Durable Powers of Attorney

Florida Statute section 709.08 governs durable powers of attorney.  A durable power of attorney is a written document whereby one person can designate another to act for them.  The person who signs the document and appoints another is the “principal” and the person appointed to act is the “attorney in fact.”  The attorney in fact is an agent of the principal.  The term “attorney in fact”  identifies him as a particular type of agent who has been authorized to act for a principal under a power of attorney.  An attorney in fact can be a person who is at least 18, a trust company able to do business in Florida, or a charitable organization.  The attorney in fact cannot delegate his or her authority, except that the power to transfer stocks can be delegated to a transfer agent.  The durable power of attorney must be executed with the same formality as a transfer of real property.  That is, it must be signed in the presence of  two witnesses.

Ordinarily the authority of any agent ends with the incapacity of  his or her principal.  This is not the case with a durable power of attorney.  In fact, that is where the term durable comes from; i.e., it is “durable” because it survives the agent lack of capacity.  A durable power of attorney must contain the phrase:  “This durable power of attorney is not affected by subsequent incapacity of the principal except as provided in s. 709.08, Florida Statutes”.  However, “similar words showing the intent that the authority of the attorney in fact survive the principal’s incompetency may also be used.  Therefore, a durable power of attorney can be useful in avoiding guardianship because the attorney-in-fact can manage property for the incapacitated person.

It is not, however, necessary for the principal to be incapacitated for the durable power of attorney to be effective.  The attorney in fact can begin using the power of attorney the day it is signed.  The principal does not have to be incapacitated. This makes a durable power of attorney both very useful and very dangerous.  Powers of attorney can be, and have been, used to steal from the principal.  For that reason, I caution clients they may not want to deliver them until needed.  An other alternative is to appoint co-attorneys-in-fact in the hope that each will keep the other honest.

However, durable powers of attorney can be “springing,” which means they cannot be used by the attorney in fact until the principal becomes incapacitated.  Incapacity is defined as the inability to manage property  as defined in Florida Statute section 744.102(12)(a) . The exercise of a springing power requires the delivery of affidavits to the third-party.  This can be problematic because a physician may be reluctant to certify someone as incapacitated as required for the usefulness of a springing power.

Any lawyer who prepares powers of attorney has probably seen instances where people waited until it is too late to seek a power of attorney.  Often a parent becomes incapacitated and then a child realizes that they need to sell property or transact some business for the parent.  If the parent is already too incapacitated to do it themselves, the child may seek  a power of attorney so they can help the parent.  Unfortunately, it is too late for an incapacitated parent to sign a power of attorney.  A person must be competent to delegate their authority to another.  Powers of attorney are useful for planning ahead, but you must plan ahead.

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