Table of contents:
Definition of Power of Attorney in Alabama
A power of attorney (POA) is a legal document that gives one person (the “agent”) the authority to act on behalf of another person (the “principal”). The principal can grant the agent broad or limited powers, depending on their needs.
In Alabama, there are several different types of POAs, including:
- General POA: Grants the agent broad powers to act on behalf of the principal, including managing finances, making medical decisions, and handling legal matters.
- Limited POA: Grants the agent specific powers, such as the authority to sign contracts or make financial transactions.
- Durable POA: Remains in effect even if the principal becomes incapacitated.
- Springing POA: Only becomes effective when a specific event occurs, such as the principal’s incapacity.
POAs can be used in a variety of situations, including:
- When the principal is out of town or otherwise unavailable.
- When the principal is incapacitated and unable to make decisions for themselves.
- When the principal wants to give someone else the authority to manage their affairs.
Creating a Power of Attorney in Alabama
Creating a power of attorney in Alabama involves several important steps to ensure the document is legally valid and effective. Understanding the requirements and following the proper procedures are crucial for both the principal (the person granting the power) and the agent (the person receiving the power).
Requirements for the Principal and Agent
To create a valid power of attorney in Alabama, the principal must be at least 18 years of age and of sound mind. The agent can be any individual, including family members, friends, or professionals. However, the agent cannot be a minor or an individual with a conflict of interest, such as a creditor or a person who would benefit financially from the power of attorney.
Importance of Notarization
Once the power of attorney document is drafted, it must be notarized to be legally valid. A notary public is an official who verifies the identity of the principal and witnesses the principal’s signature on the document. Notarization serves as proof that the principal signed the document voluntarily and with full understanding of its contents.
Powers Granted by a Power of Attorney in Alabama
A power of attorney (POA) in Alabama grants an individual (the agent) the legal authority to act on behalf of another person (the principal). The scope of powers granted can vary widely, depending on the specific language used in the document. Generally, POAs can be classified into two main types: general and limited.
General Powers of Attorney
A general POA grants the agent broad authority to act on behalf of the principal in all matters, including financial, legal, and personal. This type of POA is typically used when the principal is unable to manage their own affairs due to incapacity or absence.
Limited Powers of Attorney
A limited POA grants the agent specific, limited powers to act on behalf of the principal. For example, a limited POA may authorize the agent to manage the principal’s finances, but not to make medical decisions or sell property. This type of POA is often used when the principal wants to delegate specific tasks without giving the agent complete control over their affairs.
Examples of Specific Powers
The following are examples of specific powers that may be included in a power of attorney:
- Manage financial accounts
- Buy and sell property
- Make medical decisions
- File taxes
- Represent the principal in legal matters
- Sign contracts
Duties and Responsibilities of the Agent
Under a power of attorney in Alabama, the agent has a fiduciary duty to act in the best interests of the principal. This means that the agent must:
- Act in accordance with the principal’s wishes and instructions
- Use reasonable care and diligence in carrying out their duties
- Keep the principal’s property and finances separate from their own
- Account for their actions to the principal or to a court
Potential Conflicts of Interest
There are a number of potential conflicts of interest that may arise in the agent-principal relationship. For example, the agent may have a financial interest in a transaction that is not in the best interests of the principal. Or, the agent may be related to the principal and may be influenced by their personal relationship. In these cases, the agent must take steps to avoid any conflict of interest.
Termination and Revocation of Power of Attorney in Alabama
A power of attorney in Alabama can be terminated or revoked in several ways:
- By the principal: The principal can revoke the power of attorney at any time, with or without reason, by giving written notice to the agent.
- By operation of law: The power of attorney automatically terminates upon the death of the principal, the incapacity of the principal, or the completion of the purpose for which the power of attorney was created.
- By court order: A court may terminate or revoke a power of attorney if it finds that the agent is abusing their authority or is not acting in the best interests of the principal.
Legal consequences of terminating or revoking a power of attorney
When a power of attorney is terminated or revoked, the agent’s authority to act on behalf of the principal immediately ceases. Any actions taken by the agent after the termination or revocation are void.
How to properly revoke a power of attorney
To properly revoke a power of attorney in Alabama, the principal must:
- Sign and date a written notice of revocation.
- Deliver the notice to the agent.
- File a copy of the notice with the county probate court in the county where the power of attorney was originally filed.
