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Power of Attorney Pitfalls and Dynamics

  1. A Power of Attorney is a written authorization to an agent to perform specified acts on behalf of a principal.
  2. There are several types of a Power of Attorney. The most common include a General Power of Attorney, a Special Power of Attorney, a Limited Power of Attorney, a Durable Power of Attorney for Financial Affairs, and a Durable Power of Attorney for Medical Decisions.
  3. Most General Power of Attorney forms which you might get in a bookstore or online are effective immediately. It is generally a mistake to give someone a General Power of Attorney effective immediately as that gives someone total power to dispose of your assets at a time when you should be making the decisions regarding your assets.
  4. Under special circumstances such as when you are going to be out of town and cannot attend a real estate sale closing, you might want to give someone a Special Power of Attorney to sign real estate documents or other documents for a limited time.
  5. A Durable Power of Attorney is one that continues in effect even if the person making it, legally known as the principal, later becomes disabled. Most Durable Powers of Attorney become effective upon the later disability of the person making it.
  6. Improper use of a Power of Attorney can cause a headache and can be a trap for the unwary.
  7. Properly used, a Durable Power of Attorney can avoid the necessity of a Guardianship if you later become mentally disabled.
  8. One of the biggest mistakes made in creating a Power of Attorney occurs when a poor choice is made in selecting the person to carry out the Power of Attorney who is called the attorney-in-fact.
  9. If a dishonest, incompetent, or unscrupulous person is picked as an attorney-in-fact, you may become a victim and suffer great financial losses.
  10. We have all read too many stories of older persons being financially exploited or taken advantage of by someone improperly using a Power of Attorney.
  11. In many cases it is wise to appoint a professional fiduciary, or a bank trust department to serve as attorney-in-fact.
  12. Never appoint a person who has filed bankruptcy or who has no assets as your financial attorney-in-fact, even if that person is your son or daughter.
  13. If a person has not managed his or her finances well, it is a risk to appoint that person as your financial attorney-in-fact.
  14. It might be alright to appoint such a person your medical attorney-in-fact but even that might be risky if the person would stand to profit from your estate if you died.
  15. Your Durable Power of Attorney can have Medicare planning provisions.
  16. A Power of Attorney should provide for it being revoked if the attorney-in-fact is your spouse and your spouse files for a divorce.
  17. If you reside in Southwest Washington or in the Portland, Oregon area and would like to consult with an attorney concerning having a Power of Attorney prepared, please visit our website at to contact our law firm for an appointment with attorney Dan Marsh.


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Vancouver, WA 98660

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