Thursday, July 3, 2014
Angela M. Vallario (University of Baltimore School of Law) recently published an article entitled, The Uniform Power of Attorney Act: Not A One-Size-Fits-All Solution, 43 U. Balt. L. Rev. 85-118 (2014). Provided below is a portion of the author’s introduction:
A power of attorney is a staple of the modern estate plan, providing a simple way to avoid a guardianship and allowing an agent to manage a principal's assets when necessity or incapacity requires it. The nature of the power of attorney is to give an agent legal authority to act on the principal's behalf for financial matters. However, abuse by agents has caused reluctance among third parties to accept power of attorney documents, and this, in turn, has caused uproar for estate planners and their clients.
In response to this agent abuse and subsequent third party reluctance to accept power of attorney documents, the nation's attorneys have been forced to share war stories, as well as tricks and solutions, in an effort to minimize the problems and embarrassment created when power of attorney documents are prepared and executed one day and not honored the next. In some cases, attorneys have even begun to advise their clients to use certain financial institutions likely to honor the legal-drafted document and to avoid those institutions reluctant to do so. Additionally, attorneys have been forced to contact the legal departments of banks, threaten suit, and in some situations use a costly and time-consuming alternative, the guardianship.