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What is the process for creating a Power of Attorney?

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Published by:

Sarah Chen

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Reviewed by:

Alistair Vigier

Last Modified: 2023-06-02

Are you wondering about the process for creating a Power of Attorney? Many people don’t consider what happens in the case where you are injured and unresponsive. If you suffer a head injury and can no longer speak or express yourself, what happens then?

A Power of Attorney is a legal document that allows someone to appoint another person, known as an attorney-in-fact or agent, to make decisions and take actions on their behalf. The person granting the power is called the principal, and the document is used to grant specific legal powers or general authority to the agent.

The process for creating a POA varies depending on the laws of the state in which it is executed and the type of POA being created. Generally, however, it involves drafting a document that specifies the powers being granted, identifying the principal and the agent, and having the document signed by the principal and witnessed by at least one other person. Some states may also require notarization.

It’s important to note that a POA is only valid while the principal is alive and has the capacity to make decisions. If the principal becomes incapacitated or dies, the POA is no longer valid and any actions taken by the agent after that point may not be legally binding.

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The different types of POA

There are different types of POA, some of them are Durable Power of Attorney, Medical Power of Attorney, Limited Power of Attorney, and Springing Power of Attorney. Each one of them serves a different purpose such as financial decision-making, medical decision making and so on.

Having multiple copies of the POA document can be useful in case the original is lost or destroyed, but it is not necessary to have multiple copies. It is important to keep the original in a safe place and provide copies to the agent and any relevant parties, such as financial institutions or healthcare providers. It’s important to review the document regularly and make updates as needed to ensure it reflects the principal’s current wishes and intentions.

Why Do People Have POA?

One common reason is that the person making POA will not be able to look after decisions and obligations when they are injured or away travelling in another country. Someone might give POA the ability to pay bills while they are away travelling.

If someone is in the hospital, their bills will also still have to be paid. Insurance for the house and car will still have to be paid. The mortgage must still get paid.

POA is not expensive, so everyone should consider doing it. If you want to know how many POA copies you need, you should book a free consultation with a law firm.

What happens if a Power of Attorney is not executed properly?
If a Power of Attorney is not executed properly, it may not be legally binding or enforceable. This means that the person appointed as the attorney-in-fact or agent will not have the authority to make decisions or take actions on behalf of the person granting the power, known as the principal.

Signed by the principal

One common issue that can arise with a POA that is not executed properly is a lack of proper signatures. In order for a POA to be valid, it must be signed by the principal and typically witnessed by at least one other person, and in some states, notarized as well. If the document is not properly signed, it may not be considered a valid legal document.

Another issue that may arise is the POA not being dated correctly or having an expiration date that has passed. It’s important that the POA is up to date and that the principal’s current wishes are reflected in it.

Additionally, if the POA is not written in accordance with the state laws or the terms of the POA are not clear, it may not be valid.

If a POA is found to be invalid, the principal will need to execute a new one, and all actions taken by the agent under the invalid POA may not be legally binding. It is important to consult with an attorney to ensure that the POA is executed properly and to avoid any potential issues.

As you can see, creating a power of attorney can be complex.

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How long does a Power of Attorney last?

The duration of a Power of Attorney can vary depending on the specific terms outlined in the document and the laws of the state in which it is executed. The POA can be set to expire on a specific date, for a certain period of time, or upon the occurrence of certain conditions.

A Durable Power of Attorney remains in effect even if the principal becomes incapacitated and is typically used for financial decision-making, while a Springing Power of Attorney comes into effect only upon the occurrence of a specified event such as incapacitation, and is typically used for healthcare decisions.

Creating a Power of Attorney

It’s important to note that a POA is only valid while the principal is alive and has the capacity to make decisions. If the principal becomes incapacitated or dies, the POA is no longer valid and any actions taken by the agent after that point may not be legally binding.

It is important to review the POA regularly and make updates as needed to ensure it reflects the principal’s current wishes and intentions. It’s also important to consider the choice of an agent carefully, as they will have significant authority and should be someone the principal trusts and believes will act in their best interests.

What is a Power of Attorney?

It is a legal document that you give to someone to give them the power to make decisions for you or to be able to do things for you. It can be:

-Paying bills
Selling assets
-Making health decisions
-Taking money out of your bank account
-Making investment
-Many other things

The person that you give power to is called the “attorney.” Please note that this person does not have to be an attorney or a lawyer. The term is very confusing and should probably be changed.

The difference between a will and a power of attorney (POA) is that POA is in effect when you are alive, and a will takes effect when you die.

Who Should I Pick as Power of Attorney?

There are two minimum criteria to be appointed as POA:

-The person understands what they need to do (it’s better that they speak to an estate lawyer first)

They must be 19 years old or older

Most people pick a family member. You can also pick the government (public guardian) or a trusted company. The “attorney” will have a lot of power, so give it some thought before deciding.

It’s also best if you speak to the person to make sure they want to do it. It is also possible to name multiple people in case something happens to one of the “attorneys.”

Who makes your decisions for you and what happens to your assets? Most young adults would not consider this to be an issue. Most young adults do not think about getting wills created as they feel it is something they can always deal with when they are older.

However, peace of mind and security that can be created in a few short hours now, could save days and potentially years of stressful litigation for family members and friends in the far future.

Why You Need Power of Attorney

When consulting a lawyer in Ontario about estate planning, you should always ask about the power of attorney.

Although the power of attorney documents are typically short, seemingly unimportant documents, those few pieces of paper can save your loved ones tens of thousands of dollars in the long run.

If you do not have a signed power of attorney to deal with your healthcare and property, your family will likely have to apply for guardianship over you. This process can take sometimes several months or even longer if there are multiple people trying to obtain guardianship status.

You should have discussions surrounding who you want to be in charge of your investments. You also want to think about your vehicles and specific assets. This can all be encompassed into a power of attorney.

Creating a Power of Attorney

These directives are vital in situations where multiple children, siblings, and sometimes spouses and ex-spouses are present. You want to think about who should actually be the person acting in your best interest.

When no power of attorney exists anyone of these persons can bring their own application. They can be confirmed as your guardian. This is true even if their intentions are self-motivated.

Still, wondering why you need power of attorney? Talk to a lawyer. We hope you found this article on creating a Power of Attorney useful.

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