What is a Durable Power of Attorney (DPOA), and how does it differ from a medical directive?
Andy Rosenberg explained that a Durable Power of Attorney is a legal document used when someone becomes disabled or incapacitated and cannot handle their financial affairs. It allows a trusted person to act on their behalf without going through guardianship court. In contrast, a medical directive, often called a healthcare surrogate in Florida, authorizes someone to make medical decisions in the same scenario. Both documents are essential but serve different purposes.
How is a durable power of attorney different from a general or limited power of attorney?
A limited power of attorney is restricted to specific tasks (e.g., selling a house while someone is on vacation). A general power of attorney allows broad authority over financial matters but terminates if the person becomes incapacitated. A durable power of attorney is like a general one, but it continues to be valid even after incapacity, making it the most protective option in long-term estate planning.
What happened to Florida’s “springing” power of attorney law?
Rosenberg noted that prior to October 2011, Florida allowed “springing” durable powers of attorney, which only became effective after a person was declared incapacitated. However, due to lobbying from banks and financial institutions, the law changed. Now, once signed, a durable power of attorney is immediately effective and remains valid through incapacity — increasing the importance of choosing a trusted agent and storing the document securely.
Why should young people or healthy adults consider getting a power of attorney?
Many people mistakenly think powers of attorney are only for the elderly. Rosenberg stressed that anyone over 18, especially college students, should have one in place. Without it, even parents cannot assist with financial or medical decisions for their adult children in emergencies. Planning ahead ensures someone trustworthy can step in if the unexpected happens.
What can happen if you don’t have a power of attorney in place when you need one?
Without a valid DPOA, the only option may be guardianship court, which is time-consuming, expensive, and stressful. Rosenberg shared a real-life example of a 52-year-old stroke victim whose family called in desperation. Sadly, because there was no DPOA in place, they were legally unable to act and forced to pursue guardianship — a process Rosenberg described as a “nightmare.”
How should someone choose who to name as their power of attorney?
Rosenberg advised clients to consider trustworthiness, responsibility, communication skills, and financial savvy when selecting a power of attorney. He also emphasized that the person should follow rules carefully and avoid bending them. If a person doesn’t have a child or close relative who fits that description, they may consider a sibling or trusted friend.
What powers should a durable power of attorney include?
According to Rosenberg, a comprehensive DPOA should include the authority to:
- Access and manage bank accounts
- Pay bills
- Handle investments
- Buy or sell real estate
- File taxes
- Execute legal documents related to Medicaid planning
He cautioned that many DIY or short-form documents miss critical powers, especially those needed for asset protection in long-term care planning.
Are there powers that should not be included in a durable power of attorney?
Yes. Rosenberg recommended excluding any language that allows the agent to:
- Transfer their authority to someone else
- Amend or revoke estate documents after death
- Vote on the principal’s behalf
- Make sworn statements of personal knowledge as if they were the principal
These exclusions protect the integrity of the document and limit potential misuse.
Can a bank refuse to honor a power of attorney?
Surprisingly, yes. Banks in Florida can reject a DPOA, but they must do so in writing, with a specific reason. If a bank wrongfully refuses, it can be liable for attorney’s fees and damages. Common reasons for refusal include questions about execution, validity, or mental capacity at the time of signing.
Is a power of attorney still valid if you move to another state?
If someone moves to another state, Rosenberg recommends creating a new DPOA specific to that state’s laws. However, if someone is just visiting another state, their original DPOA is still valid. He reminded listeners that the DPOA becomes invalid upon death — that is when the executor or personal representative takes over.
When is the best time to get a power of attorney?
Rosenberg emphasized that the best time to create a DPOA is before it’s needed. Much like life insurance, it must be in place while you’re healthy. Once someone becomes incapacitated, it’s often too late to execute a valid document, and the court process becomes the only option.