General Power of Attorney - Springing FAQ

A general power of attorney (springing) is a simple, inexpensive and reliable way to arrange for someone to make your financial decisions should you become incapacitated.    If you do become incapacitated, the general power of attorney (springing) will be very helpful to those close to you.

For more information on drafting your own powers of attorney, please read the free legal tutorial entitled  Powers or Attorney which can be found in the Lean Law Library.

How does a general power of attorney (springing) work?

When you create and sign a power of attorney, you give another person legal authority to act on your behalf.  This person is called your attorney-in-fact, donee or agent.   The word "attorney" here means anyone authorized to act on another's behalf.  It is not restricted to lawyers.

A general power of attorney (springing) becomes valid when you become incapacitated or unable to handle your own affairs.

When does a general power of attorney (springing) take effect?

Some powers of attorney can be drafted so that they go into effect when signed (e.g. a special power of attorney for a real estate transaction).    A "springing" power of attorney does not go into effect unless and until a doctor or doctors certify that you have become incapacitated (the exact specifics of this determination are normally contained in the power of attorney).  A springing power of attorney allows you to maintain control over your own affairs until you become incapacitated, when it springs into effect.

What does an attorney-in-fact/donee/agent do?

Many people give their attorney-in-fact/donee/agent broad powers over their finances.    You are entitled to give your attorney-in-fact/donee/agent as much or as little power as you wish.  You may want to give your attorney-in-fact/donee/agent authority to do some or all of the following:

• use your assets to pay your everyday expenses and those of your family

• buy, sell, maintain, pay taxes on and mortgage real estate and other property

• collect benefits from Social Insurance or other government entities, civil or military

• invest your money in stocks, bonds and mutual funds

• handle transactions with banks and other financial institutions

• buy and sell insurance policies and annuities for you

• file and pay your taxes

• operate your small business

• claim property you inherit or are otherwise entitled to

• hire someone to represent you in court, or

• manage your retirement accounts

Whatever powers you give your attorney-in-fact/agent/donee, he or she must act in your best interests, keep accurate records, keep your property separate from his or hers and avoid conflicts of interest.

How do I create a general power of attorney (springing)?

To create a legally valid general power of attorney (springing), you must properly complete and sign a power of attorney form and have it witnessed by two people.  An affidavit of witness should be prepared and notarized if the power of attorney needs to be recorded for real estate transactions or other purposes.

Some banks and brokerage companies require their own power of attorney forms.   If you want your attorney-in-fact/agent/ donee to have an easy time with these institutions, you may have to prepare and sign more than one power of attorney (your own form and the forms provided by the institutions where you do business).

What happens if I don't have a general power of attorney (springing)?

If you become incapacitated and you haven't prepared a general power of attorney (springing), your spouse, relatives or companion will have to ask a court for authority to deal with your financial affairs.  If you are married, your spouse does have some authority over property you own together.  He or she will be able to pay bills from a joint bank account.  However, there are significant limits on your spouse's other rights concerning property owned by both of you.  Your relatives may have to hire a lawyer to petition the court for authority to deal with your finances, and this could get expensive.

Depending on where you live, the person appointed by the court to handle your finances is called a conservator, guardian of the estate, committee or curator. When this person is appointed, you lose the right to control your own money and property.

The appointment of a conservator is usually just the beginning of court proceedings. Often the conservator must:

• post a bond (a type of insurance policy) in case he or she steals or misuses property

• prepare (or hire a lawyer or accountant to prepare) detailed financial reports and periodically file them with the court

• get court approval for certain transactions, such as selling real estate or making investments.

A conservatorship is not necessarily permanent, but it may only be terminated by a court.

I have a living trust. Do I still need a general power of attorney (springing)?

A  living trust can be useful if you become incapacitated.  In most cases, the person who will distribute trust property after your death (the successor trustee) can also take over management of the trust property if you become incapacitated.   However, not many people transfer all their property into a living trust, and the successor trustee would have no authority over property that wasn't owned by the trust, so a living trust is not a adequate substitute for a general power of attorney (springing).

Can my attorney-in-fact/donee/agent make medical decisions on my behalf?

No.  A general power of attorney (springing) does not give your attorney-in-fact/donee/agent legal authority to make medical decisions for you.  You can prepare a personal health care directive (or living will) which lets you choose someone to make medical decisions on your behalf if you become incapacitated.  A personal health care directive or living will tells your doctors your preferences about certain kinds of medical treatment and life-sustaining procedures if you can't communicate your wishes.

For more information about health care documents, please see the Health Care Directive FAQ or  read the free legal tutorial entitled Personal Health Care Directives (Living Wills) found in the Lean Law Library

When does a general power of attorney (springing) end?

It ends at your death. You can't give your attorney-in-fact/agent/donee authority to handle things after your death by way of a springing power of attorney (e.g. paying your debts, making funeral or burial arrangements or transferring your property to the people who inherit it).  If you want your attorney-in-fact/agent/donee to have the authority to wind up your affairs after your death, use a will to name that person as your executor.

Your general power of attorney (springing) also ends if:

• You revoke or renounce it.  As long as you are mentally competent, you can revoke a power of attorney at any time.

• A court invalidates your document. A court could declare your document invalid if it concluded that you were not mentally competent when you signed it, or that you were the victim of fraud or undue influence.

• No attorney-in-fact/agent/donee is available.  Any power of attorney must end if there's no one to serve as attorney-in-fact/agent/donee.  To avoid this problem,  name an alternate attorney-in-fact/agent/donee in your document.

• You become bankrupt

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