Legal Professional?
Build Your Business

What Is a Durable Power of Attorney?

A durable power of attorney is a type of power of attorney reduced to a written document. The durable power of attorney usually contains magic words that state something such as, "This power of attorney shall not be affected by my disability," or, "This power of attorney shall take effect upon my disability." The exact words are not necessary, but something similar to this sentiment is necessary. For a durable power of attorney to be valid, it must include a signature by its creator before that creator becomes disabled.

When Do Durable Powers of Attorney Take Effect?

  • Durable power of attorney: presently effective—It is possible to create a durable power of attorney that takes effect while the creator is not disabled and has full command of his or her faculties such that he or she can manage his or her own legal and financial affairs. Such a durable power of attorney is deemed to be presently effective. The danger or risk with such a durable power of attorney is that the agent named is granted a great deal of authority, and that authority is subject to abuse and misuse. The agent is supposed to act in the creator's best interests and is directed to follow the creator's instructions, but that might not always happen as intended. For this reason, the agent selected must be a person who is greatly trusted by the creator.
  • Durable power of attorney: triggered upon disability—Alternatively, a durable power of attorney can be created to take effect only in a condition of disability. It is up to the creator to specify how the determination of disability status will be made. That determination is critical because it triggers the agent's ability to use the power of attorney for the creator's benefit and care. The magic words in the operative legal document must state that the durable power of attorney is triggered only in an instance of disability. Sample text for this type of durable power of attorney that takes effect in a condition of disability is set forth above.

Are Durable Powers of Attorney Needed for Spouses Who Jointly Own Property?

If one person in a marriage becomes disabled, that party's spouse is permitted to sign checks and withdraw money from a jointly-owned bank account. Yet, the non-disabled spouse is not permitted to sell other jointly-owned property such as stocks, a residence, or second home if the disabled spouse's signature is missing. A spouse is not permitted to make changes to the beneficiaries named on a disabled spouse's life insurance policy or retirement accounts either.

The more prudent course of practice for married partners who own all of their property jointly is to have both spouses create durable powers of attorney. Otherwise, the non-disabled spouse is still limited in what he or she is able to achieve and accomplish legally and financially to continue to maintain the couple's lifestyle and ongoing care.