Incapacity Standards in Trusts and Powers of Attorney

Clients often ask to set incapacity standards in their trusts and powers of attorney. Typically, they might suggest a requirement that two physicians certify incapacity before a successor trustee, or an agent, may act. We discourage these limitations. In practice they cause more problems than protections. Anyone tried to get a physician to write a letter recently? Compound that with two letters. And who is your physician, anyway? Is your primary care actually in the hands of a nurse practitioner? If you’re in the hospital, or have moved to a facility, who is responsible for determining your level of capacity. A recent case in our office pointed out the folly of rigorous incapacity standards. The document required two physicians licensed in the state where the signer lived when he executed the documents. But he hadn’t lived there in a year or more. He couldn’t sign new documents at this point. So what did we do? We filed a court proceeding to determine his capacity. In other words, the very kind of action he intended to avoid by planning ahead and signing a power of attorney and a living trust.