Jennifer Mahe: Can a power of attorney avoid the necessity of a guardianship?

Unfortunately, situations occur in life where we are either required to make decisions on behalf of a loved one or we are unable to make decisions on our own behalf.

Such situations are overwhelming and often require legal assistance or court intervention at a time when people have many other problems to address. Thus, the best solution is preparation now, before such a situation arises or, if you are already in that situation, understanding the options which may exist. Legally there are two common options designed to allow one adult to act on behalf of another adult.

The first option is provided by a power of attorney. Powers of attorney are legal documents that allow a legally competent adult to nominate an individual or individuals to act as their agent and take action on their behalf in the event the nominating adult is unable to take action on their own behalf. There are two types of powers of attorney, one for medical decisions and another for financial decisions.

Powers of attorney are broad grants of authority which allow for numerous actions on behalf of the person granting that authority. For example, utilizing a power of attorney an individual may be able to decide whether to allow or prohibit certain medical treatments for their loved one. They also may be able to sell their loved one’s house or access their loved one’s bank accounts to pay their loved one’s bills. Therefore so long as a power of attorney has been executed many of the decisions that might need to be made can be handled by the individual nominated as the agent.

Furthermore, the agent can take the actions permitted by the powers of attorney without the requirement to obtain court approval or oversight. Nonetheless, in order for a power of attorney to be valid, the person executing the power of attorney must be legally competent. Thus this option is only helpful if it’s proactively addressed by the nominating individual executing a power of attorney while they are still competent and able to make decisions on their own behalf.

The second option is provided by guardianship. Guardianship is a legal process whereby an individual or individuals petition the court to be appointed as guardian for another individual commonly referred to as the ward. In order for a guardianship to be entered, the ward must be deemed legally incompetent by the court. Thereafter annual reports will need to be filed by the guardian with the court detailing the status of the ward and the ward’s estate. Nonetheless, once appointed, the guardian can make decisions on behalf of the ward, though in some instances court approval needs to be sought before the guardian can take certain actions.

Guardianship often becomes necessary when an individual doesn’t execute powers of attorney when competent, when a third party provider, for example a long term care provider, requests a guardian be appointed prior to providing services or in the rare event an action must be taken which isn’t adequately provided for an existing power of attorney.

Because of the necessity of court involvement and the costs associated with obtaining court approval many people prefer to avoid guardianship. Despite the preference of those individuals, it’s worth noting in some situations it’s beneficial to the guardian, the ward and the ward’s loved ones to have the ability to obtain court oversight and input.

Regardless of whether you prefer a power of attorney or a guardianship, it’s worthwhile for all competent adults to consider executing powers of attorney.

Jennifer Mahe has practiced law in the Northern Nevada area since 2005 focusing on general civil matters such as real estate, business, litigation and estate planning. She can be reached online at www.mahelaw.com, or at 775-461-0992. Have a question? Email Jennifer at jmahe@mahelaw.com.