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It’s a term you’ll hear both lawyers and laypeople refer to on a regular basis: the power of attorney. But there can also be a fair amount of confusion over just what this legal term of art actually means.

Simply put, a power of attorney is a written document giving permission by the “Principal” for someone else to act on his/her behalf. Although the phrase makes use of the word “attorney,” a person does not have to be a lawyer in order to step into this role. Rather, a person with power of attorney is simply acting as the agent of the Principal.

The word, “durable,” means that the power of attorney remains valid even if the Principal becomes incompetent.


Powers Can Be Broad or Limited

Powers of attorney can be quite broad in scope, or they can be drafted to cover a narrow, specific set of circumstances. For example, in a real estate transaction, you might give someone a limited power of attorney to sign a deed for the transfer of property if you are unable to attend the real estate closing for the sale of a parcel of land you own. Or the power of attorney may grant your agent the authority to act on a wide range of financial matters, both business and personal.

A health care power of attorney can be used to designate someone to obtain your health care information and make health care decisions on your behalf if you become incapacitated. There are some important limitations, however, with respect to decisions concerning the withdrawal of life-supporting treatment.

Powers of attorney do not have to go on forever. You can specify when you want the power of attorney to end, or you can revoke a power of attorney that you previously granted to someone.


Ohio’s Power of Attorney Laws

As the Ohio State Bar Association has noted in a consumer pamphlet on power of attorney, Ohio’s laws on granting someone power of attorney underwent some changes as recently as 2012. Many of the revisions were aimed at preventing abuse with respect to the financial affairs of elderly Americans, recognizing that powers of attorney are usually granted for the purpose of handling someone’s day-to-day affairs, not to make sweeping changes in an individual’s estate plan.

So unless the document granting someone power of attorney specifically authorizes it, an agent cannot give away property, create a trust, make changes to an existing trust, or change beneficiary designations on life insurance policies or other sensitive accounts. If these are things you’d like your agent to be able to do, the state bar association recommends designating two “co-agents” and requiring them to act together, in order to protect against fraud and abuse.

Although it is not necessary that your agent be a licensed attorney, it’s a good idea to consult one before attempting to grant someone power of attorney. For three decades, the Law Offices of John Grundy has been helping consumers throughout Northeast Ohio with questions about wills, trusts, and power of attorney. Contact us today to schedule a free consultation.