Today I want to talk about power of attorney. While most of you will have heard of power of attorney, probably few of you know exactly what it is.

Power of attorney is a legal instrument that authorizes substitute decision-making. It is divided into two categories: power of attorney for property and power of attorney for personal care.

Power of attorney for property grants the attorney (the person who is being granted the power) the right to manage, sell, or acquire property on behalf of the grantor. The power of attorney may delegate all matters that the grantor is capable of doing, except for making a will. It is generally assumed that the power granted will be a continuing one, subject to the conditions set out in the document.

However, under the law power of attorney for property will cease to be effective if the grantor becomes incapacitated. Nonetheless, power of attorney may survive the grantor’s incapacity if there is express intention that the attorney may continue to act during the grantor’s incapacity.

Power of attorney for personal care allows the grantor to name an attorney who can make decisions regarding personal care if the grantor becomes incapacitated. Unlike power of attorney for personal property, the power is only invoked when the grantor becomes incapacitated.

When creating power of attorney, many choose to draft their own documents or buy pre-printed forms at local bookstores. I caution my clients against this practice.

You should always consult a properly licensed lawyer to ensure that your power of attorney is properly drafted and legally valid. There is always a chance that power of attorney may be abused. For example, your attorney may sell off your assets without your consent under power of attorney for property. A lawyer can help you to minimize the risks of loopholes and abuse.