What is a Power of Attorney?
A Power of Attorney is a document in which you appoint one or more persons to conduct financial and property transactions for you. It can give general, very broad powers or be limited to very specific acts.
A Power of Attorney can be created as provided in our Statutes (written laws), or it can be created under the common law. Generally speaking, where there is no Statute, the “common law” is found in court cases that have been appealed to our appeals courts. The justices at the appeals level “find” the unwritten law from all the facts and circumstances and determine how that fact situation is generally handled in the community.
A statutory Power of Attorney is a document that has been defined and prescribed by the legislature and is detailed in our Statutes.
In talking about a Power of Attorney, you are the “principal” and the person you appoint is your “attorney-in-fact.”
A Power of Attorney has authority only during your lifetime. Its power expires with you. The authority can also expire upon your incompetence or other incapacity. We, therefore, generally recommend a “durable” Power of Attorney unless the circumstances indicate that a durable power of attorney is not appropriate. If the document specifically states that its power will continue even if you become incompetent, it is a “durable” Power of Attorney.
The authority you give to your attorney-in-fact is generally very broad and it is effective if the attorney-in-fact has possession of an original document. You should select your attorney-in-fact very carefully. That person will stand in your shoes for financial transactions and can wreak havoc if he or she is not trustworthy and capable of making good financial decisions for you.
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