What is a Power of Attorney?
A power of attorney, or POA, is a legal device that grants an individual, known as the “Agent”, the legal authority, to make decisions and act on behalf of another individual, known as the “Principal.” The decision can involve real estate transactions, banking transactions, business operating transactions, insurance transactions, tax matters, etc. Some financial powers of attorney are very simple and used for single transactions, such as closing a real estate deal. The agent appointed need not be a professional, rather someone that the principal has trust and confidence in. An agent pursuant to a power of attorney owes a fiduciary duty of care to the principal. The power of authority may be limited in scope; it may also be more general granting the Agent an array of decision-making authority.
CLICK HERE to view the New York Statutory Short Form Power of Attorney.
There are two types of Power of Attorney: Durable Power of Attorney and Non-Durable Power of Attorney.
Durable Power of Attorney
A durable power of attorney allows the agents to continue acting on the principal’s behalf even if the principal becomes incapacitated. A durable power of attorney simply means that the document stays in effect if the principal becomes incapacitated and unable to handle his/her own matters. To cover all of the issues that matter to you, you’ll probably need two separate documents: one that addresses health care issues and another to take care of your finances.
A medical power of attorney or “health care proxy,” grants an agent the authority to make decisions concerning the health care of the principal in case the principal becomes incapacitated. Your health care agent will work with doctors and other health care providers to make sure you get the kind of medical care you wish to receive. When arranging your care, your agent is legally bound to follow your treatment preferences to the extent that he or she knows about them. Typically, the principal will execute a “health care directive” or “living will” with specific instructions for the agent and health care providers to abide by.
Non-Durable Power of Attorney
A non-durable power of attorney, or a general power of attorney, does not allow the agent to act in the interests of the principal if the principal becomes incapacitated. Generally, a non-durable power of attorney grants a limited scope of action to the agent, whom the principal may simply need to carry out a single task. An agent acts as the principal’s legal representative in matters that the principal is unable to attend to personally. These can be revoked by the principal at any time or automatically cease effectiveness once the matter has been completed. If the principal becomes incapacitated, the non-durable POA becomes invalid.
Revoking the Power of Attorney
The power of attorney continues to be in effect until such time that the principal revokes it or it is terminated by the Principal’s death or other events described in Section 5-1511 of the General Obligations Law.
Do I need a Power of Attorney?
In life, uncertainty is almost certain. Whether you are appointing an agent to perform simple mundane tasks on your behalf or whether you are appointing an agent to deal with more serious, complicated, and sensitive matters on your behalf, it is important to understand and consider executing a power of attorney.
For more information on Power of Attorney or related issues, you may contact attorney Sergey Kalantarov, Esq. of Kalantarov Law, PLLC by calling (516) 953-9801.