Who Can Override Power of Attorney and How?

This content has been reviewed and edited by an Investment Advisor Representative working for Global Predictions, an SEC-registered Investment Advisor.

If you're thinking about setting up a Power of Attorney (POA) or want to understand how it can be changed, you're in the right place. Whether you're planning for yourself or helping a loved one, it's important to know exactly what a POA does, who can step in, and when changes can be made.

In short, a POA allows someone you trust to handle key decisions—like managing finances or healthcare—on your behalf. It ensures that, if you can’t take charge, someone else can. But don’t worry, it's flexible. A POA can be adjusted or revoked as situations change. This guide will explain how it all works.

When Can a Power of Attorney Be Overridden?

Several situations may arise where a POA can be changed or canceled. Of course this depends on the specific details outlined in the document and the laws in your state. Here are the most common ways a POA can be overridden:

1. Revoking a POA

As long as the principal (the person who created the POA) is of sound mind, they maintain full control and can typically revoke the POA at any time. This involves writing a revocation notice and notifying all relevant parties, such as the agent, bank, or healthcare providers.

• Hypothetical Example: Jane appointed her brother, Tom, as her agent while recovering from surgery. A few months later, feeling ready to take control again, Jane wrote a revocation letter, informed Tom and her bank, and regained full responsibility.

2. Court Intervention

If family members or loved ones believe the agent isn’t acting in the best interest of the principal, they can petition the court to intervene. This typically requires presenting evidence, such as financial records, to prove the agent’s misconduct.

• Hypothetical Scenario: Elena appointed her son Robert as her financial agent. However, her daughter Sophia noticed suspicious withdrawals from Elena’s accounts. Sophia consulted a lawyer, gathered evidence, and petitioned the court to remove Robert as the agent to protect Elena’s finances.

3. Expiration Upon the Principal’s Death

A POA automatically ends when the principal dies. Afterward, the executor of the will or the probate court manages the estate. A POA cannot be used to manage assets after the principal's death.

4. Annulment Due to Invalidity

If the POA was not properly established—perhaps the document was signed incorrectly or lacked the necessary witnesses—the court may declare it invalid, meaning the agent loses all legal authority.

Steps to Override a Power of Attorney

If you suspect that a POA is being misused, follow these steps:

• Consult an Attorney: Seek guidance from an estate planning or elder law attorney who can explain the process and relevant laws in your state.
• Gather Evidence: If you believe the agent is abusing their authority, collect documents such as bank statements or medical records to support your case.
• File a Petition with the Court: Submit a formal request explaining why the POA should be revoked. The court will review the evidence and may hold a hearing to decide on the next steps.

Important Note: Laws regarding Powers of Attorney (POA) can vary from state to state. To ensure your POA is set up and administered correctly according to local laws, it is recommended to consult your state’s specific regulations and seek guidance from an attorney specialized in estate planning or probate law.

Preventing POA Misuse

Setting up a POA is helpful, but it's vital to take steps to prevent potential misuse. Here are some tips:

• Choose a Trustworthy Agent: Select someone responsible and capable of handling the tasks you assign. They should be financially literate and prioritize your best interests.
• Set Clear Limits: A limited POA can outline exactly what the agent is authorized to do, so they don’t have full control over everything.
• Monitor the Agent’s Actions: Consider adding a safeguard, like having a third party review the agent’s decisions periodically, to ensure they’re acting in your best interest.