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My mother was POA over my stepfather who has dementia. My mother was diagnosed with acute leukemia while she was comatose and an attorney and notary came to her house, had my sister raise my mom's hand and sign my mom's name, giving power of attorney to my stepsister. Is this legal?

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Consulting an attorney is a good next step.
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Let's assume the farcical "transfer" of POA (which, as has already been described, isn't legally possible anyway) will be shown to be invalid. The situation as is is that your stepfather now has no authorised representative, so you and your sisters had better get a move on and apply for guardianship. Did your mother leave a will? And are you in touch with your stepfather's other child? Is that person aware of what's been happening?
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My stepsister was not secondary poa of my stepfather only my Mother was listed. My Mother called the attorney's office about a secondary Poa a month before she passed and was told if a person was not named at the original visit when my mother and stepfather went in for him to sign the poa that no one else could be given secondary poa by her. Let me state up front my stepdad is private pay at the nursing facility. All 4 of us know all the money from anything our mom and him owned is solely for his care until he passes. We all want Market Value for their home. He may have many more years to spend in a nursing facility and he and my mom have both worked hard all their lifes he deserves to have the best care his money will afford. To answer another question my stepsister was approached by a neighbor wanting to purchase the house. She never informed any of us that after my mom being passed only 6 weeks that she was meeting with someone. My sister just happened to run by and she had them looking at the house. When my stepdad passes we all are heirs to anything that is left be it a nickel doesn't matter as long as we make sure he has what he needs til he passes. He has 2 children and my mom has 3. We also have multiple witnesses that my mom was comatose. Thank all of you for your advice. We are going to consult an attorney.
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That does explain it better. But only your stepdad can assign a POA for himself. If he is not competent to sign it, then it cannot be done.

What, exactly, did your mother sign? Have you seen the document? That is what is so confusing in this post.

Yes, if his daughter is legally his POA she can indeed do financial transactions on his behalf. And selling the house to pay for his care might be one of those transactions. She would not have to consult you. But selling it well below market value would not be in his best interests. Is she selling it to a friend?

My confusion concerns how, exactly, did she get to be his POA? Oh, wait, if she was secondary POA after your mother, and your mother signed relinquishing POA because of her health, then that would indeed legitimately make his daughter the POA. Is that what mother signed? Something saying she was unable to be POA? That is the only thing that makes sense here. And since she clearly was not able to be the POA, getting this signature seems legitimate to me. In any event, her POA would expire with her death, and if the daughter were the secondary, she would automatically become the primary. 

The only concern, if daughter is POA, is why is she trying to sell way below market value? How do you know that she is?  That is, how do you know what houses like your stepfather's and in the condition of his house are selling for?

Aside from the POA question, do you object to the house being sold for the care of your stepfather?
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To clarify my Mother had poa over my stepdad. The attorney drew up a paper came to my moms bedside had my sister use my moms hand to sign over poa of my stepdad to his daughter. My stepdad is still alive but incompetent. My stepsister has poa so according to her lawyer she can sell their house without any approval from us. In NC when one spouse dies and they own a home jointly it automatically goes to the surviving spouse. I hope this explains the situation better.
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POA ONLY applies during the principal's lifetime. It confers no authority after the person dies.

On what authority is your stepsister trying to sell the house?

This is all very confusing. If she is claiming that she has POA for your father based on something his wife signed, that is pure fantasy. The four of you should see a lawyer.
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So that was wrong. But a POA stops at death. Your stepsister can't use the POA any more. Find out what authority she is using now that your Mom passed away. That's where you should concentrate.
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Yes my two sisters witnessed this. My mom passed 4 days later. I did not witness because I refused to go in and see my mother done this way. My Mother has only been dead 6 weeks and my stepsister is already trying to sell the house without informing the other 4 of us and way below market value. The money is to take care of my stepdad until his death. I was just wondering if legally we had a right to challenge the way she got poa. Thank you so much for all your answers. By the way my mom was married to him over 48 years and together 53. By the way my mom had poa over my stepdad and yes it definitely happened in North Carolina.
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In this alleged action, who was the POA for? Mother can only assign a POA for herself. Is that what she did? She made her stepdaughter her own POA? Even that would not be legal if she could not demonstrate that she knew what she was doing. Assuming there was a period when she was not comatose, was lucid, and understood the concept of having someone make decisions for her if she could not, then perhaps the action was valid.

She had no authority to assign a POA for her husband. So if that is what they say happened I would doubt it ever took place. If it did it simply isn't a valid document.

Guardianship may be what is needed at this point.
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Obviously not. Did you personally witness this?
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No this isn't legal. I would report the lawyer. Previous POA has to be revolked by the person who assigned the POA and he can only reassign someone. At this point guardianship is needed on Dad and Mom.
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How do you know this is what happened? This would clearly be illegal and an honest notary would never certify a document signed in this way.
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