By: Jim Dossey, MS, MBA, JD -
Etta James, born Jamesetta Hawkins, died on January 20, 2012. Having won six Grammy awards, James gained fame with hits such as "The Wallflower", "At Last", "Tell Mama", "Something's Got a Hold on Me", and "I'd Rather Go Blind." James was diagnosed with Alzheimer's disease in 2008.
Unfortunately, Etta James left another legacy that should be avoided. James signed a power of attorney in 2008 appointing her son, Donto James, as her agent. Her husband of 41 years, Artis Mills, later claimed that James was already suffering from dementia and was not competent when she signed the power of attorney. Both Mills and Donto wanted to use James's estate to provide for her care at home. However, Mills wanted to manage James's estate, roughly $1 Million in savings, himself whereas Donto felt a third party should manage the estate "to avoid present and future family conflict and discrepancies.'' Mills and Donto battled in court for the next three years until her sickness was declared terminal in 2011.
A Power of Attorney ("POA") is a legal document that authorizes an agent to act on behalf of the person signing the POA (the "Principal"), such as in business dealings, medical decisions, or other legal matters. Because a power of attorney is a contract, the Principal signing the POA must demonstrate contractual capacity. In Texas, the Principal "...must be in possession of sufficient mind and memory to understand the nature and effect of their act in executing the contract." Haile v. Holtzclaw, 400 S.W.2d 603,612.
A Principal suffering from dementia or limited mental capacity can still execute a POA, as long as they have a lucid moment when they are signing the POA. However, a POA is not valid if the Principal lacks capacity at the time of the document execution. If this is the case, often the only way another party can act on behalf of the incapacitated person is through a conservatorship or guardianship. Ultimately, the parties in the James case settled shortly before she died, establishing a conservatorship with Mills as her conservator, enabling him to make her financial and medical decisions.
Dossey & Jones can help you with your Power of Attorney and other Estate Planning needs!