Keeping it Simple Series: Can a Power of Attorney Agent Amend a Trust?
The short answer is, it depends. That is a typical lawyer answer for you, but it really does depend on some key wording in two documents - the Trust itself and the Power of Attorney. Let's begin with some definitions. A Trust is a document that hold title to your assets that prevents probate of your estate upon your death (if done correctly). There are numerous types of Trusts, so for simplicity, I will use a typical Revocable Living Trust (aka Family Trust). A Power of Attorney is a document in which the Principal (you) gives another person (the Agent or Attorney-in-Fact) the power to make financial decisions for you in the event you cannot.
In certain situations it may be prudent to give your agent the power to make changes to your Trust once you pass away. One common reason is to make amendments for tax advantages that may have not been known during your lifetime or that the tax laws changed shortly before your death.
California Probate Code sections 15400 - 15414 govern modification and termination of trusts.
Specifically, probate code section 15401 allows for this scenario.
Subsection (c) states:
A trust may not be modified or revoked by an attorney in fact under a power of attorney
unless it is expressly permitted by the trust instrument.
What this means is, the Trust must include specific language that the Agent under your Power of Attorney has the authority to made modifications or revocations. The Power of Attorney, must include specific verbiage that the Agent has the power to make modifications or revocations to your specific Trust (i.e. it must state the Trust name). Here is an example:
My agent has the power to modify or revoke the Jane Smith Revocable Trust dated January 1, 2000. With the specific Trust named, there will be no ambiguity as to which Trust can be amended, in case you have more than one trust - which is a possibility.
Always remember, a well-drafted Will and Trust will avoid the pitfall of probate court and save your family time, money, and stress.
Author: Duisters Law, APC - Will and Trust attorneys.