Shirley B. Whitenack was quoted in the Star-Ledger’s Biz Brain column on February 27, 2012:

Question: "I have served as power of attorney, without compensation, for a non-family member with mental disease for the past 10 1/2 years. A great deal of time is dedicated to managing her health care and finances. As power of attorney, am I entitled to reasonable compensation based upon the actual responsibilities assumed and performed? If I am so entitled, how is compensation computed?”

Answer: "…. The person who executed the power of attorney, also known as the principal, has the power to direct whether the agent under a power of attorney, also known as attorney-in-fact, is to be compensated, said Shirley Whitenack, an estate planning attorney with Schenck Price, Smith & King in Florham Park.

“’The principal may either include a provision for compensation in the power of attorney document or in a separate written agreement addressing compensation,” she said. “The principal may determine the method by which the compensation is to be computed and when such compensation shall be paid.’”

“If there is no written direction, and if the principal no longer has to ability to make such decisions, the attorney-in-fact will have to file an application in the Superior Court of New Jersey, Probate Part, in the county where the principal resides, to request an award of reasonable compensation, she said.

Whitenack said the determination of reasonable compensation will depend on the facts and circumstances of the case. The court may decide on an hourly rate charged similarly to those charged by third parties for similar services, or it may be based on statutory commissions, or any other basis determined by the court to be reasonable.” 

“ … Another consideration is cost. For you, the cost of hiring an attorney to make such an application could be costly and may be challenged by the principal or other family members, Whitenack said.

“Another option is possible if the principal is competent even though she has a mental illness. She can either sign a new power of attorney containing a compensation provision or sign a written agreement addressing compensation to ensure that the attorney-in-fact will be compensated in the future, Whitenack said.” To view the entire column, go to http://www.nj.com/business/index.ssf/2012/02/biz_brain_determining_compensa.html