Power of Attorney Explained

A power of attorney is a written authority that lets one person act for another in defined matters. The person giving it is the donor, and the person appointed is the attorney. This page explains the main types and what must happen before the document can be used. This is general legal information, not legal advice, and the names of documents, the thresholds and the procedures differ by country and jurisdiction, so check the rules where you live.

What it covers, and what it does not

The document can cover paying bills, running a bank account, buying or selling property, dealing with a tax authority, or making decisions about care and medical treatment. You set the scope when you make it, and the attorney cannot go beyond it.

A financial power usually does not cover health and welfare decisions, and a health power usually does not let the attorney touch your money. Many places require two separate documents. A power also stops the moment you die, so it can never replace a will.

• Donor - The person who gives the authority, also called the principal.
• Attorney - The person appointed to act, also called the agent.
• Scope - The specific decisions and assets the document covers.

A general power versus one that starts on loss of capacity

A general power of attorney takes effect as soon as it is signed and lasts while you still have capacity. People use it for a fixed task, such as a property sale while they are abroad, or for a set period.

An enduring or lasting power is designed to survive the point where you can no longer decide for yourself. In many places it is dormant until a doctor or a panel confirms capacity is lost, and only then does it become usable. In others it operates from signing and simply continues through incapacity. The names and the test differ by country.

The distinction matters. A general power usually dies with capacity, so families who hold only that document find it useless exactly when it is needed. They then have to ask a court or tribunal to appoint someone to make decisions, and that process can take months.

• Lasting or enduring power - A power that continues, or begins, when capacity is lost.
• Incapacity - Being unable to understand or make a particular decision.
• Court appointment - A judge or tribunal naming a deputy or guardian in place of a power.

Signing, witnesses and registration

Most jurisdictions require writing, your signature and witnesses, plus a certificate provider who confirms that you understand the document and are not being pressured into it. Some places also require a doctor or a lawyer to certify capacity.

An enduring or lasting power must usually be registered with a government body before anyone can use it. Without registration the attorney has no authority at all, even if the signing was flawless. Registration can take weeks, so start while the person still has capacity to sign the form.

Use the current official form for your jurisdiction. Registries often reject out-of-date templates, and the number of witnesses, the fees and the supporting documents all vary from place to place.

• Certificate provider - The person who confirms the donor understands the document.
• Registration - Enrolling the document with the official body before use.
• Revocation - Formally cancelling a power while the donor still has capacity.

Choosing attorneys and limits worth adding

Name one attorney and at least one replacement. Acting jointly means two people must agree, which is safer but slower. Acting jointly and severally lets either person act alone, which is quicker and riskier, so say clearly which you want.

You can cap spending, ban gifts to the attorney, require receipts, or insist on a second signature above a set amount. Attorneys owe a duty to act in your best interests, keep their own money separate, and stay inside the scope of the document.

Tell the attorney where the document is kept, and tell them it exists at all. An attorney who does not know about the power cannot use it, and banks will not act on a document nobody can produce.

• Jointly - A term meaning all named attorneys must act together.
• Jointly and severally - A term meaning any one attorney may act alone.
• Duty of care - The legal duty to act honestly and in the donor's interest.

Misuse, review and ending it

Powers get misused, usually by relatives taking money, selling property below its value, or changing a will while acting as attorney. If you suspect it, report the matter to the registration body, the police or a safeguarding team, and get legal advice quickly. A court can revoke the power and order an account of what was spent.

Review the document every few years and whenever your family, assets or country of residence change. To cancel a power while you still have capacity, sign a revocation, tell the attorney in writing, and notify the banks and the registry. If a court deadline, an eviction or a safeguarding concern is involved, speak to a qualified lawyer or a free legal advice service immediately rather than rely on a web page.

• Safeguarding team - A local authority team that investigates abuse of a vulnerable adult.
• Account - A formal record of what the attorney received and spent.
• Misuse of power - Acting outside the document, or for the attorney's own benefit.