Tuesday, July 14, 2009

Power of Attorney

I've had people ask from time to time whether they can still use a power of attorney that someone signed over to them after that person dies.

A North Carolina Power of Attorney is only effective as long as the person who signed it is still living. In fact, unless it's what's called a Durable Power of Attorney, it could become void even before that.

The normal North Carolina Power of Attorney (POA) allows someone to handle financial and property matters for the person who signed it (the Principal), but does not give that person 'power' over the Principal. The person who can do things in addition to the Principal is called an Attorney in Fact (AIF). The Principal is still free to handle his or her affairs even though they've named an AIF to help them

The ordinary POA is only effective as long as the Principal is competent, but in North Carolina, the Principal can sign a Durable POA, which will continue in effect even if the Principal becomes incompetent or incapacitated, or even unconscious. However, if the Durable provision of the POA has to be be used, then the POA must be recorded at the Register of Deeds office in the Principal's county of residence.

Once the Principal dies, the POA automatically becomes void and that person's will takes effect, leaving whoever is named as Executor to handle the financial and property matters.

In some instances, if a person becomes incompetent or incapacitated for a long time and has not signed a POA, then someone may need to be appointed as his or her Guardian. Guardianships will be discussed in a later post.

As always, the discussions in this blog pertain to North Carolina law as it affects North Carolina residents or property holders. If you have more specific questions, you should consult your own attorney. However, I will be glad to answer any further general questions you may have about this topic.