In Los Angeles County, a power of attorney (POA) is a legal agreement that allows one person (the “Principal”) to grant another person (the “Agent” or “attorney-in-fact”) the authority to act on his behalf in legal matters under certain circumstances. The type and extent of the power of an Agent depend on the type of POA requested and executed by the Principal.
A power of attorney is among the most commonly executed real estate planning documents. In fact, it is so commonly used that people often miss to stop and think about the power behind a POA. If you are thinking about signing a POA, it is critical to understand all the essential facts about a power of attorney in California.
When you give someone power of attorney, it is entirely up to you to decide how much authority to give them and what decisions they will be able to make – and when they would be able to make them.
Types of Power of Attorney Agreements in Los Angeles County, California
Power of attorney can take three primary forms in Los Angeles County. They are the following:
Limited Power of Attorney
Limited power of attorney authorizes the attorney-in-fact to act on behalf of the Principal in one instance, on a single subject. It is a beneficial agreement for business transactions that happen in another country or state.
Let’s say you want to buy a new house in another state that’s on the other side of the country, and all you need to do to finish the deal is sign a few papers. You can quickly resolve this by giving a limited power of attorney to a person who lives in that state, which will authorize them to sign the papers and finish the deal. Once the deal is done, the authority you’ve granted them will automatically expire.
Durable Power of Attorney
A durable power of attorney allows the attorney-in-fact to make decisions on behalf of the Principal in specific precisely defined areas of his affairs. Unlike the limited power of attorney, durable power of attorney doesn’t automatically expire. It can last indefinitely, or until the Principal decides to revoke it.
This type of power of attorney is advantageous because it grants the attorney-in-fact to make critical decisions for the principal, but it also allows the principal to revoke the agreement if they happen to regain the capacity to make their own decisions.
Springing Power of Attorney
Springing power of attorney is similar to the durable power of attorney with one significant difference – the power is conditional. It doesn’t take effect unless certain circumstances take place. This agreement can be about anything. Most commonly, it authorizes the attorney-in-fact to make essential decisions on behalf of the Principal, only if the Principal becomes incapacitated.
People may authorize a power of attorney for various reasons, but it is most commonly used to grant the attorney-in-fact to make legal, financial, and medical decisions on the Principal’s behalf if the Principal becomes incapacitated.
It is crucial that you have complete trust in the person to whom you are granting the authority of making decisions on your behalf because any power of attorney is prone to abuse, no matter how limited it is.
Contact us for more information and legal advice.