At our firm, a financial power of attorney is one of the most important estate planning documents we prepare for our clients.  One of the most difficult decisions for our clients is naming an agent.  For clients with multiple children, the task is even more daunting, especially when only one child is named as an agent in a power of attorney.

A power of attorney allows someone to appoint another person — an “attorney-in-fact” or “agent” — to act in place of him or her — the “principal.”   Financial powers of attorney usually include the right to open bank accounts, withdraw funds from bank accounts, trade stocks, pay bills, and cash checks. They could also include the right to give gifts.

When a parent names only one child to be the agent under a power of attorney, it can cause bad feelings and distrust. If you are dealing with a sibling who has been named agent under a power of attorney or if you have been named agent under a power of attorney over your siblings, the following are some things to keep in mind:

  1. Right to information. Your parent doesn’t have to tell you whom he or she chose as the agent. In addition, the agent under the power of attorney isn’t required to provide information about the parent to other family members.
  2. Access to the parent. An agent under a financial power of attorney should not have the right to bar a sibling from seeing their parent.
  3. Revoking a power of attorney. As long as the parent is competent, he or she can revoke a power of attorney at any time for any reason. The parent should put the revocation in writing and inform the old agent.
  4. Removing an agent under power of attorney. Once a parent is no longer competent, he or she cannot revoke the power of attorney. If the agent is acting improperly, family members can file a petition in court challenging the agent. If the court finds the agent is not acting in the principal’s best interest, the court can revoke the power of attorney and appoint a guardian.
  5. The power of attorney ends at death. If the principal under the power of attorney dies, the agent no longer has any power over the principal’s estate. The court will need to appoint an executor or personal representative to manage the decedent’s property.

In order to avoid conflict, under the right circumstances, the parent can name co-agents in the document. You need to be careful how this is worded or it could cause more problems. The best way to name two co-agents is to let the agents act separately. Another option may be to steer clear of family members and name a professional fiduciary.

Sibling disputes over how to provide care or where a parent will live can escalate into a guardianship battle that can cost the family thousands of dollars.  If you or someone you know are interested in creating a power of attorney or a comprehensive estate plan, please contact our firm. We would be happy to work with you.