The Durable Power of Attorney is a powerful estate planning tool that everyone should have. Properly drafted, a Durable Power of Attorney allows for the right person to be able to manage your affairs when you are physically or mentally unable to do so. However, a Durable Power of Attorney goes into effect once executed and generally grants someone else great power to make decisions for you and to enter into agreements on your behalf. Many people may be uncomfortable granting these powers to someone else while they are still capable of managing their own affairs. Is it possible to delay the effects of a Durable Power of Attorney?
What Is A Power of Attorney?
A Power of Attorney is a legal document that is used to delegate legal authority to another. The person who signs a Power of Attorney is called the Principal. The Power of Attorney gives legal authority to another person called the Agent or Attorney-in-Fact to make financial and legal decisions for the Principal. The authority that the Principal grants the Agent can be as broad or narrow as the Principal wishes. It is entirely dependent on what powers the documents grants the agent.
How Long Does This Power Last?
A Power of Attorney lasts until it is revoked by the Principal, the death of the Principal or until the Principal becomes mentally incompetent or physically unable to make decisions. If the Principal wishes for the effects of the Power of Attorney to continue after he or she becomes mentally incompetent, the Principal can make the document a “Durable Power of Attorney.” The document is ‘durable’ because it survives the Principal’s mental and physical incompetence.
There is a third category beyond simply Non and Durable Power of Attorney. A Springing Power of Attorney becomes effective at a future time. It ‘springs up’ upon a specific event designated in the Power of Attorney document. Generally, this event is the illness, incapacity or disability of the Principal.
Springing Users Beware
While a Springing Power of Attorney may be attractive to some with the flexibility that it provides, it is not without its risks. Unlike a Durable Power of Attorney which merely lasts throughout incapacity, a Springing Power of Attorney only goes into effect at the time of incapacity. In order for it to ‘spring’ into effect, there must be a determination of your incapacity usually by a doctor. This means that your Agent will not be able to act on your behalf until this determination is made.
There is also a large gray area of what incapacity means and to whom. Your documents will have to specify with certainty when you are incapacitated but that is a hard task to accomplish. A person might not become fully incapacitated all at once. What happens if you have good days and bad days? What happens if your Agent believes that you are incapacitated but the doctors do not? A Springing Power of Attorney may unintentionally set you up for conflict at a time where you need peace and quiet in your life.
The Choice Is Yours
Ultimately only you and a New York estate planning attorney will be able to decide what is best for you. Many problems with a Springing Power of Attorney can be avoided with careful planning and execution but only you will be able to decide with what amount of risk you are comfortable with in your estate planning documents.
See Related Posts:
Determining Incapacity in New York
Back to Basics: Funeral Instructions as Part of Your Estate Plan