How to deal with entities that require signatures from parent who has advanced dementia?

Usually the DPOA has the authority to sign necessary paperwork.

Something else just occurred to me. You might want to google the California State Bar Association, attorney grievance committee, and check to see if your mother's attorneys' name is there.

Terry and Scrimble, remember that I'm just trying to interpret what I think the situation is, and what the documents are for. There were some other issues that I didn't address because I really wasn't sure if I was on the right track or not.

Terry, I did work for several years in what's known as transactional law, with emphasis on commercial lending and real estate. I've also worked I estate planning firms, and been a government contract administrator as well.

Gee, I really miss those days now!


I'm still wondering about the need for a separate Residence Trust, unless the heirs named in the Family Trust are different. There are a lot of other questions about the sequencing and purpose of some of the documents.

Clarification to the paragraph beginning "a second question"...I'm still not clear whether the Residence Trust was actually created and is being amended or is now being created after the Reverse Mortgage has been executed. So that paragraph is a bit fuzzy.

As to Scrimble's mother's attorney, I've met a few like him. One I temped for was a solo practitioner allegedly specializing in Estate Planning. He prepared so many documents for one client that they filled a large 3" binder. When the client asked to take them home to review them, he became very angry and said that he provided a summary of each document and she didn't need to read them before her mother signed.

I felt badly for the client and was embarrassed because the attorney's behavior became belligerent. It didn't take long before he was hollering at the client. I don't recall if he ever did release the dox to her because I was just too embarrassed to listen.

Unfortunately, when it comes to complicated documents, that's not an unusual practice for attorneys.

I honestly don't think any toes would be stepped on if you took all the dox to your attorney and told her that you really need to understand the intent and purpose, as well as the plan, are to make sure that you're comfortable with what's happening.

And please do post back; I'd like to know how things work out for you.

I also just found an error, even after proofing the post several times. In the paragraph beginning "you wrote", the last reference of "RV" should be "RM". I don't know why I was thinking of an RV park or maybe it was just a typo.

Good luck, and you're quite welcome. It was quite a mental challenge for me and I enjoyed it!

Thank you from the bottom of my heart! GardenArtist you explained this better to me in such a way that I can finally grasp what my responsibilities are and not having to second guess the one person I should be trusting- my mom's attorney. He literally would not explain these things to me, just sent them and ask her to sign with a notary present. That was my first red flag. I can say I'm not the brightest and I am more forgiving when it comes to most people but when it's something to the effect of an entire estate and the savings thereof, I've been baffled by this guys lack of returning calls, emails, and messages. My estate and elder attorney stated she would take over only not to step on toes after I attempted to contact him again. Still no answer from him however, the building operator said they stepped out to lunch. I just shake my head and I really did not leave any rude or condescending messages at all. Just who I was and please call me back regarding questions I had. Once again, the help and explainations I received on here were beyond helpful and an answer to prayer. I am so glad, like Terry512 stated, that I didn't have my mom sign as directed and have everything implode with the RM and other legalities.
Thank you again!!!! Have a wonderful and blessed weekend and if you don't mind, I will post what my attorney lets me know once I get these documents explained as to their necessity.

GA, I think you have explained the whole issue to the best of your ability and well done!! It seems much more clear what and why the attorney is asking for papers to be signed and I agree that it is improper to ask SB to sign the documents or talk to herr mother into signing when neither one of them understands what's going on. Maybe his assistant made sure the papers were done and he doesn't really know what and how to express himself as to the validity of the documents. He just wants them signed by golly. I wouldn't do it either. If ScrimbleB can understand what you've written, or she may at least get the gist of it and explain it to her mother. You must have had issues with loan documents, RM's, trusts, etc. in the past or you can see something that is not easily available to the rest of us but you've explained it well and I hope it makes some sense to her so she can protect her mother. They should each have a full copy of all the docs and all sit around the table and have him read it in it's entirety and explain what it is and why he's asking for it. That's what he's billing her for anyway so he shouldn't hedge on doing that. ScrimbleB, you really have your work cut out for you and maybe an attorney would be the best decision if you don't really want to go line by line to fully understand what he wants you to do. The worst thing possible is to sign willy nilly and then wonder what happened to the profits. good luck.

I’m going to recap to see if I’ve got everything straight.

First, though, this is a confusing situation, and I think that to put everything in perspective, you really should have your own attorney read all the documents, because you need a good legal opinion on these issues. And all anyone can do from here is just try to interpret. But an attorney REALLY needs to read all the documents and explain to you what your mother's attorney is trying to do.
I'm not entirely comfortable with his approach, if I'm understanding the situation correctly.

Okay, this is what I think is happening, or supposed to happen:

Your mother’s attorney has prepared and wants your mother, despite diagnosed dementia, to execute documents that deal with her home covered by a Reverse Mortgage, which someone (your mother?) executed, presumably after your father died.

The Family Trust was amended and restated after your father’s death and establishes that your mother, you and one other person are Trustees, each with the authority to act independently.

Now the attorney wants to protect the equity in the home (presumably against family attempts either now or later after the house is sold) to access the funds, right? Therefore, he’s creating a Residence Trust to hold title to the house, now before the house is sold, and to hold the funds after the house is sold and the RM is paid off, right?

You wrote that there are still funds left in equity that can be drawn against under the RM; however, those funds that have been drawn down are presumably not being paid back, interest is likely accruing monthly, and that interest is added to the amount on which interest accumulates the following month....i.e., interest on interest on advance. The RV is negatively amortized, no funds are being paid down on it, but the increasing amount owed is diminishing what equity did exist.

While there still is equity in the house, it will be diminished the longer the house is on the market, depending on the amount of the existing advances as well as the interest rate and various fees. However, assuming there will still be equity, your mother’s attorney wants to protect that from the family and reserve it solely for her care. Right?

So a Residence Trust will be created, solely to hold title to the house and the proceeds from its sale until your mother dies.

This requires execution of the Residence Trust, solely for purpose of protecting the house and the subsequent proceeds from sale. In addition, a Quit Claim Deed transferring title to the house into the Residence Trust will be executed, to "fund" the Residence Trust.

Is title now vested in your mother, as a single woman or survivor of her deceased husband, or is it vested in the Family Trust?

Issues:

Beyond the issue of your mother’s executing both these documents given a dementia diagnosis (assuming it addresses her ability to execute legal documents), there’s the issue of a transfer of title that might be considered an event of default under the RM, which could cause the RM lender to accelerate the mortgage and require full payment.

When the house is sold, your mother as Trustee of the Residence Trust would also have to execute a Warranty Deed to the purchasers. Again the issue of the dementia arises.

However, are you named as Co-Trustee of the Residence Trust as well as the Family Trust? If so, this would allow you to sign the purchase agreement and other documents necessary to sell the house.

Once the house is sold, the proceeds will be put into some type of investment, savings, CD, etc. account, titled in the name of the Residence Trust, and held solely for use for your mother’s needs for her remaining life. Those are terms in the Residence Trust. Right?

A second question related to that issue is whether the RM lender knew about the Residence Trustee and if the RM reflects your mother or the Residence Trust as the borrower. My sole experience with loans to a Trust was that most banks don’t know how to deal with trusts, but the one that did required the trustees to personally guarantee the loan.

The Family Trust would again be amended and restated, affirming that all terms are reaffirmed except as relating to those that allow the house to be released and transferred to be held separately in the Residence Trust.

The Pour-Over Will, if it addresses the house as being subject to the Family Trust, would I think be subject to a Codicil reaffirming all the terms, IF the house is addressed, and if so inclusion of its transfer into the Residence Trust would be stated.

The Occupancy Agreement may address who may live in the house either while it’s subject to the Reverse Mortgage (and that’s another issue if the house is vacant, since it also may be a violation of terms of the RM), and until it’s sold. Right?


There may very well be some erroneous assumptions, as it's still not entirely clear to me what the sequence of events has and will be, nor is it clear what the intent of the various documents are as well as if they're being done after the fact and if they could cause an event of default in the Reverse Mortgage.

What I also don't understand is why your mother's attorney didn't explain all of this to you. It's confusing, and to expect that you'll be the go-between to secure your mother's signature to documents you don't even understand is highly improper in my opinion.

I wouldn't sign anything or ask your mother to without addressing the entire situation with your own attorney, and asking him/her to read the documents as well as the Reverse Mortgage to identify any potential conflicts.

I think I would consult an Elder Care Attorney to review the papers and tell him/her what the other attorney is saying/doing and ask for guidance. Do you owe the bill he sent you? Should you sign the documents? What will they do to the mortgaged house? And a lot more questions for the new attorney just to be sure before signing anything or having your mother sign any paper.

Scrimble, thanks for your clarifications. I think I've got it figured out but just lost the entire response I was posting. I'll be back after I have dinner and am fortified so I don't make another stupid mistake. I hate it when I lose a whole response!

Me again, the restated trust that was enacted after my dads passing stated that "the settlor appoints herself, xxx and me, as the concurrent Trustees of the Trust and we may act independently on behalf of the trust and carry out powers and authority as a trustee. These are recorded documents from just a few years back. So I'm confused

Sorry, it is a living trust and attached Will.

So, here are the documents he sent me.
1. The Residence Trust
5. The Occupancy Agreement.
6. The Quitclaim Deed to transfer out of the Family Trust to "my mom".
7. The Quitclaim Deed to transfer into the Residence Trust.
8. The Amendment to the Family Trust.
The other unnumbered items were for unclaimed property in various states and he also sent a Small Estates declaration for a notary to witness as my mom signed that as well.
The home is in a reverse mortgage and the trust is a revocable trust. Sorry for the mistake in my earlier post. My mind is a twirling.

I've been trying to think how good attorneys would handle this situation, in which a family member sought advice for the attorney's client b/c the client couldn't herself. I think a good attorney would work with the family member, and bill him/her, but I think the trustee for the client would work WITH the family member's attorney jointly to accomplish the goal of the person named in the DPOA.

I honestly still can't figure out what the intent of the various documents and changes are.

Please do report back; I'd like to understand what's really happening,

If you could also tell what other documents he wants you to sign, it might make more sense.

Is he trying to quit claim the house to you, to release it from the Irrevocable Trust so the house can be sold? Is the house titled in the name of the IT now?
That does make some sense; I'm just not sure if this can be done from a trust that's irrevocable; I think it would depend on the specific terms of the trust whether assets once funded could be released.

Living Trusts can be revoked, Irrevocable Trusts cannot. But I don't know if an IT can be unfunded. I haven't experienced anything like that before.

There's another whole issue and that's who is the trustee of the Irrevocable Trust? Generally when houses are "funded" into a trust, a Quit Claim Deed is executed from the maker of the Trust and reads something like "Scrimble's Mom, a single woman, as Trustee of SM's Irrevocable Trust dated ......, 20xx or any Successor Trustee thereof."

I'm wondering if there's also a clause in the IT allowing the Successor Trustee to act if your mother develops dementia and can't act as Trustee herself (if she is in fact Trustee).

My mom does have a reverse mortgage however the payoff is only 1/2 of what the house appraised out of and therefore the rest would be my mom's free and clear to be put into savings. My attorney only reviewed the Poa documents but now will be called tomorrow to further this dilemma. It really is frustrating and wrong. I even received a bill today for his services and yet I'm not his client. I'm not a happy camper right now and sad to think this could happen to other people. I will check back once I get more info regarding this confusing situation! Thank you for your patience with this and trying to understand when I can't even myself!

I'm still confused. Does your mother have a reverse mortgage, or is that being contemplated? If she has one, and if there have been any draws, I hope you're aware that these are negatively amortized loans. There isn't likely to be much equity at all if she's drawn down on it and doesn't make payments.

If you want to sell the house, pursuant to title having been transferred by a quit claim deed, the reverse mortgage will have to be paid off from the proceeds of the sale. However, there may be some issues raised by the title company if you've been quit claimed the property but still plan to use your DPOA to act on your mother's behalf.

If the quit claim deed is to transfer the home from the irrevocable trust, better inspect that trust with a fine toothed comb. Irrevocable means exactly that, and it might just apply to anything, including the home, that's already been funded into the trust. Your own attorney should opine on this issue.

There's still something odd about this situation. He states he's your mother's attorney, but he's asking you to sign documents. Has your attorney reviewed all these documents and offered any opinion?

I have run into people who feel it would be much better to have my mom's signature on documents rather than mine as POA, especially when dealing with large sums of money. The implication seems to be that there is much less likelihood of raising red flags and further scrutiny on documents bearing the owners signature. Of course if anyone ever does flag these documents there would be some question as to their legality, but I assume the hope is that it would never come to that point.
Perhaps this is the type of thing your mother's lawyer is proposing, that is why he has stepped back when you questioned him. He doesn't want to come out and say what he is doing isn't strictly legal, sort of the left hand not admitting what the right is up to....very murky legal waters!

Thank you for your responses. He is an odd man and as I was asking him questions he told me he was her attorney not mine. So then I told him that I wanted what was best for my mom and whatever money that came from the equity of her home after it sold be protected and used only for her so no one else could use it, i.e. greedy family. So he sent me an email and in the mail to a no longer valid address, 9 different documents. They were to basically to help her money be safe. They were to move her home out of the irrevocable trust, a quit claim deed, a verification of wanting her will as it is stated , etc. So I have tried to call him back with no return call and now no return email from him either. This was all after he and I discussed how I didn't like that she would sign papers she didn't know she was signing and was that fair and would be legal? He said the comment he was her attorney not mine. She doesn't have any clear days just moments and those are few and far between and last maybe 5 minutes to say the most and even then it goes into another topic.
I know her current paperwork is valid as I've had my attorney review it. I wonder if I can switch attorneys though? He's not responding and it's just a weird situation.

Just a thought is he going to let her DATE the document or is it a document that should have been signed at the time but someone missed it? If so GA is right it might be invalid

Before you fire your current attorney, let him know that you are calling the American Bar Association for guidance about getting him to accept DPOA. Does he specialize in elder law? Has he made these requests to you in writing or just verbally? How long has this person been your mother's attorney? Does your mother have any "clear" days when you could get her to sign? Perhaps it's time to get guardianship? Here's an article from 2011 about why it's become harder to get people to accept POA:
wsj/articles/SB10001424052748704681904576315662838806984
Power Grab!
Signing Over Power of Attorney to a Loved One Has Never Been Trickier. Here's What You Need to Know.
By Kelly Greene and Jessica Silver-Greenberg

I think I would think seriously about finding a new attorney.

I'm not sure I understand the need for a Quit Claim Deed in conjunction with the reverse mortgage; if the mortgage has already been recorded, after she's been diagnosed with advanced stages of dementia, and if she didn't know what she was signing, the mortgage might be invalid.

Something's very odd about this situation. If you are named in the DPOA, and are authorized to sign financial and legal documents, I don't understand why the attorney isn't accepting that authority.

I'm curious what the other "numerous documents" are - as I say, something's fishy about this whole situation.

The only attorneys I've ever worked for who insisted someone sign something, at any stage of their lives, either didn't know how to explain the need for the documents or weren't what I would consider reliable attorneys.

Back off whatever this deal, step back and reassess the situation. If you need help in finding a reliable attorney, there are ways to do so through your state's Bar Association.