General Durable Powers of Can Attorney Backfire: Lessons from Financial Institution Resistance and the Advantages of Trust-Based Planning

A recent investigative report out of Utah illustrates a growing challenge for families across the country, including in Ohio and Missouri: valid General Durable Powers of Attorney (GDPOAs) are frequently rejected, refused, or delayed by banks, brokerage firms, and insurance companies. When financial institutions refuse to honor these documents, families can face prolonged financial paralysis, increased costs, and, too often, the very court intervention (guardianship or conservatorship) that proactive estate planning was meant to avoid.

The Utah Case Highlights a National Problem

In the widely reported case, Pam Davis attempted to manage her brother Stan’s finances after he fell victim to a devastating scam. Despite holding a valid Power of Attorney (along with conservatorship and guardianship documents), a major credit card issuer repeatedly refused to recognize her authority. Only after media intervention was the matter finally resolved. This is not an isolated incident. Families in Ohio and Missouri regularly report similar frustrations with banks, brokers, insurance companies, and other institutions when trying to use GDPOAs during incapacity or after a loved one’s death.  Moreover, the problem is not new; Diane G. Armstrong, elder consultant and author, testified before Congress in 2003 that even judges "disregard durable powers"  and "ignore our lists of preselected surrogate decisionmakers." (Guardianship Over the Elderly: Security Provided or Freedoms Denied? at p.74).

Ohio and Missouri Law Supports POAs — But Institutions Often Don’t

Both states have strong statutes intended to make GDPOAs effective:

• Ohio generally requires third parties to honor properly executed GDPOAs and provides remedies for unreasonable refusal (Ohio Revised Code Chapter 1337).
• Missouri similarly mandates recognition of valid GDPOAs, emphasizing the grantor’s intent and minimizing unnecessary court involvement (Mo Durable Power of Attorney Act).

Despite these legal "protections," financial institutions often refuse these documents, demand new account openings or additional documentation, or simply stonewall appointed agents. The result is often delayed access to funds, interrupted direct deposits and bill payments, increased stress, and sometimes the need to pursue formal guardianship, a process that removes autonomy, invites potential abuse, incurs high legal fees, and brings the probate court into family matters.

Moreover, only Missouri has a statutory provision interpreted as imposing liability on institutions that wrongfully reject valid GDPOAs.  Ohio adopted most of the Uniform Power of Attorney Act, but expressly chose not to adopt the provision that imposes statutory liability or attorney-fee recovery on third parties who unreasonably refuse a valid POA. As a result, if a bank or brokerage refuses a GDPOA in Ohio, the agent’s primary recourse is usually to file a court action to compel acceptance, without any automatic right to recover attorney fees or damages for the refusal itself.

The Core Problem with Heavy Reliance on GDPOAs

General Durable Powers of Attorney, while essential tools, have inherent limitations in today’s financial environment:

• Rejection, Refusal, and Delay: GDPOAs are frequently rejected or delayed by institutions, even when documents are properly drafted and presented.

• Lack of Seamless Continuity: GDPOAs can expire, be challenged, or become ineffective in certain situations (e.g., after death).

• Vulnerability During Crisis: When a loved one is incapacitated or has passed, families need immediate, reliable access to assets. Institutional resistance can force rushed guardianship petitions, exactly the outcome thoughtful planning seeks to prevent.

• Limited Asset Protection:  A GDPOA does not provide the same level of lifetime asset management flexibility or direction, probate avoidance, creditor or other risk protection, or long-term planning, provided by a properly funded revocable living trust.

Relying too heavily on a GDPOA alone leaves individuals and their estates exposed precisely when they are most vulnerable.

The Stronger Alternative: Trust-Centered Estate Planning

A well-drafted revocable living trust addresses many of these shortcomings and offers superior protection and efficiency:

• Acceptance: Assets titled in the trust are managed by the successor trustee without the need for institutional approval of a GDPOA. Financial accounts, real estate, and investments can continue operating seamlessly.

• Resilience:  While GDPOs get "weaker" over time and lack need or use, trusts build resilience and become "stronger" over time. 

• Asset Protection:  A properly drafted trust can actually protect assets from guardianship control, protecting your preferred decision-makers, and discouraging guardianship by reducing guardian compensation (guardian compensation is often based on the total value of assets managed in the guardianship estate).

• Privacy: Probate avoidance (during life and at death) is built-in with trust planning, minimizing court involvement and public disclosure.

• Reduced Guardianship Risk: With assets in trust and a comprehensive plan, families are far less likely to need court-appointed guardians.  

• Discouragement: Most trust-based plans discourage court involvement and incentivize decision-makers and beneficiaries to respect your advance directives, including those regarding guardianship. 

• Greater Control and Flexibility: The grantor retains full control during life, while the trust provides clear instructions for incapacity and death.

• Acceptance by Institutions and Third-Parties:  Many banks and brokers are more comfortable working with trust-titled and trustee-managed accounts.

Combining a revocable living trust with a properly drafted GDPOA that supports the trust creates a robust, multi-layered plan that minimizes reliance on any single document.

Practical RecommendationsIf you already have a trust, the following are steps you can take right now to support your plan:

• Prioritize trust funding. Work with an elder law attorney to retitle assets into a revocable living trust during your lifetime, and ensure that all qualified accounts (IRAs, TSAs, Roths, SEPs, and retirement plan assets) become property of the trust at the time of your death unless they are directed to a surviving spouse.

• GDPOA Deployment: Use a GDPOA as a safety net, not the primary tool protecting you or your estate. Ensure it is broad, up to date, and accompanied by clear instructions for agents.  Also, if it is your desire,  make sure that it confers authority to transfer assets for the purposes of government benefits planning (Medicaid), and to settle an irrevocable trust (provided beneficiaries are the same) as well as transfer assets to the trust.

• Proactively Communicate with Institutions: Notify banks, brokers, and insurance companies of your trust and GDPOA while you are still healthy. Request written confirmation of receipt and acceptance.  

• Maintain Organized Records: Keep a Certificate of Trust, full trust agreement (in a secure location), and updated GDPOA readily available.  If necessary, consider LegalVault® or Docubank.  For more information, see our articles, "The Trouble With Advance Directives," and "Most Procrastinating on Planning; Those That Plan Don't Protect Their Plans."  You can read all of the articles that discuss or refer to LegalVault® here.   

• Review and Update Regularly: Life changes (marriage, divorce, births, deaths, disabilities, moves, name changes) may require adjustments to the plan.  Consult with your drafting attorney (minimum frequency every 3-5 years) for changes in the law.  Subscribe to this blog.  

The Bottom Line: Plan Beyond the GDPOA

General Durable Powers of Attorney remain important, but they should not be the cornerstone of your estate plan. Over-reliance on POAs exposes you and your loved ones to institutional resistance, delays, and the very guardianship risks you hope to avoid.  A trust-centered approach, with properly titled assets, clear succession, and supporting documents,  provides far greater security, efficiency, and peace of mind. This strategy supports true aging in place by preserving control and minimizing external interference during times of vulnerability.

If you have experienced difficulties with financial institutions honoring a Power of Attorney, or if you want to strengthen your plan with trust-based strategies, contact an experienced elder law attorney. Proactive planning today can prevent unnecessary battles tomorrow.

For more on guardianship reform, visit the National Association to Stop Guardian Abuse (NASGA).What steps have you taken to make your estate plan more resilient? Share your thoughts in the comments. Together, we can encourage better planning practices that truly protect independence and family control.

Doolin v. Owen: A Cautionary Tale regarding Springing Powers of Attorney

The Kentucky Court of Appeals’ decision in Doolin v. Owen, decided on July 18, 2025, underscores the critical importance of careful drafting and execution of powers of attorney (POAs). This case highlights the pitfalls of “springing” POAs, those POAs that become effective only upon a specific condition like the incapacity of the principal, and offers valuable lessons for seniors and families planning for incapacity and asset management.

Case Background and Facts
In 2015, Linda Miller executed a general power of attorney (POA) in Kentucky, designating an agent to manage her affairs. The POA was designed as a “springing” POA, meaning it would only take effect upon Linda’s disability, as confirmed in writing by her personal physician. The document also specified that it was a durable POA under Kentucky law, intended to remain effective even if Linda became incapacitated. Later, Linda was declared partially disabled in managing her personal affairs and wholly disabled in managing her financial affairs, though the record did not indicate whether her personal physician provided the required written confirmation.
In 2017, relying on the authority of the POA, Linda’s agent established a trust agreement naming Marcy Doolin as the beneficiary. The trust was intended to manage and distribute Linda’s assets. Linda passed away in September 2022, and disputes arose regarding the validity of the trust created under the authority conferred by the POA. Marcy Doolin filed a petition in the Jefferson Circuit Court seeking a declaratory judgment to confirm her rights as the trust’s beneficiary. David Owen, the administrator of Linda’s estate, moved to dismiss Marcy’s petition, arguing that the trust was invalid because the POA was never properly activated.
The circuit court ruled in favor of Owen, finding that the 2015 POA was never triggered due to the absence of a written confirmation of disability from Linda’s personal physician, as required by the POA’s terms. Consequently, the trust created under the POA’s purported authority was deemed void ab initio (invalid from the outset). Marcy sought postjudgment relief, presenting new evidence: a 2017 MRI report and a physician’s report indicating Linda’s disability. The physician was not, however, Linda's personal physician. The circuit court denied her motion. Marcy appealed to the Kentucky Court of Appeals.
On appeal, the Kentucky Court of Appeals reviewed the circuit court’s dismissal de novo, as it involved a legal question of contract interpretation (the POA). That means that the appellate court did not defer to the trial court in any way, but looked at the entire record as if the trial was conducted fresh from the beginning.  The court also reviewed the denial of postjudgment relief for abuse of discretion. The appellate court affirmed the circuit court’s rulings, solidifying the importance of adhering to the specific conditions outlined in a springing POA.
The Kentucky Court of Appeals addressed two primary issues:

1. Was the 2015 POA properly triggered, allowing the creation of the trust agreement under its authority?
2. Did the circuit court abuse its discretion in denying Marcy’s postjudgment motion based on newly discovered evidence (the 2017 MRI report and another physician’s report)?

These issues are critical for seniors and families, as they highlight the legal and practical challenges of employing and relying on springing POAs to manage financial affairs during incapacity.The Kentucky Court of Appeals’ HoldingThe Court of Appeals affirmed the circuit court’s rulings, with the following key findings:

• POA Not Triggered: The court treated the 2015 POA as a contract, interpreting its terms strictly. The POA explicitly required written confirmation of Linda’s disability by her personal physician to become effective. Since no such documentation was provided in the record, the POA was never activated. As a result, the trust created in 2017 under the POA’s purported authority was void, as the agent lacked the legal authority to establish it.
• Postjudgment Relief Properly Denied: Marcy’s postjudgment motion relied on a 2017 MRI report and a report from another physician indicating Linda’s disability. The Court of Appeals found that these documents did not satisfy the POA’s specific requirement for a written confirmation from Linda’s personal physician. The circuit court did not, therefore, abuse its discretion in denying the motion, as the new evidence failed to meet the POA’s springing condition.

The court also dismissed Marcy’s additional arguments, finding them either unpreserved, insufficiently explained, or unpersuasive. The decision reinforced the principle that springing POAs require strict compliance with their triggering conditions to be effective.Lessons for Seniors and FamiliesThe Doolin v. Owen case, combined with insights from the Aging-in-Place Planning and Elderlaw blog article, “The Impotent Power of Attorney” offers critical guidance and warning for seniors and their families:

• Understand the Risks of Springing POAs:  As highlighted in “The Impotent Power of Attorney,” springing POAs, like the one in Doolin v. Owen, can create significant obstacles and introduce unnecessary variables into the orderly administration of an estate plan. Requiring a physician’s written confirmation of disability may seem like a safeguard, but it can render the POA wholly ineffective if the condition is not met precisely.  These are commonly rejected by third parties, e.g., banks, brokers, and financial institutions, that recognize these uncertainties and desire to avoid being embroiled in controversy.  Seniors should carefully weigh the benefits and risks of springing POAs versus immediate POAs, which take effect upon signing.

• Ensure Clear and Specific POA Terms: The case underscores the importance of drafting POAs with clear, achievable conditions. The requirement for a specific physician’s written confirmation led to the trust’s invalidation. Seniors should work with an elder law attorney to draft POAs that avoid overly restrictive conditions, ensuring the agent can act when needed without unnecessary hurdles.

• Verify Compliance with POA Conditions:  Families and agents must diligently comply with a POA’s terms. In Doolin, the absence of the required physician’s letter nullified the trust. Before taking significant actions like creating trusts or managing assets, agents should confirm that all conditions of the POA have been met and document compliance thoroughly.

• Plan Early to Avoid Disputes:  Li
  nda’s trust was intended to benefit Marcy, but its invalidation disrupted her estate plan and led to litigation. Seniors can prevent such outcomes by establishing estate plans, including POAs and trusts, well before incapacity. Early planning with an elder law attorney can ensure that documents are valid and aligned with the senior’s wishes.  If Linda had settled the trust at the same time that she created the POA, the result would likely have been as she intended.  

• Engage Professional Guidance:  The complexity of Doolin v. Owen illustrates the value of legal expertise in estate planning. An elder law attorney can help draft POAs, trusts, and other documents to withstand legal scrutiny, advise on the implications of springing versus immediate POAs, and assist in resolving disputes if they arise. 

• Document Disability Promptly: For springing POAs, obtaining and preserving the required documentation (e.g., a physician’s letter) is critical. Families should coordinate with healthcare providers to secure written confirmation of incapacity as soon as it is diagnosed, storing it securely with the POA to avoid challenges like those faced in Doolin.  A forensic (after the fact) letter or statement of expert evaluation may not suffice either to protect either prior or subsequent decisions.  

• Review and Update Estate Plans Regularly: Life changes, such as a new diagnosis or a change in physician, can affect the validity of a springing POA. Seniors should review their POAs and estate plans periodically to ensure they remain effective and reflect current circumstances.

ConclusionDoolin v. Owen serves as a stark reminder of the potential pitfalls of springing powers of attorney and the importance of meticulous estate planning. Seniors and their families must approach POAs with care, ensuring that conditions for activation are clear, achievable, and properly documented. By working with an elder law attorney, planning early, and reviewing documents regularly, seniors can protect their assets and ensure their wishes are honored, avoiding the kind of legal disputes that invalidated Linda Miller’s trust. For more insights on avoiding an “impotent” POA, revisit our blog post, “The Impotent Power of Attorney,” and consult an elder law professional to safeguard your future.