Power of Attorney

If you want to ask someone to represent or act as on your behalf in private legal affairs like business transactions or other legal matters, you will need a letter from an attorney to authorize the representative and tihs is called the POwer of Attorney (POA). There are types of Power of Attorney that you need to know before making as such. However the court is not involved with Powers of Attorney unless in the case of the first person's incapacity to make decisions. The purpose of the Power of Attorney is to make the representation legal and valid. Prior to releasing a Power of Attorney you must be educated on how it works and the types of it.


Power of Attorney

A "Power of Attorney" is a written document often used when someone wants another adult to handle their financial or property matters. A Power of Attorney is a legal form but is NOT a court form.

The courts generally are not involved with Powers of Attorney, however, if someone becomes incapacitated or unable to make their own decisions (e.g., in a coma, mentally incompetent, etc.) and needs another adult to make decisions for them, the court may get involved to order a legal Guardianship or Conservatorship for the incapacitated person.

The "principal" is the person who creates a Power of Attorney document and they give authority to another adult who is called an "attorney-in-fact." The attorney-in-fact does NOT have to be a lawyer, but must be a competent adult (18 years or older). The principal has the right to revoke or cancel the Power of Attorney at any time and may put a specific time limit in the document saying how long it is valid.

Talk with a lawyer if you are not sure how to prepare a Power of Attorney for your situation or if you need legal advice.


Types of Powers of Attorney

There are, at a basic level, two types of powers of attorney. A "general" power of attorney is unlimited in scope and duration, and permits the named individual to act as your legal representative in relation to financial matters until such time as it is revoked.

A "specific" power of attorney imposes limits upon the named representative, and may restrict the scope of that person's powers to a single type of conduct or a single transaction. For example, the person could be granted the power to engage in financial transactions from a specific checking account, or to sign the closing documents for a specific real estate transaction.

Either type of power of attorney may be limited in its duration. That is, the document can specify a date after which the power of attorney will no longer be valid.

Ordinarily, power of attorney forms do not have to be registered with the state. However, if a power of attorney grants somebody the right to engage in transactions relating to real estate, it may be necessary to record the form.

Learn more about The Types of Powers of Attorney .


Durable Power of Attorney

A durable power of attorney (or POA) is arguably the most powerful instrument that you can create and is especially important in estate planning. A POA is a relatively insignificant and informal document that allows another individual to legally act on your behalf.

A POA can be as powerful or long-lasting as you want although they are generally reserved for very specific occurrences and for a limited time. The term durable is inferred in this article as the purposes are for the POA to last indefinitely unless otherwise rescinded.

By signing a POA, you give the full force of your signature and/or decision-making capacity to another person and whatever that person does under the authority of that POA carries the full weight of the law. In other words, if you give someone a POA that allows him or her to sign a specific contract on your behalf, it is just as though you have signed the contract.

More about Durable Power of Attorney .


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