Elizabeth S. Pagel, PLLC

Understanding Powers of Attorney

A Power of Attorney is a valuable tool for many people.  This article will address the main types of Powers of Attorney, and what this document can (and cannot) do.

Any power of attorney involves two people:  the Principal (the person signing the POA) and the Agent (the person being given the right to make decisions for the Principal).  There may be one or more Agents named, and those Agents may be required to act together, by agreement, or subsequently.  For example, if Agent A becomes unable or unwilling to act for the Principal, then Agent B “takes over.”

It’s important to understand that only the Principal can request a Power of Attorney.  A prospective Agent cannot get the right to act on behalf of the Principal unless the Principal agrees.  The Principal must be competent to sign documents.  If, for example, you want to be able to manage your elderly parent’s business affairs because he is suffering from dementia, you may be too late.  These documents need to be in place before the need arises.

You should also be aware that a Power of Attorney automatically ends upon the death of the Principal.  Once the Principal has passed on, managing his affairs becomes an issue for the probate courts and the executor of his will.

Statutory Durable Power of Attorney

A Statutory Durable Power of Attorney grants the Agent authority to make business-type decisions for the Principal.  These powers can be very broad, or very narrow—it’s up to the Principal.  Some of the possible powers may be the power to  make real property transaction; banking and other financial transactions; business operating transaction; personal and faily maintenance transactions (such as paying bills, setting up home services like cable TV, electricity, security systems, or discontinuing those services) and retirement plan transactions. The Principal may grant the Agent the authority to make gifts to others out of his property, and can limit the value and nature of those gifts as well as the recipients.

A Statutory Durable Power of Attorney may become effective immediately, or only upon a finding of incapacity of the Principal, or upon some other defined circumstance or date.  It can expire on a specific date or event.  It can be withdrawn by the Principal at any time—it is not permanent.  If the Agent is married to the principal, the Power of Attorney terminates automatically if the parties divorce. 

A Statutory Durable Power of Attorney cannot be used to execute a Will on behalf of the Principal, or to revoke a previously executed Will.  In most cases it cannot be used to file for divorce on behalf of the Principal, but there may be some exceptions to this.

If you have been named as an Agent in a Statutory Durable Power of Attorney, make sure you have read the document carefully and understand what powers you have and do not have.

Medical Power of Attorney

A Medical Power of Attorney gives the Agent the authority to make medical decisions on behalf of the Principal if the Principal is unable to make those decisions for herself.  This should not be confused with an Advance Directive or “Living Will.”

An Advance Directive sets out the Principal’s wishes if he is diagnosed with a terminal or irreversible medical condition.  It sets out whether, in certain circumstances, the Principal wishes to receive all available medical treatment, only certain treatments, or “comfort” treatment only.  Only the Principal can issue an Advance Directive.  There is no Agent.  A Medical Power of Attorney does not permit the Agent to override the Principal’s wishes, and the Agent will probably not have the authority to make end-of-life decisions.

The purpose of a Medical Power of Attorney is to designate someone to make medical decisions if for some reason the Principal is unable to make those decisions.  The Principal may have been found to be mentally unsound, or may be unconscious.

If you are named as an Agent in a Medical Power of Attorney, you should talk to the Principal about his wishes. 

Whether executing a Statutory Durable Power of Attorney or a Medical Power of Attorney, the Principal must be competent to do so. She must be mentally sound and able to understand what she is signing.  If the Principal is suffering from dementia or is unconscious, no Power of Attorney can be executed.

If you believe you would benefit from either a Statutory Durable Power of Attorney or a Medical Power of Attorney, contact us! We’d be happy to assist.

Elizabeth S. Pagel PLLC
116 S. Avenue C
Humble, TX 77338
281-446-1437

THIS ARTICLE IS MEANT TO PROVIDE GENERAL INFORMATION ONLY AND SHOULD NOT BE CONSIDERED LEGAL ADVICE.  EACH CASE IS UNIQUE.

THIS ARTICLE DOES NOT CREATE AN ATTORNEY-CLIENT RELATIONSHIP

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