Several clients have called me lately asking about their power of attorney document. Most are familiar with this document and have a pretty good idea what it is and how it is used. For those who are not, and since not all powers of attorney are created equal, let me give you a primer.
First, the person creating the power of attorney and granting powers to someone else is called the principal. And while most people say they are the “power of attorney” for someone else, the correct title for the person acting on behalf of the principal is the “attorney-in-fact.” Thus, when the attorney-in-fact (for example, Billy Bob) signs a document on behalf of the principal (Susie Sue), the correct legal signature should look something like “Susie Sue, by Billy Bob, her attorney-in-fact.”
Second, powers of attorney have a wide range of names. For example, one might be called a financial power of attorney, and another might be called a property power of attorney. Generally, the name refers to the types of powers the principal is granting to the attorney-in-fact.
Third, powers of attorney can be general or special or limited. If a power of attorney is general, it grants a wide range of powers upon the attorney-in-fact. Alternatively, if a power of attorney is special or limited, only limited powers are granted, maybe for a special purpose or situation. Most commonly you will see a special power of attorney for real estate granting to the attorney-in-fact only the powers necessary to complete a specific real estate transaction for the principal.
Fourth, not all powers of attorney come into effect at the same time. You commonly hear about durable powers of attorney and springing powers of attorney. If a power of attorney is durable it remains effective even after the principal becomes incapacitated. A springing power of attorney means that it springs into effectiveness as the result of a certain situation, most commonly when the principal becomes incapacitated.
While powers of attorney seem to be pretty straightforward, there are several intricacies and significant decisions to be made based on the principal’s circumstances. It is a powerful document and should not be treated lightly. Please come in to see us to learn more about this document and how we can craft a power of attorney as part of a comprehensive estate plan to meet your specific needs.
What the Attorneys of Morris Hall Can Do For You:
The attorneys at Morris Hall have 100’s of years of combined experience ensuring that families’ assets are protected from probate, unnecessary taxes, creditors, ex-spouses and Medicaid spend-down. The attorneys also help those in Arizona and New Mexico to apply for and receive Medicaid assistance and Veterans Benefits. Our Arizona offices are located in Phoenix, Mesa, Scottsdale, Cave Creek, Tucson, Prescott, Flagstaff and Arrowhead. Our New Mexico offices are located in Albuquerque, Las Cruces and Santa Fe. Contact us today at 888.222.1328 to schedule an appointment
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.