Beware the Dangers of a Power of Attorney
Powers of Attorney can be Abused
This case involved an elderly lady unable to speak English who gave a Power of Attorney to her son who then proceeded to borrow monies secured against her unencumbered residence at extortionate rates until of course there was default in repayment. The Court ultimately agreed on appeal that the use of a Power of Attorney in this fashion was an abuse of the power and as such could not be relied upon by the mortgagee alleging this gave the son authority to enter into these loan transactions.
Powers of Attorney in commercial transactions need to have very specific limitation to avoid cases like this one occurring.
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