Florida Power of Appointment
A Florida Power of Appointment might mean that you inherit millions. Or not. Certain family members and heirs may be entitled to know about these odd “creatures” hidden in a Florida Trust Document. If you don’t inherit under a power of appointment, you may or may not have rights to find out WHY you did not inherit. One of the most frustrating things about them may be that your mom or dad has the right–the power!– to give you money or property. A January, 2021 case from Florida’s 1st District Court of Appeal discusses this legal topic. To learn more, read on.
Where Can I Read More about Florida Power of Appointment?
To read about Florida Power of Appointment, there are two places to start. First, start with Part 1 of Chapter 709 Florida Statues. Most people think of Chapter 709 as dealing with Powers of Attorney, like a durable power of attorney. That’s Part 2. Part 1 deals with Florida power of appointment. Second, did you know that someone with a power of appointment can bind other beneficiaries or even family members? Read a very specific part of the Florida Trust Code. Read 736.0302, Florida Statutes. This is super important. Why?
Understanding the Basics
- A person who creates, or gives, or grants, a power of appointment is called the power creator.
- A power of appointment is the right, but not necessary an obligation, to give away property.
- To “appoint” certain property, or a property interest, to others.
- A person who is given, or granted, a power of appointment is often called the “power holder.”
- A power of appointment is typically created under a Florida trust or will.
- The power creator spells out what property the power is given over, who has the power, who the power holder may appoint (or give) the property to, and what happens if the power is NOT exercised.
- Oh yes, the power creator should tell you in the legal document how you use or exercise the power. How do you transfer the property which is subject to the power.
- Now, you probably know this, but a power of appointment should NOT be confused with a Power of Attorney.
Beneficiaries Are Bound by Others?
Yup, that’s right. If I can appoint, or give away, a trust, to specific people, I have that power. And if I decide not to give the property to you, you can be bound by my decision. That’s power ! If you are NOT a beneficiary of a trust, but for the possibility that you may–or may not– inherit trust property if I APPOINT it to you, you can be bound by what I do. What does this mean? It means that you may or may not be entitled to accountings. And if notice is given to me, you might be stuck with my decisions. My actions or inactions. So, if you are upset that you did not get money or trust property, don’t necessary yell at the trustee. You may not be allowed to. Do you have standing? Are you bound by what the Power Holder did or did not do? If I got accountings and thought they were fine, you may not be able to challenge the accountings even if I appoint property to you. That’s a discussion about “representation” and being bound by those who hold a power of appointment. That’s Florida Trust Code 736.0302. Confusing? Don’t feel bad. These trust concepts can take a while to grasp.
Appeals Court Decision on Florida Power of Appointment
The 1st District Court of Appeal issued its opinion in the case of Ammeen v. Sjorgren on January 11, 2021. Why is this Florida trust legal opinion important? Because it explains how heirs or potential trust beneficiaries can be bound by what another does. Another trust beneficiary. Who was given a power of appointment.