Part of the comprehensive estate planning process is drafting a set of advance medical directives to allow you to control your medical decisions in the event that you can no longer express your wishes on your own. One of the documents is a living will, which allows you to express your wishes for end of life care. But all too often, people turn to online forms or self-drafted living wills for these important documents, and the top three problems that come up with living wills are:

1. Missing in Action

Sometimes family members or medical providers do not know that a living will exists. If they do know there is a living will, they cannot find it. It’s important that your family knows of the document and where to locate it.

2. Poorly Drafted Documents

Many of the online living will forms are extremely vague and do not offer much guidance when it comes to the emotional decisions surrounding end of life care. Why? It is often much more complex than simply removing life support from a patient with no hope of recovery. Most people are unable to imagine many of the scenarios that can occur, let alone how they will feel in advance.

3. Emotional Choices

While your general wishes are there in black and white, there’s much more to it – the human factor. Tough decisions will need to be made, with various if/then aspects. A document may not be able to insert common sense and emotions into the picture – and sometimes that is what is needed when it comes to these decisions.

There are steps you can take to make sure your end of life wishes are heeded by having other estate planning documents in place, such as a Durable Power of Attorney for Health Care, which allows you to appoint a health care proxy to make decisions on your behalf if you become incapacitated.

An estate planning attorney can not only help you draft the legal documents needed, but they can provide direction and advice that makes the documents work toward a comprehensive estate plan that meets your specific needs and goals.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

A recent study in the New England Journal of Medicine found that one in four senior citizens will require someone else to make decisions for them at the end of their lives. How do you ensure that these decisions reflect your wishes, particularly when it comes to medical care?

Estate planning, specifically the drafting of advance medical directives, allows you to keep some control of your medical care when you are unable to express your wishes. Advance medical directives dictate your treatment preferences and give you the opportunity to designate a decision-maker in the event that you become unable to make these decisions on your own behalf.

Two of the most often used advance medical directives used in estate planning are:

• A living will: A living will specifies the types of medical treatments and life-sustaining measures that you do and do not want, for instance, mechanical breathing devices such as respirators or ventilators, feeding tubes or resuscitation.
• A medical power of attorney: A medical power of attorney allows you to name a person to make medical decisions for you if you are unable to communicate them on your own. The person you name to make these decisions is called your health care proxy or agent, and they are to act in your best interests, so it’s important to choose this person carefully.

Advance directives are the legal documents within an estate plan that allow you to convey your decisions regarding end-of-life care and health care ahead of time. Not only do advance medical directives provide a way for you to communicate your wishes to loved ones and health care professionals, but they ease the burden of making these decisions on your family, knowing that your wishes are being carried out.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

You often come across the terms ‘fiduciary’ and ‘fiduciary duties’ in the course of estate planning – but do you know exactly what these terms mean?

Fiduciary

A fiduciary is an individual, a business or even an association that holds assets or power for another party with the legal authority and duty to make decisions regarding finances and matters on their behalf. A fiduciary is expected to act with good faith and honesty and is normally chosen with the premise that they have more knowledge and expertise about the particular matters being handled. Typical fiduciaries that are encountered are:

• Attorneys;
• Financial advisors;
• Real estate agents;
• Bankers;
• Stockbrokers;
• Estate executors; and
• Guardians.

A fiduciary is always expected to act in the best interest of the person to whom they are providing services or care.

Fiduciary Duties

A fiduciary duty is an obligation to act in the best interest of another party, and as such, a fiduciary is held to a higher standard of both trust and conduct than a ‘regular’ person. While it seems that a fiduciary relationship is based primarily on trust between the two parties, there is also a legal obligation involved when a relationship involves trust, confidence and reliance on the fiduciaries’ expertise. In fact, in a fiduciary relationship, laws forbid the fiduciary from acting in any adverse or contrary manner to the interests of the client, or from acting for their own benefit.

Certain relationships in the estate planning process are regarded as fiduciary, these include:

• Attorney and client;
• Trustee and beneficiary;
• Executors and the heirs or beneficiaries of a decedent’s estate; and
• Conservators and the protected person.

The term fiduciary comes from the Latin term ‘fiducia’, which means trust. Fiduciary duties not only involve trust, but they are taken further to an obligation that is taken very seriously not only by estate planning attorneys, but by many in the legal, business and financial sectors.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

A Durable Power of Attorney is a powerful estate planning tool used to ensure that someone may act on your behalf in the event of incapacity – but how do you make sure that your financial institutions will honor it?

Many banks carefully scrutinize Power of Attorney documents, and rightfully so. But there have been many cases in which a bank refused to accept a Power of Attorney involving one of their customers. In fact, a recent Florida ruling awarded a gentleman $64,000 after his father’s bank refused to release funds to him from a joint account of his father even though he had a valid Durable Power of Attorney document. At that point, a friend of his father’s, who was also listed on the account, withdrew the funds from the account. The bank was ordered to repay the funds to the gentleman as the jury found they should have honored the legal document.

Careful planning may have avoided this situation. Banks are trying to protect their customers’ interests as well as their own. They are concerned they may be sued if the Power of Attorney document is found to be invalid or fraudulent. To prevent this situation, contact your financial institution when your Power of Attorney is executed and ask what is needed to ensure the document is accepted. Some companies may have a standard form to complete, and while it may not be legally necessary, it can make it easier for your agent should the Power of Attorney be needed later, so it makes sense to complete the form in addition to the Power of Attorney document prepared by your attorney.

In addition, may financial institutions and title companies (necessary if you need to sell or refinance real estate) will not accept a Power of Attorney once more than a year has passed. I recently heard of a title company that refuses to honor any Power of Attorney that was executed more than six months prior. Thus, if you’re relying on a Power of Attorney rather than a Living Trust to get through a period of disability, it is safest to execute a new Power of Attorney no less than once a year.

To make sure your estate planning documents are legal, valid documents, work with an estate planning attorney to ensure that not only will they be acceptable when they are needed, but that they meet your needs and goals.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

A durable power of attorney is an important estate planning tool, and it is one of the most essential components of many estate plans. A power of attorney is a written legal authority given by one party, called the principal, to another, called the agent, proxy or attorney-in-fact, to act on the principal’s behalf.

Since a person making a legal document must have the capacity to do so, there is often language added to a power of attorney in an estate plan that allows it to be durable. To make a power of attorney durable, a specific clause is added to the document to allow it to remain in effect, or even take effect, should the principal become incapacitated.

An estate plan should have a durable power of attorney document to prepare for the possibility of incapacitation due to illness, age or even an accident. As an estate planning document, it is usually specified that the power of attorney would not go into effect unless a doctor certifies that the principal is incapacitated, or upon any other event that can specified within the document. While powers of attorney may not always be accepted by every institution, it is certainly best to have one.

You do not have to choose an estate planning lawyer to be your agent in a power of attorney, but it is important to select someone that you trust. The family member, friend or even the institution that is chosen as an Agent will be acting on your behalf regarding financial or health care issues, and they must act within your best interests and within the terms that are specified in the power of attorney document.

There are other estate planning tools that can be used in place of a durable power of attorney, such as a health care proxy or a living trust, that can manage finances and property later in life. But it is essential to have a tool that allows you to avoid the intrusion of a court ordered process, such as a guardianship or conservatorship, to handle finances should you no longer be able to do so on your own.

An estate planning attorney can work with you to create a comprehensive estate plan that not only allows for the distribution of property upon your passing, but can help manage issues that can come up later in life.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

Advance medical directives are written legal documents that allow you to specify the type of medical care that you want in the future, as well as appoint who you would want to make health care decisions on your behalf should you lose the capacity to make these decisions on your own. Advance medical directives are an aspect of estate planning that help direct your assets and decisions later in life, while other aspects of estate planning, such as wills and trusts, distribute or manage your assets after you pass.

Many do not realize that more than just a Living Will is needed as an advance medical directive. A Living Will provides direction in a very limited set of circumstances. Specifically, in Colorado, a Living Will provides your choices on the administration, withholding or withdrawal of specific life sustaining procedures if you are terminally ill and unconscious or incapacitated for at least seven consecutive days. It is used to document your decisions regarding CPR, medications, ventilators, hydration, nutrition, and more and when you would like these measures used, not used or withdrawn.

A Medical Power of Attorney, on the other hand, is broader in scope, as it is a document that appoints a health care ‘agent’ or ‘proxy’ to make medical decisions on your behalf when you cannot do so yourself. Unlike a Living Will, the authority of this document does not only apply to terminal illness or a vegetative state, but in other situations, such as incapacitation due to senility or loss of consciousness after an accident. The scope of a Medical Power of Attorney can be as broad or as limited as you wish it to be. It can provide very specific instructions to your health care proxy or general guidance on your wishes.

Advance medical directives are an essential part of estate planning. Should you not have these important documents in place, your loved ones may be forced into a situation where a court is involved and possibly a guardianship to give someone the authority to make medical decisions for you. A set of advance medical directives, including a Living Will and Medical Power of Attorney, allow you to maintain not only dignity, but a measure of control over your future health care issues.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.

A Power of Attorney is a valuable tool in your estate planning arsenal. This legal document allows you to grant authority to someone of your choosing to take action on your behalf.

You can use a Power of Attorney to give someone the ability to pay your bills while you’re on vacation for example, or to act on your behalf during a financial or real estate negotiation.

But unless the Power of Attorney is “durable,” it expires if you become incapacitated. This is an important point to remember because many people use Powers of Attorney specifically for the purpose of protecting against disability.

There are two basic types of durable Powers of Attorney: one that works for financial matters as outlined above and the other for health care decisions. In order for these documents to protect you if you are incapacitated, they must both be durable.

Then, should you become unable to handle your own affairs, the Durable Power of Attorney for finances would allow your appointed agent to handle your financial affairs for you. They can pay your bills, access your checking and savings and even continue to negotiate financial and real estate transactions on your behalf, if you so choose.

The Durable Healthcare Power of Attorney enables someone to speak on your behalf with regard to medical decisions, such as treatments or medications you may or may not want.

In order for a Power of Attorney to be useful when you need it, you also need to know why some institutions will not accept them. A Power of Attorney must be extremely comprehensive in order to adequately give authority to handle exactly the things your agent may need to take care of. Some institutions require that a Power of Attorney be on their own form. In addition, Powers of Attorney should be re-signed regularly as many institutions won’t accept them after a certain period of time (some insist that the Power of Attorney be no older than 6 months!). To learn more about Powers of Attorney and how to protect yourself in the event of incapacity, give us a call today.

The Hammond Law Group is a member of the American Academy of Estate Planning Attorneys.