Power of attorney is an instrument that allows its maker (known as the principal) to appoint an agent to make decisions for him in his absence or when he is not able to make decisions.
A Durable Power of Attorney goes into effect usually upon signature of the document whereas a Springing Power of Attorney goes into effect when the principal can no longer make decisions for himself such as in the event of illness or physical disability that impedes speech. A Power of Attorney may be open-dated unless terminated or it may be for a fixed period only. The Principal may extend broad and general powers or he may strictly limit what an agent can do to protect his interests.
The agent is often called an attorney-in-fact but he is not an attorney who becomes a member of the bar by designation. He is an advocate who represents the principal, he speaks for the principal and makes a decision in the principal's absence. He is called an attorney-in-fact. The agent need not be a member of the bar (who is known as an attorney-at-law). It is enough that the agent be of age, of sound mind (able to make a decision and communicate it), and enjoys the trust and confidence of the principal.
While it is enough that an agent enjoys the trust and confidence of the principal, it does not follow that his powers are limitless. The principal may lay out the extent of powers to be exercised by the agent. For example, in the principal’s absence the agent will be in charge of his rental property. He shall maintain the property, collect rent from tenants, among other powers; but unless given the authority to sell the property, the agent cannot do s. If the agent does this, he violates the fiduciary (legal and ethical) relationship with the principal, and the principal cannot only terminate his designation as an agent but can also file criminal and civil actions against him, and the agent will be required to restore or reimburse whatever losses the former incurred.
On the other hand, the principal is not precluded by law from ratifying an act performed by the agent beyond the scope of his powers as long as it does not affect public interest or public policy. Let’s say the agent converted the property into a prostitution den to make more profit. Even if the principal later on agrees and ratifies the actions of the agent, he is not allowed to do so by law since it is against public policy.
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