The Challenges with Naming Co-Fiduciaries

A client who has two or more children is typically asked to choose one over the other(s) as the primary agent under a Power of Attorney or as primary successor trustee under a Living Trust.  The question the client sometimes asks is if they can name both children or all of them as co-fiduciaries. Most parents are convinced that their children will cooperate fully, and that there will never be any disagreements between or among them. Unfortunately, this isn’t always the case.

In cases where parents name co-fiduciaries, siblings can agree on a general direction without agreeing on the specifics of how things should be accomplished.  If all parties don’t agree, disputes may ensue that can cause rifts among siblings and create disharmony in families.

These are some challenges when co-fiduciaries are named:
•    Getting everyone to coordinate their schedules to be at the same place at the same time, especially during business hours, can prove a daunting challenge.
•    Delivering important documents from one to another to another for signatures can cause unnecessary delays.
•    Some financial institutions and health care providers may refuse to honor a Power of Attorney or an Advance Medical Directive that allows either co-fiduciary to act individually; they don’t want to end up caught in the middle of a dispute, being blamed by one co-agent for allowing the other co-agent to make or carry out some decision personally.
•    When co-fiduciaries disagree and become deadlocked, they can go to court to get the deadlock resolved which turns out to be an expensive solution. In addition, it allows the possibility that a judge, rather than family members, will be making decisions on the client’s behalf. It could very well produce or deepen a rift in the family that may never heal. Such consequences are hardly what the client imagined, let alone intended.

If you don’t have your estate planning or incapacity planning documents in place, now is the time. Call the Fairfax and Fredericksburg Elder Law Firms of Evan H. Farr, P.C. at 703-691-1888 to make an appointment for a consultation.

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About Evan H Farr, CELA, CAP

Evan H. Farr is a 4-time Best-Selling author in the field of Elder Law and Estate Planning. In addition to being one of approximately 500 Certified Elder Law Attorneys in the Country, Evan is one of approximately 100 members of the Council of Advanced Practitioners of the National Academy of Elder Law Attorneys and is a Charter Member of the Academy of Special Needs Planners.

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