If my sister has my dad’s Power of Attorney, what is the scope of her authority?

He has a car that has a book price of $16,000. First she said she was going to gift it to herself but then, when I got upset, she went to him to ask for the car way below book price. That is his largest asset next to his house. Something does not seam right. My dad does have some fluid moments but is suffering from dementia.

Asked on June 6, 2014 under Estate Planning, New York

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

An attorney in fact (the person granted power by the power of attorney) has the *authority* to do whatever the POA grants (i.e. not all POAs grant equal or full power; you have to review the  POA for its own particular terms), BUT also has the *obligation* to wield that power for the best interests of the grantor (the person granting them this power). In this case, your sister may, subject to the terms of the POA, have the right to sell the car; but she should only do so if it's in the interest of your father. Sometimes, a below-market sale is justified, if doing so avoids marketing or advertising costs, gets the deal done faster, gets a cash deal instead of financing, etc.; and a reasonable discount to family is also not something that a court would generally look askance at. The issue is, was an discount "reasonable" under all the circumstances? E.g. say your father cannot driver and has no need for a car anymore--your sister taking it off his hands for, say, $10k might not be unreasonable, if the alternative would be for him to keep paying insurance and placing ads in the paper while trying to sell it for more. On the other hand, if he needs a car, and/or she got it for $5k, that's likely an abuse.

If your father has dementia, you may wish to speak with an elder law attorney about possibly having a guardian appointed for him to look after his interests.


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