and private way to decide which family member or trusted friend will have the legal authority to carry out your wishes if you can no longer speak or act for yourself. If you do not have a power of attorney or if your power of attorney is not drafted properly, and something happens that results in your inability to make decisions, your family/friends may later face court proceedings and court supervised Guardianship and/or Conservatorship.