One of the primary purposes of executing a DPOA is to avoid the necessity of bringing a guardianship proceeding in the event of incapacity. Properly executed, a durable power of attorney (DPOA) is not invalidated by the subsequent disability or incompetence of the principal, unless termination is expressly provided. As a general rule, therefore, if you have properly prepared powers of attorney for financial matters and health care (these are two separate documents), a guardianship proceeding will not be necessary if you later become incapacitated.
Power of Attorney - 99 However, there are exceptions to this rule:
First, if the person you chose to act as agent is unable to fill that role (i.e., that person has pre-
deceased you, or is now unwilling to act as your agent), a guardianship proceeding may be necessary. Protecting against this occurrence is possible by appointing more than one alternate agents – e.g., appointing your daughter to act as agent were your spouse become unable to do so.
Second, it is possible for agents to abuse their authority and act against your best interests. If that
were to occur, another family member or friend could bring an action in Probate Court to remove the agent and appoint a guardian instead.
Third, it is also possible that you might disagree with your agent’s decisions and ask to have the
power of attorney document revoked. If you do this, even though you might be incapacitated, a guardianship proceeding would have to be brought. A court might decide, for instance, that you still had capacity to make some of your own decisions even though family members disagree.
For further information, please see:
N.H. Rev. Stat. Ann. Ch. 137-J: 14 – Execution and Witnesses N.H. Rev. Stat. Ann. Ch. 564-E:104 – Power of Attorney is Durable N.H. Rev. Stat. Ann. Ch. 564-E:109 – When Power of Attorney Effective
N.H. Rev. Stat. Ann. Ch. 564-E:110 – Termination of Power of Attorney or Agent’s Authority
How do I revoke a power of attorney?
A power of attorney is revoked by written notice from the principal to the attorney-in-fact. It is a good idea to also give notice to any banks, brokerages or other places where the attorney-in-fact conducted normal business on behalf of the principal in order to prevent liability from further acts of your unauthorized agent.
If a power of attorney is durable, and the principal is now incompetent, the principal still retains the power to revoke the durable power of attorney and to veto decisions made by the attorney-in- fact. This is because a court has never declared that the principal is incompetent. In the event that this occurs, a guardianship proceeding may need to be brought in order to have a court make a determination of incapacity and to appoint a guardian.
A power of attorney can also be revoked when the attorney-in-fact dies, becomes incapacitated, or resigns, and the power of attorney does not provide for another attorney-in-fact to act under the power of attorney.
Power of Attorney - 100 Another way to revoke a durable power of attorney is for an interested party, on behalf of the principal, to file a petition in Probate Court alleging that the attorney-in-fact violated his/her fiduciary responsibilities to the principal. The power of attorney will be terminated upon determination by the court that:
1. The agent has violated or is unfit to perform his fiduciary duties under the power of attorney; and
2. At the time of the determination by the court, the principal lacks the capacity to give or to revoke a power of attorney; and
3. The termination of the power of attorney is in the best interest of the principal or of the principal’s estate.
For further information, please see:
N.H. Rev. Stat. Ann. Ch. 137-J: 6 – Requirement to Act in Accordance With Principal’s Wishes and Best Interests
N.H. Rev. Stat. Ann. Ch. 137-J: 22 – Civil Actions
N.H. Rev. Stat. Ann. Ch. 564-E110 – Termination of Power of Attorney of Agent’s Authority
Can an appointed attorney-in-fact under a durable power of attorney be forced
to act, even if he or she does not want to do so?
No one can be forced to assume the obligation of attorney-in-fact without his or her consent. Under our state’s durable power of attorney law, the agent’s authority under a general power of attorney does not take effect until they have signed a written acknowledgement accepting the position. If the agent initially accepts the authority but decides that they no longer want to act, they must resign as outlined in the power of attorney document by giving written notice to the principal, if they are competent. At this point, a successor agent can take over, if one is listed in the power of attorney document, or the principal can designate a new attorney-in-fact. If the principal is incompetent when the agent resigns, and no successor is in place, the only remaining option may be guardianship.
An attorney-in-fact who has previously acknowledged acceptance of the power and who subsequently refuses to act under circumstances which cause damage to the interests or person of the principal, can be held liable for breach of fiduciary duty.
For further information, please see:
N.H. Rev. Stat. Ann. Ch. 564-E:113 – Agent’s Authority and Agent’s Acceptance or Declination N.H. Rev. Stat. Ann. Ch. 564-E:183 – Agent’s Resignation; Notice
Power of Attorney - 101
Can a bank or other institution refuse to honor a valid power of attorney?
New Hampshire’s durable power of attorney law requires that, generally, a third party must accept a valid power of attorney document within 7 days after it has been presented for acceptance. A third party may refuse to honor a power of attorney only under certain circumstances, including a good faith belief that the power of attorney is not valid or that the agent does not have authority to act. If a third party improperly refuses to accept a valid power of attorney, they can be ordered by a court to accept the power of attorney and be held liable for attorney’s fees incurred in taking action to secure the acceptance of the power of attorney.
For further information, please see:
N.H. Rev. Stat. Ann. Ch. 564-E:106 – Validity of Power of Attorney
N.H. Rev. Stat. Ann. Ch. 564-E:120 – Liability for Refusal to Accept Acknowledged Power of Attorney