Definition, purposes, and protocols attributable to Powers of Attorney documents by Kurt Bachman
Q: Will you please elaborate on the definition, purposes, and protocols attributable to Powers of Attorney documents?
A: The term “power of attorney” becomes more understandable if you bear in mind that “attorney” originally meant “one who was appointed” or “turned to” to officially represent the appointer. This referred to a private person with no special legal ability and was distinguished from an “attorney at law,” who is a certified legal expert. Nowadays, a “power of attorney” refers to a legal document in which Person A (the “Principal”) appoints Person B to legally act in the name of Person A to the extent allowed by the document. The POA document can be quite simple, or very complex, and can be customized to meet any individual circumstances. For a POA to be effective, Indiana law requires only that it name the Attorney-in-Fact and the power or powers granted thereto and that it be signed by the Principal in the presence of a public notary. You can revoke the POA in whole or in part at any time during your lifetime so long as you remain competent. State law requires that an Attorney-in-Fact act in a “fiduciary” capacity; in other words, an Attorney-in-Fact who accepts the POA is legally required to work in the Principal’s best interests or else face liability for the damages that the Principal may incur. In several states, a POA also ends when you somehow become incapacitated; but, Indiana dispenses with this requirement, thereby making all POAs “durable” (i.e., valid through incapacitation until death) unless otherwise specified. Because a power of attorney is a powerful legal tool to help you manage your affairs, you should have your elder law attorney create the form, customize it for your needs, and update it as necessary. By not taking this precaution, you risk giving someone the power (even if they do not have the right) to ruin you financially or otherwise. You also risk the POA not having the legal authority to take action on your behalf at a critical moment because it does not comply with the law or was too narrowly drafted. For instance, you will want certain powers added to make the POA Medicaid compliant if you are in need of long-term care asset preservation or Medicaid eligibility planning. Also, if you have real property in another state, the POA should conform to that state’s requirements as well. Please consult with your elder law attorney to explain how a POA can assist your individualized needs.
