What are my Agent’s
Obligations?
Your agent has special legal
duties. These are called fiduciary
duties. A fiduciary duty is the highest
duty known in the law. Your agent owes
these fiduciary duties to you. Your
agent also owes these same duties to your guardian and conservator.
Your agent has a fiduciary duty
to act only within the powers you give in your power of attorney. (S)he must follow your instructions and
expectations. When in doubt about your
expectations, your agent must act in your best interest. Your agent must be loyal to you and act in
good faith, with care, competence and diligence. If you select your agent because of his or
her special skills or expertise, those skills and expertise are considered in
determining whether your agent acted with care, competence and diligence. For example, if your agent is an attorney,
(s)he will be held to the standard of care, competence and diligence for an
attorney as opposed to the standard for an agent with no legal education and
experience. Your agent must cooperate
with your other agents, including your agent for health care decisions, and try
to implement your estate plan if it is in your best interest. If you think your agent may have violated
these duties, or if you are an agent and need advice on your duties, contact
Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Your agent must carry out his or
her duties for your benefit only.
Transactions by your agent that benefit your agent (called self-dealing)
are presumed improper. However, if your
agent acts in your best interest with care, competence and diligence, then
(s)he is not liable solely because:
·
(S)he also benefits from the transaction;
·
(S)he has an individual or conflicting interest
in relation to your property or affairs; or
·
The value of your property or estate declines.
Nevertheless, your agent must
avoid any conflict of interest that would impair his or her ability to act in
your best interest. If you think your
agent may have engaged in self-dealing or you are an agent concerned about a
potential conflict of interest, contact Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Your agent must keep a record of
all receipts, expenditures and transactions made for you. Contact Thomas T. Tornow, P.C. at http://www.tornowlaw.com for help with
these records.
Your agent must inform you if
(s)he knows that your co-agent has violated, or is about to violate, the co-agent’s
fiduciary duty to you. Likewise, your
successor agent must inform you if (s)he knows that your former agent violated
his or her duty to you. Other than these
obligations of disclosure, your successor agent or co-agents are not liable for
a breach of duty by your other agents unless they participated in the breach. If you think your co-agent or former agent
violated their duty, or you are an agent concerned about another agent’s
actions, contact Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Unless it is expressly permitted
in your power of attorney, your agent cannot delegate his or her duties to another
person or business. You should be very
cautious about allowing delegation. If
you think delegation may be necessary, you should specify in your power of
attorney exactly what powers, and under what circumstances, your agent can
delegate and to whom they can be delegated.
If your power of attorney allows delegation, your agent is not liable
for the act, error of judgment or default of the person or business (s)he
delegates to unless your agent did not exercise care, competence and diligence
in selecting the person or business. If
you select your agent because of his or her special skills or expertise, those
skills and expertise are considered in determining whether your agent acted
with care, competence and diligence in selecting the person or business. For example, if your agent is an accountant,
(s)he will be held to the standard of care, competence and diligence that an
accountant should use in selecting the person or business. Before allowing your agent to delegate his or
her powers, get advice by contacting Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Although not advisable, your
power of attorney can provide that your agent is not liable for breaching these
duties. However, such a provision will
not protect your agent if:
·
The provision is the result of your agent
abusing his or her confidential or fiduciary relationship with you; or
·
Your agent acted dishonestly, with an improper
motive, or with reckless indifference to your best interest or the purpose of
your power of attorney.
Don’t exempt your agent from
liability for breaching his or her duties without getting advice from Thomas T.
Tornow, P.C. at http://www.tornowlaw.com.
When dealing with others on your
behalf, your agent should always disclose that (s)he is acting for you and not
for him or herself. This prevents your
agent being personably liable for the debt or action. When signing documents, your agent should
write or print your name, then sign his or her name and disclose that (s)he is
signing as your agent. For example:
“John Smith, by Sally Smith, his Agent” or "Sally Smith, signing as agent
for John Smith." If you are unsure
how something should be signed, contact Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Unless your power of attorney
provides otherwise, your agent is not required to account for his or her
activities unless the information is:
• Requested by
you;
• Ordered by a
judge;
• Requested by
your guardian, conservator or another of your fiduciaries (such as a co-agent);
• Requested by a
government agency with authority to protect your welfare; or,
• Requested by
your executor, personal representative or successor to your estate after your
death.
In those situations, your agent
must provide the information within 30 days, or if your agent documents in
writing why (s)he needs additional time, within 60 days. If you are an agent who has been asked to
account for your activities, or you want an accounting from your agent, contact
Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Your agent must immediately stop
acting for you as soon as (s)he knows that your power of attorney has been
terminated or revoked. If they do not,
immediately contact Thomas T. Tornow, P.C. at http://www.tornowlaw.com.
Because an agent may be liable
for violating a power of attorney, his/her fiduciary duties, or the law
regarding powers of attorney, anyone asked to be an agent under a power of
attorney should consult with Thomas T. Tornow, P.C. at http://www.tornowlaw.com about his or her
important responsibilities and duties.
This
post is exclusively for informational purposes. It is not legal advice. Viewing
this post, using information from it, or communicating through this blog does
not create an attorney-client relationship. Thomas T. Tornow, P.C. is not
liable for the use or interpretation of information on this blog and expressly
disclaims all liability for any actions you may or may not take based on the
content of this blog.
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