When a person prepares his or her estate planning documents, it is smart to grant to a family member or a close friend a financial power of attorney in the event financial matters such as bill paying, document signing, etc.,need to be addressed when the principal (the grantor of the power) is unavailable or incapacitated.
It is surprising how many people mistakenly believe that such a power extends beyond the death of the principal. However, upon the death of the principal (now known as the “decedent”), the financial power of attorney document “dies” with him or her and is not legal.
It is important for the attorney-in-fact (the agent) named in the power of attorney to know that at the point of death, only a personal representative of the decedent’s estate or a trustee of the decedent’s trust has legal capacity to sign any documents, including checks to pay bills, on behalf of the decedent. Of course, the principal is free to terminate the power of attorney provided he or she has capacity.