Power of Attorney


Power of Attorney

Effective January 1, 2014 the Minnesota Statutory Short Form Power of Attorney form changed slightly so now is a good time to review what exactly a Power of Attorney is.

In Minnesota, Powers of Attorney are subject to the provisions of Minnesota Statutes, Chapter 523. The breed most of us may be familiar with is the “Statutory Short Form Power of Attorney” based on Minnesota Statutes Section 523.23.  In order to get to know this breed better, let’s review some of its basic features. The person who grants the authority to act in his or her behalf to another person is called the “principal”. The person who holds a power of attorney authorizing him or her to act in behalf of another is called the “attorney-in-fact.”

Another feature is that the power of attorney is valid only if a competent adult (the principal) signs and dates the power of attorney giving another the written power to act as their attorney-in-fact. A competent adult means an adult who is not incapacitated and is not subject to an appointment of a guardian or conservator. In plain English, your crazy Uncle Eustis who talks to trees and communicates with Martians most likely cannot validly give another adult the power to act as his attorney-in-fact.

Another feature is that the power of attorney can be “durable” or “non-durable”. A durable power of attorney means that the power of attorney continues to be valid even if the principal becomes incapacitated or incompetent after granting it. A non-durable power of attorney ceases to be valid if the principal becomes incapacitated or incompetent. Again, in plain English, if Uncle Eustis signs a non-durable power of attorney while he is sane and then he walks into a tree causing him to go into a coma, the power of attorney is likely no longer valid since he would probably be considered incompetent.

Before Uncle Eustis becomes incapacitated or incompetent, he can sign the power of attorney which gives broad and sweeping powers to the attorney-in-fact. The powers that may be granted cover many areas including transactions involving real property, personal property, bonds, shares, commodities, banking, business, insurance, beneficiary transactions, gifts, and fiduciary transactions. The Statutory Short Form Power of Attorney may also authorize the attorney in fact to act in behalf of the Principal as to claims and litigation, family maintenance, benefits from military service, records, reports and statements. (Minnesota Statute Section 523.24 provides a definition for all these powers and this blog will not address them in depth so if you wish further information on this, contact an attorney.) This feature of the power of attorney is essentially the body since these powers guide and control what the attorney-in-fact can do on behalf of Uncle Eustis.

How long Uncle Eustis’ power of attorney continues depends on not only whether it is durable or non-durable but who is the attorney-in-fact and how long Uncle Eustis lives. For example, if Aunt Hazel, Eustis’ wife, is his attorney-in-fact but she files for divorce, the power of attorney terminates upon the commencement of the divorce (also upon separation or annulment of the marriage). On the other hand, if Aunt Hazel never starts a divorce but Uncle Eustis dies from a heart attack while playing a tough game of Scrabble, the power of attorney terminates upon his death. Uncle Eustis also has the option of having an expiration date for the power of attorney. These features must be taken into consideration when deciding who to designate as the attorney-in-fact. In fact, more than one person can be designated as the attorney-in-fact and other individuals can be designated as successor attorney(s)-in-fact in case the attorney-in-fact dies, resigns or is otherwise unable to serve.

This blog briefly describes the various features of a power of attorney demonstrating that Uncle Eustis (and you) should give these features consideration before signing a power of attorney. For further information and advice on what might work best for your situation, please contact an attorney.

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