What is a Power of Attorney?
A power of attorney is a written document that allows one person to act on behalf of another. Just as a written lease document casts the people involved into two new roles—landlord and tenant—a written power of attorney document casts the people involved into two new roles—principal and attorney-in-fact. The person authorizing someone else to act on their behalf is called the principal. In Minnesota, a person authorized to act on behalf of the principal is called an attorney-in-fact. The written document that creates these roles is called the power of attorney. A common mistake is to call an attorney-in-fact (the person) a power of attorney (the document).
What is an Attorney-in-Fact Allowed to Do Regarding Disputes?
Not all powers of attorney are the same. Some grant limited powers. Some grant full powers. If a power of attorney grants the attorney-in-fact general authority with respect to claims and litigation, what is the attorney-in-fact allowed to do regarding disputes? In Minnesota, an attorney-in-fact may pursue and resolve legal disputes on behalf of the principal. To do so, an attorney-in-fact in Minnesota may hire attorneys, accountants, expert witnesses, or other assistants.
How Can Someone Challenge an Attorney-in-Fact’s Actions?
Sometimes, family members are concerned that an attorney-in-fact is abusing their access to the principal’s money or other property. What can concerned family members do?
First, someone can ask the attorney-in-fact to provide an accounting of their use of the principal’s money and property. Although not all powers of attorney are the same, all attorneys-in-fact in Minnesota must keep complete records of all transactions entered into on behalf of the principal.
Second, if the attorney-in-fact will not provide an accounting voluntarily, then someone can petition Minnesota District Court for a protective order directing the attorney-in-fact to provide an accounting. Under a subpoena or court order, that person can also get the accounting source documents (the statements, invoices, receipts, etc.) and audit the accounting.
Third, someone can petition Minnesota District Court to appoint a conservator to manage the principal’s finances. If the court appoints a conservator, a decision of the conservator takes precedence over that of an attorney-in-fact. In addition, the conservator has the power to revoke the power of attorney.
Disputes and Power of Attorney
If you find yourself in a dispute involving a power of attorney, either as the attorney-in-fact or as someone concerned about an attorney-in-fact’s use of a principal’s money or other property, consider hiring an attorney familiar with power-of-attorney litigation and court procedures.