The Skinny on Powers of Attorney

When I started to practice law, the British still controlled America. Well, it wasn't that long ago, but I am in my fourth decade of practice, and when I started, many states still followed old American and British Common Law in regards to powers of attorney. The common law had a theory that you could only give someone a power of attorney if you were capable. If you were incapacitated, the theory was that you did not have your own powers, so you couldn't give a power you didn't have to someone else.

By the 1970's, it became apparent that a large percentage of the population was living far longer than previous generations, and that meant many more people were suffering from dementia or other infirmities of age, and those people needed someone to handle their affairs without going to court for a Conservator. The "durable" power of attorney has now been adopted in some form all over the country. "Durable" means that it is still valid, even if the person making it is no longer capable.

But being durable was not the only problem people faced. Put a hundred attorneys in a room and they might draft a hundred different versions of a power of attorney, making it difficult for banks or other institutions to determine if adequate powers were given so that they could honor the power of attorney. So Connecticut, as many states did, adopted a law call the "Statutory Short Form Power of Attorney". That power of attorney has a series of provisions, such as dealing with real estate, or banks, or personal property, etc. The words on the face of the power of attorney are simple, such as "real estate", but in the statute, there is a long and detailed explanation of what that means. A buyer of real estate can then rely on that language to accept a deed signed by the appointed agent, without having to examine every word in a long document. You may have seen those funny boxes on the front of the power of attorney, which are there so you can easily eliminate powers you don't want to give. You do that by crossing out the provision and initialing in the box alongside.

This had made use of a power of attorney much easier. But there are still practical problems if the power of attorney is several years old, as a bank or other institution may fear that the person making it has died, or has revoked it. This can usually be solved by a special certification by an attorney representing the person who made the power of attorney, stating that it was valid when made, that the person is still alive, and has not revoked it.

Although powers of attorney are very important documents, they can also be very dangerous, because an unreliable or untrustworthy person holding it could do great harm to your assets. So a word to the wise is to choose that child, other relative, or friend very carefully.

In the past, the Connecticut Statutory Short Form power of attorney also included health powers. That has been rescinded for all new statutory powers of attorney, although older ones are grandfathered in.

There are many other aspects of that statutory power of attorney that cannot be addressed in this short article, such as the inability of a spouse or other person in Connecticut to transfer real estate to themselves as the person holding the power of attorney, unless there is specific language added to allow that. Also, it is probably wise to add the authority to establish a trust and to fund that trust.

People often ask if they can download a power of attorney, but with that potential shortcoming in mind, and many other pitfalls, my answer is always, "You can do surgery on yourself also, but think of the risks."

An ounce of prevention is worth a pound of cure.