More on Powers of Attorney
A few weeks ago, we introduced you to the different types of power of attorney (POA) designations. If you missed that primer on POAs, you can click here to catch up. Whether you are a principal considering who to name as your agent, or an agent whose powers have recently gone into effect, you likely have some questions about the rights and responsibilities that come with POA designations. This post will discuss some of the key considerations for principals and agents alike.
As a principal, it is important to consider the powers that you want to delegate to the agent you will name in your power of attorney document versus those powers you wish to reserve solely for yourself, if any. These powers can vary greatly depending on the type and scope of the document you execute. A principal can allow an agent to manage all aspects of the principal’s health care and financial decision-making. This can include paying bills, accessing and managing bank accounts, buying and selling real and personal property, hiring and firing third parties to perform services for the principal, among many others. Alternatively, a POA can be narrowly tailored to allow an agent to perform certain limited, expressly defined tasks for the benefit of the principal, while preserving all of the principal’s other rights to manage their day-to-day lives. As you might imagine, the process of determining how much power to give an agent is deeply personal and situationally dependent. Before you execute a POA document, you should be sure to meet with a qualified and experienced attorney to determine what type of POA document will work best for your individual circumstances.
As you can gather from just a few of the types of powers listed above, an agent can exercise a great deal of control over a principal’s life. Accordingly, it is important for a principal to consider carefully who to name as an agent. The most important factor to consider is the nomination of an agent whom you can trust and rely upon to make decisions and take actions that are in your best interests. This is a highly personal decision that should not be taken lightly.
As an agent, you may be overwhelmed by the vast power over the principal’s life that has been assigned to you. Take this power seriously. An agent of a POA owes the highest legal duty to the principal, called a “fiduciary duty.” This means that an agent must act with the utmost standard of care to make decisions and act for the benefit of the principal. One of the first things a new agent should do is read the POA document. It is important to identify the powers an agent has and does not have in order to follow the express intentions of the principal. It is also important to know when an agent’s responsibilities start and end. An agent may wish to obtain legal help in order to adequately fulfill the agent’s duties and fully understand what actions are and are not permitted.
While a blog post may be a good introduction to these legal issues, it only scratches the surface of this highly complex area of the law. Now that you have some idea of what to consider when it comes to POAs, you likely have questions and concerns that are unique to your situation. An attorney at Kelly & Brand, Attorneys at Law, LLC can help advise you on the appropriate steps to take whether you are a principal or an agent.