September 21, 2016
Authored by: Luke Lantta
There, less than a week before the principal’s death, the agent used a power of attorney to execute a deed conveying to himself 280 acres of the principal’s property and another 500 acres of the principal’s property to himself and his siblings. The trial court set aside the deeds on the grounds of a breach of fiduciary duty. The Georgia Supreme Court reversed and remanded because there was some evidence that the agent executed the deeds at the principal’s request. There can be no breach of fiduciary duty when an agent acts pursuant to the principal’s express direction or with the principal’s approval.
Just because you can doesn’t mean you should. True, powers of attorney can help facilitate the affairs of people who cannot or do not want to handle their financial affairs. But, powers of attorney are poor substitutes for other means of disposing of property. Some jurisdictions ban the practice of an agent using a power of attorney to give himself the principal’s property or create presumptions against it. Even if the transaction is permitted in your jurisdiction, such a transaction will be looked at with scrutiny. When there are a whole wide world of vehicles for transferring property, using a power of attorney to transfer the principal’s property to the agent should be used sparingly.