What’s Durable Power of Attorney?
Durable Power of Attorney (DPOA) is a legal document, authorized by specific statute, recognized to be binding and controlling of your legal rights. Historically, a power of attorney was created at common law in writing by one person, naming another as his or her “agent” or “attorney-in-fact” (NOT Attorney at Law). However, the incapacity of the person making the power of attorney revoked the authority of the agent to act under the power of attorney, under the theory that if the person making the power of attorney lacked capacity to act, then the agent for that person did not independently have sufficient legal capacity to act for them.
That’s a little bit cumbersome, as a third party relying on a power of attorney might not even see the person who created the power of attorney, who is called the principal. Defenses to contracts and legal actions, such as signing a deed to property, sprang up. The third party might very well say, “Who knew that the principal was in fact lacking capacity at the time the agent attempted to legally act on the principal’s behalf?”
Modern statutes create the survivorship of the agency under a “durable” power of attorney, which survives the incapacity of the principal. This makes the modern DPOA statute much more flexible, and in fact an inexpensive alternative to guardianship of the property, which is court supervised and more expensive and comprehensive in its procedural and legal requirements. Florida updated its Durable Power of Attorney statutory scheme effective October 1, 2011, with revisions to Chapter 709, Part II, Florida Statutes. http://www.leg.state.fl.us/STATUTES/index.cfm?App_mode=Display_Statute&URL=0700-0799/0709/0709PartIIContentsIndex.html&StatuteYear=2011&Title=-%3E2011-%3EChapter%20709-%3EPart%20II
Under these new changes, certain authorizations, such as creation of a trust, modification or revocation of a trust, making of a gift, changing rights of survivorship, changing a beneficiary designation, waiving a right to be a beneficiary of an annuity or retirement plan, or disclaiming property, must be specifically evidenced by a separate signed provision. These powers should be carefully considered and discussed in application for each individual DPOA, and if chosen, should be evidenced by confirming signature or original initials of the principal, clearly shown on the face of the signed DPOA.
The new Florida DPOA scheme also does away with any express “springing” DPOAs being created. In other words, new Florida DPOAs are live and effective immediately, and are not contingent on your incapacity (i.e., the reverse of the common-law power of attorney, which had been permitted under prior statute). However, if you are wary of granting a DPOA effective immediately, consider if safety warrants either the appointment of a co-agent, so that the two (2) co-agents together will presumably keep one another honest, or “escrowing” your DPOA with your Attorney at Law, to be used and released conditioned on your own future request, or your physician’s written opinion to your Attorney at Law that you are unable to handle your own affairs at that time.
Don’t be a victim of one size fits all planning. Know your legal rights on estate planning and act accordingly!