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A principal might:-
This sort of arrangement might be structured so that family members:-
Two Powers of Attorney might operate respectively on opposite sides of a critical date to allow a ‘changing of the guard’.
For example, imagine an arrangement under which the ‘critical date’ is for each party to the marriage, their spouse’s 72nd birthday and use of following two Powers of Attorney and eachg spouse executes a Power of Attorney along these lines, where the same date is inserted in each Power of Attorney, being the 72nd birthday of their spouse:-
First Power of Attorney | "I appoint my spouse (and children as successor agents) and this Power of Attorney terminates on [date]…" |
Second Power of Attorney | “This Power of Attorney commences on [date]… I appoint my children as agents…” |
In a variation of this arrangement, perhaps under the Second Power of Attorney, their spouse may also be appointed an agent, with authority to act independently, whilst the children may only act by agreement (either with each other or perhaps also with the spouse, or perhaps under a ‘majority’ arrangement , such that a child may only act ‘by majority’, defined to mean with at least one co-agent unless there is only one eligible and appointed agent).
Under this arrangement:-
each party’s spouse would remain as their ‘primary’ agent until they spouse achieved 72 years of age
on the spouse’s 72nd birthday:-
This kind of arrangement may be structured so that the principal’s spouse may also perform tasks under the Second Power of Attorney.
To achieve particular outcomes it may be best to use two Powers of Attorney, namely a government form and a custom-made Power of Attorney.
For example, the custom-made Power of Attorney may be created to include a direction, to the following effect:
“…agents appointed under the Power of Attorney are authorized to use the Power of Attorney in the shape of a government form executed by me and bearing the same date as this Power of Attorney, solely for the purpose of fulfilling the terms of this Power of Attorney…”
The government form may or may not include reference to the custom-made Power of Attorney, depending upon how the principal wants to structure their affairs.
This sort of arrangement means that for example, the custom-made Power of Attorney might be expressed to commence at precisely the same time that the government form is certified to commence, so as to take advantage of certifications with respect to commencement.
For example, the custom-made Power of Attorney might say, so to speak:-
“this [custom made] Power of Attorney commences at the same as the government form bearing the same date..”
By creating a durable and a non-durable Power of Attorney, a principal can operate two different regimes.
One regime operates up to any point in time that the principal has capacity and the other commences at any time that the principal loses capacity.
This sort of arrangement permits the principal to:-
The idea below titled Using Two Powers of Attorney is a variation on this idea.
A principal might create two durable Powers of Attorney, prescribing two different regimes.
The suggested definition of the term “at any time during any period” in the Case Study - Between Two Dates may be helpful in constructing these terms.
The first regime may be designed to work if the principal has capacity and the other if the principal lacks capacity.
Casting them both as durable Powers of Attorney:-
Potentially, for example:-
Alternatively, for example:-
Under this arrangement, if the agent who is authorized to act independently at times when the principal has capacity is confident that the principal has capacity they may act on their own and if that agent is unsure if the principal they can prefer to act by agreement with other agents per the second Power of Attorney.
Central to this kind of arrangement may be a need to ensure the Powers of Attorney substantially mirror each other in various respects, for example with regard to the tasks authorized to be performed under the Powers of Attorney.
Considerations relevant to a Power of Attorney are inherently simpler where the principal authorizes an agent to act whether or not the principal has capacity.
This approach means that capacity of the principal is unlikely to be an issue of any magnitude at any time during the life of the Power of Attorney.
A principal who wants to further minimise this risk might for example, ensure that a suitable medical report is obtained at the time they create the Power of Attorney, confirming their capacity at the time at that time.
By comparison, an approach for example whereby an agent may only act if the principal has capacity or only if the principal lacks capacity means that:-
It may be sensible for a principal to create a Power of Attorney that under which an agent may only act if the principal has capacity or only if the principal lacks capacity, depending upon the needs and preferences of the principal.
Inclusion of checks and balances might be useful.
Checks and balances include provisions dealing with:
Notably in New York,[1] a person may appoint a monitor with authority to inspect accounts and similar.
This is unique as within the Six (6) Greater States.
In the other states, there is nothing to prevent a principal from creating a Power of Attorney under which an agent is given similar authority to a monitor in New York.
Checks and balances may be particularly useful when creating a durable Power of Attorney.
Options with respect to checks and balances are explored under the heading There Are Risk Management Practices Involving The Terms Of The Power of Attorney.
If a key person is integral to the affairs being the subject of a Power of Attorney it may be helpful to use two Powers of Attorney:-
The two Power of Attorney might for example, contain directions along these lines:-
1st Power of Attorney | This Power of Attorney does not operate at any time that Mary Smith is not eligible and appointed under this Power of Attorney and my Power of Attorney dated the same date as this Power of Attorney which appoints John Smith and David Smith as my agents is to operate at any time that Mary Smith is not eligible and appointed under this Power of Attorney" |
2nd Power of Attorney | “This Power of Attorney does not operate at any time that Mary Smith is eligible and appointed under the Power of Attorney I have executed today dated the same date as this Power of Attorney which appoints Mary Smith as my agent and if Mary Smith is not eligible and appointed under the Power of Attorney I have executed today dated the same date as this Power of Attorney, this Power of Attorney appointing John Smith and David Smith as my agents operates at any time that Mary Smith is not eligible and appointed under that *Power of Attorney" |
Relevant wording might include:-
Conditions control the right of a candidate to be appointed as an agent.
For example, a principal might appoint a grandchild as a successor agent) on terms that they become entitled to have certain expenses paid for them (i.e. educational expenses), for as long as they continue to act in a manner consistent with achieving that qualification by say, 25 years of age
This sort of a scheme would operate as an incentive for grandchildren, who would have their education or perhaps other expenses paid, if they enter university and any time thereafter, as long as they remain committed to acting as an agent if required.
Considerations relevant to this sort of arrangement might include:-
It may be useful to consider the content of the legislation in the various Six (6) Greater States when drafting particular provisions in a Power of Attorney, for example:-
There are many more examples in this Wiki.
A principal might appoint, for example:-
A principal might prescribe in the Power of Attorney:-
These directions seem likely to make it more difficult for large transactions to perform outside the purview of all agents and protect the interests of the principal’s spouse.
If an agent was authorized to perform transactions on a certain bank account, a direction that:-
A principal might prescribe in respect of a specific agent operating a bank account:-
Equally for example, a direction to the effect that only $1,000 may be withdrawn on any given day would seem to cover the same ground as the limitation noted above.
Imagine a Power of Attorney in Florida for a person[3] that contained a direction to the following effect:-
“…this Power of Attorney is to become effective on 1 January 2042.
In Florida, this Power of Attorney would fall afoul of §709.2108(3), which states:
"…a Power of Attorney is ineffective if the power of attorney provides that it is to become effective at a future date or upon the occurrence of a future event or contingency…”
A principal might authorize a specific agent to operate a specific bank account and:-
A principal might:-
A principal might appoint two agents with authority to perform three tasks and three potential successor agents who are authorized to replace an agent who becomes ineligible.
The principal might include limitations to the effect that:
A principal might limit the authority of an agent to sell assets worth in excess of $50,000, unless a suitably qualified accountant agrees the sale is in the best interests of the principal.
Under a Power of Attorney excluded from the ambit of the legislation - click here to read more. ↩︎
Taking into account for example that to work in Florida, that definition would need to ensure there is no suggestion the word “operate” implies something less than “becoming effective” for the purpose of §709.2108(3). ↩︎
Being a Power of Attorney for a person that is not excluded from the ambit of the legislation - click here to read more. ↩︎