I have read others’ opinions implying the relative lack of importance of the Durable Power of Attorney for asset management (“DPOA”) as an estate planning tool — as if it were somehow a “throwaway” or an “extra” document. Even in my own counseling of clients, I often get the question: I am asking you to prepare a trust. I will also have a Will. Why do I also need this document?” In the past I explained that the “durable power of attorney ‘fills in the gaps’ left by other documents.”
My explanation was certainly true — but the significance of this document goes much further. After my own experience caring for a parent and using my own estate planning document, I can say this: It is an extremely powerful and useful tool. Trusts are important, as are Wills. However, the DPOA for asset management is indispensable. As a caregiver I would have been lost without that document, and I otherwise might have been required to open an expensive conservatorship.
An example is in order: My first use of the DPOA was with a major credit card company. With the onset of her dementia, my Mother left a tangled web of charges and confused billing. The company would not even speak to me until I produced the DPOA. After receiving the document, they resolved the issue without incident. If I was unable to provide this document, I would have been unable to resolve the issue.
I continued using it throughout my Mother’s disability, all the way up to the time of her death. I was able to access phone records and resolve billing issues. Unfortunately, banks were unwilling to honor my form, which is not unusual. It is possible under some circumstances to compel a party to accept a durable power of attorney in California, under Probate Code section 4541(f), but the time and expense involved (yes, even for an attorney!) can make enforcement impractical or undesirable. Banks usually insist upon their own form. However, in a worst circumstance, it may still be possible to force them to accept the form.
Even forgetting that problem, this powerful document was indispensable. Yet, there must be care in both preparing DPOA, and in selecting the appropriate agent
I will address these issues in later posts.