Competition between post-mortem power of attorney and execution of a will
What is the relationship between the post-mortem power of attorney and the execution of a will?
The post-mortem power of attorney and the execution of a will are legal instruments available to a testator to ensure the settlement of his estate and all property-related matters.
Both post-mortem power of attorney and execution of a will have in common that they relate to the administration and distribution of the decedent's assets. In both cases, a third person is appointed to perform these tasks.
However, there are also differences between the two instruments, particularly with regard to when they take effect. The post-mortem power of attorney takes effect during the testator's lifetime and enables the authorized person to manage his or her property affairs during his or her lifetime. In contrast, executorship does not begin until after the testator's death and can only be arranged through a will.
In some cases, it may make sense to use both a post-mortem power of attorney and an execution of a will. In particular, this may be necessary if the ordered executorship does not cover certain tasks or if the executor has additional tasks that are covered by the postmortem power of attorney.
However, difficulties may arise if the testator has granted several post-mortem powers of attorney and at the same time has ordered the execution of the will without precisely defining the relationship between them or incorrectly assessing the extent of the execution of the will. The BGH dealt with this problem in its decision of 14.9.2022 (Akz.: IV ZB 34/21).
In this case, the parties disputed the validity of an application withdrawal declared by the granddaughter of the deceased testator in property law proceedings. These proceedings concerned the transfer of co-ownership shares and the payment and surrender of certain documents.
On January 31, 2020, the testatrix had granted her granddaughter a transmortal power of attorney for health care, which entitled her to represent her in court in all personal and property matters. In a handwritten will dated Feb. 11, 2020, the testator named her granddaughter as her sole heir and at the same time ordered the execution of her will. On the same day, the testatrix granted the complainant a post-mortem power of attorney in the event of death to represent her after her death in all personal and property matters vis-à-vis anyone and in any way. On Feb. 22, 2020, the testatrix again drafted a handwritten will in which she reiterated the sole heir status of her granddaughter, but this time ordered the execution of her will "because of the assertion and enforcement of her claims against the husband."
A lawyer was appointed executor, who was also the petitioner in this case. The areas of responsibility not affected by the execution of the will were, moreover, to remain with the executor of the will by the complainant.
As a consequence of the withdrawal by the granddaughter, the executor should bear the costs of the proceedings.
This case illustrates the complexity that can arise when a testator grants several post-mortem powers of attorney and at the same time orders an execution of a will without clarifying the relationship between them or properly defining the extent of the execution of the will.
Overall, the BGH stated that the relationship between a post-mortem power of attorney and an ordered execution of a will cannot be defined in a blanket manner, but must be determined on a case-by-case basis, taking into account the testator's intent and by interpreting the power of attorney document and the will.
It is advisable that testators who are considering both a post-mortem power of attorney and an execution of a will for the administration of their pecuniary affairs and the settlement of their estate clearly define the relationship between the power of attorney and the subsequent execution of the will. It is also advisable to clearly define the extent to which the power of attorney is to be exercised in the power of attorney document and to ensure that there is no overlap of duties, as in the case decided by the BGH. The executor should also check whether he can revoke competing powers of attorney.