Suppose you have been acting as agent on someone’s financial power of attorney. Tragically, they died this week. What can you do as agent after the death of the principal?

Or maybe you are named as personal representative in someone’s will. When they die, are you able to take any actions before their will is admitted to probate?

Or perhaps you have been acting as court-appointed conservator of the estate of someone who has been unable to manage their own affairs. If they die does your authority end immediately?

Caution: every scenario is different.

Second caution: we’re talking about Arizona law

OK — these scenarios are very common. At Fleming & Curti, PLC, we often get questions about what a fiduciary is able — or maybe even required — to do after the death of the principal.

But every variation can lead to a different answer. And state laws can vary widely. So take what we write here as suggestive, rather than dispositive. Maybe we can help you sharpen your questions for further inquiry.

Death of the principal — power of attorney

Here’s the historic rule: when the principal (the person who signed the document) on a power of attorney died OR became incapacitated, the agent’s authority ceased. A half century ago, we modified that old rule. We now allow powers of attorney to continue even after the principal becomes incapacitated. That is, we allow that if the document includes language giving that permission.

But powers of attorney — both financial and health care — still terminate with the death of the principal. Well, except that there are at least a handful of exceptions:

  1. A health care power of attorney can give some kinds of permissions that only kick in after death. Like authority to approve an autopsy, or approve organ donation, or make burial arrangements. Those powers aren’t actually enumerated in Arizona law. They are, however, included in the form power of attorney drafted by the legislature.
  2. The authority of an agent on a financial power of attorney doesn’t technically end on the death of the principal. It ends when the agent learns of the death. So if some legitimate acts were underway at the time of death, the instant of that death might not make the agent’s acts improper.
  3. Even after the agent on a financial power of attorney learns of the death, they still have a general duty to protect that principal’s assets. That could, for instance, mean a duty to get insurance coverage extended, or lock up (or remove to safety) the principal’s property. That doesn’t mean the agent has a “duty” to liquidate assets, or make investment decisions. But they might be liable for a failure to act reasonably.

Death of the principal — conservatorship

That duty to protect and preserve assets is stronger (and clearer) in the case of the court-appointed conservator (of the estate). The death doesn’t automatically end the conservatorship or the conservator’s duties. That only happens later, on the court’s approval of the conservator’s final accounting. In the meantime the conservator should take reasonably protective steps.

That might (but doesn’t always) include paying for insurance, arranging security of property, paying for burial arrangements and assisting in the appointment of a personal representative of the decedent’s estate. And the conservator’s claim against the principal’s estate actually has priority for payment, so it might even be permissible to pay ongoing conservatorship bills. But get good legal advice before taking that step.

Death of the principal — wills and probate

The general rule is that the personal representative of an estate has no authority until they’ve been appointed by the probate court. But there is also something called the “relation back” doctrine that can (at least in some limited circumstances) allow the personal representative to take actions that are later validated by their court appointment. Of course, if they never get appointed that might make their actions indefensible.

The most common invocation of the “relation back” doctrine? Cases often hold that a person who files a lawsuit on behalf of the decedent just before a statute of limitations runs but before appointment as personal representative, the later probate court action can validate the too-early filing. That’s a way of protecting the estate while working through the (sometimes clumsy) court process.

Death of the principal — trusts

Unlike wills and probate court proceedings, the appointment of a successor trustee is immediate. Assuming, of course, that the person acting as trustee really is named as the successor.

If the successor trustee has already been acting at the death of the principal, then that fact does not change their authority. If they are to act only after that death, they will ultimately need to demonstrate that it has occurred. But in the meantime, protective acts can be undertaken. Secure property, pay expenses (assuming the successor has access to bank accounts), and deal with creditors and claimants. All should be permitted immediately.

Caution:

Remember what we told you at the beginning: this is about general notions, and Arizona law. Don’t cite it as authority when you’re challenged later. But take some comfort from the notion that you might be able to take care of urgent business, at least. And get prompt and capable legal advice.

PS: “legal advice” comes from a lawyer, not your banker, accountant, neighbor or friend-who-knows-lots-of-lawyers. We’re not sure why we have to keep saying that.