• Don’t be afraid to start the conversation. Whether you are a parent talking to your children, a husband talking to a wife, or an adult child talking to an aging parent, bringing up the topic of death and disability can be difficult, but it is an important conversation to have. A study by The Hartford found that parents were more willing to discuss estate planning issues than their children.
• Make sure you or your loved ones have done estate planning. All estate plans should include, at minimum, two important estate planning instruments: a durable power of attorney and a will. The first is for managing property during your lifetime, in case you are unable to do so yourself. The second is for the management and distribution of property after death. Revocable (or “living”) trusts can also help you avoid probate and manage your estate both during your life and after you’re gone. In addition, you or your loved ones should consult with an estate planning professional about the best way to minimize estate taxes. For more information on estate planning, contact Jill E. Sugarman, Esq. at 401-421-5115 ext. 215 or by e-mail at JSugarman@McLaughlinQuinn.com.
• Plan for the worst. You and your loved ones need to be prepared in the event that one of you becomes disabled and will no longer be able to make your own decisions. The durable power of attorney mentioned above is an important instrument. You will also need a health care proxy (sometimes called a health care power of attorney), which gives someone else the medical authority to communicate your wishes about medical treatment. For more information on medical directives, contact Jill E. Sugarman, Esq. at 401-421-5115 ext. 215 or by e-mail at JSugarman@McLaughlinQuinn.com.
• Make sure you or your loved ones draw up a list to help your executors carry out your estate plans. The list should contain information on the location of assets, such as bank accounts, property, and stocks and bonds; the location, keys, and passwords to any safe deposit boxes; the identity of important professionals who might have information about your estate; and the location of important records, such as loan, insurance, and tax documents. The list can also contain things you want done immediately after you die, such as calling relatives or notifying employers.
• Determine you or your loved ones’ wishes regarding funeral arrangements. You may want to pay for your funeral ahead of time to take the burden off of family, but you need to be careful and shop around. Contact Jill E. Sugarman, Esq. at 401-421-5115 ext. 215 or by e-mail at JSugarman@McLaughlinQuinn.com for information and tips on making advance funeral arrangements. If you can’t make arrangements ahead of time, put your wishes in writing so the whole family knows what you want.
• Figure out who is going to get what personal property and heirlooms. Preparation and planning in advance can avoid family squabbles after you or your loved ones die. For more information contact Jill E. Sugarman, Esq. at 401-421-5115 ext. 215 or by e-mail at JSugarman@McLaughlinQuinn.com.

A power of attorney allows a person to appoint someone called an “agent or “attorney-in-fact” — to act in his or her place for financial purposes when and if the person ever becomes incapacitated. A power of attorney can name one agent or it can require two or more agents to act together.

If you are acting as a co-agent under a power of attorney, but you and your fellow agent disagree on a course of action or one party has stopped participating in decision making, what can you do? The first thing is to check the wording of the power of attorney document to see if it sets up a procedure for resolving disputes. If the power of attorney itself doesn’t help, you should contact an elder law attorney. The attorney can tell you if your state’s power of attorney laws offer any guidance. There may be a state statute that deals with disputes.

If the dispute still cannot be resolved, the final step may be to file a petition in probate court to let the court decide it. Or if the court finds that one of the agents is not acting according to the incapacitated person’s best interests, it can revoke the agent’s authority. Unfortunately, taking the matter to court takes time and money.

If you are creating a power of attorney and want more than one agent to share responsibility, but want to minimize conflict, you can name two agents and let the agents act separately. Naming more than two agents can get cumbersome and make communication difficult. An alternative to naming co-agents is for the power of attorney document to name agents in sequence. The first-named agent acts alone, but if she cannot serve for some reason, the next person on the list will serve.

Clarence Smith, Sr., named his son, Clarence Smith, Jr., as his agent under a POA. When his father no longer wanted to manage his own finances, he asked Clarence Jr. to step in as his agent. Clarence Jr. reviewed his father’s account activity and became suspicious about some withdrawals from a bank account that Clarence Sr. owned jointly with a friend from his retirement community.

Acting as his father’s agent under the POA, Clarence Jr., asked Bank of America to transfer $65,000 from the account into a new account that listed only his father as the owner. Before doing so, Bank of America contacted the other person named on the account. When she told the bank that she did not want the funds withdrawn and also accused Clarence Jr. of stealing his father’s money, Bank of America refused to honor Clarence Jr.’s request. The other account owner then withdrew all of the funds from the account and placed them into her own account, effectively preventing Clarence Sr. from accessing his own money. Clarence Sr. died several weeks later.

Clarence Jr. sued Bank of America under a Florida law that imposes penalties on financial institutions that refuse to honor reasonable requests from agents named in properly executed POAs. In November 2009, after a week-long trial, a Florida jury returned a verdict against the bank and awarded $64,142 to Clarence Sr.’s estate. The jury found that Bank of America had not acted reasonably when it rejected Clarence Jr.’s request, even though the joint owner of the bank account had not agreed to the release of the funds.

Bank of America plans to appeal. “We believe that neither the facts nor the law support the verdict,” said spokeswoman Shirley Norton.

While this case clearly illustrates the conflicts that can arise through the use of a POA, it also raises the issue of the proper use of joint bank accounts in estate planning. Under most state laws, when two or more people own “joint” bank accounts, each of them has the right to the entire account, no matter whose money is actually in the account. While joint accounts can often be useful, sometimes, as in this case, joint owners or their agents can disagree about the use of funds in the accounts. When that happens, the party who makes it to the bank first often wins. A qualified elder law attorney, such as Jill E. Sugarman, Esq. of McLaughlin & Quinn, LLC, can explain the pros and cons of joint ownership, can draft an effective POA, and can assist family members when disputes arise.

For more information about durable powers of attorney and joint accounts, contact Jill E. Sugarman, Esq. at 401-421-5115 or by e-mail at jsugarman@mclaughlinquinn.com.

A health care proxy allows you to appoint someone else to act as your agent for medical decisions. In general, a health care proxy takes effect only when you require medical treatment and a physician determines that you are unable to communicate your wishes concerning what that treatment should be. Appointing someone to serve as your agent helps ensure that your medical treatment instructions will be carried out.

While a health care proxy serves to appoint an agent to speak for you, you can also use it to give the agent guidance about your medical wishes. Following are some issues that can be addressed in a health care proxy:

• The name of the person authorized to act for you. We always recommend appointing an alternate as well.
• If you are terminally ill, in a coma, or have brain damage with no hope of recovery, you can explain the kind of treatment you don’t want. For example, do you want feeding tubes, resuscitation, dialysis, or blood transfusions?
• Whether or not you want to be kept alive by machines if you are in a persistent vegetative state.
• Under what circumstances you want pain medication to be administered.
• Whether you want to donate your organs.
• Whether you want to be cremated or buried and where and how your remains should be disposed of.

Whatever choices you make, you should take time to consider your health care wishes before drafting a health care proxy. For this reason, signing a generic hospital form is not a good idea, as such a form will not take your individual wishes into account. In addition, if you already have a health care proxy as a part of your estate plan, the generic form will revoke your more personal health care proxy.

The elderlaw attorneys at McLaughlin & Quinn, LLC’s Law For Life can help you create a document that addresses your situation.  For more information, visit us at McLaughlin & Quinn, LLC Law For Life or contact Attorney Jill E. Sugarman at 401-421-5115 x215 or by e-mail at jsugarman@mclaughlinquinn.com.