Powers of Attorney, Health Care Powers, and Advance Medical hDirectives

Power of Attorney For most people, the durable power of attorney is the most important estate planning instrument available — even more useful than a will. A power of attorney allows a person you appoint — your "attorney-in-fact" — to act in your place for financial purposes when and if you ever become incapacitated.

In that case, the person you choose will be able to step in and take care of your financial affairs. Without a durable power of attorney, no one can represent you unless a court appoints a conservator or guardian. That court process takes time, costs money, and the judge may not choose the person you would prefer. In addition, under a guardianship or conservatorship, your representative may have to seek court permission to take planning steps that she could implement immediately under a simple durable power of attorney.

A power of attorney may be limited or general. A limited power of attorney may give someone the right to sign a deed to property on a day when you are out of town. Or it may allow someone to sign checks for you. A general power is comprehensive and gives your attorney-in-fact all the powers and rights that you have yourself.

A power of attorney may also be either current or "springing." Most powers of attorney take effect immediately upon their execution, even if the understanding is that they will not be used until and unless the grantor becomes incapacitated. However, the document can also be written so that it does not become effective until such incapacity occurs. In such cases, it is very important that the standard for determining incapacity and triggering the power of attorney be clearly laid out in the document itself. Generally, we recommend our clients execute "immediate" powers rather than "springing" powers. If you are concerned that your chosen agent will take advantage of an immediate power and conduct himself improperly or take advantage of the power prior to your incapacity, what do you think that person will do while you are incapacitated? Where such reservations exist, you may be better off without a power of attorney, where a court can in fact oversee the handling of your affairs. In most cases, this is not a concern, and the "immediate" power removes one more hurdle (proving your incapacity) which could delay the effectiveness of your power of attorney.

Attorneys throughout the country now report that their clients are experiencing increasing difficulty in getting banks or other financial institutions to recognize the authority of an agent under a durable power of attorney. A certain amount of caution on the part of financial institutions is understandable: When someone steps forward claiming to represent the account holder, the financial institution wants to verify that the attorney-in-fact indeed has the authority to act for the principal. Still, some institutions go overboard, for example requiring that the attorney-in-fact indemnify them against any loss. Many banks or other financial institutions have their own standard power of attorney forms. To avoid problems, you may want to execute such forms offered by the institutions with which you have accounts. In addition, you may want to consider execution of a revocable living trust in part to avoid this sort of problem with powers of attorney.

While you should seriously consider executing a durable power of attorney, if you do not have someone you trust to appoint it may be more appropriate to have the probate court looking over the shoulder of the person who is handling your affairs through a guardianship or conservatorship. In that case, you may execute a limited durable power of attorney simply nominating the person you want to serve as your conservator or guardian. Generally, unless there is some "good cause" as to why your nomination for the office of guardian or conservator should not be honored, the Chancery courts in Mississippi will generally honor your requested appointee if set forth in a document under oath.

Health Care Power of Attorney and Advance Health Care Directive

A durable power of attorney for health care permits you to designate someone you choose to make health care decisions for you if you are unable to do so yourself. An advanced health care directive instructs your health care provider to withdraw life support if you are terminally ill or in a vegetative state. A broader medical directive may include the terms of an advanced health care directive, as well as providing instructions if you are in a less severe state of health, but are still unable to direct your health care yourself.

Just as we create estate plans for our eventual demise, we also need to plan ahead for the possibility that we will become sick and unable to make our own medical decisions. Medical science has created many miracles, among them the technology to keep patients alive longer, sometimes indefinitely. As a result of many well-publicized "right to die" cases, states have made it possible for individuals to give detailed instructions regarding the kind of care they would like to receive should they become terminally ill or are in a permanently unconscious state. These instructions fall under the general category of "health care decisionmaking." In Mississippi, this takes the form of an advance healthcare directive, or a durable power of attorney for health care.

The Durable Power of Attorney for Health Care

If an individual becomes incapacitated, it is important that someone have the legal authority to communicate that person's wishes concerning medical treatment. Similar to a financial power of attorney, a durable power of attorney for health care allows an individual to appoint someone else to act as their agent, but for medical, as opposed to financial, decisions. The health care DPA is a document executed by a competent person (the principal) giving another person (the agent) the authority to make health care decisions for the principal if he or she is unable to communicate such decisions. By executing a health care DPA, principals ensure that the instructions that they have given their agent will be carried out. A health care DPA is especially important to have if an individual and family members may disagree about treatment.

In general, a health care DPA takes effect only when the principal requires medical treatment and a physician determines that the principal is unable to communicate his or her wishes concerning treatment. If the principal later becomes able to express his or her own wishes, and is competent to do so, he or she will be listened to and the health care DPA will have no effect.

Appointing an Agent

Since the agent will have the authority to make medical decisions in the event the principal is unable to make such decisions for him- or herself, the agent should be a family member or friend that the principal trusts to follow his or her instructions. Before executing a health care proxy, the principal should talk to the person whom he or she wants to name as the agent about the principal's wishes concerning medical decisions, especially life-sustaining treatment.

Once the health care proxy is drawn up, the agent should keep the original document. The principal should have a copy and the principal's physician should keep a copy with that individual's medical records.

Those interested in drawing up a health care proxy document should contact an attorney who is skilled and experienced in elder law matters.

Advance Medical Directives

Accompanying a health care proxy should be a medical directive. Such directives provide the agent with instructions on what type of care the principal would like. A medical directive can be included in the health care proxy or it can be a separate document. It may contain directions to refuse or remove life support in the event the principal is in a coma or a vegetative state, or it may provide instructions to use all efforts to keep the principal alive, no matter what the circumstances. Medical directives can also be broader statements granting general authority for all medical decisions that are important to the principal. These broader medical directives give the agent guidance in less serious situations.