Recently, our firm has received a number of inquiries from clients telling us that their bank or credit union has refused to recognize valid financial powers of attorney.
Case Study: Mary’s Story
This can happen for a number of different reasons, but one common scenario unfolds something like this: A woman we’ll call Mary is listed as her mother’s power of attorney. What this means from a legal standpoint is that Mary has all the authority to conduct financial and business transactions on her mother’s behalf, in the event that her mother is unable to handle those affairs herself. As it happens, Mary’s mother has been diagnosed with advanced Alzheimer’s, and she has credible doctors’ notes stating as much.
Mary makes the decision that her mother needs full-time care in an assisted living facility. Such communities can be expensive, and as such, Mary decides to cover the amount from her mother’s banking and investment accounts.
Mary submits her mother’s power of attorney document to the bank, along with the physicians’ notes. For weeks, she experienced nothing but radio silence. Mary makes several attempts to follow-up, and when she finally connects with someone from the bank, they give her unwelcome news: They will not recognize the legitimacy of her mother’s power of attorney form, stating that it’s too old. Mary is left with no way to provide for her mother’s extended care needs.
The Solution: Contact a Trusts Attorney
Mary’s plight is all too common, and yet, there is a solution. California Probate Code § 4406 authorizes her to file suit against any third party who refuses to honor a properly executed statutory form power of attorney. Furthermore, the statute authorizes the recovery of attorneys’ fees from the third party if it is found that the third party acted unreasonably in refusing to accept the agent’s authority under the power of attorney.
But here’s the problem: Even though the law may be on your side, financial institutions have greater resources than you might, and, in most instances, unless they are looking down the barrel of a lawsuit, they will not agree to do the right thing. If you or a family member are engaged in a dispute with a financial firm that is refusing to honor your loved one’s valid power of attorney, we can help. Give the five-star attorneys at Max Alavi, Attorney at Law, APC a call today. We are here to assist you with any issues related to a living trust, probate durable power of attorney, and beyond.