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Durable
Power of Attorney
A Durable Power of Attorney
is one of the most powerful instruments that the law
creates and is especially important in estate planning.
An
ordinary power of attorney is revoked, and the agent's
power to act for the Principal (signor of the
power of attorney) automatically stops, if
the Principal becomes incapacitated.
Under
North Carolina law, and the law of many other states, a
power of attorney with proper wording may be made
"durable." Through a Durable Power of
Attorney, an
agent may continue to act on the Principal's behalf even
after stroke, dementia or other incapacitating illness
or accident. The agent can use the Principal's funds to
pay bills, can contract for nursing home services for
the Principal's benefit and can make basic health care
decisions.
An
aging parent may give a durable power of attorney to
their trusted adult child so that, in the event the
parent is disabled or incapacitated, the child can act on
the parent's behalf and carry on routine matters. In many
instances, this arrangement is far better than making
the child the joint owner of the parent's bank accounts
and other property and assets.
It is important to
remember by signing a power of attorney, the Principal gives the full
force of his or her signature and/or decision-making
capacity to another person and whatever that person does
under the authority of that power of attorney carries the full weight
of the law. Without a power of
attorney, the Principal may be left with no one who can
legally represent him or her and maintain his or her
finances or business while incapacitated. In these
cases, the Court would appoint someone to serve as a
guardian of their estate while they are incapacitated.
In these cases, the guardian may be a relative that
the Principal would not want or trust to watch after his
or her finances and property.
The Court could also appoint a professional who will charge
the estate and have no idea what the Principal's wishes
are.
Most
powers of attorney are considered
"immediately effective". The person
who is appointed gains this power immediately and can
act on that
power of attorney starting the moment it is signed.
Unless specified otherwise, the power granted by a
power of attorney is gained immediately.
The other option is a
"springing"
power of
attorney. It is triggered by
an event, and only that event will make the
power of attorney's powers
effective. For example,
a
doctor certifies that the Principal has become
incapacitated.
Only then would the
power of attorney
become effective. It is very
important that the terms of the springing
power of attorney be laid
out clearly, including the method for determination of
the incapacity and the person who decides whether or not
the Principal is incapacitated.
A
Durable
Power
of Attorney is
a valuable tool in protecting assets and
providing finances for medical care for a person who can no longer make
decisions in their own best interest. It is very important that
the agent is someone trustworthy and honest.
If there is no one to fill the role, another
option is to nominate someone to act as guardian or
conservator. In these cases, the
Court has
the capacity to watch the person making decisions and
make them more accountable.
A Power of
Attorney is a powerful legal document that gives
someone else right to act as though they are you, and
the law will treat these actions as if you committed
them
yourself. If you are interested in having a Power
of Attorney, consult
with an attorney at Haas McNeil & Associates, P.A. to understand
the risks and benefits, and to ensure the documents are
properly prepared. |
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