When I work with clients to create a plan, one of the most important elements we discuss is who will be carrying out their wishes.
In general, my clients find that they need to fill five primary positions: Power of Attorney, Medical Power of Attorney, Executor, Guardians, and Trustees. These are your “fiduciaries.” Many clients have heard the term “fiduciary” before, but often ask me to explain what it means. Put simply, a fiduciary is someone with a legal duty to handle certain affairs on behalf of someone else. Most importantly, a fiduciary is obligated to put the interest and welfare of the person for whom they are responsible above their individual interests.
This post will focus on Power of Attorney and Medical Power of Attorney. The other three fiduciaries will be discussed in a future post.
A Power of Attorney and Medical Power of Attorney are documents prepared to give clients peace of mind should they be unwilling or unable to make decisions on their own. These documents allow a client to name an agent who will be responsible for making decisions. Once an agent is named, the agent will have a legal authority to act in the client’s name depending on the scope of the powers.
Unlike Guardianship, which will be discussed in a future post, a power of attorney does not reduce or diminish a client’s rights. It merely allows another to do things that the client wants them to do; it does not prevent a client from doing things they want to do for themselves.
In Texas, a power of attorney can be as broad or as specific as a client wants and can be general or durable.¹ The client has the ability to choose the powers they give in a power of attorney and set any expiration date or none.
For example, a limited power of attorney is done when a couple is buying a house and one person is not able to attend the closing. Such a power will allow one spouse to act on behalf of the other spouse and will end once the closing is done. However, a client who anticipates that they may be incapacitated in the future could sign a durable power of attorney that grants powers to their agent upon their incapacity and then ends when the client dies.
A medical power of attorney gives someone else the ability to make medical decisions about medical treatment for a client who is not able to do so. However, treatment cannot be given or withheld if the client objects. A medical power of attorney does not replace a Living Will, or Directive to Physicians. The Living Will, or Directive to Physicians, allows the client to make their own decisions regarding the use of life sustaining treatments when their condition is terminal or irreversible and death is imminent.
No one can force anyone else to act as their agent. It is important to speak with an individual you are considering naming as your agent and discuss your wishes with them. The person you chose as your agent can have considerable power to act on your behalf, and you want to make sure that you are on the same page about your expectations. You should also ask your estate planning attorney for guidance when choosing potential agents.
¹For a detailed discussion, see http://texaslawhelp.org/resource/powers-of-attorney?ref=LE7t8