A power of attorney allows a person (known as a “principal”) to appoint a representative (or agent) to manage their property and affairs in the event they are no longer able to do so for themselves. At some point, nearly everyone will need a power of attorney to represent them. But it’s hard to know what a power of attorney is, how to appoint the right one, and what type of power of attorney you need. This is why it’s always a good idea to discuss any power of attorney agreement with a local attorney well-versed in these matters like the skilled lawyers at M&A Law Firm.
Understanding Power of Attorney in Illinois
Power of attorney agreements are regulated by state law. In Illinois, this law is the Illinois Power of Attorney Act, Ill. Com. Stat. 755/45.
The basic requirements of the Illinois Power of Attorney Act include:
- A designation of an agent and a written description of their powers
- A properly signed power of attorney document (signed by the principal)
- A properly witnessed and signed power of attorney document (by an individual at least 18 years old)
- The principal must acknowledge and identify their own signature and have the document notarized (the notary public may also be a witness)
Each of these basic requirements must be carried out in a specific way, and a licensed attorney can help you understand exactly what needs to be done and why.
How to Appoint a Power of Attorney
Only an individual of sound mind and who is mentally competent can legally sign and appoint a power of attorney. Sometimes a court will require an evaluation completed by a doctor to verify the competence of an individual.
For real estate transaction, Illinois requires the filing of a standard power of attorney form called the Illinois Statutory Short Form Power of Attorney for Property. It is a boilerplate document anyone can fill out, sign, and have notarized with the help of a licensed attorney.
After the power of attorney document is executed, an agent is appointed power of attorney by the principal. A copy of the document must be provided to the agent for it to be effective.
A power of attorney document does not have to be executed by an attorney, nor in the presence of an attorney. But consulting an attorney will ensure that process is done properly and meets all of Illinois’ legal requirements. An attorney also ensures you are protected in the case your power of attorney needs to represent you.
You may appoint more than one power of attorney. You can assign them to serve jointly or separately in decision making processes for managing various affairs. The benefit is that they can work as a check on each other. However, multiple agents could disagree and cause delay in legal transactions.
Power of attorneys can be revoked at any time. To revoke a power of attorney, notify the agent in writing and make sure to retrieve all copies of the power of attorney documents back from anyone who may have a copy.
Choosing A Power of Attorney
When choosing a power of attorney, it is important to choose someone who can be trusted to look out for your best interest. That means choosing someone who will respect your wishes and who will not abuse the powers they are granted as your agent. It is also wise to choose an additional agent to serve as a backup in the case the appointed power of attorney is not able or willing to serve.
There are several different types of power of attorneys. Each type gives the appointed person the attorney-in-fact to makes decisions on the behalf of the principal. Two common provisions are for a durable power of attorney or for a springing power of attorney. A durable power is effective immediately and not affected by a subsequent incapacity of the principal. A springing power of attorney is effective upon the incapacity of the principal, as determined by a written verification by two physicians.
The general power of attorney has broad powers. The powers may include handling financial and business transactions, buying life insurance, settling claims, operating business interests, making gifts, and employing profession help. A person can appoint a power of attorney if they are trying to manage their affairs from outside the country or if they need someone to handing matters when they are physically or mentally incapable.
The power of attorney is not a paid appointment, and the responsibility includes keeping accurate and details records of all transactions that take place, provide periodic updates, and to respond in a timely and honest fashion. This is a difficult job, and the agent can be held liable for intentional misconduct if he or she acts improperly, which is another reason why it’s a good idea to have an attorney’s watchful eye over the entire arrangement.
Special Powers of Attorney
Special power of attorney authorizes an agent to be appointed for only a specific or limited purpose. These certain powers include selling property (real or personal), managing real estate, collecting debts, and handling business transactions. The form requires the agent’s duties to be as specific as possible as to what the agent can and cannot do when drafting the limited power of attorney. As always, be sure to consult an attorney to make sure your power of attorney includes the correct language and will be interpreted as desired.
A healthcare or medical power of attorney grants an agent the power to make medical decisions on behalf of a principal. This power of attorney is an authorization of a trusted agent to make the medical decisions on behalf of an individual who lacks the capacity to in a medical emergency.
By default, these powers of attorneys are durable, as it is effective as soon as the principal is not mentally or physically competent to communication their decisions. The durable power of attorney is a catchall. It is a general, special, or health care power of attorney that has a provision to keep the current power of attorney in effect. A durable power of attorney will be an active representative during specified dates or upon an event. For example, this power may not take effect until a doctor certifies that a person is mentally incompetent, or until an individual falls into a coma. A non-durable power of attorney, on the other hand, ends if the agent is revoked, whether on a predetermined expiration date or if willingly canceled.
No matter your personal situation, it is highly likely that you will need to execute of power of attorney agreement at some point in time during your life. When that day comes, be prepared with the assistance of a skilled local attorney. The lawyers at M&A Law Firm stay at the cutting-edge of Illinois Power of Attorney law, so reach out for a free consultation if you’re considering entering into one of these specialized agreements.