Like death and taxes, having a personal fiduciary act on our behalf will be necessary for all of us at some point in our lives. Identifying these persons or institutions to act as an agent under power of attorney, executor under a will, or as trustee under a trust should be carefully considered and discussed with an estate planning attorney.
Depending on your family dynamic and the relationships you have with your family, your considerations and final decisions should also be discussed with your immediate family members. There are of course some situations when this is not advisable. Consider the situation that Beverly Schottenstein, a prominent person in Central Ohio, found herself in when she discovered the grandsons she selected to act on her behalf, and who she trusted, turned out not to be looking out for her best interest and who repeatedly refused to discuss her own financial matters with her, even when she inquired. Mrs. Schottenstein has publicly discussed this matter in the hopes that it will help others to avoid such an unfortunate and unexpected situation. In her case, she was still a competent individual who could pursue action to remove the grandsons from her agency.
Imagine how much more troublesome this situation is when the person is unaware this is occurring due to their own incompetency or illness. It is critical when considering a family member or friend to act in any of these fiduciary roles that they be trustworthy with the highest integrity and commitment to complete the required tasks responsibly and in the best interest of the one on whose behalf they have been asked to serve. They must also be willing to accept such a position if named to do so and understand what the law requires of them in serving and carrying out their responsibilities.
An alternative to a family member is to select a reputable trust company or lending institution that has a trust department to serve. These third parties are experienced in serving in such roles and can remain objective. Under Ohio law they are also held to a higher fiduciary standard than the individual serving in such roles. These third-party fiduciaries will charge a fee for their service but arguably even a named family member, other than perhaps a spouse or child, should also be compensated for the performance of their duties. Consider the old adage in that you get what you pay for. One limitation on the use of the institutional fiduciary is that they may be limited in their service to only executor and trustee positions and may, by their own policies or regulations, be prohibited from serving as an agent under a power of attorney. In such case, one could at least combine the use of individuals with the institutional fiduciary in order to select fiduciaries for each needed role.
The attorneys at Thomas Law Group can assist you in all of your estate planning needs, including making decisions about personal fiduciary selections.