What Are the “Powers” in Powers of Attorney?

What are the “powers” in Powers of Attorney?

It is very common for clients to say to us, “My mom/dad/friend/sister/etc. just made me their Power of Attorney.  What does that mean?”

Here are some general rules to keep in mind if you find yourself in that situation:

Read the forms

In New Mexico, there are two types of Power of Attorney forms: one that deals with financial issues and one that deals with medical issues.  Everyone should complete both of these forms.  Both of these forms have detailed information regarding what actions the Power of Attorney is authorized to take.  Some Power of Attorney forms delineate what the designee is allowed to do and others have checklists where the signor initials which powers they elect for their designee.  Reading with an eye for detail will give the Power of Attorney insight into what their loved one wanted them to be able to do on their behalf.

Talk to the person who designated you

If you find out that you are someone’s Power of Attorney, it is a good idea to talk to them about what their specific wishes are.  While this is true for all types of Power of Attorney forms, it can be particularly difficult and emotional when making serious medical or end of life decisions.  Something that is important to keep in mind is that a Power of Attorney should make decisions from the point of view of the person who designated them.  This can be emotionally difficult, especially for Powers of Attorney who have a close connection to the person who designated them, like a parent.  I recommend a book called Being Mortal by Atul Gawande that gives excellent advice about how to have conversations with loved ones about their fears, desires, and choices in medical crises and end of life decisions.

Advocate and Assistant

If the person who has designated you as their Power of Attorney still has capacity to make their own medical and financial decisions, then you have become their advocate and assistant.  Depending on the details of the Power of Attorney form in your particular case, generally you have become someone who can carry out the requests of the person who designated you- that means you may be able to make financial transactions of their behalf, like depositing or withdrawing money from a bank or speaking to a doctor about their medical condition.

​Best Interest

While the best interest standard​ can be hard to pin down, if the person who designated you as their Power of Attorney no longer has the capacity to make their own medical or financial decisions, that is the standard that must guide you.  This means that you should only make decisions regarding their assets or health that are either in line with what they expressed to be their wishes when they had capacity, or something that will benefit their well being.

You should consult an attorney before you take an action about which you are uncertain.

Fiduciary Duty

If you do something as a Power of Attorney that is either not at the request of the signor or in the best interest of that person, you may be in violation of your fiduciary duty. If you are found to have violated your fiduciary duty you may be liable to the person that designated you or their creditors.  If you have doubts about the actions you should take as Power of Attorney, it is a good idea to consult with an attorney about your responsibilities.

Being someone’s Power of Attorney can give them enormous comfort during their most vulnerable times.  Don’t let your worries regarding what you are and are not allowed to do detract from important moments in your loved one’s life.  If you have doubts about your responsibilities as Power of Attorney, ask for a consultation with an attorney to put your mind at ease.