A power of attorney (POA) is a legal document that authorizes someone to act on your behalf in financial, legal, or medical matters. There are different types of POA, each with its unique purpose and level of control and liability. In this blog post, we will discuss the different types of POA and their levels of control and liability.
General Power of Attorney
A general power of attorney (GPOA) gives the agent broad powers to act on behalf of the principal in financial and legal matters. The agent can perform almost any act as the principal, such as opening financial accounts, managing personal finances, and signing legal documents. A GPOA arrangement is terminated when the principal becomes incapacitated, revokes the power of attorney, or passes away[2].
The agent under a GPOA has a high level of control over the principal’s affairs. They can make decisions that affect the principal’s financial and legal interests. However, the agent also has a high level of liability. They are responsible for acting in the principal’s best interests and can be held accountable for any damages caused by their actions.
Durable Power of Attorney
A durable power of attorney (DPOA) is similar to a GPOA, but it remains in effect even if the principal becomes incapacitated. This arrangement designates another person to act on the principal’s behalf and includes a durable clause that maintains the power of attorney after the principal becomes incapacitated[2].
The agent under a DPOA has the same level of control as a GPOA. However, they also have a higher level of responsibility. They must act in the principal’s best interests, even if the principal is unable to communicate their wishes. The agent can be held liable for any damages caused by their actions.
Limited Power of Attorney
A limited power of attorney (LPOA) gives the agent specific powers to act on behalf of the principal in a particular matter or for a limited time. For example, a principal may grant an LPOA to an agent to sell a property on their behalf. An LPOA can be used for financial, legal, or medical matters[1].
The agent under an LPOA has a lower level of control than a GPOA or DPOA. They can only act within the scope of the powers granted to them by the principal. However, they also have a lower level of liability. They are only responsible for acting within the scope of their powers and can only be held liable for damages caused by their actions within that scope.
Springing Power of Attorney
A springing power of attorney (SPOA) only becomes effective when a specific event occurs, such as the principal becoming incapacitated. This arrangement is similar to a DPOA, but it only becomes effective when a triggering event occurs[6].
The agent under an SPOA has the same level of control and liability as a DPOA. However, they only have that control and liability when the triggering event occurs.
Medical Power of Attorney
A medical power of attorney (MPOA) gives the agent the power to make medical decisions on behalf of the principal if they become unable to make those decisions for themselves. An MPOA can be used to make decisions about medical treatment, end-of-life care, and other medical matters[1].
The agent under an MPOA has a high level of control over the principal’s medical care. However, they also have a high level of responsibility. They must make decisions that are in the principal’s best interests and can be held liable for any damages caused by their actions.
Conclusion
In conclusion, there are different types of power of attorney, each with its unique purpose and level of control and liability. A GPOA gives the agent broad powers to act on behalf of the principal, while an LPOA gives the agent specific powers for a limited time or matter. A DPOA remains in effect even if the principal becomes incapacitated, while an SPOA only becomes effective when a triggering event occurs. An MPOA gives the agent the power to make medical decisions on behalf of the principal. It is important to choose the right type of POA and a trusted agent to act on your behalf.
Citations:
[1] https://www.legalzoom.com/articles/what-is-a-power-of-attorney
[2] https://www.kindredhospitals.com/resources/blog-kindred-spirit/2017/06/02/4-powers-of-attorney-every-caregiver-should-know
[3] https://www.lawhelp.org/dc/resource/frequently-asked-questions-about-general-powe
[4] https://www.freewill.com/learn/5-types-of-power-of-attorney
[5] https://a.arlawhelp.org/wills-and-estates/power-of-attorney
[6] https://www.investopedia.com/terms/p/powerofattorney.asp