Powers of Attorney
Powers of Attorney (POA) allows someone, known as a “principal” to give another person, known as “attorney in fact” (though not necessarily an actual licensed attorney) or “agent” the legal authority to take actions on their behalf. The POA is generally used to authorize a trusted person to make non-medical decisions in as complete or narrow a manner as the person giving the power wants or needs their agent to act.
Under Florida law, if prepared correctly, the POA requires third-parties to honor the document and deal with the attorney-in-fact just as they would with the principal. Failure to recognize and honor the document may lead to legal liability to an uncooperative third-party.
A Power of attorney can be customized to fit the specific needs of the situation and can give others the right to do almost any legal act that the maker of the Power of Attorney could do. Examples of how a power of attorney can be used in limited situations include giving another the right to sell or otherwise sign legal papers regarding real estate. In real estate closings, POAs are commonly used when someone can’t physically attend the closing
A “Durable POA” is a very broad and long-lasting version of the document. It is generally used for situations where there is a greater need than to deal with something specific and temporary, such as a single real estate transaction.
It is common to use a POA to allow someone to handle financial transactions for another with the full authority to speak with and receive information from banks, financial managers and others with whom the principal does business. Elderly clients often use POAs to allow their children or other trusted family members and advisors to manage their finances.
The great responsibility and potential for abuse and exploitation that runs with such powers makes it essential to guard against undue influence and fraud. For these reasons, at CPC Law, we take great care to protect against and look for signs of such bad motives against our clients.
An important reason to consider having a POA when you are completely competent and may not need help from anyone to manage your life is the alternative if you become incapacitated without one. If that happens, you may not be legally capable of designating someone to be your agent through a POA.
This could lead to the need to file a long and costly guardianship action in court. This is the process by which a judge considers evidence and decides on whether someone should be named legal guardian to take care of another and handle the things a POA allows them to do. For this reason, many of our clients have POAs drafted as a precaution (with great trust between the parties) and then simply put them away until it’s actually needed, if ever.
As with other estate planning documents, there are specific legal requirements for making a valid and enforceable document. The person making the health care surrogate must be mentally competent to understand what they’re signing and the powers being delegated. Their signature must also be witnessed and notarized.
There are a number of situations where a power of attorney can be very helpful but it’s a powerful tool that needs to be carefully crafted to fit the specific needs of the person creating it. Many times a power of attorney can be a useful and necessary planning tool, but there may be a less drastic option available to fit a given need.
To discuss a POA as part of your estate plan, call CPC Law for a free consultation.
Contact CPC Law at (407) 851-0201 and speak to an attorney now!
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