Main Takeaways:

• A statutory durable power of attorney is a legal agreement, giving someone the power to act on behalf of someone else, except for healthcare decisions.
• If the principle is already mentally incompetent, a power of attorney cannot be established, as the principle must be able to act on his or her own behalf.
• A power of attorneys role can be tailored to suit almost any situation and can include managing the principle’s bank account, personal residence, and trust fund, or simply paying bills and sending invoices.

Statutory Durable Power of Attorney

A statutory durable power of attorney is a legal agreement, created by statute, that gives someone the power to act on behalf of someone else with respect to most matters with the notable exception of healthcare decisions. Healthcare decisions must be addressed by a Medical Power of Attorney, which is a separate document.

For example, an aging parent may sign a power of attorney giving his or her child the power to make important financial and legal, decisions in the parent’s behalf if he or she becomes incapacitated. The person with power of attorney (POA) is known as the agent, and the person who appoints the power of attorney (in this case the parent) is known as the principle.

Depending on the situation and the principle’s needs, he or she can appoint either a POA for healthcare or a POA for finances, both of which give the agent the power to act on the principle’s behalf regarding that area (healthcare or finance).

When to Assign a Power of Attorney

In order to sign a Statutory Durable Power of Attorney, the principle must be able to act on his or her own behalf. So if your parent is already mentally incompetent due to a disease like Alzheimer’s or dementia, the time for establishing a power of attorney is already past.

For this reason, your parent should set up a power of attorney while they’re still capable and clear-headed. The principle and agent can decide, as part of an agreement, when the POA becomes effective. It can either become effective immediately or upon a person’s incapacity, so there’s no harm in signing a power of attorney agreement even if the principle shows no signs of becoming mentally incompetent in the near future.

What if I Don’t Have a Statutory Durable Power of Attorney?

Without a Statutory Durable Power of Attorney, a person’s family members will be restricted by law from making any financial or, legal decisions on behalf of that person, should they become incapacitated or incompetent. If you find yourself in this situation, you may be able to go to court and be appointed as that person’s legal guardian. But, it is much easier to just sign a power of attorney agreement before things progress to this stage.

A POA can be tailored to suit just about any individual situation. The principle can choose how broad an agent’s powers will be, and can set limits as they see fit. A POA may give an agent the power to manage the principle’s bank account, personal residence, and trust fund. Or it may simply allow them to pay bills and send invoices.

Speak With An Attorney Today

It goes without saying that, if you’re thinking of setting up a power of attorney, you need to make sure the agent you appoint is trustworthy and will represent your best interests without abusing the power. If the principle has second thoughts about the agreement, they can cancel it at any time, provided they are still of sound mind and competent.

If you have any questions regarding a power of attorney, speak with a knowledgeable lawyer today.