Wednesday, September 19, 2012

The Purpose of a Power of Attorney Form

A Durable Power of Attorney is one document that everyone should consider. This simple document is very essential if injury or sickness strikes and you are not capable of managing your own affairs.

Download Power of Attorney Forms in Adobe PDF and MIcrosoft Word at

If you want someone else to act legally on your behalf the Power of Attorney (POA) is what you need. You will be referred to as the Principal and the one who will act on your behalf is known as Attorney-in-fact or agent. The Power of Attorney could be limited to a particular action which the Agent is allowed to carry out on your behalf. This document may give the Agent broad powers. It is important that you appoint someone that you really trust. It is either a family member, a trusted friend, an advisor, a bank or an institution with the same nature.

The Significance of Power of Attorney
The importance of Durable Power of Attorney is best comprehended if you are aware what would happen with the basic type of Power of Attorney. Once you affix your signature in the non- durable POA this will be used only during the time you are still alive and capable to manage your own transactions. In case you become incapable or die, the POA is revoked automatically by-law and your attorney-in-fact will no longer be able to carry out on your behalf. This makes the Power of Attorney from being binding, unintentionally, and until a particular time, it was the only time that a Power of Attorney could be arranged.

The non-durable Power of Attorney is less important for estate planning and family purposes, but because of the Power of Attorney, it is required most of the time if you become disabled. That is the only time you really need another person that is capable of managing legal decisions for you.

Sample case
This is a case of a father that grant powers to his daughter. The condition of the father worsened, so the daughter decided to transfer her father’s home to her name. Later her father died, the Will revealed that his beneficiaries are his 3 children. But, since the house has been already under the name of his daughter what is left to the other children is very little. They feel their sister is being unfair so they sue their sister claiming that their sister did not use the power of attorney properly. But the judge sees no irregularity was committed and thus approved their sister’s action. Again, not enough consideration was given to the right authority being granted. In this case, this situation could have been prevented if the durable power of attorney added a provision requiring that all the gifts to children should be divided equally.

Cancelling a Power of Attorney
As long as you are capable, you have the power to cancel your Durable Power of Attorney. To cancel it, simply send a written notice to your agent informing him that the document has been cancelled. As soon as the agent receives the notice of your revocation, the agent has no power to act under the Durable Power of Attorney. But, your cancellation will not undo any actions taken before being notified that the Power of Attorney has been cancelled.

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