In a recent publication in the Court of Appeal of the state of California, 3rd appellate district, Robin Hutcheson et.al vs. Eskaton Fountainwood Lodge et al. in an update filed as C074846.
What Is An Attorney-In-Fact?
As people age, they sometimes need someone to step in and handle various business and/or financial affairs for them. This person, referred to as an attorney-in-fact, signs a power of attorney document granting them certain powers and also restricting them from making other decisions. But just how far does the attorney-in-fact title allow this designated person to go?
It’s About Business, Not Health
An attorney-in-fact is meant to handle the business and financial affairs of an incapacitated person. That may mean writing checks, paying bills, selling property, and signing various documents.
But the attorney-in-fact is not permitted to make healthcare decisions for the person. Even if the decision requires financial consideration, it doesn’t fall under the purview of power of attorney.
Agreeing to Arbitration Clauses
An attorney-in-fact may, in the general course of conducting business for the principal, may be required to sign certain documents, including arbitration agreements. Arbitration agreements place limitations on how you can resolve disputes with other parties you’ve entered into a contract with.
An arbitration clause signed by an attorney-in-fact is binding, as long as it falls within the scope of the permitted duties of the attorney-in-fact. If the agreement was signed as a result of actions taken outside the power of attorney document (such as through the course of making healthcare decisions)
then it may not be considered binding, as was decided by the California Third Appellate District Court in November 2017.
Learn More About An Attorney-In-Fact’s Power
To find out what a power of attorney can and can’t do, and to determine the best way to appoint both financial and healthcare representatives, contact our Palm Springs estate planning law firm today.
