Post by norbert1 on Jul 7, 2006 10:04:48 GMT -5
Can you explain how a power of attorney works?
The simplest explanation is that the Power Of Attorney document is a permission slip. It says (in effect) that “I appoint __________ as my Attorney-in-fact and give him permission to make legal and financial decisions on my behalf. His decisions have the same legal force as if I made that decision myself.”
It is a common law document and a private agreement between two people. Unlike a formal guardianship, it does not take any authority or power from the grantor, and no one is obligated to honor the POA designation. Generally, the financial institution sees the benefit of honoring the POA, but they may need to be convinced first, or may require use of their own POA form.
Typical wording from www.ilrg.com/forms/powatrny.html
“My Agent shall have full power and authority to act on my behalf. This power and authority shall authorize my Agent to manage and conduct all of my affairs and to exercise all of my legal rights and powers, including all rights and powers that I may acquire in the future. My Agent's powers shall include, but not be limited to, the power to:” (List of permitted actions follows.)
Explanation
A general power of attorney is usually used to allow your agent to handle all of your affairs during a period of time when you are unable to do so. For example, when you are traveling out of the state or country or when you are physically or mentally unable to handle your affairs. A general power of attorney is frequently included as part of an estate plan to make sure that you have covered the possibility that you might need someone to handle your financial affairs if you are unable to do so.
A power of attorney (POA) or letter of attorney in common law systems or mandate[disambiguation needed] in civil law systems is an authorization to act on someone else's behalf in a legal or business matter. The person authorizing the other to act is the principal, granter or donor (of the power), and the one authorized to act is the agent, the attorney-in-fact[1], or in many Common Law jurisdictions, simply the attorney.
The term attorney-in-fact is commonly used in the United States, to make a distinction from the term Attorney at law. An attorney-at-law in the United States is a lawyer—someone licensed to practice law in a particular jurisdiction.
As an agent, an attorney-in-fact is a fiduciary for the principal, so the law requires an attorney-in-fact to be completely honest with and loyal to the principal in their dealings with each other
"Durable" Power of Attorney -The general, special and health care powers of attorney can all be made "durable" by adding certain text to the document. This means that the document will remain in effect or take effect if you become mentally incompetent. Under common law, without the durable clause, the power of attorney appointment is voided if the grantor loses ability (for mental or health reasons) to grant this authority in the first place.
“Springing POA” An alternative to creating a durable power of attorney is a springing power of attorney. The power granted under this designation does not come into effect until you become disabled.
There must be a formal determination of disability before the power of attorney can be accepted and used. A springing power might require that two doctors examine you and confirm that you are disabled.
The springing power of attorney is used because some people just feel uncomfortable making a delegation of power today, while still healthy. While that sentiment is quite understandable, the potential problems should be considered, too.
Generally, you cannot have two POA attorney-in-fact agents at the same time. More normal is a designated backup POA. When a new POA is executed, there is wording that revokes any previous document. This is a potential source of mischef from from ill-intended relatives. If you have scheming relatives, a guardianship is advised, these cannot be revoked by a simple signature. A voluntary guardianship is generally simple and relatively inexpensive. Some POA documents contain a prefered guardian designation, which can make things simpler should the need for guardianship arise.
Universal (off the Web) financial POA's are not widely available or advisable. You get the POA from a local attorney who has a document that has been developed to comply with case law in that specific state, and is modified to suit your specific needs. It is the financial POA document that may be subject to legal proceedings from trouble-making relatives. It is important to have the lawyer who can testify that at time of signing, this person had enough understanding to be able to sign the document. The lawyer is likely to be more lenient about "confusion" issues if the person's heirs are not in question. (small family, sibs in agreement on affairs)
The terminology varies from state to state.
from New York--
2. What is a Durable Power of Attorney?
A Durable Power of Attorney is a written power of attorney which contains the words "This power of attorney shall not be affected by my disability," or "This power of attorney shall become effective upon my disability," or similar words. In order to be valid it must be signed by you before you become disabled.
7. What are some specific authorities which might be given in a Durable Power of Attorney? Ordinarily, you want your agent to be able to do anything you could do, and so most Durable Powers of Attorney are very broad. Specifically, a power of attorney might authorize your agent to do any or all of the following on your behalf:
- Pay for support and care.
- Conduct banking transactions.
- Deal with property.
- Handle legal claims.
- etc.
Health Care Proxy ---
is the terminology that some states use for Medical Power of Attorney.
“The New York Health Care Proxy law allows you to appoint someone you trust - for example a family member or close friend - to make health care decisions for you if you lose the ability to make the decisions yours self.
Some states have really confusing terminology
Missouri has a durable power of attorney (financial)
And a durable power of attorney for healthcare. (This is redundant - to be useable, a healthcare power of attorney has to be durable!)
Bottom line, you need ---
- a power of attorney for finances,
- a medical power of attorney
and
- a living will that specifies that the proxy has authority to say no to the use of feeding tubes and respirators.
- also in a few states, most notably Arizona, DPOA for Mental Health
Living will-
Some states will have the living will text and decision check box built into the health care proxy document - in other states it will be a separate document.
Some states are very strict and require specifically worded authorization for the Health POA to refuse the use of feeding tubes.
From the New York form - "Unless your agent knows your wishes about artificial nutrition and hydration (feeding tubes) your agent will not be allowed to make decisions about artificial nutrition and hydration. See instructions on reverse for sample of language you could use.)"
Perhaps the New York law has been loosened, but at one time, specific written authorization to refuse feeding tubes was required. As a result, New York had the highest use of feeding tubes in late stage alzheimers, at about 43% getting feeding tubes. Similar requirements exist in aprox. 13 states (primarily New England and Michigan) I.E. - they require high levels of evidence on this issue.
- DPOA for Mental Health - This allows the DPOA to sign a patient in involuntarily to a psych/mental health unit. Without this in most states you have to go to the courthouse and sign a that your mom is a danger to herself and others, and then the police get her (often in handcuffs) and take her to the nearest psychiatric unit for a 48-72 hour hold. After that there is a hearing to decide what to do.
-- Problems I have seen or encountered trying to use POA --
Banks - May require some convincing to honor the POA. May require the grantor to come to the bank to confirm the document. The bank may require the use of their POA form. Or they may send your form to the legal department for examination. (I had to drag my confused LO to the bank. She became mentally exhausted from the paperwork required for POA designation on three accounts.) Having your attorney dog the bank, may get the bank to cooperate.
Stock Brokerage firms - Will generally honor a POA form if the broker has a good feeling about the situation. Will require you sign a form that there is no other superseding document in existence. If there are any complications, such as competing POA documents or meddling relatives attempting to gain control, the brokerage will shut down and tell you to come back with a guardianship.
Social Security Administration. Is unlikely to honor a private POA document. I had to drag my confused LO through the metal detectors to the regional SS office to get POA designation put on her account. Many caregivers obtain “representative payee” designation to do business with SS. Direct deposit lessens problems dealing with SS administration.
IRS Is reluctant to honor a private POA. Requires that it contain specific IRS wording to honor the document. Usually requires that you use their own IRS form, which only is good for 3 years (defeats the intended purpose of a POA for an incapacitated person.)
further information
www.ilrg.com/forms/states/ny-powerofattorney-faq.html
The simplest explanation is that the Power Of Attorney document is a permission slip. It says (in effect) that “I appoint __________ as my Attorney-in-fact and give him permission to make legal and financial decisions on my behalf. His decisions have the same legal force as if I made that decision myself.”
It is a common law document and a private agreement between two people. Unlike a formal guardianship, it does not take any authority or power from the grantor, and no one is obligated to honor the POA designation. Generally, the financial institution sees the benefit of honoring the POA, but they may need to be convinced first, or may require use of their own POA form.
Typical wording from www.ilrg.com/forms/powatrny.html
“My Agent shall have full power and authority to act on my behalf. This power and authority shall authorize my Agent to manage and conduct all of my affairs and to exercise all of my legal rights and powers, including all rights and powers that I may acquire in the future. My Agent's powers shall include, but not be limited to, the power to:” (List of permitted actions follows.)
Explanation
A general power of attorney is usually used to allow your agent to handle all of your affairs during a period of time when you are unable to do so. For example, when you are traveling out of the state or country or when you are physically or mentally unable to handle your affairs. A general power of attorney is frequently included as part of an estate plan to make sure that you have covered the possibility that you might need someone to handle your financial affairs if you are unable to do so.
A power of attorney (POA) or letter of attorney in common law systems or mandate[disambiguation needed] in civil law systems is an authorization to act on someone else's behalf in a legal or business matter. The person authorizing the other to act is the principal, granter or donor (of the power), and the one authorized to act is the agent, the attorney-in-fact[1], or in many Common Law jurisdictions, simply the attorney.
The term attorney-in-fact is commonly used in the United States, to make a distinction from the term Attorney at law. An attorney-at-law in the United States is a lawyer—someone licensed to practice law in a particular jurisdiction.
As an agent, an attorney-in-fact is a fiduciary for the principal, so the law requires an attorney-in-fact to be completely honest with and loyal to the principal in their dealings with each other
"Durable" Power of Attorney -The general, special and health care powers of attorney can all be made "durable" by adding certain text to the document. This means that the document will remain in effect or take effect if you become mentally incompetent. Under common law, without the durable clause, the power of attorney appointment is voided if the grantor loses ability (for mental or health reasons) to grant this authority in the first place.
“Springing POA” An alternative to creating a durable power of attorney is a springing power of attorney. The power granted under this designation does not come into effect until you become disabled.
There must be a formal determination of disability before the power of attorney can be accepted and used. A springing power might require that two doctors examine you and confirm that you are disabled.
The springing power of attorney is used because some people just feel uncomfortable making a delegation of power today, while still healthy. While that sentiment is quite understandable, the potential problems should be considered, too.
Generally, you cannot have two POA attorney-in-fact agents at the same time. More normal is a designated backup POA. When a new POA is executed, there is wording that revokes any previous document. This is a potential source of mischef from from ill-intended relatives. If you have scheming relatives, a guardianship is advised, these cannot be revoked by a simple signature. A voluntary guardianship is generally simple and relatively inexpensive. Some POA documents contain a prefered guardian designation, which can make things simpler should the need for guardianship arise.
Universal (off the Web) financial POA's are not widely available or advisable. You get the POA from a local attorney who has a document that has been developed to comply with case law in that specific state, and is modified to suit your specific needs. It is the financial POA document that may be subject to legal proceedings from trouble-making relatives. It is important to have the lawyer who can testify that at time of signing, this person had enough understanding to be able to sign the document. The lawyer is likely to be more lenient about "confusion" issues if the person's heirs are not in question. (small family, sibs in agreement on affairs)
The terminology varies from state to state.
from New York--
2. What is a Durable Power of Attorney?
A Durable Power of Attorney is a written power of attorney which contains the words "This power of attorney shall not be affected by my disability," or "This power of attorney shall become effective upon my disability," or similar words. In order to be valid it must be signed by you before you become disabled.
7. What are some specific authorities which might be given in a Durable Power of Attorney? Ordinarily, you want your agent to be able to do anything you could do, and so most Durable Powers of Attorney are very broad. Specifically, a power of attorney might authorize your agent to do any or all of the following on your behalf:
- Pay for support and care.
- Conduct banking transactions.
- Deal with property.
- Handle legal claims.
- etc.
Health Care Proxy ---
is the terminology that some states use for Medical Power of Attorney.
“The New York Health Care Proxy law allows you to appoint someone you trust - for example a family member or close friend - to make health care decisions for you if you lose the ability to make the decisions yours self.
Some states have really confusing terminology
Missouri has a durable power of attorney (financial)
And a durable power of attorney for healthcare. (This is redundant - to be useable, a healthcare power of attorney has to be durable!)
Bottom line, you need ---
- a power of attorney for finances,
- a medical power of attorney
and
- a living will that specifies that the proxy has authority to say no to the use of feeding tubes and respirators.
- also in a few states, most notably Arizona, DPOA for Mental Health
Living will-
Some states will have the living will text and decision check box built into the health care proxy document - in other states it will be a separate document.
Some states are very strict and require specifically worded authorization for the Health POA to refuse the use of feeding tubes.
From the New York form - "Unless your agent knows your wishes about artificial nutrition and hydration (feeding tubes) your agent will not be allowed to make decisions about artificial nutrition and hydration. See instructions on reverse for sample of language you could use.)"
Perhaps the New York law has been loosened, but at one time, specific written authorization to refuse feeding tubes was required. As a result, New York had the highest use of feeding tubes in late stage alzheimers, at about 43% getting feeding tubes. Similar requirements exist in aprox. 13 states (primarily New England and Michigan) I.E. - they require high levels of evidence on this issue.
- DPOA for Mental Health - This allows the DPOA to sign a patient in involuntarily to a psych/mental health unit. Without this in most states you have to go to the courthouse and sign a that your mom is a danger to herself and others, and then the police get her (often in handcuffs) and take her to the nearest psychiatric unit for a 48-72 hour hold. After that there is a hearing to decide what to do.
-- Problems I have seen or encountered trying to use POA --
Banks - May require some convincing to honor the POA. May require the grantor to come to the bank to confirm the document. The bank may require the use of their POA form. Or they may send your form to the legal department for examination. (I had to drag my confused LO to the bank. She became mentally exhausted from the paperwork required for POA designation on three accounts.) Having your attorney dog the bank, may get the bank to cooperate.
Stock Brokerage firms - Will generally honor a POA form if the broker has a good feeling about the situation. Will require you sign a form that there is no other superseding document in existence. If there are any complications, such as competing POA documents or meddling relatives attempting to gain control, the brokerage will shut down and tell you to come back with a guardianship.
Social Security Administration. Is unlikely to honor a private POA document. I had to drag my confused LO through the metal detectors to the regional SS office to get POA designation put on her account. Many caregivers obtain “representative payee” designation to do business with SS. Direct deposit lessens problems dealing with SS administration.
IRS Is reluctant to honor a private POA. Requires that it contain specific IRS wording to honor the document. Usually requires that you use their own IRS form, which only is good for 3 years (defeats the intended purpose of a POA for an incapacitated person.)
further information
www.ilrg.com/forms/states/ny-powerofattorney-faq.html
I am no longer able to hold your hand my beloved but I cherish the remembrance of your hand in mine...and the wonderful person that touched so many lives with joy. : ) 