My 90-year-old mother has dementia, and I need her signature to unlock a $200,000 stock certificate. How should I proceed?

But what happens if a caregiver needs a dementia patient to make a decision? Say, for example, that Alexa is caring for her 90-year-old mother, Beatrice, who has dementia. Beatrice has a $200,000 stock certificate, and Alexa wants Beatrice to sign it so the certificate can be sold.

So, what can Alexa do in this situation?

Can you get a dementia patient to sign a stock certificate?

A stock certificate is a document that shows you own a specific number of shares in a company. When someone holds a physical stock certificate and wants to sell or transfer shares, the certificate holder often must sign it and have their signature "guaranteed" by a financial institution participating in a Medallion Signature Guarantee program.

Unfortunately, Alexa can't just make her mom sign, because her mom may no longer be able to under the law.

"The first thing you need to do is determine if she still has the legal capacity to understand what she is signing, as well as the consequences of the transaction," Andrew L. Hope, an estate planning attorney and founder of Hope Law Firm, told Moneywise.

Hope explained: "You can’t simply have someone with dementia sign a document because you need access to the funds. If someone lacks the ability to make this kind of decision, signing on their behalf without the proper legal authority will create serious consequences."

The key question is whether Beatrice has legal capacity, which Scott Rahn, founding partner at RMO Lawyers, told Moneywise is based on the specifics of the transaction. This would likely mean Beatrice must understand what stock is, the implications of holding versus selling, and who will receive the proceeds. If she doesn't have this understanding, Rahn said that "neither a notary nor a medallion guarantee can cure a lack of capacity."

This may be a big problem for Alexa, as trying to force the signature could get her into legal trouble. "Attempting to obtain a signature from an elderly person who does not have capacity can be considered elder abuse," said Somita Basu, partner & co-founder at Norton Basu LLP.

The signer needs the right authority and motivation

Fortunately, there are options for Alexa and Beatrice. However, Alexa must make sure she has the right motivation.

"Don't forget the stock and its proceeds still belong to Mom," Rahn said. “'Unlocking' the asset means protecting it and using it for her benefit."

The good news is, Alexa may already have authority to act.

"In a situation like this, an existing durable power of attorney can be very important," said Hopel. "A power of attorney allows someone the parent trusts to handle their financial matters if they become unable to do so."