By Sandra W. Reed
The title here is intended as a play on the fairy tale "Cinderella" and not an indictment of stepsiblings.
Cindy, a widow in her early 60s, was undergoing physical therapy for an injury to her foot, making it difficult for her to get around. In addition, she was suffering depression brought on by the immobility and pain, resulting in her neglecting to pay bills and taking care of other financial affairs.
Her stepsister, Charlotte, suggested Cindy give her power of attorney to manage her business matters. When Cindy agreed, Charlotte had her attorney draw up a Statutory Durable Power of Attorney (SDPOA) naming Charlotte as her agent. Charlotte then took over.
A few weeks later, Cindy’s brother, Prince, discovered that Charlotte had moved the money from Cindy’s personal bank accounts to a new bank, setting up joint accounts in Cindy’s and Charlotte’s names and granting Charlotte right of survivorship (ROS), meaning Charlotte would be entitled to any money in the accounts at Cindy’s death. Charlotte had also contacted Cindy’s former employer and was attempting to take control of Cindy’s pension, potentially extracting a lump sum instead of monthly payments.
With these revelations, Cindy realized that Charlotte could not be trusted. But Charlotte now had control of all of Cindy’s assets. How could she protect herself?
Revocation of Power of Attorney
Cindy could immediately execute a revocation of the SDPOA granting authority to Charlotte, either through a document of revocation alone or through a new power of attorney granting power of agency to someone else. She chose the latter and named Prince as her agent. She needed to immediately present the new POA to all financial institutions with whom she deals and to her prior employer to give them the proper notice that Charlotte no longer has authority.
Closure of Joint Accounts
Cindy closed all the joint accounts that Charlotte opened and established individual accounts in her name only. This voided the ROS in favor of Charlotte. It was her preference whether to return to her old bank or remain with the new bank where Charlotte had established the joint accounts. She chose the new bank.
Designation of Guardian if Necessity Arises
Cindy anticipated that Charlotte might try to have Cindy declared incompetent and have herself named as Cindy’s guardian. To protect herself, Cindy had her attorney prepare document stating that, in the event she should ever need a guardian, she does not want Charlotte to be named as guardian. Texas law provides that, should a judge ever appoint a guardian for her, the judge shall not appoint Charlotte. Cindy also named the person she would want to be her guardian should she ever need one. Texas law provides that, if the person she named to act as a guardian, although the judge has discretion as to whom to name, that person will most likely be appointed.
Sandra W. Reed is an attorney with Katten & Benson, an Elder Law firm in Fort Worth, Texas. She lives in beautiful Somervell County, near Chalk Mountain. She may be contacted by phone at (254) 797-0211 or by email at firstname.lastname@example.org.