Before imposing a condition in respect of the potential appointment of a candidate for appointment as an agent, successor agent or sub-agent, a prudent principal might consider whether a direction or limitation may be used instead of a condition.
That said, it is not impossible for a direction or limitation to control the appointment of a candidate for appointment as an agent, successor agent or sub-agent, merely that directions and limitations deal with matters without necessarily affecting the eligibility for appointment of a candidate.
Legislation in the Six (6) Greater States dealing with termination of a Power of Attorney for a person as against an agent does not mention termination of an agent’s appointment in the event that the agent’s breaches a condition of appointment.
This is illustrated in the Summary Table - Legislation Grounds For Termination, which addresses termination as against an agent and termination of the Power of Attorney separately, noting that the legislation only refers to termination in accordance with its terms in respect of termination of the Power of Attorney.
In this regard, it is curious that:-
The position is curious in Texas and Florida because only Texas and Florida make provision with respect to termination of a Power of Attorney according to its terms and in both these states, the provision dealing with termination of a Power of Attorney according to its terms are directed to termination of the Power of Attorney, not termination as against an agent, the effect of which seems to falls short of the work necessary to effect termination of an agent’s appointment if the agent breaches a condition of appointment, notwithstanding that this does not prevent the Power of Attorney terminating according to its terms, merely gives it no legislative recognition in this context.
In Pennsylvania and Illinois where there are no substantive termination provisions in legislation, inclusion of a condition in a Power of Attorney would require the Power of Attorney to deal with that termination in all respects.
Accepting that legislation governing Powers of Attorney for a person in the Six (6) Greater States makes no mention of conditions, a prudent principal would consider carefully how they deal with conditions, presumably in full terms in their Power of Attorney.
Dealing with conditions might involve for example:-
A principal may for example, require that a person be married to a specified person, or own certain property, or engage in certain activities, so as to qualify for appointment or remain appointed as an agent, successor agent or sub-agent.
It would be important to ensure for example, that conditions of this kind accord with the other terms of a Power of Attorney including in particular, terms dealing with appointment of agents and similar.
Imagine a Power of Attorney containing individual conditions along the lines:-
In this example, Mary is first choice, Bill is second choice, followed by John and Peter.
Examining whether for example, a condition has been satisfied might include consideration of matters like:-
Defining when a condition must be satisfied may be best achieved using one of the following six (6) alternatives:-
A condition that must be fulfilled:-
The ‘six-type’ approach above does not account for other forms of conditions, for example ‘staged conditions’ involving a series of criteria required to be satisfied, staggered over time.
For example, a ‘staged condition’ might involve the candidate in respect of whom the condition applies to have completed a university degree by 31 December 2025, married by 1 January 2027 and remain married as at 30 December 2030.
Anyone attempting to define a ‘staged condition’ might be assisted by consideration of the concepts above.
In Texas, Illinois and Florida, provisions dealing with certification of a contingency seem to offer scope for an agent to certify certain matters which probably include an assurance that they are not ineligible by virtue of breach of any condition.
This is less applicable in California, New York and Pennsylvania where:-
When drafting conditions, focus on using the name of the person in respect of whom the condition applies. For example:-
References like ‘brother’ or ‘sister’ should be avoided in favour of full names and where names are mentioned inclusion of an address is also warranted, unless specified elsewhere in the Power of Attorney
Dates and times are important and so rather than expressions like “12pm (GMT) in ………. on May 12, 2029 in Austin, Texas” preferred over say, “May 12, 2029”.
The wording of conditions is a delicate exercise with serious ramifications.
A simple test to apply when wording a conditions is to determine if any other construction other than the intended construction could be given to the condition or uncertainty exists as to its construction and operation.
There are literally hundreds of examples of ways to draft better conditions, these are just two suggestions.
Many lawyers would recommend drafting of conditions and related provisions in a Power of Attorney be done by a lawyer, given the impact they can have upon the effectiveness of a Power of Attorney and the need to appreciate their effect as part of the whole terms.