Durable Power of Attorney
WHY DO I NEED A DURABLE POWER OF ATTORNEY?
If you become disabled due to an accident or illness and you are deemed mentally incompetent, your business and personal affairs will more than likely have to be administered by a court-appointed guardian. The guardian may or may not be someone whom you would have chosen to attend to your needs. In fact, he may be a complete stranger! Plus, a guardianship can be expensive. The guardian will have to post a bond equal in value to your estate, and the premium for this bond will have to be paid out of your estate. The guardian will have to go to Court for permission to transact virtually any type of business transaction and he will have to demonstrate to the Court why the action that he desires to take is necessary and desirable. The guardian will also have to file annual accountings. Guardianships, then, are expensive, time-consuming and cumbersome; a very inefficient way to take care of your business and your personal needs when disability occurs.
The solution to this problem is the Durable Power of Attorney. With a valid, well-written Durable Power of Attorney your business and personal needs can be taken care of in an efficient manner at minimal expense.
WHAT CAN A DURABLE POWER OF ATTORNEY DO FOR ME?
It permits you to appoint someone to manage your affairs:
Management of Your Assets
The person you have designated in your Durable Power of Attorney can be given the power to manage your assets that could include such things as to:
Write checks on your bank account and make deposits
Pay your bills
Have access to your safe deposit box
Sign your tax return
Make important decisions about your retirement plans - IRA's (eg: Rollover decisions)
Make important decisions about your insurance (eg: borrow against the cash surrender value of a life insurance policy)
Buy or sell stocks, bonds, mutual funds and other securities
Buy or sell real estate; enter into, terminate or modify lease agreements
Continue to operate or windup your business (pay employee's salaries, etc.)
Arrangement for Your Personal Needs
The person you have designated in your Durable Power of Attorney can be given the power to arrange for your personal needs that could include such things as to:
Provide for you a residence (nursing home; private residence, etc.)
Provide you with nursing care (employ nurses & physicians, etc.)
Provide for your recreational needs (arrange for travel, etc.)
Provide for the care and custody of your personal effects
Provide arrangements for the care and custody of your pets
Make pre-arranged funeral plans
Provide for your religious needs consistent with your beliefs
Take custody of your important personal papers (Will; Insurance papers; Certificates of Deposit; Stock certificates)
Have access to your medical records
WHO CAN I DESIGNATE TO ACT FOR ME UNDER A DURABLE POWER OF ATTORNEY?
The person that you name (your "attorney in fact") can be any person capable of transacting business. He or she need not be a licensed attorney at law. Quite often a person who is married will name his or her spouse as the "attorney in fact" and, if the spouse for whatever reason can not serve, an adult child is named as the alternate. The person you name should be someone in whom you have complete trust and confidence.
DOES THE DURABLE POWER OF ATTORNEY HAVE TO BE RECORDED?
Although the Durable Power of Attorney must be notarized and it can be recorded at the County Clerk's office, it does not have to be recorded to be effective. However, if real estate transactions are undertaken by the attorney in fact, the Durable Power of Attorney will need to be recorded in the County clerk's office of the County where the land is located.
CAN I HAVE A DURABLE POWER OF ATTORNEY THAT DOES NOT BECOME EFFECTIVE UNLESS AND UNTIL I BECOME INCOMPETENT?
Yes. Texas law now permits a Durable Power of Attorney to be a "springing" power of attorney which does not become effective unless and until you become incompetent.
ONCE I GIVE THE DURABLE POWER OF ATTORNEY - WHAT HAPPENS IF I LATER CHANGE MY MIND?
If you recorded the power of attorney, you may revoke the Durable Power of Attorney at any time by recording a Notice of Revocation with the County Clerk where you filed it. In any case, it would also be important to notify the attorney in fact and any third parties who had been dealing with your attorney in fact that you had revoked the Durable Power of Attorney.
WHERE CAN I GET A DURABLE POWER OF ATTORNEY?
An attorney knowledgeable about wills and estate planning should be able to prepare this document at a very reasonable cost.
WHERE SHOULD I KEEP MY DURABLE POWER OF ATTORNEY?
It should be kept where you keep your most important papers.
This article is taken from a pamphlet published and distributed by the law firm of Brooks, Campbell & Grubbs, L.L.P. (Copyright 1997) and is used with permission. Its purpose is to inform citizens of their legal right under Texas Law. It is not intended to advise anyone on a specific problem because different facts may change the application of the law in a particular matter. If you would like hard copies of the pamphlet, at no charge, Please contact:
BROOKS, CAMPBELL & GRUBBS, L.L.P.
BANK ONE TOWER
4245 Kemp, Suite 800
Wichita Falls, Texas 76308-0663
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