Written by Benjamin Kingsley

Do you have questions about or need assistance with a power of attorney? Please click here to email us at contact@legalandme.com.

Do you need a power of attorney form? We make a do-it-yourself power of attorney: finance power of attorney or healthcare power of attorney.

No, an agent acting under a power of attorney cannot assume the personal debts of the principal. This is a fundamental principle in estate planning and agency law that protects both the principal and the agent.

The primary reason for this prohibition is that a power of attorney creates a fiduciary relationship between the principal and the agent. The agent has a duty to act in the best interests of the principal, not to take on personal liabilities that could potentially harm their own financial situation. Assuming the principal’s debts would be contrary to this fiduciary duty and could be seen as a breach of the agent’s responsibilities.

Additionally, creditors have no legal basis to pursue the agent for the principal’s debts. The debts remain the sole responsibility of the principal, even if they become incapacitated or pass away. In the event of the principal’s death, creditors must file claims against the principal’s estate, not against the agent personally.

It’s also important to note that a power of attorney document typically does not grant the authority to assume debts. The powers granted to an agent are usually limited to managing the principal’s affairs, making financial decisions, and handling transactions on behalf of the principal. Assuming personal debts falls outside the scope of these standard authorizations.

Furthermore, allowing agents to assume principals’ debts could lead to potential abuse or exploitation. Unscrupulous agents might take advantage of their position to shift financial burdens onto themselves, potentially with the intention of later seeking reimbursement or compensation from the principal’s estate.

In conclusion, the prohibition on agents assuming principals’ debts under a power of attorney serves to maintain the integrity of the fiduciary relationship, protect the agent from personal liability, and prevent potential abuse of the power of attorney arrangement.

Do you have questions about or need assistance with a power of attorney? Please click here to email us at contact@legalandme.com.

Do you need a power of attorney form? We make a do-it-yourself power of attorney: finance power of attorney or healthcare power of attorney.