Legal issues can be complicated at the best of times. However, the complexity increases when an individual becomes incapacitated to the point of requiring someone else to handle his or her legal matters for them. It is not always easy to know when "Power of Attorney" status should be transferred to a family member or friend, and once the decision has been made, there is still the question of which specific kind of Power of Attorney status should be granted.
Power of Attorney status is not a "one size fits all" proposition, and it is important to be informed of the various options available. One of the important category distinctions to be aware of is the difference between Durable Power of Attorney and "springing" Durable Power of Attorney. These two options have their own unique advantages and disadvantages. We will take a comparative look at each.
Durable Power of Attorney
Durable Power of Attorney is a document which allows an individual, known as the "principal," to give the authority to another individual, known as the "agent" or "attorney-in-fact," to make financial and legal decision on their behalf. This status is considered "durable" because it remains in effect if the principal becomes mentally incompetent to conduct their own affairs. Despite the terminology, the agent need not be a lawyer but can be a competent spouse, family member, friend, or agency. The powers that are granted to the agent can be as broad or as narrow as the principal wishes to define them. However, whoever is chosen to execute the principal's affairs should be someone who is capable and trusted to handle the defined responsibilities.
Springing Durable Power of Attorney
Springing is a variation on the standard Durable Power of Attorney. With a standard Durable Power of Attorney, the agent gains immediate power over the principle's financial and legal affairs. Once the documents are signed, the agent is responsible for acting on behalf of the principle, regardless of the principle's mental capacities. With a Springing Durable Power of Attorney, the agent is granted legal authority only at the time when the principal becomes mentally incompetent. The agent's legal authority "springs" into effect when a doctor designates the principal as mentally incompetent.
Pros and Cons
Each of these Durable Power of Attorney options has advantages and disadvantages. A typical Durable Power of Attorney is relatively easy and affordable to set in place. However, since there is no ongoing court supervision of the agent, it can be subject to abuse. A Springing Durable Power of Attorney can ensure that the principal has the power over their own affairs for as long as possible, but it does entail certain ambiguities regarding when the principal should be considered mentally incompetent.
