Powers of Attorney and Estate Planning

Powers of attorney are a crucial part of every Alabama estate plan. When you put an estate plan in place, the powers of attorney in your plan protect you during your lifetime by designating trusted individuals to make your financial and health care decisions in the event you become incapacitated and cannot make those decisions yourself. Your powers of attorney are subject to complex state laws and should be carefully reviewed with an Alabama estate planning attorney.

Alabama Uniform Power of Attorney Act

A statute named the Alabama Uniform Power of Attorney Act, found in Chapter 1A of Title 26 of the Code of Alabama, governs the contents, execution, and validity of most powers of attorney, also known as POAs, in the state. The term “Uniform” in the title indicates that this law has been adopted in substantially the same form by multiple states.

The Uniform Act applies to the POAs in an estate plan, which include a durable financial power of attorney and a durable power of attorney for health care. In Alabama, the durable health care power of attorney can be used in addition to a document called an advance directive for health care, which may also include other provisions.

Power of Attorney Definition

The Uniform Act states that: “Power of attorney means a writing or other record that grants authority to an agent to act in the place of the principal, whether or not the term power of attorney is used.” As the definition makes clear, a person who executes a POA is the principal; the designated person is the agent.

When you execute a durable financial power of attorney, you grant authority to manage your financial matters to a trusted individual of your choosing if you become unable to make and implement financial decisions yourself. Similarly, a durable power of attorney for health care is used to authorize a trusted person to make medical and health care decisions on your behalf in the event you are unable to communicate.

Durable and Non-Durable POAs

With respect to a power of attorney, the Uniform Act states that the term “durable” “means not terminated by the principal’s incapacity.” The POAs in an estate plan are usually durable, in order to authorize the agent to make decisions in the event of the principal’s incapacity. A POA can also be non-durable, which means it terminates in the event of the principal’s incapacity.

To ensure that a POA is durable in nature, it is advisable to include specific language stating the durable character of the authorization. However, the Uniform Act specifically provides that a power of attorney is durable by default and remains in effect after the principal’s incapacity, unless the document specifically states otherwise. A principal may revoke a POA in whole or in part by providing their agent with written notice of the revocation.

General or Specific Authority

A power of attorney may grant general authority to an agent, or the POA may grant only specific authority described in detail in the document. A general power of attorney may pose potential risks of excluding important decisions or being ambiguous. If a financial institution or other entity declines to recognize the agent’s general authority as applying to a specific task, the agent may need to seek out legal advice to clarify the extent of authority in the POA.

Consulting with an Alabama estate planning attorney is the best way to ensure that an agent’s authority is properly described in the POAs in your estate plan. Counting on a knowledgeable attorney also makes certain that the documents conform with applicable laws, are valid in Alabama, and are executed as required by state law.

Advance Directive for Health Care in Alabama

A specific section of the Uniform Power of Attorney Act applies to powers of attorney for health care. In addition, a law named the Alabama Natural Death Act, found in Chapter 8A of Title 22 of the Code of Alabama, governs advance directives for health care, which typically include a durable power of attorney for health care, sometimes referred to as a health care proxy.

An advance directive for health care may also include a living will, which expresses your wishes and instructions concerning end-of-life care and life-sustaining treatment. A living will is completely separate and distinct from a will that is part of a basic estate plan. The Natural Death Act also includes specific provisions relating to requirements for valid execution of an advance directive.

An advance directive for health care should contain details concerning your wishes for treatment, so that your health care agent can make decisions based on your preferences in the event you become incapacitated and cannot make those decisions yourself. A durable health care POA is very similar to a durable financial POA, except that the health care document relates to medical and health decisions, rather than financial matters.

Benefits of Using an Alabama Estate Planning Attorney

Creating a complete estate plan with help from an Alabama estate planning attorney is the best way to protect yourself with durable powers of attorney. When your durable POAs are part of a sound estate plan, your attorney makes certain that all the provisions in the durable POAs are consistent with all the other provisions and documents in your estate plan.

Consulting with an attorney about POAs has several other advantages. First, an estate planning attorney knows and understands the provisions of the Uniform Power of Attorney Act and the Natural Death Act. In addition, your attorney listens carefully to your needs and then customizes your durable powers of attorney to fully reflect your detailed wishes concerning finances and health care in the event you become incapacitated.

Alabama estate planning attorney David Trice, the founder and owner of Trice Law Group, applies his extensive law practice experience in guiding clients through the process of putting an estate plan in place, including durable powers of attorney. David’s substantial background in health law complements his understanding of the legal requirements for difficult health care and end-of-life decisions.

Durable powers of attorney do more than protect you during your lifetime. They also protect your loved ones. In many situations, a valid durable power of attorney can avoid the need for family members to seek court appointment of a guardian and conservator if a loved one becomes incapacitated and unable to make their own decisions.