Powers of Attorney are quickly becoming a very useful estate planning tool. People are living longer, so there is greater likelihood that persons will need assistance managing their affairs due to some sort of disability or incapacity.
A Power of Attorney is useful because it allows a person (the principal) to select an agent (their attorney-in-fact) to manage the principal’s finances and property. This is an inexpensive and easy-to-create tool to be used as an alternative to a conservatorship or guardianship, which are costly and time-consuming.
In Minnesota, a Statutory Short Form Power of Attorney has been created to best capture all the benefit of traditional, common law Powers of Attorney.
A Power of Attorney is validly executed in the state of Minnesota when it is:
- In writing
- Dated and signed by the principal
The Minnesota Statutory Short Form Power of Attorney is valid when the two requirements above are met and:
- The exact wording and content of the form in subdivision 1 is duplicated verbatim
- The First, Second, Third parts of the form are properly completed
- Signature of the principal is notarized
Foreign Power of Attorney
If your Power of Attorney was validly executed in another state or country, then it will be valid in Minnesota.
A certified copy of an original Power of Attorney will be treated as valid when it is certified by an official of the state or political subdivision who is authorized to make such certification.
Durable Power of Attorney
A Power of Attorney can be made durable, if the principal requests. A durable Power of Attorney means that the Power of Attorney will be effective whether the principal is competent or not. To make a Power of Attorney durable, the document must contain language stating: “this power of attorney shall not be affected by the principal’s incapacity or incompetence” or something of the like that shows the principal’s intent that the power be durable.
If there is an expiration date on the Power of Attorney, then it must be stated as a specific month/day/year. Otherwise, it is indefinite.
Termination of a Power of Attorney only occurs:
- Upon the death of the principal
- Upon the expiration date (if any)
- If the nominated attorney-in-fact is a spouse, upon the commencement of a divorce, separation or annulment, see: Til Death Do Us Part.
The only way to revoke a power of attorney is in writing, signed by the principal and notarized.
An attorney-in-fact has the duty to keep record of all transactions he/she enters into on behalf of the principal.
A principal can give some or all of the following transactional powers to an attorney-in-fact through a validly executed Statutory Short Form Power of Attorney:
- Real Property Transactions
- Tangible Personal Property Transactions
- Bond, Share Commodity Transactions
- Banking Transactions
- Business Operating Transactions
- Insurance Transactions
- Beneficiary Transactions
- Gift Transactions
- Fiduciary Transactions
- Claims and Litigation
- Family Maintenance
- Benefits from Military Service
- Records, Reports and Statements
- All Other Matters
Given the importance of these transactions and the power a Power of Attorney conveys to an attorney-in-fact, it is very important that the person(s) you choose to act on your behalf in this capacity be someone you trust completely, see: Key Players in Your Estate Plan.