POWER OF ATTORNEY

     A Power of Attorney is an essential element for managing your affairs, especially when you are unable to do so for yourself.

What is a Power of Attorney?

     When you sign a Durable Power of Attorney, you give legal authority to someone, your agent (or attorney-in-fact) to act on your behalf. This provides a simple way for someone to manage part or all of your financial affairs. You may make it very broad or limit it to certain specific acts.

What are some uses of a Power of Attorney?

     A Power of Attorney may be used to give another the right to sell your car, home or other property, or to allow your agent to sign a contract, handle financial transactions, or sign legal documents on your behalf. It may give your agent the right to do almost any legal act that you could do.

What are the types of Powers of Attorney?"

     A "Limited Power of Attorney" gives your agent the authority to perform only a specific act. A "general" Power of Attorney gives your agent very broad powers to perform any legal act on your behalf. Limited and general Powers of Attorney terminate if and when you become incapacitated. Because most people want Powers of Attorney to be used upon their incapacity, Florida law provides for a special power known as a "Durable Power of Attorney." A Durable Power of Attorney remains effective even if you become incapacitated. It must contain special wording that provides the power survives incapacity. Property subject to a Durable Power of Attorney can include all real and personal property; including stocks, bonds, mutual funds, bank accounts, and other intangible personal property.

Must you be competent to sign a Power of Attorney?

     You must be able to understand what you are signing; the effect of a Power of Attorney; to whom you are giving the Power of Attorney; and what property may be affected by it.

Who may serve as your agent?

     Any competent person 18 years of age or older may serve as your agent. You should choose someone who is reliable and trustworthy. Certain financial institutions and not-for-profit corporations may also serve. Keep in mind that although your agent is required to act in your best interest, there is no formal supervision of your agent's actions. It is very important to name someone you trust completely. You should keep the original document and tell your agent where to locate the document if it is needed.

When is the Power of Attorney effective?

     The Durable Power of Attorney is effective as soon as you sign it unless it states otherwise. Until recently, in Florida Powers of Attorney were valid and your agent able to act immediately even if you were still competent. As of January 1, 2002, Florida law provides for a new Durable Power of Attorney that allows you to restrict your agent from acting until your doctor determines you are incapable of handling your financial matters.

When does a Durable Power of Attorney terminate?

A Durable Power of Attorney terminates when one of three things happens:

• You die
• You revoke the power of attorney
• A court determines you are totally or partially incapacitated

What if the third party will not accept the Power of Attorney?

     Powers of Attorney are not always accepted by third parties, such as banks, because they are concerned whether the document is valid. Third parties do not want liability for the improper use of the document. If the Power of Attorney was lawfully executed and it has not been revoked, suspended or terminated, third parties may be forced to honor it. Refusal is more common with older Powers of Attorney. Due to changes in Florida law, Durable Powers of Attorney executed on or after October 1, 1995, have more clout; therefore it is important to have a Durable Power of Attorney signed after this date. While an older document may be enforced as well, one executed under the new law is more easily enforced.

Who should have a Durable Power of Attorney?

     Everyone should include a Durable Power of Attorney as part of their financial and estate planning. While there are preprinted forms available, they may not be appropriate and may not provide the protection needed, or they may actually revoke existing legal documents unintentionally. Because a power of attorney is an important and powerful document, it is recommended to consult with an attorney to ensure no mistakes are made.

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