Did you ever wonder where the phrase “acting in concert” comes from? It may have originated from the Old Italian word “concerto” meaning “agreement, harmony” which sounds very nice. You would hope that two people who have to decide things together would do so collegially and with mutual consensus on the issues.
But the phrase may also have originated from Vulgar Latin “concertare” meaning “to settle by argument, debate, or to separate – decide by fighting”. This definition suggests an adversarial process to reaching agreement.
Which brings me to today’s estate planning topic – how many cooks should you have in the kitchen when creating your estate planning documents? Normally when spouses have a will or a trust they name each other as personal representatives (executors), successor trustees or agents under a durable power of attorney or health care surrogate documents.
Who should succeed the surviving spouse when making all of these decisions is where all of the real fun begins.
Many times parents will name their children to act as their successors. They might name two adult children to make their legal, tax, financial and health care decisions together. They might name them in successive order but in several instances they might want two or more adult children to act together. They expect the children to “act in concert”.
This then begs the question – do both of them have to agree in order to carry out business? Under Florida law the general answer to that question is “yes”.
And here’s where it gets interesting. What happens if the two parties named in the legal documents can’t stand one another? One says the sky is blue and the other disagrees. There’s no shame in the fact that we have raised children who don’t see eye to eye – that seems to be common among many siblings for whatever reason.
But when you are entrusting your legal, financial and health care decisions to those who you love but may not necessarily get along, what should you do? One choice is to clearly name the children in successive order. Indicate who is to act first, then second, then third.
The idea of putting two cooks in the kitchen at the same time isn’t always a bad one, however. One child might be good with financial aspects but might be impulsive. Another child might temper the impulsiveness of the first. So even if they butt heads on occasion, naming two very different siblings to act together might actually lead to better decisions.
When choosing two or more individuals to serve together in these roles, you should first communicate with all of them what to expect. Tell them that they’ll be working together. Set expectations. You might tell them that while you expect them to debate certain decisions and not see eye to eye on all matters, you are choosing them both because you appreciate and value their different perspective on things. This kind of a conversation might help them see their differences in a new light, and be more open to one another’s viewpoints.
If, however, you suspect that the bad blood between them may lead to stalemates, then it is a wise idea to impose a third party “tie-breaker”. You might name a close friend, relative or advisor to fill this role only when necessary. The legal documents can be drawn to anticipate these issues and provide for a means to resolve them.
One type of document is a bit problematic – your Durable Power of Attorney. Under Florida law, you cannot create a “springing” Durable Power of Attorney meaning that it is only effective if the person holding the one before it can’t act. The Durable Power of Attorney document is valid the minute that you put pen to paper and sign it. Therefore, when you have more than one Durable Power of Attorney, you usually have multiple individuals all with current authority.
One solution is not to give individual Durable Power of Attorneys, but rather name multiple individuals in one document. While this avoids the multiple individual powers problem mentioned above, it also creates a situation where the incapacity of one of the agents named in the document renders the entire document useless. So that is usually not a recommended course of action.
The bottom line is to carefully consider those that you are naming in positions of authority within your legal documents, and to communicate what you have done and your expectations for when they must act for you. And then hope for the best!
©2023 Craig R. Hersch. Learn more at www.floridaestateplanning.com