LEGAL ISSUES REGARDING AN AGING CLIENT BASE Todd Prendergast Vice-President, Legal, Assante Wealth Management

TODAY’S AGENDA Power of Attorney documents Capacity Dealing with difficult circumstances Scenarios

POWER OF ATTORNEY DOCUMENTS Form: Anything client can legally do him/herself One or more Alternates Presently exercisable vs. conditional Enduring vs. not

POWER OF ATTORNEY DOCUMENTS Substance: In addition to the client – NOT at the exclusion of the client Use common sense Watch for red flags Guidance from Compliance/Legal

CAPACITY Living longer 2011 was “crossover year” More diseases of old age High divorce rate Unfortunate equation: Increased life span + economic turbulence + remarriage = late life litigation, particularly regarding finances

CAPACITY Capacity to manage property Incapacitated if: Unable to understand information relevant to a decision about property; OR Unable to appreciate reasonably foreseeable consequences of a decision about property.

CAPACITY Capacity to grant Power of Attorney Knows nature and approximate value of assets; Aware of obligations owed to his/her dependants; Understands attorney’s broad authority; Knows attorney must account for decisions; Understands revocation rights; Appreciates impact of imprudence; and Understands exposure to misuse.

DEALING WITH DIFFICULT CIRCUMSTANCES Assessment – who is qualified You must have a client Privacy issues Business realities

DEALING WITH DIFFICULT CIRCUMSTANCES Practical rules to keep in mind 1.People who are mad at each other will eventually end up mad at you. 2.If you assist one of these people, the other one will threaten to sue you. 3.The person you assist will ultimately blame his/her misbehavior on you (see Rule #1).

DEALING WITH DIFFICULT CIRCUMSTANCES Options to consider – Being proactive Suggest POA to client at earliest opportunity. Involve the named attorney, to some extent, in discussions. Involve family members, to some extent, in discussions.

DEALING WITH DIFFICULT CIRCUMSTANCES Options to consider – Managing a dispute Stay out of other people’s battles (see Practical Rules). Do not ignore the issue or dither. Gather information. Communicate, no secrets with authorized individuals. Differentiate between authorized individuals and concerned individuals, but respect both.

DEALING WITH DIFFICULT CIRCUMSTANCES Options to consider – Resolving a stalemate Letter Deadline May have to pay into court Careful documentation of everything

SCENARIOS AND QUESTIONS Child says parent is incapacitated Stranger shows up with a POA document for your client Competing POAs or conflicting directions from attorneys One child says the POA is invalid POA asks for a copy of all of the client’s statements/records POA transferring account in from another financial institution Client has died

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