Incapacity planning is the area of estate planning concerned with the management of your legal and financial affairs if you were to become mentally incompetent, or simply unable to manage your assets because of physical limitations.

Without planning, a court proceeding called an interdiction may be required to allow the family to come before the court to seek permission to make banking or other financial decisions or to buy or sell property.

Some people attempt to avoid these problems with the use of a General Durable Power of Attorney.  Unfortunately, many of the powers of attorney that we see are invalid or lack the necessary language to accomplish what needs to be done.

People are often shocked to find out that Louisiana law does not require a power of attorney to be honored or accepted.  If a bank, hospital, etc., feels that the power of attorney does not expressly authorize your agent to do what he or she is attempting to do, they are not required to honor the power of attorney and cannot be legally forced to do so.

A living trust is often a better alternative to using a power of attorney alone to attempt to handle the financial affairs of an incapacitated person.  Unlike a power of attorney which need not be honored, the trustee of a trust has full legal authority to act on behalf of the incapacited person, and can enforce that legal authority in court if necessary.  For that reason, trusts are far superior to powers of attorney in incapacity planning.

Another potential threat is that Louisiana law allows any interested party to come into court and file an interdiction against you to have you declared legally incompetent and to attempt to take over your affairs.  If this occurs, that person could ask the court to appoint him or her as your curator.  The legal effect of this is to invalidate any power of attorney that you created while still competent.  This is another reason why a trust is superior to a power of attorney.  If you had a trust in place, the person attempting to take over your assets would be blocked from access to your trust, and your assets would be safe from the legal attack.

Call us today at (318) 352-9229 for free information on how we can help.