A power of attorney (POA) authorizes a specified individual to act as your agent to handle certain matters, such as finances or health care, on your behalf. If a power of attorney is durable, it remains in effect if you become incapacitated, such as due to illness or an accident. A General POA covers a wide range of transactions, while a Limited POA covers only specific situations, such as authorizing a car dealer to register your new vehicle for you.
An ordinary power of attorney expires if you become mentally incompetent, while a durable power of attorney includes special wording that makes it effective even if that happens. So when does the POA designation end?
Regardless of when the document takes effect all powers under a POA end upon the principle’s death. When the principal dies, the agent loses all ability to act in his or her stead both medically and financially. That is not necessarily problematic for healthcare POA since you no longer need to make medical decisions after death. However, it can be problematic for a financial POA because even after death there maybe financial issues requiring access to information.
If the agent was also named as the executor of the decedent's estate that will allow that designated person to remain to have access to financial accounts for purposes of administering the estate and guiding the probate process. The agent may also retain access to certain assets if they were named as a joint owner or payable-on-death or transfer-on-death beneficiary. If the person died intestate (without a will) the agent can petition the local probate court to be appointed as the personal representative which would allow them access to the estate. In these situations, there is a continuing fiduciary duty. The agent under a POA has a legal duty to act in the best interest of the principal and the executor has a legal duty to act in the best interest of the estate and its beneficiaries.
For more information on power of attorney, trust and estate planning, please contact the experienced and knowledgeable attorneys at Stouffer Legal in the greater Baltimore area.
