Types Of Power Of Attorney: Which One Is Right For You?
Life is full of unpredictable events. You may not be able to perform certain tasks as planned. You never know where your work takes you. Moreover, our health is never under our control.
With so much uncertainty around us, legal documents like power of attorney (POA) give us some assurance. A POA helps you make decisions or take actions when you are not physically or mentally capable of doing so. The document lets you appoint a trusted person (called an attorney) to handle your affairs on your behalf.
You can prepare a power of attorney to manage your financial affairs, make important business decisions, conduct real estate deals, or make any other decisions influencing your financial or corporate life.
When it comes to planning for your medical needs, you should prepare a representation agreement. This document helps you choose a person solely responsible for making decisions regarding your healthcare and personal care.
Coming back to POA, always work with an experienced local lawyer to draft the document. For example, if you live in Surrey and have most of your properties here, look for a reliable power of attorney lawyer in Surrey for guidance. Legal help ensures that you take the right steps and stay updated with your POA’s legal implications.
Depending on your circumstances and requirements, you can prepare different types of power of attorney documents. Let us discuss the most common and important POAs you can draft:
General Power Of Attorney
A general power of attorney lets you give broad authority to your attorney to manage your financial, legal, and corporate affairs. Most of these documents do not involve specific tasks to be performed by attorneys.
A general POA is valid only until the grantor (the creator) is mentally capable. Most grantors prepare these documents to delegate responsibilities for a specific period of time. For example, you can have your attorney pay your bills or collect your rent for a few months if you are away on a business trip.
A general POA’s validity ends if the grantor becomes mentally incapable of making sound decisions. It is temporary and terminates as soon as the grantor becomes physically available again.
Such POAs are ideal for managing activities like:
- Paying bills
- Signing contracts
- Collecting rent
- Filing taxes
- Managing bank accounts
Enduring Power Of Attorney
Enduring power of attorney is a long-term arrangement where an attorney manages your operations while you are mentally capable and after you lose mental capacity.
If you are exploring different types of power of attorney on a long-term basis, this should be your choice. It is commonly prepared by people who are doubtful of their physical and mental well-being. They appoint a trusted attorney (usually a close friend or family member) who looks after their financial, legal, and corporate affairs for a long time.
If you plan to make an enduring POA in British Columbia, it should be signed while you are still mentally capable. You will also need to clearly state that its validity will continue after you lose mental capacity. Otherwise, the document will automatically turn into a general POA and become invalid after you become mentally incapable.
While many aging people choose this power of attorney, it does not cover matters related to their healthcare and personal care needs. For this, they will need a representation agreement.
Limited Power Of Attorney
As the name suggests, a limited POA comes with an expiry date. It is prepared for a specific period of time, giving an attorney the power to perform specific tasks on your behalf.
A limited power of attorney is prepared while the grantor is mentally capable. It becomes invalid if they lose mental capacity, even if the period mentioned in the document is still not finished. When you prepare a limited POA, you will need to mention the specific tasks your attorney should perform. They won’t have powers beyond performing these tasks on your behalf.
Such a POA is commonly prepared for short-term transactions like:
- Completing the purchase or sale of a property
- Managing your bank account while you are away
- Signing documents for one-time transactions or deals
Springing Power Of Attorney
A springing power of attorney comes into effect only after the grantor loses mental capacity. It is prepared when they are mentally capable of planning for unexpected incapacity.
Preparing this POA can be quite challenging, as grantors and their family members often have a tough time proving the onset of mental health complications. However, hiring a skilled power of attorney lawyer in BC will make matters easier for you.
The Final Word
These were some of the most common power of attorney types you can choose from. Seek legal help before choosing the most suitable document for you and your loved ones.