Power Of Attorney
Power of Attorney
A power of attorney is a legal instrument that is used to delegate legal authority to another. The person who signs a power of attorney is called the Executants/Principal. The power of attorney gives legal authority to another person (called an agent or attorney-in-fact or the Power of Attorney Holder) to make property, financial and other legal decisions for the Executants/Principal. The word attorney here means anyone authorized to act on another’s behalf.
The power of attorney is frequently used to help in the event of a Executants/Principal’s illness or disability, or in legal transactions where the Executants/Principal cannot be present to sign necessary legal documents.
A general power of attorney gives powers to a person or organization (known as an agent or attorney-in-fact or poer) to act in your behalf. These powers include handling financial and business transactions, buying life insurance, settling claims, operating business interests, making gifts, and employing professional help. General power of attorney is an effective tool if you will be out of the country and need someone to handle certain matters, or when you are physically or mentally incapable of managing your affairs. A general power of attorney is often included in an estate plan to make sure someone can handle financial matters.
You can specify exactly what powers an agent may exercise by signing a special power of attorney. This is often used when one cannot handle certain affairs due to other commitments or health reasons. Selling property (personal and real), managing real estate, collecting debts, and handling business transactions are some of the common matters specified in a special power of attorney document.
Power Of Attorney
Notary for Rs.
Registered for Rs.
Duration-2 to 3 days
Yes. A power of attorney can be abused, and dishonest Power of Attorney holder/ Agents have used powers of attorney to transfer the Executants/Principal’s assets to themselves and others. That is why it is so important to appoint an Power of Attorney holder/Agent who is completely trustworthy.
A power of attorney can be used to grant any, or all, of the following legal powers to an Power of Attorney holder/Agent:
- Buy, sell, maintain, pay taxes on and mortgage Movable and Immovable Property.
- Manage and look after your property.
- Leave and License Agreement/Rent Agreement and to collect rent/License Fee
- Conduct your banking transactions.
- Invest, or not invest, your money in stocks, bonds and mutual funds.
- Make legal claims and conduct litigation.
- Attend to tax and retirement matters.
- Make gifts and release the right of Property on your behalf.
- Use your assets to pay your everyday expenses and those of your family.
- Buy and sell insurance policies and annuities for you.
- Claim property you inherit or are otherwise entitled to.
- Collect benefits from Social Security, Medicare or other government programs or civil or military service.
- Operate your small business.
Power of attorney requirements vary by state, but typically are signed by the Executants/Principal and need to be witnessed and/or acknowledged/Registered before a notary public or Sub-Registrar Office.
You are required to sign (execute) only one copy. However, it is not unusual for a principal to sign several original copies. Some banks and brokerage companies have their own durable power of attorney forms. If you want your attorney-in-fact to have an easy time with these institutions, you may need to prepare two (or more) durable powers of attorney with your own form and forms provided by the institutions with which you do business.
You should choose a trusted family member, a proven friend, or a professional with an outstanding reputation for honesty. Remember, signing a power of attorney that grants broad authority to an agent is very much like signing a blank check. Certainly, you should never give a Power of Attorney to someone you do not trust fully. Do not allow anyone to force you into signing a Power of Attorney.
There are various types of powers of attorney; they can be either general, durable or limited. Some states have also adopted a statutory power of attorney. A general power of attorney grants the agent broad powers to act in regard to the principal’s assets and property while the principal is alive and not incapacitated. A durable power of attorney will remain effective even if the principal becomes incapacitated. A special or limited power of attorney restricts the agent’s action to a particular purpose in order to handle specific matters when the principal is unavailable or unable to do so. A statutory power of attorney copies the language in a state statute which includes an example of a form that may be used. State laws vary, but the states that have adopted a statutory form of power of attorney typically allow for other language to be used as long as it complies with the state law. A power of attorney may be created for a limited time period and/or specific purpose, such as a Health Care Power of Attorney, Power of Attorney for Care and Custody of Children, Power of Attorney for Real Estate matters and Power of Attorney for the Sale of a Motor Vehicle.
A revocable living trust can be useful if you become incapable of taking care of your financial affairs. The person who will distribute trust property after your death (the successor trustee) can also, in most cases, take over management of the trust property if you become incapacitated.
Few people, however, transfer all their property to a living trust, and the successor trustee has no authority over property that the trust does not own. So a living trust isn’t a complete substitute for a durable power of attorney for finances.
Yes, you may appoint multiple Power of Attorney or agents. If you appoint two or more agents, you must decide whether they must act together in making decisions involving your affairs, or whether each can act separately.
Consider the advantages and disadvantages to both forms of appointment. Requiring your Agents to act jointly can safeguard the soundness of their decisions. On the other hand, requiring agreement can delay action, or one may be unavailable to sign. If your agents are allowed to act separately, one will usually be available to act for you, but there may be confusion and disagreements if the agents do not communicate with one another, or if one of them believes that the other is not acting in your best interests.
Powers of attorney are only as good as the agents who are appointed. Appointing a trustworthy person as an agent is critical. Without a trustworthy agent, a power of attorney becomes a dangerous legal instrument, and a threat to the principal’s best interests.
In some states, the proper legal instrument for delegating health-care decisions to another is called a health care proxy. In most states a durable power of attorney for finances does not give your agent legal authority to make medical decisions. In most states, you also want to write out your wishes in a living will or an advanced health care directive which will tell your doctors your preferences about certain kinds of medical treatment and life-sustaining procedures if you cannot communicate your wishes. If your living will is properly prepared, your doctors are legally bound to respect your wishes.
Yes, the agent named in a power of attorney is only your representative. As long as you are capable to make decisions, you can instruct your agent to do only those things that you want done.
The agent is obligated to act in the best interests of the principal. An agent is a fiduciary, with strict standards of honesty and loyalty to the principal. An agent must safeguard the principal’s property, and keep it separate from the agent’s personal property. Money should be kept in a separate bank account for the benefit of the principal, and agents must also keep accurate financial records of their activities, and provide complete and periodic accountings for all money and property coming into their possession. Instruct your agent to provide accurate records of all transactions completed for you, and to give you periodic accountings. You can also direct your agent to provide an accounting to a third party (e.g., a member of your family or trusted friend) in the event you are unable to review the accounting yourself.
Usually, powers of attorney do not need to be recorded. However, powers of attorney dealing with the sale and purchase of real estate must be recorded in the county real estate records.
There is no official or government monitoring of agents acting pursuant to power of attorney. That is the responsibility of the principal. It is therefore important to insist that your agent keep accurate records of all transactions completed for you, and to provide you with periodic accountings. You might also direct your agent to give an accounting to a third party in the event you are unable to review the accounting yourself.
You may revoke the authority of the agent. n order to revoke, cancel, or end a power of attorney before it expires, the principal must sign a revocation of power of attorney and give a copy of the revocation to any person who might have or will possibly deal with the agent. Giving a copy of the revocation to people the former attorney-in-fact dealt with is to avoid an apparent authority situation.
A person has apparent authority as an agent when the principal, by his words or conduct (e.g., having granted power of attorney to former attorney-in-fact), leads a third person to reasonably believe that the person/agent has the authority that the agent appears to have, and the third person relies on this appearance of authority. The question of apparent authority is probably the most litigated question in agency law.
If a principal revokes a power of attorney that is recorded in the real estate records of a county, a revocation of that power of attorney should also be recorded in the real estate records.
Assume John Doe appoints his wife, Mary Doe, as his agent in a written power of attorney. One way to sign a document as attorney-in-fact would be as follows:
By:_________________________ JOHN DOE,Attorney-in-Fact
What if I move?
Generally, a Power of Attorney that is valid when you sign it will remain valid even if you change your state of residence. It should not be necessary to sign a new power of attorney merely because you have moved to a new state. However, it is a good idea to take the opportunity to update your power of attorney.
Today, most states permit a Durable Power of Attorney to remain valid once signed until the principal dies or revokes the document
Generally speaking, a principal can give an agent the authority to do any act that the principal could do on his or her own, unless prohibited by public policy or a contractual obligation. Although each state is free to determine its own rules, the following acts are generally not permitted by an agent on behalf of a principal:
- Marriage or Divorce. Matters pertaining to marriage and divorce cannot be delegated to an agent.
- Voting. An agent cannot vote on behalf of a principal.
- Creating, amending or revoking a Last Will and Testament. No state (with the possible exception of the State of Washington) currently allows an agent to create, amend or revoke a Last Will and Testament on behalf of a principal.
- Amending or revoking revocable living trusts. If a revocable living trust provides for the disposition of assets upon the death of the grantor, then the common law provides that an agent cannot act on behalf of the grantor to amend or revoke the trust. However, the law in this regard is not clear in most states, so extreme caution is warranted if this authority is to be considered under a power of attorney.
- Representing a principal in court. An agent may not normally represent a principal in court. The exception, of course, is if the agent is also an attorney at law.
- Bankruptcy. The bankruptcy courts are divided on this issue. One bankruptcy court (the United States Bankruptcy Court for the Eastern District of Virginia) has denied a bankruptcy petition filed by an agent on behalf of a principal. Other bankruptcy courts have permitted such filings.
- Retirement benefits. Neither the Department of Veterans Affairs, the Social Security Administration, nor the United States Office of Personnel Management recognizes an agent under a power of attorney.
Unless the power of attorney is to be used immediately, the original should always be retained by the principal in a safe place. The agent should be advised that he or she has been named as agent and should also be advised as to the location of the original and the number of originals that have been signed. If the principal stores the originals of the power of attorney in a safe-deposit box, the principal should authorize the bank to allow the agent access to it and should also give the agent a key. If the principal stores the originals of the power of attorney at home, then the originals should be kept in a fire and water proof safe. The agent should also have access to the home, either with a key or through contact with a neighbor or relative.
In order for a power of attorney (POA) document to be valid, the person granting the POA (the Principal) must be mentally competent when the Principal signs it. This means that the Principal must understand the powers that he/she are granting to the Agent (i.e. the attorney-in-fact) and the implications of having someone else make decisions for the Principal.
A person appointing an agent must be mentally and legally competent to appoint an agent. Otherwise, the appointment is voidable. Someone who had been declared NCM (i.e., mentally incompetent) by a Court cannot appoint an agent.
You might consider having a guardian or conservator appointed on behalf of your father. A guardianship or conservatorship is a legal relationship between a competent adult (e.g., guardian or conservator) and a person who is no longer able to make his own responsible decisions (e.g., ward). A guardian or conservator appointed by a court can be authorized to make legal, financial, and health care decisions for the ward. The guardian must regularly report to the court and may be removed if he or she does not adequately take care of the ward and adhere to the guardianship or conservatorship laws.
Generally, the death of the principal (grantor) operates as an instantaneous and absolute revocation of the agent’s authority or power.
A power of attorney is simply an agency relationship based on an agreement authorizing one person, the agent, to act for another, the principal. An agent or attorney-in-fact may resign by giving notice to the principal (person that granted the power of attorney) and recording the notice wherever the power of attorney was recorded (such as the county land records).
If the power of attorney legally authorizes a particular act, the agent cannot be held personally liable for doing that act, unless the contract specifies otherwise.