Title Tale: Power of Attorney Scenario
Written by: Mylene Marcelo, Title Manager/Title Officer
We have a current vesting deed adding son into title dated 2017 as joint tenants with rights of survivorship. The Deed was executed by a Power of Attorney (POA) made by Wilma, Principal to Fred Jr., as Agent. The POA was dated 1997. Wilma was competent at the time the Power of Attorney was signed but the problem is, review of POA shows it does not allow self-dealing. By Fred signing on behalf of Wilma adding himself into title is deemed self-serving. He did not have the authority to transfer title to himself. The worse part of it is Wilma is now deceased. Now, does Fred Jr. obtain title as surviving joint tenant? How do we fix this?
Fred Jr. does not automatically obtain title as surviving joint tenant. The fact that the Deed creating joint tenancy was created by self-dealing would be deemed invalid. In this scenario, Wilma originally owned the property. When she died in 2010, she left a Will leaving her estate to her two children: Fred Jr. and Pebbles and said Will was admitted to probate. We requested for the probate documents to be pulled. We want to review the Petition, the copy of the Will, the Letters issued to the Personal Representative and the Order of Distribution and all other pertinent documents regarding the Estate. Apparently, Fred Jr. was the appointed Personal Representative of the Estate of Wilma. The solution would be to have a Deed executed by the Personal Representative and a Deed from Pebbles who is the other heir in order to perfect vesting into Fred Jr., who is the proposed borrower to be insured.
It is very important that the authority of an Attorney-in-fact is reviewed every time a Power of Attorney is being used in a transaction. This is just one of the documents that we review on a daily basis. It can be one that has already been recorded or one that is about to be used in our transaction. Either way, it is always best to submit the executed Power of Attorney for review and approval.