As Power of Attorney am I responsible for showing how I spent my mother's money caring for her?
Full Question:
Answer:
A power of attorney is a legal instrument that gives someone else the authority to make certain decisions and act for the signer. The person who has these powers is called an agent or attorney-in-fact. The person designated to be the agent assumes certain responsibilities, including acting in the principal's best interest and following the principal's directions. Agents are "fiduciaries," which means that the agent must act with the highest degree of good faith in behalf of their principals. Although an agent is supposed to make decisions in the principal's best interest and to use the principal's money and other assets only for the principal's benefit, the agent nevertheless has great freedom to act as he or she pleases. An agent must keep his or her money separate from the principal's; keep detailed records concerning all transactions he or she engages in on the principal's behalf; not stand to profit by any transaction where the agent represents the principal's interests; and not make a gift or otherwise transfer any of the principal's money, personal property, or real estate to himself or herself unless the power of attorney explicitly states he or she can do so.
Principals usually grant their agents fairly broad powers to manage their finances and to conduct financial transactions in their behalf. Even so, principals can grant their agents as much or as little authority as they think reasonable. Typical powers include the authority to do acts for the principal with respect to inheritances or claim property to which the principal is otherwise entitled, including collecting the principal's Social Security, Medicare or other governmental benefits; conducting real estate transactions (purchase, sell, mortgage, etc.); conducting transactions with banks and other financial institutions; filing and paying the principal's state, federal, and local taxes; hiring a lawyer to represent the principal in court; making investment decisions for the principal (purchase and sell stocks, bonds, mutual funds, etc.); managing the principal's retirement funds; purchasing or selling insurance policies and annuities for the principal; running the principal's business; and using the principal's money to pay the principal's living expenses. Whatever powers the principal gives the agent, the agent must act for the principal's best interests, must maintain accurate records, keep the principal's property separate from his or hers and avoid conflicts of interest.
Agents are sometimes paid for their work on the principal's behalf. This depends on the nature of the relationship between the agent and the principal, as well as the nature of the agent's duties. In most situations where the agent's duties are fairly simple, there is no payment for the performance of those duties. If, however, the agent is saddleburdened with substantial responsibilities (such as running a business or managing a complex transaction), payment for the agent's services may be appropriate. If the principal wishes to or expects to pay the agent, the principal should clearly say so and outline the details of payment in the power of attorney. Because of the importance of the agent's duties and the potential for mistake, misunderstanding, or even outright overreaching, the agent will usually be required to maintain separate and accurate records and make them available to the principal or to persons the principal designates.
The following are Illinois statutes:
755 ILCS 45/2-2 (from Ch. 110 1/2, par. 802-2)
Sec. 2-2. Short Title. This Article shall be known and may
be cited as the "Durable Power of Attorney Law".
755 ILCS 45/2-3 (from Ch. 110 1/2, par. 802-3)
Sec. 2-3. Definitions. As used in this Act:
(a) "Agency" means the written power of attorney or other
instrument of agency governing the relationship between the
principal and agent or the relationship, itself, as
appropriate to the context, and includes agencies dealing
with personal or health care as well as property. An agency
is subject to this Act to the extent it may be controlled by
the principal, excluding agencies and powers for the benefit
of the agent.
(b) "Agent" means the attorney-in-fact or other person
designated to act for the principal in the agency.
(c) "Disabled person" has the same meaning as in the
"Probate Act of 1975", as now or hereafter amended. To be
under a "disability" or "disabled" means to be a disabled
person.
(d) "Person" means an individual, corporation, trust,
partnership or other entity, as appropriate to the agency.
(e) "Principal" means an individual (including, without
limitation, an individual acting as trustee, representative
or other fiduciary) who signs a power of attorney or other
instrument of agency granting powers to an agent.
755 ILCS 45/2-7 (from Ch. 110 1/2, par. 802-7)
Sec. 2-7. Duty — standard of
care — record-keeping — exoneration. The agent shall be under
no duty to exercise the powers granted by the agency or to
assume control of or responsibility for any of the
principal's property, care or affairs, regardless of the
principal's physical or mental condition. Whenever a power is
exercised, the agent shall use due care to act for the
benefit of the principal in accordance with the terms of the
agency and shall be liable for negligent exercise. An agent
who acts with due care for the benefit of the principal shall
not be liable or limited merely because the agent also
benefits from the act, has individual or conflicting
interests in relation to the property, care or affairs of the
principal or acts in a different manner with respect to the
agency and the agent's individual interests. The agent shall
keep a record of all receipts, disbursements, and significant
actions taken under the agency. The agent shall not be
affected by any amendment or termination of the agency until
the agent has actual knowledge thereof. The agent shall not
be liable for any loss due to error of judgment nor for the
act or default of any other person.
755 ILCS 45/2-7.5
Sec. 2-7.5. Incapacitated principal.
(a) This Section shall apply only to an agent acting for a
principal who is incapacitated. A principal shall be
considered incapacitated if that individual is under a legal
disability as defined in Section 11a-2 of the Probate Act
of 1975. A principal shall also be considered incapacitated
if:(i) a physician licensed to practice medicine in all its.
branches has examined the principal and has determined that
the principal lacks decision making capacity; and
(ii) that
physician has made a written record of this determination and
has signed the written record within 90 days after the
examination; and
(iii) the written record has been delivered
to the agent. The agent may rely conclusively on that written
record
(b) An agent shall provide a record of all receipts,
disbursements, and significant actions taken under the
authority of the agency when requested to do so:(i) by a
representative of a provider agency, as defined in Section 2
of the Elder Abuse and Neglect Act, acting in the course of
an assessment of a complaint of elder abuse or neglect under
that Act;
(ii) by a representative of the Office of the State
Long Term Care Ombudsman acting in the course of an
investigation of a complaint of financial exploitation of a
nursing home resident under Section 4.04 of the Illinois Act
on the Aging; or
(iii) by a representative of the Office of
Inspector General for the Department of Human Services acting
in the course of an assessment of a complaint of financial
exploitation of an adult with disabilities pursuant to
Section 35 of the Abuse of Adults with Disabilities
Intervention Act.
(c) If the agent fails to provide his or her record of all
receipts, disbursements, and significant actions within 21
days after a request under paragraph (b), the elder abuse
provider agency or the State Long Term Care Ombudsman may
petition the court for an order requiring the agent to
produce his or her record of receipts, disbursements, and
significant actions. If the court finds that the agent's
failure to provide his or her record in a timely manner to
the elder abuse provider agency or the State Long Term Care
Ombudsman was without good cause, the court may assess
reasonable costs and attorney's fees against the agent, and
order such other relief as is appropriate.
755 ILCS 45/2-10 (from Ch. 110 1/2, par. 802-10)
Sec. 2-10. Agency-court relationship. Upon petition by any
interested person (including the agent), with such notice to
interested persons as the court directs and a finding by the
court that the principal lacks the capacity to control or
revoke the agency:
(a) if the court finds that the agent is
not acting for the benefit of the principal in accordance
with the terms of the agency or that the agent's action or
inaction has caused or threatens substantial harm to the
principal's person or property in a manner not authorized or
intended by the principal, the court may order a guardian of
the principal's person or estate to exercise any powers of
the principal under the agency, including the power to revoke
the agency, or may enter such other orders without
appointment of a guardian as the court deems necessary to
provide for the best interests of the principal; or
(b) if
the court finds that the agency requires interpretation, the
court may construe the agency and instruct the agent, but the
court may not amend the agency. Absent court order directing
a guardian to exercise powers of the principal under the
agency, a guardian will have no power, duty or liability with
respect to any property subject to the agency or any personal
or health care matters covered by the agency. Proceedings
under this Section shall be commenced in the county where the
guardian was appointed or, if no Illinois guardian is acting,
then in the county where the agent resides or, if the agent
does not reside in Illinois, then in any county.