This is a judicial settlement proceeding, in which all issues have been resolved except the distribution of approximately $40,000.00 to Clara Rennie [hereafter, Rennie]. The record establishes that Rennie is an adult under a disability. She is a sister of the decedent and she resides in Franklin Square, New York.

Rennie is approximately 90 years old. According to the report of the guardian ad litem appointed to represent her in the 2004 probate proceeding,

"Clara Rennie was diagnosed with Alzheimer Disease in 1999 and according to her son [Mark Rennie] has been pretty incoherent for the last two (2) years.' She does not communicate at all, babbles, needs to be fed, is incontinent and non-ambulatory.' She has round-the- clock care and we [other brother and sister] visit her at least once a week.'"

The issue before me at this juncture is how Rennie's legacy is to be paid to her by the fiduciary of this estate. SCPA 2220(1) provides, in effect, that any bequest to an incapacitated person shall be paid to the guardian of such person. Rennie's attorney has indicated that Rennie has never had a guardian appointed on her behalf, but he states that she does have a fully executed power of attorney and health care proxy which were given by her in the year 2000. A copy of the durable general power of attorney has been furnished to this Court, and it reveals that it is in statutory form, executed by Clara on November 10, 2000, acknowledged before her attorney, Henry Tanck, Esq., and appoints William Rennie, 95 Barrymore Boulevard, Franklin Square, New York, as her attorney [*2]in fact. The power of attorney specifically authorizes William Rennie to have full powers in "estate transactions".

Rennie's attorney has also advised this Court that, because Rennie has executed a durable general power of attorney and a health care proxy, no guardian would be appointed for her in the jurisdiction in which she resides because Supreme Court there is cognizant of, and adheres to, the admonition in Mental Hygiene Law [MHL] article 81 proceedings to grant a guardianship only where necessary and essential for the needs of the alleged incapacitated person. Where a valid general power of attorney exists, counsel points out, Supreme Court would usually not appoint a guardian. See, e.g., Matter of Isadore R., 5 AD3d 494. In these circumstances, the requirements of SCPA 2220(1) cannot literally be complied with.

In Matter of Murray, ____ Misc 3d ____, 2006 NY Slip Op 26479, decided by me on October 3, 2006, I had occasion to review the interplay between this State's liberal recognition of powers of attorney and the appearance requirements under SCPA 401, 402 and 403, as applied to an incapacitated person who had executed a valid durable general power of attorney pursuant to Article 5 Title 15 of the New York General Obligations Law. I held in Murray that, notwithstanding the specific language of SCPA 401, 402 and 403 - - which would require the appearance of an incapacitated person either by a guardian or a guardian ad litem - - a person under a disability[*3] could appear in an estate proceeding by her attorney in fact:

"...given the...'public policy of this State that there be liberal use and recognition of the efficacy of powers of attorney' (Arens v. Shainswit [37 AD2d 274, 279], I find that a validly executed power of attorney, which authorizes, as in the instant case, the attorney in fact to act for the principal in 'estate matters', must be given recognition by this Court where the attorney in fact seeks to appear and act for the principal in a probate or administration proceeding. A formal plan for handling the incapacitated person's property interests validly established by her should not be lightly set aside or disregarded by the courts."

In reaching my conclusion in Murray, I pointed out that, given the public policy of not appointing a guardian for an alleged incapacitated person where that individual already had in place a valid plan for management of his or her personal and property needs, such as with the execution of a valid health care proxy and/or a durable power of attorney, a court would not be authorized to appoint a guardian to handle such person's affairs (see, e.g., MHL, §81.01; see also, Matter of Eggleston, 303 AD2d 263, 266, and Matter of Isadora R., supra). This is precisely the same argument made now by Rennie's attorney, and I believe it is just as valid in the context of SCPA 2220(1) as I held it was in the appearance context in Murray.

Again, as in Murray, I have before me a statute [SCPA 2220(1)] which focuses on a court-approved representative of an individual to act for that individual where she is unable by reason of her incapacity to act for herself. And, also as in Murray, I have a person who has executed a durable general power of attorney which, by its terms, would permit the attorney in fact to receive the bequest in this estate on her behalf. If the power of attorney is valid, and there is no conflict of [*4]interest in its exercise in this case, I perceive no reason why I should not allow the attorney in fact to accept payment of Rennie's bequest from this estate on her behalf. The findings necessary to my approving the use of the power of attorney here for purposes of SCPA 2220(1) would give the same judicial imprimatur as the appointment of a guardian of the property for Rennie under MHL article 81 for a similar purpose.

Thus, I conclude that, generally speaking, SCPA 2220(1) will be satisfied by payment of a bequest to an attorney in fact appointed under a validly executed durable general power of attorney, where (a) no guardian of the property has been appointed for the incapacitated individual, and (b) there is no conflict of interest between the incapacitated person's interests and the attorney in fact who seeks to exercise the power to receive the bequest.

However, because there are certain critical distinctions in how a guardian appointed under the Mental Hygiene Law, and an attorney in fact, are authorized to act vis-a-vis an incapacitated person's property, I believe certain safeguards must be put into place in the latter situation. An attorney in fact is generally subject to few restrictions in dealing with the principal's property (but see, Matter of Ferrara, 7 NY3d 244), whereas an article 81 property guardian may act only pursuant to specifically granted powers by the appointing court and must file an account annually (see, MHL §81.21, §81.31 and §81.32).

In light of these distinctions, and because of the SCPA's preference for a guardian to handle an incapacitated person's bequests, I find that, where it will otherwise be permissible to allow a bequest to be paid to an attorney in [*5]fact on behalf of an incapacitated person, the attorney in fact (1) may use such bequest only for, and in the "best interests" of, the incapacitated person, (2) will require court permission before making expenditures above a certain dollar amount (to be set on a case by case basis) from the bequest, and (3) must file an annual accounting with the court with respect to the use of the bequest, which will be subject to the court's review and approval.

Accordingly, I direct that, at the earliest convenience of Rennie's counsel, the original power of attorney (or a certified copy thereof) be filed for recording in this court, together with the affidavit required by §207.48 of the Uniform Rules, and the payment of the required recording fee (see, SCPA 2402[15][a]). This Court will then determine if the bequest may be paid to Rennie's attorney in fact. In this regard, counsel should also provide, by appropriate affidavit, all relevant information concerning the making of the power of attorney, directed to this Court's need to determine whether it was valid when executed. Given Rennie's 1999 Alzheimer's Disease diagnosis, as related in the 2004 probate guardian ad litem report, the information should touch upon Rennie's condition at the time the power of attorney was executed.

This decision shall constitute the Order of this Court and no other or further order shall be required.

DATED:BUFFALO, NEW YORK

December 29, 2006

BARBARA HOWE

Surrogate Judge