You’ve likely heard of the term at some point and have a general idea of what it is, but it’s a subject worth exploring in greater detail. Learning more about powers of attorney now can save you and your loved ones from potentially nightmarish situations in the future.

We’ll devote much of this article to discussing durable power of attorney, but let’s start by first recapping what power of attorney is in the first place.

Understanding the Power of Attorney

Power of attorney is a topic we’ve discussed previously but in case you missed that, let’s take the time to learn more about this legal term.

As its name suggests, the power of attorney is a legal power that you give to a different person or persons that enables them to act on your behalf. Once you give someone power of attorney, they become your agent or attorney-in-fact while you assume the role of being their principal.

A legal document outlines the terms of the power of attorney you’re giving to another party. This document will indicate which actions a specific agent can perform on your behalf.  Whoever you designate as your agent will likely be required to present the document every time you execute an action, according to the American Bar Association.

You often use a POA as a safeguard against potential accidents. They ensure that the decisions involving you or your estate will continue to follow your best interests, even if you can’t make them yourself.

Furthermore, POAs are also sought after because they are highly useful in business. Instead of you having to personally travel from one place to another to complete business deals and other transactions, your empowered agent can do that for you.

POAs also differ in terms of type.

First, you have what is known as a general power of attorney. An individual granted a general power of attorney can make all decisions for you if they are deemed eligible by the law.

In contrast, a limited power of attorney is more restrictive. Someone granted an LPOA can make decisions regarding one of your bank accounts, but not all of them. You can also specify the exact matters they can decide for you.

If you desire, you can also restrict a limited power of attorney by designating a period of effectiveness for it.

POAs also vary from one another in terms of their longevity. In many cases, a power of attorney will stop being effective if the principal is incapacitated. They regard the POA in that scenario as a non-durable power.

On the opposite side, you have what are known as durable powers of attorney.

Defining Durable Power of Attorney

The durable power of attorney can remain effective for a long period of time. That power will remain usable even if the principal has become incapacitated in some way.

DPOAs are essential for several reasons.

First, designating someone to be your attorney-in-fact with DPOA matters because it makes an otherwise difficult situation more manageable.

Imagine a scenario where you are incapacitated, thus leading to your finances effectively becoming inaccessible. If you didn’t give someone DPOA ahead of time, your loved ones will have a harder time getting your finances in order.

LegalZoom notes that your loved ones will likely need to go to court first and have you declared incompetent before they can start taking control of your finances. That’s a process that can take plenty of time and effort, and it can stress out your family members even more.

DPOA also matters because it gives you greater control over what kind of treatment you receive later in life. By giving DPOA to a trusted loved one, you can be sure that someone who has your best interests in mind makes the medical decisions for you.

What Are the Different Types of DPOAs?

There are two main types of DPOAs.

The first is known as a healthcare DPOA. The person or persons granted the DPOA are legally obligated to make medical decisions for the currently incapacitated principal.

A healthcare DPOA is relied upon whenever the principal is unable to make those medical decisions. Whoever you chose to hold the healthcare DPOA will also be the person who talks to the doctors and other medical professionals on your behalf.

You can indicate in your healthcare DPOA that you want to be admitted into an assisted living facility if you are ever incapacitated, and your agent will carry that out.

An important thing to note about a DPOA is that it’s not a living will. The attorney-in-fact you named in the DPOA document cannot make decisions regarding your end-of-life care because that’s what the living will is for. Your family members and your doctors will make that kind of decision together.

The other type of DPOA is known as a financial durable power of attorney. By giving someone financial DPOA, you authorize them to make decisions regarding your assets. They can control your different accounts, sign checks on your behalf, and handle other essential matters related to your finances.

You must be thorough when crafting the financial DPOA document so that the agent will know exactly how to use your assets.

To protect against your financial DPOA abusing their power, the law regards them as a fiduciary, according to the Takacs McGinnis Elder Care Law. This is an important thing to note because someone designated as a fiduciary is legally bound to act in your best interests.

If your financial agent starts to sign off on transactions that are not beneficial to you or in ways that go against what you have outlined in the DPOA document, the law can punish them following the laws in your area.

How Should You Approach Crafting Your DPOAs?

Naming someone to hold either your healthcare or financial DPOA is not a matter to be taken lightly. It’s one of the most important decisions of your life, and you must be sure that you’re handing the reins over to people who are responsible.

It’s obvious that you should pick the people who you trust the most as your agent or agents. There are no limitations placed on who you can name as your agent. You can name a family member, a friend, or even an acquaintance as your agent in the DPOA document.

That’s one part of the process.

Next, you need to craft the documents themselves.

You have the option here of combining your healthcare and financial directives into one document, but Investopedia advises against doing that. Your broker should only be concerned about your financial affairs while your doctors should only know about your medical status. The best way to keep those matters independent of one another is by creating separate DPOA documents.

Feel free to name the same agent so that decisions can be made faster.

When Will the Durable Power of Attorney Start to Take Effect?

You, as the principal, will determine when the durable power of attorney becomes usable.

One option is to have the DPOA take effect right away. This is a move worth considering if you want someone completing financial transactions for you.

Most healthcare DPOAs only become effective after you’ve become incapacitated.

When Will the Durable Power of Attorney Expire?

Though a DPOA will not expire even if the principal is incapacitated, there are still different ways it may be rendered ineffective.

Similar to other POAs, a durable power of attorney will expire as soon as the principal passes away. This applies to all kinds of POAs, by the way.

As the principal, you can also set a kind of limit on the effectiveness of the DPOA. If you indicated in the document that the DPOA will only last for a specific amount of time, then that will be honored.

The courts can also step in and invalidate a durable power of attorney. It’s unlikely that the court will decide to take a closer look at a DPOA document on its own. A third party must petition the court to strip power of attorney from a previously chosen agent.

If the court agrees with the third party and revokes power of attorney from the designated agent, the alternate agent will then take over the responsibilities. Sometimes, there may be no alternate agent named in the document. With no alternate agent, the court will name a legal guardian who will handle the principal’s affairs.

The durable power of attorney may also expire if the agent originally named is no longer capable of handling his/her tasks.

A DPOA can similarly expire if the previously named agent was the former spouse of the principal. You can cite the divorce as the reason the spouse should no longer serve as the agent.

Tips to Remember When Crafting a DPOA Document

Working on your DPOA document early on is a wise move. That will make it easier for you to identify the right candidates to name as agents. You should also write down more comprehensive guidelines for your agent or agents to follow.

To get started on crafting your DPOA document, you will first need to secure a template. You can find these templates online, but you should be careful about obtaining your document that way. Some templates may not be up to date regarding the laws in your state, and that can prove problematic down the line.

As much as possible, you should approach an attorney for assistance when creating your DPOA document.

Be as specific as you can when creating the document. Doing so will enable your agent or agents to execute your desired actions with greater ease.

Some states may require you to have the DPOA document notarized and/or filed. Check the laws in your state to ensure that the document is legally binding.

Some states will require you to record the creation of the DPOA document. Once again, refer to the laws in your area to find out what you need to do.

You should also make a habit out of regularly checking your DPOA document. Consult with your attorney from time to time and see if the information contained in the document is still to your liking.

Tips to Remember if You Are Executing a DPOA Document

As the person entrusted with a durable power of attorney, you need to keep certain things in mind to fulfill your obligations well.

The main thing to remember is to have the DPOA document on hand. You won’t be able to invoke the powers of the document without it being present. It also must be the certified copy that you bring along and not a photocopy.

Before affixing your signature to any document you’re filling out as the principal’s agent, you should take a moment to ask if there is any specific format you need to follow. You won’t be violating any rules if you fail to follow the right format, but they may not execute the orders until you sign correctly. Remember to indicate that you’re signing as the agent of the principal.

Carefully considering the terms of your durable power of attorney will help ensure that you receive proper medical attention even if your health declines. We at Lakeside Manor also specialize in providing the highest level of care to all the patients entrusted to us. Find out more about our services and facilities by contacting us today.

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You probably have a general idea of what power of attorney is all about and why you may need it in the future. This article will elaborate on the topic further and clear up some common misconceptions.

In addition to better defining the POA, you can also refer to this article as you seek to learn more about possibly overriding that legal document. You’ll also find out more about why that move may even become necessary in the first place.

What Is Power of Attorney?

Let’s turn to the American Bar Association for assistance in defining this legal term.

As they noted, this legal tool provides “one or more persons the power to act on your behalf as your agent.” Agent is the term to name the person on the receiving end of the power of attorney. Sometimes, though, the person or persons in question may also be the attorney-in-fact.

Meanwhile, the person who is giving that power they regard as the principal.

The principal will be the one to decide when the POA will take effect. As the principal, you can decide to make the power valid right away, or you could indicate that it will only become effective after certain conditions are met.

You can also decide how long the effectiveness of this particular power will last. Principals can opt to only make the power valid for a limited amount of time, or they could decide to have it take effect permanently.

What Are the Types of Power of Attorney?

There are two main types of power of attorney.

The first is known as the general power of attorney.

When granting this kind of power, you are giving someone the ability to make all decisions on your behalf as long as the law deems the moves legal. Someone with this authority can make financial and health-related decisions for you, so be careful when deciding who should have it.

The other type is known as the limited power of attorney.

In contrast to the general POA, a limited POA may only apply after meeting certain conditions. If you’re trying to get your finances in order, but want to avoid having a single person responsible, you can give multiple parties limited POAs, so they handle separate accounts.

You can classify a limited POA into subtypes.

Springing Powers

You can classify the limited POA you are giving to a person as a springing power and effectively exercise control over which actions they can perform and when they can execute them.

According to Investopedia, springing powers only start to take effect once a specific event has taken place. You can list a different condition if you prefer, but more often than not, the principal will indicate that the springing powers should only go into effect once they have become mentally incapacitated or if they have passed away.

Patients who suffer from progressive mental ailments may benefit from giving a trusted party springing powers. For example, a person with advanced dementia may no longer make reasonable decisions about their care or their assets. In that scenario, the agent with the springing powers can step in and make the right calls.

To further guide that person, the principal may create a will to follow.

Durable and Non-Durable Powers

POAs do not last forever. They often lose effectiveness once the principal becomes incapacitated in some way or if the principal dies.

POAs that work that way are non-durable.

If you want your agent to continue making decisions on your behalf even after you die or become incapacitated, you will want to give him/her durable power of attorney.

Why Do You Need Durable Power of Attorney?

Even as we do our best to watch over our health and stay in great shape, the reality is that we do not have complete control over how our bodies age. You may develop an illness that severely affects your mental capabilities, thus rendering you unable to make important decisions.

By providing someone you know with a durable POA, you can rest knowing that your wishes will continue even if you can no longer make any decisions.

You can grant someone durable POA over your finances, meaning the individual in question will be the one in charge of how to use your money. The person given the durable POA remains legally bound to follow your directives so he/she cannot take all the money unless that is what you specified.

Durable POA can also grant a person the power to make decisions regarding your long-term care. If it’s your wish to be admitted to an assisted living facility, the agent must follow that instruction.

Why You Should Consider Granting Power of Attorney to a Separate Party

As you can see, a person given POA takes on plenty of responsibility but also obtains plenty of authority. Giving that kind of power to someone should not be taken lightly since it can be exploited and abused.

Even so, one can argue that giving someone POA while you still have a sound mind is a smart move.

We know how unpredictable life can be.

Granting POA to someone makes it possible for you to prepare for the worst. By outlining your wishes clearly and choosing the right person to receive the POA, you can effectively ensure that they will handle your affairs in the manner you prefer.

Another reason to give power of attorney to someone is that the alternative can seem troublesome in comparison.

Going back to the American Bar Association, they note that assigning guardians to individuals who become incapable of handling their own affairs is common. A guardian will effectively serve as the person who makes decisions for you.

To be clear, having a guardian is not always a bad thing. However, this is still a choice most folks would like to avoid because they don’t have a direct say in who they pick.

Handing someone POA is not a move you necessarily have to make only later in life. You can also use this legal instrument to make doing business more convenient.  If you’re running a business with branches all over the country and there are certain decisions you want to leave to subordinates, you can give them power of attorney.

How Is Power of Attorney Abused?

We hinted at it earlier, but the unfortunate truth is people can abuse POA.

An important thing to point out about POAs is that they are typically not monitored closely by a third party or a court. This quality of a POA makes it easy to exploit for the agent.

Abusive agents may decide to no longer follow the wishes of the individuals. Instead of executing the plan provided by their principals, the agent may opt to make financial decisions that benefit themselves.

They may even sign off on decisions that no longer keep your health in mind.

The Different Ways a Power of Attorney Can Expire

Generally speaking, POAs will expire at some point.

You can take over control when this happens by revoking the power of attorney yourself. Principals can also decide to configure a power of attorney in such a way that it will expire once they become incapacitated or die.

If you want to set a time limit on how long someone can wield power of attorney on your behalf, you can include a termination date into the document.

The court can also look at a POA document and decide to invalidate it. In cases where a spouse is the agent, the POA may become invalid if the agent and principal are divorced.

The POA may also become invalidated if the agent named is no longer capable of executing the wishes of the principal.

How to Override Power of Attorney

Unless you explicitly mentioned a termination date for the document, there’s a chance that the person you gave power to will use it for a long time. In a case where abuse is already taking place, having someone hold on that power is not ideal.

Before deciding whether to override the power of attorney, you need to know a few things.

First, you must know this is not going to be an easy ordeal. You could end up in a long, legal battle.

Next, you must also take the time to pick out the right lawyer to work with. Preferably, you should hire a lawyer who is an expert in elder and disability law.

Another thing to note here is that the POA can be invalidated by more than one person and in more than one way.

The People Who Can Override the Power of Attorney

The methods of vetoing the POA are directly linked to certain individuals. Let’s take a closer look at who they are.

The Principal

By far, the easiest way to quash the POA handed to an agent is to have the principal rescind it. The only real catch is that the principal must still be of sound mind when making this decision.

If the principal agrees to remove POA from an agent, he/she can do so verbally or fill out a revocation form, according to Legal Templates.

The Agent

Now things can start to get a bit tricky.

In the event that a principal is no longer of sound mind or refuses to rescind POA from an agent, you will need to approach the agent yourself. You can ask him/her to step down from the role.

If the agent does indeed step down, then the alternate agent named in the document will take his/her place. The court may get involved if there is no alternate agent designated by the principal. The court will appoint a guardian who will handle the principal’s affairs.

A Third Party

Try picturing this scenario: Your grandfather’s agent is misusing his savings, and he cannot do anything about it. You already approached the agent and asked him to step down from the role, but to no one’s surprise, he is not eager to let go of your grandfather’s money.

Clearly, nothing will change if that situation continues. You will need to act if you want to salvage what remains of your grandfather’s savings.

To do that, you will need to petition the court to revoke the power of attorney from your grandfather’s current agent and name a guardian, instead. That is easier said than done, of course.

You will first need to prove that the agent is no longer acting in the best interests of the principal. On top of that, you also must show the court that the wishes your grandfather originally authored should no longer be valid because of the new developments.

Removing power of attorney from the agent your grandfather originally named is not going to be easy, and it could take a while before the court decides. The best thing you can do here is to partner with the right lawyer. From there, he/she can gather evidence and present a compelling case to the judge.

Before deciding to move forward with those legal actions, you must know that the cost of pursuing this case can be high. Set aside a large sum of money if you want to see this case to the end.

Make sure to evaluate your options carefully before deciding to give anyone power of attorney. This decision could affect the quality of life you enjoy as a senior citizen.

We at Lakeside Manor are also dedicated to improving the quality of life of our residents. Get in touch with us today to find out how we can care for you.

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