The holidays are here. While you are carefully and cautiously planning your seasonal plans during this unusual year, it is also a good time to consider estate planning. The wrong time to handle such matters is at someone's bedside in the hospital, or worse, discussing virtually with a medical doctor, nurse, or banker who controls accounts or safe deposit boxes. Having these tough conversations will not only ensure your wishes are carried out should you become incapacitated or pass on, but it can also protect those who are left to carry out those wishes.
Perhaps the most important decision in this process is selecting the right person to act as executor of an estate, or agent for a power of attorney, guardian, or trustee of the assets of your minor children or elderly loved ones. A common error people make is asking someone who does not fully comprehend the role of a fiduciary. This can lead to confusion and disagreement among family members in your death, or even put someone who agreed to such a position out of a sense of kindness and honor, at risk of serious criminal consequences including felony misconduct charges.
A fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties. Typically, a fiduciary prudently takes care of money or other assets for another person. Anyone who assumes the role of fiduciary makes a solemn, legally binding promise to act solely in the best interests of the principal. This is not a concept limited to the agents of an incapacitated or deceased individual. Many licensed professionals act as fiduciaries every time they act on behalf of a client. Some examples include attorneys, CPA's, trust departments at a financial institution, and real estate agents. These licensees have had training in acting as a fiduciary.
Appointing a close family member or friend of the deceased or incapacitated who has no training or experience in fiduciary acts can place that person in harm's way. Accusations can arise against fiduciaries simply because they failed to record what they did and the reasons why. Family members and business partners' friends serving as an attorney in fact (power of attorney), independent executors administering the assets of an estate, and guardians of minor children with access to their assets are all groups in which many very serious allegations are asserted every year. These often well-intentioned individuals have been placed in these positions without fully understanding what they were agreeing to.
There are also cases in which a close friend or family member who is originally brought on as a caretaker for a disabled or elder person gains access to bank accounts or other important documents and begins making decisions or transactions that are not in the best interest of the principal. This is stealing and can be classified as felony theft with serious legal repercussions.
Anyone without a proper understanding of the responsibilities that come with these positions, simply isn't a good choice when selecting a fiduciary.
The Fowler Law Firm, P.C. offers a free initial consultation to anyone needing help with estate planning or selection of a fiduciary or power or attorney.
About your authors:
Davis Oliver serves as The Fowler Law Firm PC Managing Attorney Georgetown, counsels daily with many private employers and represents them in trial.
Laura Fowler is the Managing Shareholder of The Fowler Law Firm PC. She is a regular speaker to real estate and business groups and an instructor licensed to teach continuing education courses required by the Texas Real Estate Commission.
About The Fowler Law Firm PC: Attorneys with The Fowler Law Firm PC proudly donate their talents and resources to many area charities and teach courses in Continuing Education Click HERE for more information. Follow our charitable adventures on our Facebook or LinkedIn pages.