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Is document that mashes-up legal concepts valid?

Dear Mr. Premack: I’ve had a friend for 50 years who is now elderly. She has a Durable Power of Attorney (with Trust Powers and Health Care Powers) signed and filed in 1996. As a trust it states that the authority will continue for a reasonable amount of time after death and shall end due to the appointment of a Guardian of the Estate by a Court of competent jurisdiction. Since then, I have been told that a Durable Power of Attorney ends when someone dies. Do the trust powers continue as stated and end only after Court Appointment? – LM

I hope that your friend is still competent and capable. It is very likely that, because of the terms you use to describe it, she has a mashed-up document that is not legally valid. There are several sources of Texas law for the separate legal tools that were, in your friend’s case, mashed together:

  1. Chapter XII of the Texas Probate Code contains the legal rules necessary to create a valid Durable Power of Attorney, and to determine when it terminates.

  2. The Texas Trust Code contains the legal rules to create a valid Trust, and to delegate to someone the powers of a Trustee.

  3. The Texas Health and Safety Code contains the legal rules necessary to create a Medical Power of Attorney in which you can validly delegate authority to make medical choices.

Your friend’s problem is this: those multiple sources of law are meant to cover different problems that may be encountered under varying circumstances. The Probate Code, for instance, says that an Agent’s authority must, by law, end if a) the principal – that is, your friend – revokes the power, b) the principal dies and that death is actually known by the Agent, or c) a Guardian is appointed by a court. By contrast, a Trust does not have to end except in whatever manner your friend specified when the Trust was created. A Trust can outlast the principal’s death and can continue to exist if a Guardian is appointed for the principal.

Also, ownership arrangements are different when comparing a Durable Power of Attorney to a Trust. In a Trust, ownership of assets is actually conveyed to the Trustee, subject to the use of those assets by the Trust’s beneficiary. By contrast, in a Durable Power of Attorney, ownership of the assets remains with the principal, and the Agent simply acts as the owner’s representative.

One similarity is that both a Durable Power of Attorney and a Trust can name multiple parties to act – a Trust can have “Cotrustees” and a Power of Attorney can have “Coagents”. But the law behind Texas health care powers does not allow multiple parties to act. The provisions of the Health and Safety Code require that a Medical Power of Attorney designate one individual to act as agent. If that individual cannot act, then a replacement can step into place – but there can never legally be two joint decision makers at single time. Further, the Agent under a Medical Power of Attorney only has power to act after a doctor certifies the principal as incapable of making medical choices, but there are no such start-up requirements in a Trust or Durable Power of Attorney.

Also, you say that this mashed-up document was “filed” in 1996. That is odd, because Medical Powers of Attorney are never filed with any government authority. Trusts are generally private and are not filed. Durable Powers of Attorney were only filed with the government from 1989-1991 until that law was changed to state that they need not be filed. The oddity of filing the document points out that whoever wrote it for her was not giving good legal assistance.

If your friend is still competent and capable, she needs to see a Certified Elder Law attorney (whose practice focuses on the elderly) to create new, separate legal documents that validly accomplish her goals. Likely she needs a) a Durable Power of Attorney that follows the rules in the Probate Code, b) a Medical Power of attorney that follows the rules in the Health & Safety Code, and 3) a Will or other legal tool – like a trust – which controls how her assets will be distributed after her death. They must all be created as separate documents, not as a mash-up.

Paul Premack is a Certified Elder Law Attorney practicing estate planning and probate law in San Antonio.

Original Publication: San Antonio Express News, March 4, 2011


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