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Dear Mr. Premack: About 10 years ago, my aunt signed a
power of attorney naming me as her agent. She has always been in good
health, and did not want me to do anything while she could take care of
herself. So her power of attorney said that it "did not become effective
until" she became disabled. A few months ago, she had a stroke, and is in
a nursing home unable to speak or sign her name. I took the power of
attorney to her bank, but they refuse to give me access to her account.
They say that ten years ago, the kind of power of attorney she made was
not legal in Texas so it is not legal today. Can you give me any guidance
here? Shouldn’t my aunt’s wishes be followed? – C.M.
The power of attorney you speak of is called a "springing" power of
attorney. A person creates it while still healthy, in anticipation that
some day she may become disabled. When the disability occurs, the power of
attorney "springs" into action so her agent can take care of her business.
Springing powers of attorney became expressly legal in
Texas in 1993 when the Texas "Durable Power of Attorney Act" was created.
That law specifically allows a power of attorney to say, "this power of
attorney becomes effective on the disability
or incapacity of the principal." In other words, it clearly allowed the
type of power of attorney made by your aunt.
However, you said that your aunt’s power of attorney was about 10 years
old, so it predates the Durable Power of Attorney Act. Earlier than 1993,
lawyers were not at all certain that a springing power of attorney was
legal in Texas. There was no law that said it was valid, but there was no
law that said it was not valid.
A case decided by the Court of Appeals in Texarkana in August 1999 has
laid that issue to rest. The case is Comerica Bank vs. Texas Commerce
Bank, and it discusses the actions of a Mrs. Bradfield. She wrote a
springing power of attorney in 1986. In 1995, she became disabled, and her
agent transferred some of her assets into a trust with Comerica using the
springing power of attorney.
In 1997, Mrs. Bradfield died and Texas Commerce was appointed as her
Executor. The Executor wanted the assets moved back to her estate so the
funds could be given to the heirs named in her Will. Comerica felt that
the assets were 1) legally part of its trust, 2) should go to the trust’s
beneficiaries, and 3) that using the springing power of attorney had been
perfectly legal.
The court decided that while there was no explicit statute allowing
springing powers of attorney, they were legal in 1985. Reviewing the law,
the court recognized that it had been legal to make powers of attorney
that commenced at some future time, for instance, "this power of attorney
becomes valid when I "leave for Europe" or when I "buy a new business." If
a power of attorney can be written that commences at some future date,
then a power of attorney that starts "when I become disabled" was also
legally valid.
As such, your aunt’s 10-year-old springing power of attorney is clearly
legal and valid. I suggest you talk with one of the bank’s vice-presidents
about the situation. Clear up their legal question and insist that they
accept your authority. |
