Is It Too Late for a Durable Power of Attorney?

            I recently got a call from John who was concerned about his mother, Susan. She had been forgetting to pay her bills and had recently suffered a bad fall. John realized that his mother would increasingly need his help in the coming days and months, yet he had no legal authority to do so.  John wanted to know if I could help his mother get a Durable Power of Attorney in place. I told John that it may be too late.

            Powers of Attorney can only be signed while you still have the capacity to understand what you’re signing and that you’re giving someone the power to handle your finances without court supervision.  In fact, you must have more capacity to sign a Power of Attorney (contractual) than you must have to sign a Last Will (testamentary). Once you no longer have this capacity, you cannot sign a Durable Power of Attorney. And that’s good public policy, right? We don’t want people who don’t understand what they are signing to give away management of their financial affairs to another.

            Whether or not you have capacity to sign documents often turns on the facts. Factors like your current health, medical history, and recent behavior should be taken into account. If you have advanced dementia or Alzheimer’s and live in a nursing home, it’s likely too late. However, if you have recently been diagnosed, and have “good” days and “bad” days, it may not be too late. One possibility is to wait for a “good” day and schedule an appointment with your general physician on the same day as an appointment with your Estate Planning attorney. Have your physician conduct a Mental Status Exam, which involves asking you a series of questions to test your competency. Take the findings of that exam to your attorney on that very same day, and ask to sign a Durable Power of Attorney. Your attorney will likely review the exam results and may spend some time talking to you and asking you questions to be sure for themselves that you are competent to sign. While this course of action is a possibility, many attorneys will not be open to preparing a Power of Attorney when your competency is even in question.

            Of course, the best and easiest time to sign a Durable Power of Attorney is before you actually need it. Before you start forgetting things, before any kind of diagnosis. If you do not have one in place, you should take care of that immediately. Having one prevents an embarrassing and expensive Guardianship proceeding that’s required if you can’t handle your own finances down the road. The simple and inexpensive Durable Power of Attorney can save you and your loved ones so much heartache.