There are many reasons an individual may wish to grant somebody else the authority to act on their behalf in legal, financial and healthcare matters. This includes when they are aging or unwell, particularly if they are facing reduced mental capacity as a result; when they are planning to be overseas for a period of time and need their affairs managed on their behalf during their absence; or when they lack expertise in a particular area and believe that a professional may be better placed to make decisions on their behalf.
Delegating this authority to a third party is known as Power of Attorney, or POA. Because each individual’s needs and circumstances are unique, every POA that is drafted by a family law or estate planning attorney will be tailored to the specific requirements of the client, or “principal”. The person to whom authority to act is granted is often referred to in legal terms as the agent.
When Is A POA An Appropriate Solution?
A POA should always be drafted by an experienced family law or estate planning attorney to ensure it will satisfy the needs of the principal. The attorney will ensure that their client has considered the implications of the POA and understands the scale of the decision-making that they have chosen to impart to their agent.
A POA is an appropriate solution to a number of situations, such as when someone is facing a long-term medical condition where their end-of-life decisions will need to be communicated and there is a high probability that they will not have the physical or mental capacity to make those decisions.
It is also an appropriate way of ensuring that parental responsibility will be assumed by a chosen, specified individual should a single parent be temporarily incapacitated, involved in a medical emergency or deployed in a military environment.
Many people choose to use a POA to grant financial, legal, real estate or business representation to a more qualified individual to act on their behalf. They often select this route to maximize their income or reduce their risk, and the level of authority they delegate may vary from managing bank accounts to initiating lawsuits or selling property.
It is essential that the specific permissions and limitations an individual wishes to delegate are clearly articulated within the POA. They must always select an individual to act as their agent whom they trust to act in their best interest and in accordance with their wishes.
Who Needs A Power Of Attorney?
By the time somebody becomes incapable of managing their affairs, it is usually too late to appoint a power of attorney. This decision needs to be made at a point when an individual is completely of sound mind, recognizes their limitations and accepts that delegating certain authorities to one or two designated individuals can improve their outcome.
When estate planning, it is a logical step to appoint a power of attorney to handle medical and financial affairs, both prior to and after death. This ensures that a nominated individual will be able to act in your best interests to enact your end-of-life plan and ensure that your estate is divided in accordance with your wishes.
Revoking A Power Of Attorney
Anybody with legal capacity can revoke a POA at any time by informing their agent in writing that they wish to do so. They will need to ensure that all relevant institutions, including medical facilities and banks that have a need to know, are copied on the revocation letter.
They do not need to state a reason and can engage the services of a family law or estate planning attorney if they wish to appoint a new POA.
Power of Attorney is important because it allows you to choose someone you trust to represent and protect your interests in cases where you are unable to make appropriate decisions or take the necessary actions yourself.
It provides you with the flexibility and continuity to live your life safe in the knowledge that you have designated an appropriate individual to handle your affairs should you be unavailable or become unable to do so. It can reduce the time spent on everyday financial and legal matters, simplify estate planning, and even improve your financial position.
It is crucial that your Power of Attorney is drafted by a qualified and experienced family law or estate planning attorney to ensure that it satisfies both your specific needs and the legal requirements of the state. To be truly useful, a POA must be valid and legally enforceable while providing the necessary levels of representation.
Lewis & Matthews, P.C. is an experienced family law or estate planning firm that can guide you through the process of assigning Power of Attorney. We will treat you with the compassion you deserve and provide the legal advice and guidance needed to maximize the effectiveness of your POA.