Durable Power of Attorney (Financial)
A Durable Power of Attorney authorizes a person you designate to be able to make decisions for you and sign your name on your behalf if you are unable to do so due to incapacity. Most powers of attorney are “springing”, which means they only become effective once you are deemed incapacitated by two physicians. Once two physicians declare in brief affidavits that you are incapacitated, the power of attorney “springs” into effect, giving authority to whomever you designated to act on your behalf.
It is also possible to create an “immediate” power of attorney, as opposed to a springing power of attorney. In such a case, the drafter is bestowing the person designated with the immediate authority to act on his or her behalf. This is used most commonly in situations with elderly parents who want their child to have such control without needing to go through the steps mentioned above regarding incapacity.
Powers of Attorney are frequently used to plan in advance in case of a Principal's future incapacity or disability and loss of competence resulting, for example, from Alzheimer's Disease or a catastrophic accident. Without a power of attorney in place, should such a disabling event happen to the Principal, family members or friends would have to petition the Court to act as the disabled Principal's Guardian or Conservator to handle the Principal's affairs. This process is very time consuming and expensive.