Hands of the woman signature document sitting on desk
Nearly everyone has financial obligations that would need to be managed in the event of a serious accident or health problem. A power of attorney can be used to help in this situation.
A power of attorney is a legally binding document that gives one person power or authority to act on another person’s behalf. The person who signs the power of attorney is known as the “principal,” and the person who can act on the principal’s behalf is known as the “agent.”
Many powers of attorney take effect when the principal becomes incapacitated. The legal definition of “capacity to act” is complicated. Generally, incapacity refers to an inability to make decisions for yourself. If you are under sedation at the hospital and cannot decide between two different medical treatments, you probably do not have capacity.
People usually create powers of attorney for management of either health care or finances. A health care agent can make treatment decisions for the principal when they cannot, confirm end-of-life wishes, and make arrangements after the principal’s death. Financial powers of attorney can allow agents to pay bills and make urgent business decisions. The power of attorney document describe the extent of the agent’s power.
Some powers of attorney give the agent “general” powers to act for the principal. People planning for the possibility they will be incapacitated for some time will find a general power of attorney most useful. Other powers of attorney give the agent limited powers for a specific period of time. People planning for a brief time of need, such as an international trip or major surgery, may want a “special” or “limited” power of attorney. In particular, people who are small business owners or who have dependent children should consider executing a power of attorney to take effect during a period of unavailability or incapacity.
Need a power of attorney? Angela Klenk, Esq. and the team at Beach Cities Estate Law couple personalized attention to your estate plan with big law firm experience for a winning combination to give you peace of mind. To schedule a case evaluation, visit Beach Cities Estate Law online or call (424) 400-2125.