Durable Power of Attorney: How it Differs from a Power of Attorney

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There are differences between a Durable Power of Attorney and a Power of Attorney that many people are not aware of.  Power of attorney (POA) is a process involving legal documentation that assigns decision-making power over areas of a person’s life. This power is assigned to someone trusted, often a close relative. However, power of attorney only lasts so long. It only lasts as long as the person assigning the power (usually called “the principal”) is still mentally competent. If aging or infirmity renders the principal incapable of making his or her own medical and/or financial decisions, POA is revoked. However, if the principal assigns someone durable power of attorney, that person can act on the principal’s behalf even after the principal is no longer mentally competent. Therefore, it is wise to assign durable power of attorney for both financial and health issues. A person with durable power of attorney over another person’s health and finances may be the same person or two different people. His or her power of attorney may extend over broad areas of life, or only within specific parameters.

Durable Power of Attorney Endures Regardless of Mental Incapacity

A durable power of attorney (DPOA) simply means that the person’s power as the principal’s “agent” (or person acting in his or her place) endures beyond the principal’s mental capacity to make important decisions. Yet even someone with durable power of attorney must follow the wishes expressed by the principal. This is also true when it comes to medical treatment and end of life issues. Someone with durable power of attorney must abide by the principal’s living will, health care directive, or advance health care directive. When it comes to financial matters, the person with durable power of attorney must abide by the terms of the person’s will.

Power of attorney requirements and regulations vary from state to state, so anyone inquiring into it should check state law and consult with a licensed attorney. For example, some states consider all power of attorney durable, while others may require language within the power of attorney documents that specifically directs durability. A particular state’s stance on this issue may mean all the difference between having an agent with POA who can decide matters upon mental incompetence of the principal automatically, or whether his or her power expires with the principal’s mental decline.

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Durable Power of Attorney and Death

A DPOA is not as long-lasting as it may sound. Regardless of some differences in state law on other matters regarding POA, all states uniformly agree that power of attorney, including durable power of attorney, expires upon the principal’s death. At that time, the principal’s will becomes the most significant arbiter when it comes to decision-making. Many principals will name the person with durable power of attorney as the executor of their wills as well, which means the person continues to act on behalf of the principal after death, but that must be specified in legal documentation.

A Durable Power of Attorney may be limited at its beginning as well; it may not go into effect immediately. For example, a principal may stipulate that durable POA be triggered by a specific event, perhaps an age milestone or level of cognitive impairment. If it is triggered by a specific event, it is called “springing durable power of attorney.” The decision-making power is held off until the triggering event sets it into motion.

A DPOA is not the same as an irrevocable power of attorney, although the two terms might easily be confused. Most power of attorney assignments are revocable—that is, the principal can change his or her mind about who has POA.  Irrevocable ones mean that the principal cannot revoke the power of attorney. It is rarely used, and the term should not be confused with durable power of attorney.

Assigning durable power of attorney to someone trustworthy is an excellent idea. This way, a person is reassured that if he or she becomes unable to make decisions, a trusted relative or friend will act on his or her behalf. Further, someone with durable power of attorney can act to protect some of the person’s financial assets while the principal is being cared for long-term, as in a nursing home. This is an important consideration for optimal long-term care and for heirs.


Sources

Franco, F. Power of Attorney Vs. Durable Power of Attorney. LegalZoom. http://info.legalzoom.com/power-attorney-vs-durable-power-attorney-20053.html

Irving, S. The Durable Power o Attorney: Health Care and Finances. Nolo. http://www.nolo.com/legal-encyclopedia/durable-power-of-attorney-health-finances-29579.html

Stone, J. What Is an Irrevocable Power of Attorney? Legal Zoom. http://info.legalzoom.com/irrevocable-power-attorney-20092.html.

Streissguth, T. Is Power of Attorney Valid after Death? Legal Zoom. http://info.legalzoom.com/power-attorney-valid-after-death-20046.html

Questions and Answers about a Durable Power of Attorney. ElderLawAnswers. http://www.elderlawanswers.com/questions-and-answers-about-a-durable-power-of-attorney-3193

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