Lifecare planning for poa website


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Lifecare planning for poa website

  1. 1. Lifecare Planning by Use of Powers of Attorney Hanlon Niemann, PC 3499 Route 9 North, Suite 1F Freehold, NJ 07728 (732) 863-9900 Elder Law, Estate Planning, Asset Protection and Veterans Benefits Attorneys
  2. 2. Fredrick P. Niemann, Esq. Fredrick P. Niemann offers his clients nearly 30 years of accomplished practice in the law. He is a member of the National Academy of Elder Law Attorneys, the Guardianship and Conservatorship Committee of NAELA, Monmouth County Probate and Estate Committee and the Monmouth County Chancery Practice Committee. He is a certified will case mediator approved by the NJ Supreme Court. Mr. Niemann is one of the select few attorneys in NJ, accredited by the Veteran’s Administration to apply for Aid and Attendance benefits for Veterans and their spouses. He has been listed by the prestigious Martindale-Hubbell as “peer review” rated for 2008. A MartindaleHubbell rating attests to a lawyer’s legal ability and professional ethics, it reflects the confidential opinions of the bar and judiciary.
  3. 3. Legal Wit What do you get when you cross a librarian with a lawyer? A lot of information you need, but nothing you can understand. When questioned by a prospective client as to what a contingent fee is, the lawyer answered, “A contingent fee to a lawyer means, if I don’t win your case, I get nothing. If I do win your case, however, you get nothing.”
  4. 4. Cont. How can you tell when a lawyer is lying?  His lips are moving. The first thing we do, Let’s kill all the lawyers Shakespeare
  5. 5. Today’s Topic EFFECTIVE LIFE CARE PLANNING through a • Power of Attorney • • • What Are They? How Do They Work? Do You Need One?
  6. 6. Why have a Power of Attorney? • Excellent Planning device for individuals concerned about their present and future physical and/ or mental health and independence • Allows for continuous decision making for the benefit of a person who is mentally or physically incapacitated
  7. 7. What is a Power of Attorney a/k/a POA? • It is a document appointing another person ( an individual/ agent) to act on your behalf with legal authority on your behalf
  8. 8. What are the Formalities of a Power of Attorney? • It must be a written document • Describing the power(s) being giving to the agent • The person who is giving the POA must be competent • It must be signed / notarized • It must be acknowledgedestate deed, as a formal legal document (ie., real will, trust)
  9. 9. What is meant by the term “competent” or “legal capacity” Generally and simply stated, it means: Does the person giving the Power • • • Understand the purpose of the Power Understand the general consequences/ effect of giving a Power(s) Understand & approve of his/her agent as the person receiving the Power of Attorney
  10. 10. In addition, the Power of Attorney must be: • Voluntarily given • And, the person giving the POA must be under no coercion, duress or undue influence
  11. 11. Can you limit a POA Answer: Yes
  12. 12. The Power you give can be Limited or Unlimited in Authority and in Time • Example: The agent’s authority is limited by the document to just: • • • • • paying bills Banking filing tax return(s) managing/making investments representation before Social Security, Medicare, & Government Benefit Agencies Cont.
  13. 13. Limited Power of Attorney Cont. • Enter into contracts • Select and change health insurance plans • Select, consult with physicians and professional advisors
  14. 14. What is an Unlimited POA? • An unlimited POA allows your agent to be “you” to act in all ways that you would act • Can be unlimited in time as well
  15. 15. The Power must specify the duration of the POA • Limited time period ie: One year, one week, one day time limit, etc. Unlimited time period No expiration date specified Lifetime or until revoked by grantor
  16. 16. All Powers of Attorney can be REVOKED BY GRANTOR AT ANY TIME WHILE COMPETENT
  17. 17. When Does a POA Become Effective • • • Grantor must decide the start date Can be “effective” immediately upon signing or contingent upon the event of incapacity or disability Examples of incapacity / disability may be: stroke, heart attack, Alzheimer’s / Dementia unconsciousness
  18. 18. Which Type of POA Should You Use • The answer depends on: Your health Your relationship with your POA His/ Her trust worthiness How you feel about giving a POA in general
  19. 19. • Other considerations to giving a POA: • Your independence/ dependence on others, now and in the foreseeable future Which leads to the next issue. . .
  20. 20. Who should you select to be your POA? and • What?are the risks and benefits of having a POA Did you know? ... continued
  21. 21. No One Has the Automatic Legal Right To Act for Another • Not a : husband for a wife nor wife for a husband Parent for an adult child or adult child for parent Not a sibling for a sibling Here’s a real life story cont’d.
  22. 22. Case Study • Clients are husband and wife, mid 60’s who sign a contract to sell home. Husband, while cleaning windows falls off ladder, hits his head, and goes into a coma. Who legally, can sign the deed to close title on the house for the husband? Wife? Children?
  23. 23. Answer, neither • Hanlon Niemann petitioned court for a limited guardianship to allow wife to sign deed in order to close title and avoid being in default under contract.
  24. 24. Example #2 Adult child, disabled from birth/early childhood, is now over the age of 18 and requires public benefits. Can Mom or Dad handle child’s affairs? Answer: No
  25. 25. What are Considerations for Selecting a POA? Select someone: like yourself reliable trustworthy good judgment will honor/ respect your values, instructions, and priorities (cont.)…
  26. 26. Considerations cont. • Can be a family member or non family member • Can be an institution or corporate representative • Representative of an institution
  27. 27. Benefits vs. Risks: • Benefits of a well written POA 1. Avoids guardianship or conservatorship (guardianships and conservatorships) (Why does this matter?) Guardianships and conservatorships are formal legal proceedings and can cost $4,500-$7,500 or more for legal, physician and court fees, ongoing court supervision and accountings
  28. 28. Why Do You Need a POA? • Avoids having the court select someone other than your choice. • It gives you peace of mind
  29. 29. What Are the Risks? • Your agent steals from you • Your agent abuses his/ her authority • Agent makes decisions you don’t agree with
  30. 30. Can you Avoid or Reduce Risk? (Answer: Yes) Do nothing pick a trustworthy person require a bond require annual accountings with disclosure to family or third party limit effective date of POA to “event of disability cont
  31. 31. Reducing Risk Cont. revoke your POA and select another person (can always revoke, until your last breath or you are determined to be mentally incompetent Consider giving original and copy of Power to a trusted person or your attorney who is not the designated POA, until disability.
  32. 32. Miscellaneous Points of Interest • Death terminates POA, then Last Will and Testament or a trust controls assets, income and final arrangements of your estate
  33. 33. POA can include a power of the person as well as power over finances and assets • This is a very important concept • Power to decide non financial matters for a person is critical Example : life and healthcare decisions and planning, including • Selection of a physician Cont
  34. 34. • Care Planner • Professional Advisors • Location of residence and living environment • Including social, medical
  35. 35. Responsibilities of the POA • The POA must maintain accurate records of all financial transactions and may be required to account to principal or guardian of the estate
  36. 36. for NJ POA to be durable • In order youra incapacity), it must contain (survive language “ this POA shall not be affected by the disability of the principal” effective only upon • A POA that becomes disclose this predisability must clearly condition and contain a method whereby incapacity will be determined (ie., two independent doctors, judgment of court, evaluations or similar process)
  37. 37. Legal Liability of the POA to Third Parties • A POA acts as an agent and assumes the obligations of a fiduciary under terms of the power • An agent can be held negligent to the principal because of a breach of fiduciary relationship within scope of the POA • Reasonable level of diligence, skill and competence among equally situated individuals/ agents Cont
  38. 38. Legal Liability Cont. • Agent generally has no special duty to third persons by reason of agency relationship • Liability attaches only for his own conduct to others
  39. 39. Fredrick P. Niemann, Esq Hanlon Niemann P.C. 3499 Route 9 North, Suite 1-F Freehold, NJ 07728 732-863-9900