A power of attorney can designate someone to act on your behalf regarding certain legal or health matters, depending on state law and the specific wording of the power of attorney document. Consider contacting a knowledgeable estate planning attorney at Roulet Law Firm, P.A. to learn how this legal document can ensure that your legal, medical, and financial rights remain protected. Contact our compassionate and experienced Florida and Minnesota estate planning attorneys today at our Minnetonka, Minnesota office at (763) 420-5087 or our Venice, Florida office at (941) 909-4644 or toll free at (888) 719-5589.
What Is A Power Of Attorney?
A power of attorney is a written document that gives authority to another person to stand in the creator’s shoes, regardless of whether the term “power of attorney” is used.
Both Florida and Minnesota use the terms “principal” and “agent” to define the parties involved in a durable power of attorney. The principal is the person who the power of attorney is made for. The principal authorizes the agent to act on the principal’s behalf. The agent is the person who is supposed to follow the instructions included in this document.
A durable power of attorney can be either limited or broad in nature. A general power of attorney can allow the agent to perform many of the same tasks as the principal could otherwise handle on their own. A limited power of attorney provides powers for a certain purpose, such as handling the specific sale of a house or car.
What Does Durable Mean?
The term “durable” generally means that the power of attorney document continues in effect if the principal becomes incapacitated. However, the term “incapacitated” can mean different things in different jurisdictions. For example, Minnesota law defines incapacity as cause to appoint a guardian or conservator over an adult. In contrast, Florida law defines incapacity as someone’s inability to take necessary actions to get, administer, or get rid of their property, benefits and/or income.
Power of attorney documents that want to communicate that the agent should continue even if the principal becomes incapacitated should contain language to this effect to avoid confusion.
What Rights Are Given in A Power Of Attorney?
A power of attorney can provide broad powers for the agent. The power of attorney can state when the power of attorney goes into effect, and which powers the agent should have. Generally, the power of attorney grants whichever powers that are specifically named in the document unless otherwise prohibited by law.
Minnesota law provides that a general power of attorney can convey the following powers:
- Real property transactions
- Tangible personal property transactions
- Transactions regarding bonds, shares, or commodities
- Banking transactions
- Business operations
- Transactions related to insurance
- Military service benefits
- Gift and beneficiary transactions
- Fiduciary transactions
- Family maintenance
- Claims and litigation
- Records, reports, and statements
- Other matters allowed to be delegated to an agent
Florida law allows a power of attorney to convey the following powers:
- The authority to execute stock powers on the principal’s behalf
- The authority to delegate to a transfer agent the right to register stocks, bonds, or securities on the principal’s behalf
- The authority to mortgage the principal’s homestead property
- The authority to handle financial transactions, banking transactions, buying or selling property, handling government claims, and completing other actions on the principal’s behalf
There are certain actions that an agent cannot do for the principal in Florida, such as perform duties under a contract that requires the principal’s personal service, make an affidavit in the principal’s name, or vote for the principal.
Because these powers can significantly impact your finances and legal rights, it is important you carefully consider which powers are necessary to include in your durable power of attorney. A knowledgeable estate planning lawyer from Roulet Law Firm, P.A. may be able to advise you on which powers to convey in your durable power of attorney to reduce these risks.
What Are the Benefits Of Creating A Power Of Attorney?
To understand the benefits of a durable power of attorney, it is important to consider what could happen if you do not have a power of attorney. If you lose capacity, you will also lose the ability to make valid legal decisions or enter into contracts. This could mean facing the following consequences:
- You may be unable to pay your bills
- Without your mortgage being paid, your home could go into foreclosure
- Without your car payment being paid, your vehicle could be repossessed
- Your insurance could get cancelled
- You may be without the financial means or ability to provide for your basic needs
- Another person could infiltrate your life and take advantage of your vulnerability
- Your loved ones might be confused about your wishes and can argue about what you might have wanted
- A loved one may file a costly and intrusive guardianship or conservatorship proceeding to try to get the legal right to manage your affairs
What Is Required To Make A Valid Power Of Attorney?
The Florida Bar explains that a power of attorney must be witnessed by two individuals and notarized to be valid in Florida. In contrast, Minnesota law presumes that a power of attorney document that is dated and says it is signed by the principal is valid. Florida and Minnesota require an agent to be a natural person who is at least 18 years old or a financial institution that has trust powers and a place of business in the state. Minnesota also specifies that the agent must be of sound mind.