Skip to main content

How to Draft a Power of Attorney

Posted by attorney Chase Carter

A power of attorney (POA) can be a useful tool in planning both for sickness and for time spent out of the area. Most people only think of a POA to be used in times where they have been rendered incapacitated by disease, injury, or advanced age. A well thought out and drafted POA however, can be much more useful. This is not to say however that these documents are not without their dangers. A full outline of the dangers of a durable power of attorney have been outlined in another of my legal guides. The information below will give you a starting point to decide if you need a power of attorney and what type of power of attorney you need.

To understand whether or not you need a POA, you must first understand what a POA does. An executed POA allows a person, called your “attorney in fact" to step into your shoes. These attorneys in fact can then act as you and undertake any action that you could take yourself. Depending on the powers granted to them, an attorney in fact can do anything from sell real estate, assume debt, buy and sell stock, etc. The only limits placed upon their powers are those reservations made in the document. Without reservations made, the attorney in fact can legally do anything you could do yourself as long as the POA is active.

The other factor about a POA that you must bear in mind is the difference between a general POA and a durable POA. A general POA will expire, no matter what the expiration date or event is in the text of the document, when a person is incapacitated. This means that even though in its text the document says the attorney in fact holds the power to undertake an activity, if a person is incompetent the POA is no longer active. The other type of POA is what is called a durable power of attorney. A durable POA will continue through incapacity until the expiration set forth in the document, or the person’s death. Death will extinguish any POA.

The first question to ask yourself is what do you want this document to do. POA’s can be tailored to fit very specific needs and very specific time periods depending on the wants and needs of the client. POA’s can be limited to only operate for a series of days, or can last the lifetime of an individual. A poorly thought out, or poorly constructed POA can either expire just when they are needed, such as when a person has been rendered incapacitated and the POA they have is not durable, or last too long, such as a person who has a durable POA that allows a person to drain their estate.

A person needs to ask what need the POA will serve. Many people will draft and execute a POA when it is not needed, solely because they thought it was a good idea. A person who is young, in good health, and does not travel often may truly not need a POA. Others may be out of the area for protracted amounts of time, or are facing a debilitating disease where they will not be able to make decisions. In this event, a POA is most likely necessary so that a person can guarantee their needs are being met. A POA can be tailored to serve a limited purpose, for instance the attorney in fact holds a POA solely to execute documents to sell a piece of land, or can be broad enough to oversee all the affairs of an individual.

The most important question to ask, is who will be your attorney in fact. An attorney in fact has very broad powers and can do unlimited amounts of damage to yourself and your finances if they are not looking out for your interests. A good attorney in fact will oversee your affairs justly and will only do actions that are in your best interest. A person should choose someone that they trust completely as their attorney in fact. They should also choose a person that has knowledge of the person’s affairs. A completely trustworthy person that knows nothing of your real estate holdings, your creditors, or your health does not make a good attorney in fact the same way that someone with intimate knowledge of your holdings who is operating out of self interest does not make a good attorney in fact.

The final question to answer is how long should this document be active. POA’s can be written to expire at a fixed time, when an event happens, or when certain conditions exist. This is a decision that you must answer yourself, as you are the only one that truly knows what you need.

To execute a proper POA that serves your interest, you should contact an attorney to outline what you want the POA to do and what type of POA you need. An attorney can answer your questions and make sure the document suits your needs. Drafting a POA on your own or using ready made forms can be very dangerous, as you may not understand exactly what the form gives power to do.

Author of this guide:

Was this guide helpful?