A Durable Power of Attorney (DPOA) is a legal document that grants a designated individual, or agent, the authority to make decisions on behalf of the principal, particularly if the principal becomes incapacitated. Only the principal can execute a DPOA. An attorney is unable to assist a family member in creating DPOA on behalf of a parent or loved one without the participation of the principal.
Ensuring Continuity of Decision-Making
A DPOA is crucial because it ensures that someone trusted by the principal can manage their affairs without interruption. This continuity is vital in situations where the principal is unable to make decisions due to illness, injury, or cognitive decline. Without a DPOA, family members may face lengthy, costly, and stressful court proceedings to obtain guardianship.
Financial Management
One of the primary functions of a DPOA is to handle financial matters. The agent can manage bank accounts, pay bills, file taxes, and oversee investments. This authority helps prevent financial mismanagement and ensures that the principal’s financial obligations are met promptly if they become incapacitated.
The Agent does not Control the Principal
A signed DPOA does not immediately transfer all control to the agent. The principal retains authority to manage their own affairs unless they are incapacitated or found incompetent by a court order. The principal also retains the right to revoke the DPOA.
Termination of a Power of Attorney
A DPOA terminates at the death of the principal and may no longer be used to manage the assets of the deceased principal. A DPOA terminates if revoked by the principal or by a court of law. A DPOA that is executed for a limited purpose or period of time, may also be terminated by the terms of the document.
A Durable Power of Attorney is an indispensable tool for ensuring that a trusted individual can manage the principal’s financial matters seamlessly. Not having a DPOA can create significant challenges and risks, including delays in decision-making, financial mismanagement, family disputes, and legal complications.
Louise Paglen, Elder Law, Estate Planning and Special Needs Attorney
The McIntosh Law Firm, P.C.
www.McIntoshLawFirm.com