Jill Kolodner | July 2, 2020 | Maryland Law

Powers of attorney can be beneficial in managing your finances and healthcare. They can also avoid the need for a court-appointed guardian. However, there are several things that you should know about powers of attorney in Maryland before you execute one of these documents.

What is a Power of Attorney?

A power of attorney is a legally binding document granting another person the legal authority to make personal or financial decisions for you. The person granting the authority is the principal. The person who has the authority to act under a power of attorney is referred to as an agent or attorney-in-fact.

There are many different types of powers of attorney. Each power of attorney has unique qualities that can restrict the power given to the agent.

However, there are also powers of attorney that grant broad powers to an agent. Under these powers of attorney, your agent could do anything in your name that you could legally do yourself. Therefore, it is important to consider your goals and needs, as well as your comfort level in allowing someone broad powers, before you execute a general power of attorney.

Types of Powers of Attorney in Maryland

Depending on your goals and purposes, you may choose from several different types of powers of attorney. Examples of powers of attorney include, but may not be limited to:

General Power of Attorney

A general power of attorney grants an agent the authority to make financial decisions for the principal. The agent can manage property, conduct financial transactions, and operate a business in the principal’s name. A principal can restrict or limit some powers.

Limited Power of Attorney

A limited power of attorney grants authority for an agent to act for the principal for a specific purpose. The limited power of attorney generally terminates with the agent accomplishes the task. Limited powers of attorney may be used to file for bankruptcy or complete a real estate transaction.

Medical Power of Attorney

Medical powers of attorney give the agent the authority to make health care decisions for the principal. They may or may not grant the power to make end-of-life decisions, such as the insertion of feeding tubes or the use of respirators.

Springing Power of Attorney

A general power of attorney that does not become effective until the principal becomes incapacitated. It is crucial that a power of attorney clearly defines the standard for determining whether the principal is incapacitated, thereby triggering the authority granted in a power of attorney.

Requirements for a Valid Power of Attorney in Maryland

According to Maryland law, a power of attorney means a “writing or record” that gives authority to an agent to act in the place of the principal. An important note, the statute specifically states that this is true even if the document does not contain “power of attorney.” Therefore, you could grant someone the authority to act on your behalf without writing the words “power of attorney” on the face of the document.

However, to make it very clear that you intend to grant powers to act on your behalf to another person, it is best to state “power of attorney” somewhere on the document. It can help to avoid or successfully fight a challenge to a power of attorney by other relatives or parties.

The requirements for a power of attorney in Maryland are:

  • must be in writing;
  • signed by the principal or someone that the principal designates to sign the document in the principal’s presence;
  • acknowledged by the principal in the presence of a notary public; and,
  • signed by two witnesses in the presence of each other and the principal. one of the witnesses may be the notary public.

A principal must be at least 18 years of age and of sound mind to execute a power of attorney.

Important Note About Durability of Powers of Attorney in Maryland

Powers of attorney in Maryland are assumed to be durable powers of attorney. A durable power of attorney remains in full force and effect even if the principal becomes incapacitated or disabled. If you do not want the power of attorney to be durable, you must state so explicitly in the terms of the document.

In other words, once you sign a power of attorney, the authority granted by the power of attorney continues even if you experience a subsequent illness or accident that makes it impossible for you to make decisions for yourself. For example, if you’re in a severe car accident and need urgent care while you’re unconscious, your power of attorney will continue to be valid even if you’re not lucid.

Durability is an essential element of most powers of attorney. Individuals with a power of attorney do not need to worry about the court appointing a guardian if they are unable to make decisions for themselves. Their power of attorney can continue to make personal and financial decisions, manage property, handle finances, and perform all other duties and responsibilities under the power of attorney even though the principal may be unaware of the agent’s actions.

Because you are granting someone the authority to act in your name, it is generally a good idea to seek legal counsel before signing a power of attorney.

To learn more, call our personal injury law firm.

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