A power of attorney is a legal document delegating authority from one person to another. In the document, the maker of the power of attorney (the “principal”) grants the right to act on the maker’s behalf as that person’s agent. What authority is granted depends on the specific language of the power of attorney. A person giving a power of attorney may make it very broad or may limit it to certain specific acts.

A power of attorney may be used to give another the right to sell a car, home or other property. A power of attorney might be used to allow another to access bank accounts, sign a contract, make health care decisions for you or your dependent minors, handle financial transactions or sign legal documents for the principal. A power of attorney may give others the right to do almost any legal act that the maker of the power of attorney could do, including the ability to create trusts and make gifts.

A power of attorney is an important and powerful legal document, as it is authority for someone to act in someone else’s legal capacity. It should be drawn by a lawyer to meet the person’s specific circumstances. Pre-printed forms may fail to provide the protection desired. It must be signed by the principal and by two witnesses to the principal’s signature, and a notary must acknowledge the principal’s signature for the power of attorney to be properly executed and valid under Florida law. There are exceptions for military powers of attorney and for powers of attorney created under the laws of another state.

A power of attorney terminates if the principal becomes incapacitated, unless it is a special kind of power of attorney known as a “durable power of attorney.” A durable power of attorney remains effective even if a person becomes incapacitated. A durable power of attorney must contain special wording that provides the power survives the incapacity of the principal. Most powers of attorney granted today are durable.

The principal must understand what he or she is signing at the time the document is signed. An agent may perform only those acts specified in the power of attorney and any acts reasonably necessary to give effect to the specified acts. If an agent is unsure about authorization to do a particular act, the agent should consult the lawyer who prepared the document or other legal counsel.

If the power of attorney was lawfully executed and it has not been revoked, suspended or terminated, third parties may be forced to honor the document. The third party is required to give the agent a written explanation of the refusal to accept the power of attorney within a reasonable time after it is presented to the third party. Delay for more than a short period may be unreasonable. Upon refusal or unreasonable delay, consult an attorney.

A third party is authorized by Florida law to require the agent to sign an affidavit (a sworn or an affirmed written statement), stating that he or she is validly exercising the authority under the Power of Attorney.

The agent may hire accountants, lawyers, brokers or other professionals to help with the agent’s duties but generally may not delegate the responsibilities as agent. The power of attorney was given by the principal to the agent, and the agent does not have the right to transfer that power to anyone else. It is important that the agent keep in mind the fiduciary duties when hiring professionals to help.

The authority of any agent under a power of attorney automatically ends when one of the following things happens:

  • The principal dies.
  • The principal revokes the power of attorney.
  • A court determines that the principal is totally or partially incapacitated and does not specifically provide that the power of attorney is to remain in force.
  • The purpose of the power of attorney is completed.
  • The term of the power of attorney expires.

In any of these instances, the power of attorney is terminated. If, after having knowledge of any of these events, a person continues to act as agent, he or she is acting without authority.

The authority of an agent under a power of attorney automatically ends when one of the following things happens:

  • The agent dies.
  • The agent resigns or is removed by a court.
  • The agent becomes incapacitated.
  • There is a filing of a petition for dissolution of marriage if the agent is the principal’s spouse, unless the power of attorney provides otherwise.

The revocation must be in writing and may be done by a subsequent power of attorney. Notice should be served on the agent and any other party who might rely on the power. The notice should be served either by any form of mail that requires a signed receipt or by certain approved methods of personal delivery. Special rules exist for serving notice of revocation on banks and other financial institutions. Consult with a lawyer to be sure proper procedures are followed.

An agent is a fiduciary and as such has multiple duties when acting for the principal. These include an overriding duty to do only those acts authorized by the power of attorney, and when performing those acts to act in accordance with the principal’s reasonable expectations, to act in the principal’s best interest and to attempt to preserve the principal’s estate plan applicable to them.

For more information, contact an attorney.

Information for this article was provided by Consumer Pamphlet 13, http://www.floridabar.org.

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