A power of attorney is a person who acts on your behalf to handle certain tasks or to make decisions when you cannot. As long as you are of sound mind, you can designate a person called an agent or attorney-in-fact to act on your behalf.
As long as the principal or person who created a power of attorney remains of sound mind, they can override their power of attorney’s decisions. If the principal lacks the mental capacity to make this decision, the court can intervene and appoint a legal guardian to override an existing power of attorney.
What types of powers of attorney are available?
Since a power of attorney (POA) acts on your behalf, you can determine the type of POA you need and the authority you will grant in the document.
Depending on state laws, POA types include:
- Specific or limited power of attorney: This type limits your agent to having the authority to complete specific tasks. For example, if you are going on an extended vacation overseas, you may use a specific POA to designate someone to pay your bills when you are away. Limited POAs are designed to cover specific tasks for a limited amount of time. They can be limited to making financial or healthcare decisions on your behalf.
- General power of attorney: This is a broad POA that gives your agent a wider range of powers to act on your behalf. They may conduct business, financial, or real estate transactions, settle claims, pay bills, or even employ professional help on your behalf. They have the fiduciary responsibility to handle your legal and financial affairs for you.
- Durable power of attorney: Under a durable POA, you may give your agent specific or broad authorization to act on your behalf. Durable means that they will retain POA even if the principal becomes physically or mentally incapacitated. With a durable POA, your agent can make medical and financial decisions for you if you have a medical crisis or dementia without asking for court intervention.
- Springing power of attorney: This type of POA “springs’ into action when a specified event occurs. For example, if a principal enters the hospital for a serious health condition or surgery, an agent, using a springing POA, can make medical or financial decisions for the principal while they are incapacitated.
Who can override a POA?
As long as the principal or person writing the POA retains the mental capacity to make decisions for themselves, they can override a POA.
If the principal lacks the mental capacity to revoke their POA, a concerned family member may need to involve the court. A POA has a fiduciary legal responsibility to act in the best interests of the principal; if they do not, this is a major concern.
If a concerned person feels that a POA is not acting in the best interests of the principal, they may petition the court to intervene if they believe the agent is mishandling the principal’s finances or putting their well-being at risk, or misusing the POA for personal financial gain.
The court may appoint a legal guardian or conservator to represent a principal who lacks the mental capacity to make decisions for themselves. This person can override a POA.
The primary difference between a POA and a legal guardian is that the principal chooses their POA and determines what rights and responsibilities they are delegating to this person to act on their behalf. The court appoints a legal guardian to manage a person’s affairs. Both a legal guardian and a POA have a fiduciary responsibility to act in the best interests of the principal.
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When should you seek to override a power of attorney?
A POA has a fiduciary responsibility to act in the best interests of the principal. If they are not, you may need to take action to override a POA.
Some examples of circumstances that may justify involving the court to protect the principal include:
- Misuse of funds: The POA is responsible for using the principal’s funds in a way that best supports their well-being. If a POA is using the principal’s money for personal gain, it should be revoked.
- Mixing of assets: A POA should not combine their assets with the principal’s. This would make it difficult to ensure the principal’s funds are being used for their benefit.
- Poor documentation: The POA should document that bills are paid, assets are sold, or other financial decisions are made. The POA should keep receipts and document all financial transactions made on behalf of the principal. If they don’t or hide this information, it may be a red flag signaling a need to revoke POA.
- Overstepping authority: A POA gives an agent the authority to make decisions for the principal. If the POA limits this authority and the agent oversteps it, this may indicate a need to replace or at least question the agent.
How do you revoke a power of attorney?
If you need to revoke a power of attorney, talk with your lawyer because laws governing revoking a POA vary by state. Your lawyer can guide you through the process of revoking your POA.
To revoke a POA, you will need to complete a notarized document indicating your intent to do so. Notify all organizations or healthcare providers that the revocation may have an impact on, as well as your former agent. Following state and local laws, file a notice of revocation and destroy copies of your old POA document (except for a copy for your records).
You do not need a lawyer to revoke a power of attorney, but they can help you navigate the process and advise you if your agent is not honoring your request.
You can schedule a call with us or reach out to us directly at 855.356.0573 to learn more about how best to plan today to protect those most important to you.
