Power Of Attorney

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Context:

• The Supreme Court observed that there would be an implied revocation of Power of Attorney (“POA”) granted to the agent if the act of the Principal choosing to act for himself is known to an agent and third person.

Power of attorney (POA)

• A power of attorney (POA) or letter of attorney is a written authorization to represent or act on another's behalf in private affairs, business, or some other legal matter.
• The person authorising the other to act is the principal, grantor, or donor (of the power). The one authorized to act is the agent, attorney, or in some common law jurisdictions, the attorney-in-fact.

How a Power of Attorney (POA) Works

• A power of attorney is a legal document that binds the agent or attorney-in-fact and the principal.
• It's used in the event of a principal's temporary or permanent illness or disability or when they can't sign necessary documents.
• Both parties must sign the document and a third party is usually required to witness it.
• Most POA documents authorize the agent to represent the principal in all property and financial matters as long as the principal’s mental state of mind is good. The agreement automatically ends if the principal becomes incapable of making decisions for themself.
• A power of attorney can end for several reasons, such as when the principal revokes the agreement or dies, when a court invalidates it, or when the agent can no longer carry out the responsibilities outlined in the agreement.
• In the case of a married couple, the authorization may be invalidated if the principal and the agent divorce.

Types of Powers of Attorney (POA):

• Health Care Power of Attorney (HCPOA):
  • Allows an agent to make health-related decisions when the principal is unable to do so.
  • Also known as a health care proxy or durable health care POA.
• Financial Power of Attorney:
  • Authorizes an agent to manage financial affairs such as banking, tax filing, and investment decisions on behalf of the principal.
  • Can be general (broad authority) or limited (specific to certain matters or timeframes).
• Durable Power of Attorney (DPOA):
  • Takes effect upon signing and continues even if the principal becomes incapacitated.
  • Covers legal, property, or financial matters specified in the agreement.
• Springing Power of Attorney:
  • Becomes active only upon the occurrence of specified conditions or incapacitation events outlined in the document.

Source

https://www.livelaw.in/supreme-court/power-of-attorney-impliedly-revoked-when-principal-acts-independent-of-agency-with-knowledge-to-agent-third-parties-supreme-court-262814

PRACTICE QUESTION Q) Consider the following statements about Power of Attorney (POA) as recently seen in news? 1. A POA is a legal document that authorises an agent to act on behalf of a principal. 2. The principal in a POA is also known as the grantor or donor. 3. A POA remains valid even if the principal becomes mentally incapacitated. 4. Revocation of a POA by the principal automatically terminates the agent's authority. How many of the above statements is/are correct? A.only one B.only two C.only three D.All four Answer: A