When is it wise to give another person a durable power of attorney over my affairs?
A power of attorney is “durable" if the agent's authority continues notwithstanding that the person granting the power of attorney (the “principal") has become incapacitated (legally unable to manage his or her affairs). Powers of attorney can authorize specific acts (for example, acting for the principal in a particular transaction) or can broadly authorize the agent to act for the principal. If a person becomes incapacitated and has not granted a durable power of attorney, it may be necessary to have a guardian appointed to manage his or her property, which is often cumbersome and expensive. For this reason, spouses often grant each other durable powers of attorney granting broad powers, and older persons often give a trusted person a durable power of attorney to manage their affairs. Broad powers of attorney can be abused and should be granted carefully.
Stephen F. Lappert, Partner, Trusts and Estates Department, Carter Ledyard & Milburn LLP, New York, NY
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