Publications
Durable Power of Attorney
A Must Have Estate Planning Document
Every adult in this country should have a "durable power of attorney", which is one of the four important legal documents everyone should have. A durable power of attorney is basically a fill in the blank form document for estate planning every individual’s estate plan has to include.
The durable power of attorney allows another person to take over control of the individual’s assets and business affairs when the individual becomes incompetent or otherwise unable to manage for him or herself. After executing a durable power of attorney, you would be termed the " principal" in the agreement and the person granted controlling authority would be known as the "agent". The durable power of attorney has a provision in it that states that the powers of the agent will "endure" after the principal is incompetent. A general power of attorney won’t have such a provision. A general power of attorney becomes ineffective after the principal becomes incompetent. Circumstances proved over time that if a principal couldn’t function for himself or herself, the authority granted by a power of attorney was even more important. Therefore, laws were written which made the power of attorney survive the principal’s incompetency.
Everybody talks about the importance of a will or revocable living trust, but they overlook the importance of the durable power of attorney. It is more likely that you will be judged incompetent or unable to manage your affairs in the next month than it is that you will be dead. In the eyes of the law, it is easier to deal with a dead person’s assets than an incompetent person’s assets.
Without the durable power of attorney, a family will have to have a court proceeding to have a family member declared incompetent and someone appointed as their agent or "conservator". An important part of the durable power of attorney is the mechanism that will be used to declare the principal incompetent.
A family can save lots of time, trouble, and avoid court intervention, if they have a properly written durable power of attorney in place. A principal can usually be declared incompetent, and unable to manage their business or financial transactions, if two doctors sign a statement affirming that the principal is incompetent.
Combinations of doctors, family members, clergy, or others can be used to sign off on the principal’s incompetency.
The durable power of attorney can give the agent broad powers to take care of the principal’s affairs. A person acting as agent under a durable power of attorney can help with not only financial and medical issues, but also religious and social matters of concern to the principal. A durable power of attorney that deals exclusively with medical issues is called a "medical power of attorney" Some attorneys combine the durable power of attorney, medical power of attorney, Health Insurance Portability and Accountability Act (HIPPA) agreement and living will into a single document.
Every adult family member should have a durable power of attorney, regardless of the format chosen. You just sign the forms and put them in the filing cabinet. If an individual in your family has a problem, the durable power of attorney can save you time, financial stress, and heartache.
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