Rockville Centre Elder Law Blog

Wednesday, March 14, 2012

YES, You need a Power of Attorney!

After over 20 years of practicing law, giving seminars, and educating my clients and their families about the pitfalls of not having a good, durable power of attorney, the number of cases of new clients, whose loved ones are in desperate situations because they do not have a power of attorney, is still overwhelming.  Often such circumstances require a Court guardianship proceeding, with hours and costs involved that can certainly be profitable for a law firm, but at the incapacitated person's expense.

As the old joke goes, "I resemble that remark!"  Read on, and see if these scenarios strike a chord (I have seen them replayed in my office over, and over, and over):

Spouses NEVER did powers of attorney:  Husband and wife are married over 50 years.  Both of them are vibrant, active, "young" Senior Citizens, healthy with no major health problems.  They never execute Wills, health care proxies, living wills, or powers of attorney.  They, like many of us, feel young, act young, live like they will be young forever. As they reach their mid-70s, one of them begins to show signs of a dementia, and in the year to follow, suffers a rapid decline in mental capacity and requires constant assistance.  The other spouse is overwhelmed in so many ways: with the shock that this has happened to them; with trying to take care of their beloved all by themselves, including dressing, bathing, feeding; with handling all the responsibilties of the home by themselves; and with handling their own aging process.  When the healthy spouse seeks legal assistance in order to protect their assets so that the sick spouse can get Medicaid coverage for nursing home or home care assistance, not only are they bombarded with the complications of all the laws with no clear-cut guarantees, but they are unable to transfer the residence and some of the other assets out of the sick spouse's name.  Why?  Because the sick spouse no longer has the needed mental capacity to transfer the assets, and possibly cannot even sign his/her name correctly.  Without a durable power of attorney executed by the sick spouse, and making the healthy spouse, and possibly even children, their financial agents, assets cannot be transferred out of the sick spouse's ownership.  Result:  A guardianship proceeding may have to be commenced in Court to appoint a Guardian, and the Court will have to approve and authorize transfer of the assets out of the incapacitated person's name by the Guardian.  Despite the efforts of the Court, and the attorneys and parties involved, it is a costly and lengthy proceeding from start to finish.

Existing Power of Attorney is NOT Sufficient:  Husband and wife execute durable powers of attorney, Wills and health care proxies.  The powers of attorney are standard forms, and do not anticipate some important issues that occur with incapacity.  For instance, their power of attorney limits gift-giving, even to the spouse, to gifts of no more than $10,000 annually.  A year later, one spouse suffers several strokes, resulting in dementia and the inability to sign documents.  The healthy spouse seeks legal assistance from a different attorney than the one who prepared their documents, to protect their assets, in order to qualify the sick spouse for Medicaid.  The new attorney, who concentrates their practice in the area of Elder Law, reviews the powers of attorney and determines that the existing powers of attorney will not be sufficient to transfer assets out of the sick spouse's name, including the primary residence.  The sick spouse no longer has the ability to sign a new power of attorney.  Result: Again, a guardianship proceeding. 

In my opinion, preparing for our incapacity, is as important as preparing an estate plan for after we die.  A durable power of attorney that is properly drafted, and anticipates aging and incapacity issues in conjunction with current laws, can avoid a guardianship proceeding, as well as assist those you trust in assisting you through a catastrophic illness.  What makes a power of attorney durable is a statement in the document specifying that the power of attorney will survive your incapacity.  The express powers that are drafted in the power of attorney will specify the extent to which your financial agent can act.  While not having a power of attorney at all is imprudent, having one that is not carefully drafted to give your agent all the authority needed to assist you during incapacity is equally problematic.

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Attorney Irene V. Villacci represents clients throughout Nassau and Suffolk Counties and the surrounding areas, including: Queens, Brooklyn, Staten Island, Bronx and Manhattan.

Prior results do not guarantee similar outcome.

© 2019 Irene V. Villacci, Esq., P.C. | Disclaimer
53 N. Park Avenue, Ste. 41, Rockville Centre, NY 11570
| Phone: 516-280-1339

Elder Law / Medicaid Planning | Estate Planning | Probate & Estate Administration | Special Needs Planning | Guardianships | Asset Protection | Residential Real Estate |

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