by Attorney Alyson C. Fudge, Founder of the Lowcountry Law Office on Aging, Mental Health & Disabilities, LLC.
One of the most commonly used terms I hear from the children of seniors is “Power of Attorney.” Typically, a statement begins with the following expression: “I’m Mom’s Power of Attorney, so I can…..” With banks, lawyers, courts, doctors, social workers, hospices, nurses, insurance companies and other professionals using the term “Power of Attorney” early and often, it’s easy to see why some people are confused. First of all, a Power of Attorney is a document (not a person), and there are actually two different types of Powers of Attorney.
The South Carolina Health Care Power of Attorney was written by our state legislature in Columbia, and it is the document in which you designate a person to be able to talk to doctors and other medical professionals, receive your personal medical information, and make medical decisions (including end of life decisions) on your behalf if you are still alive, but are unable to make those decisions for yourself. The person appointed to assist you is called an “Agent.” Whereas only one Agent may serve at a time, you are allowed to pick a total of three people—the primary (or first choice) Agent, and two Alternate Agents.
The other type of Power of Attorney is called a Durable Power of Attorney, and again—the person chosen to make decisions is called an “Agent.” The purpose of the Durable Power of Attorney is to appoint someone who has the legal authority to handle your finances, make sure bills are paid, communicate with any service providers, deal with any real estate that you may own and also apply for or manage government benefits on your behalf—again, if you are alive, but are unable to manage these issues for yourself. As these documents cover different types of decisions, it is not a matter of having one or the other—each person needs to have both.
In addition, both of these documents need to be signed before you start to need assistance, just as your homeowner’s insurance policy needs to be purchased before your house catches on fire. If you wait until you need assistance, and you do not have documents, a Probate Court Judge will be more than happy to appoint decision makers for you and oversee the process of managing your affairs.
One of the main points of confusion is something we call “revocability.” All Powers of Attorney are revocable documents. That means that the authority which the documents grant can be taken back or “revoked” by Mom or Dad as easily as it was given. Sometimes, Mom or Dad become sensitive or maybe even a little bit paranoid about the people closest to them who are spending the most time trying to help. Therefore, the Agent can only act so long as Mom or Dad allow them to act. If Mom or Dad revokes the Powers of Attorney (which can be done verbally), the authority given in the documents ceases to exist. Therefore, no Agent can force someone to do or not do something against his or her will simply because that person signed a Power of Attorney.
Another problem can arise when adult children fail to realize that a Power of Attorney is not a license to steal or help themselves to Mom or Dad’s money. When serving as an Agent under a Durable Power of Attorney, there are actual laws and legal requirements which govern how an Agent can spend money when acting under a Durable Power of Attorney. The Agent can only spend the money on the Principal (the person who did the Durable Power of Attorney and appointed the Agent—i.e. Mom or Dad). The Agent cannot spend the money on him or herself. If Mom or Dad want to pay an adult child to provide care or oversight, transportation, or any other services, the answer does not lie within a Durable Power of Attorney.
However, an agreement known as a Family Care Plan can absolutely address these issues in a way that protects both Mom or Dad and the adult child providing assistance. The final issue which can arise is when people choose to go to an attorney who does not focus on this area of the law to obtain Powers of Attorney. In that circumstance, they are often given a short, generic Durable Power of Attorney which the non-elder law attorney finds online, and the document is lacking so many substantive provisions that it is essentially useless. Just like in medicine, when you have a specialized need, it is imperative to seek advice from someone who actually focuses on the area of practice concerning your need. As elder law attorneys, we regularly hear from the adult children of a parent who obtained documents from a well-meaning real estate or divorce attorney who does not practice in this area, and therefore they do not understand what government agencies or the Probate Court are going to consider to be important or necessary in order to use the document for the purpose for which it is intended.
Once the principal dies, both Powers of Attorney die with them. Just as living people have Agents, deceased individuals have Personal Representatives who, after being appointed by a Judge, have the authority to act on behalf an Estate. The two roles do not overlap, as one applies to a living person and the other applies only to the assets owned by a deceased individual.