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A power
of attorney is a document in which you
give someone the legal authority to act
for you. That person is called your
attorney-in-fact or your agent. You are
called the principal. You may name
your spouse, an adult child, a relative, or
trusted friend to be your agent. You
should choose someone you trust
completely. The actions of your agent
authorized by your power of attorney
are considered legally to be your
actions.
What makes a power of attorney
durable? |
What makes a power of attorney durable?
A durable power of attorney is effective even though you are incapacitated. If you are planning for possible future incompetency, your power of attorney must be durable. To be durable, a power of attorney must state that it either remains or becomes effective after you become incapacitated, or it must refer to Article 2 of Chapter 32A of the North Carolina General Statutes.
A nondurable power of attorney ends if you become incompetent or incapacitated. Someone may act on your behalf under a nondurable power of attorney only if you are competent, and it is used for reasons other than planning for incapacity.
A durable power of attorney may be effective immediately or only if you become incapacitated. A durable power of attorney that is effective if and when you become incapacitated is called a "springing" power of attorney. A springing power of attorney needs a method for determining if you are incapacitated so that third parties know they can rely upon your agent's authority. For this reason, many lawyers do not favor springing powers of attorney because of the difficulty in establishing when the principal is incompetent. A durable power of attorney that is effective upon signing eliminates this problem.
For example, a springing power of attorney that becomes effective when a doctor determines the principal is incompetent may have limited use if doctors are reluctant to make this determination, particularly if the principal's condition does not meet the legal definition of "incompetent." Nevertheless, a principal may need help with his or her affairs because of diminished capacity that does not meet the legal definition of "incompetent." A springing power of attorney may pose difficulties in this situation unless it is carefully drafted.
If the power of attorney does not provide a procedure for determining if the principal is incompetent, a springing power of attorney is effective when the agent swears in an affidavit that the principal is incompetent.
If you become incapacitated or mentally incompetent, your agent must keep full and accurate records of anything he or she does on your behalf. Your agent must file inventories and accounts with the clerk of the superior court unless you waive this requirement. Note: Many durable powers of attorney waive this requirement because of the burden it places upon the agent.
A durable power of attorney is valid after you become incapacitated only if it is registered in the office of the register of deeds in at least one of the following places:
Your durable power of attorney may be registered after you become incapacitated.
If you require your agent to file inventories and accountings, a copy of your durable power of attorney must be filed with the clerk of the superior court within 30 days after filing the power of attorney in the register of deeds office.
You may use a durable power of attorney to name the person you would like to be your guardian if you are declared legally incompetent. You may name your agent, if you so choose. The court does not have to follow your recommendation, but it usually will accept your choice, unless the person you named is disqualified. You may want to name your choice because a court-appointed guardian may revoke or amend your power of attorney.
To qualify as a guardian for an incompetent adult, the person must be a resident of North Carolina if he or she is appointed to take care of your property. A guardian appointed to take care of you (not your property) may be a nonresident. For more information, see the section Guardianship.
You may revoke your durable power of attorney. If you have not registered your durable power of attorney, it may be terminated in several ways.
Regardless of the method you choose, you should tell your agent that the power of attorney is revoked.
If you have registered your durable power of attorney, the following events will terminate it.
Also, your power of attorney ends if your agent dies or resigns, and you have not named someone else to take your agent's place. You may arrange to have someone name a substitute agent for you, if necessary.
In your power of attorney, you may want to set the amount of pay that your agent is entitled to receive or the method for determining the amount of pay. If your power of attorney does not provide for paying your agent, the clerk of court will determine how much to pay your agent if your agent makes a request for payment. The amount set by the clerk of court may not exceed a fixed percentage of the value of your property.
Prepared by Carol A. Schwab, J.D., LL.M., Professor and Extension Specialist, NC State University.
This publication is provided as a public service and is designed to acquaint you with certain legal issues and concerns. It is not designed as a substitute for legal advice, nor does it tell you everything you may need to know about this subject. Future changes in the law cannot be predicted, and statements in this publication are based solely on the laws of North Carolina in force on the date of publication.
Date: July 2000
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