03 Jun, 2015 Problems Using A Durable Power Of Attorney In 2015
Unfortunately, many financial institutions are becoming increasingly resistant to accepting these documents to allow third party access to accounts.
Adurable power of attorney has long been a standard document in any estate plan. Large estate or small, complex family situation or simple, giving someone the authority to engage in financial transactions on your behalf has always been considered good practice. Unfortunately, many financial institutions are becoming increasingly resistant to accepting these documents to allow third party access to accounts.
At first, these objections targeted “stale” documents, which had been signed years ago, and so lawyers began advising their clients to sign “fresh” durable powers of attorney every 5 years or so. Lately, however, the objections have broadened such that some financial institutions will not accept a valid durable power of attorney executed in the same year of presentment. In such cases, the institution generally asks that the person who executed the document physically appear to attest that it is valid (generally an impossibility, since the durable power of attorney is being used because that person is unable to physically appear). There is no legal basis for any of this; unfortunately, none of that matters when efforts to use the durable power of attorney go unfulfilled.
Sometimes involving your estate planning attorney in the situation can resolve the issue, but that generally requires the attorney to speak with the institution’s general counsel and then write a letter or affidavit. Alternatively, some institutions will tell you that if you sign their durable power of attorney form, that can be kept on file and will not be questioned going forward. Neither is a particularly useful or attractive solution under the circumstances.
In consideration of these growing problems, we would recommend that you implement some or all of the following as potential solutions to the problem detailed above:
- Take your durable power of attorney to each of your financial institutions while you are healthy, attest to them that it is valid, and ask them to put it on file (some, but not all, may be receptive to this).
- If your financial institutions have their own durable power of attorney forms, request and execute those forms while you are able.
- Transfer your financial accounts to your revocable trust. If you cannot manage the assets in your trust, your co -Trustee (or successor Trustee) can do so on your behalf without need of a durable power of attorney.
The durable power of attorney is still a critical element of any estate plan, but as changing circumstances continue to dull its effectiveness, the alternatives suggested above should be implemented to avoid significant delays when your agent attempts to access your accounts.
Buyers and Sellers Beware Before Signing an Offer to Purchase Real Estate
In Massachusetts, an offer to purchase real estate can be a binding contract to buy or sell real estate even if a subsequent purchase and sale agreement is never agreed upon. If, for example, an offer is not worded properly and the deadlines are ignored, you may find yourself bound by a document that does not encompass your intentions. Important issues are often omitted from the standard offer form used by most realtors, and there have been times when either the buyer or seller refuse to let the other party include provisions in a purchase and sale agreement which alter the offer terms. Essentially, if you agreed to a bad provision in the offer, it may be too late to fix it at the purchase and sale stage. A Court could force either the seller or the buyer to comply with the binding offer by completing the transaction if wording in the offer does not preclude that possibility. For example, a Court will not force a buyer to buy the subject property if the offer contains a liquidated damages clause (limiting the seller’s remedy to the amount of buyer’s deposit), so it would be prudent for buyers to include such a provision in any offer they sign. Similarly, sellers should make sure the offer includes a limitation on the buyers’ remedies as well. This is just one of many examples of various problems that could arise if you sign an offer without the advice and guidance from an experienced real estate attorney.
The real estate attorneys here at Gilmore, Rees & Carlson have over fifty years of combined experience and are available to discuss these issues with you whether you are buying or selling real estate.
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