- On November 1, 2016
Many of our clients have experienced the changes that occur in their parents as they age. Often, the ability of the parent to manage his or her financial affairs greatly decreases over time. If the parent planned ahead, he or she signed a power of attorney for property, naming an agent to take over when the parent can no longer handle the daily tasks of life, such as paying bills and writing checks. If you are a child acting in that capacity, or if you believe that it may be time to do so, you have certain legal duties and responsibilities that you must be aware of to best take care of your parent and protect yourself.
An agent acting under a power of attorney for property has a strong fiduciary duty to act in the best interest of the principal (in this case, the parent). The Illinois Probate Act goes into great detail as to what this duty means, and specifically states that the agent must utilize due care, and act with competence and diligence. If the agent fails in those duties, then he or she can be held liable for negligence. This means the agent must act in a way that benefits the principal, which equates to not only paying bills and writing checks, but also managing the assets wisely, eliminating unnecessary costs, monitoring the assets, and consulting experts as needed. Additionally, the agent must maintain detailed and accurate records, including copies of all receipts and disbursements, as well as documentation of significant actions. The agent must be prepared to provide this information if questioned by the principal or other interested party, such as a family member.
Since the responsibilities are so great and expansive, an acting agent should consult an attorney to ensure that he or she is properly fulfilling all of the duties required by such an important role.
Additionally, since the principal can greatly expand or limit the powers granted to an agent under a power of attorney for property, an attorney should be consulted when completing these important legal documents. The attorneys at Kelleher & Buckley, LLC have extensive experience not only in preparing these forms, but also in providing guidance to people acting as an agent under a power of attorney for property. For more information, please contact Estate Planning Co-Chairs, Linda Fine or Robert Holland, at (847) 382-9130.