At Bradford Publishing, customers often ask us for general power of attorney forms when they really need durable power of attorney forms, or vice versa. Because powers of attorney can be confusing, we want to spell out a few perplexing terms and concepts.
What is a “durable” power of attorney?
Under traditional law, the power granted in a power of attorney ends when the principal is no longer able to act on his own. In other words, if the principal becomes incapacitated or incompetent, the power of attorney document is no longer effective. However, some people use a power of attorney to plan for the possibility of a disability. Therefore, the power of attorney has to specify that it will be effective even when the principal is disabled. When a power of attorney specifies that, the power of attorney is “durable”. In power of attorney forms that Bradford Publishing provides, the powers of attorney are durable unless the principal strikes out the statement that says: “This Power of Attorney shall not be affected by disability of the principal.”
What is a general power of attorney?
In Colorado, a general power of attorney is replaced by a “statutory power of attorney”. The statutory power of attorney is a form that was developed by the Colorado state legislature. This form lists most of the types of transactions an agent may undertake using a power of attorney. If the principal wants the agent to be able to have that type of power, the power should be initialed. In essence, a statutory power of attorney is a list of transactions that would be covered by a general power of attorney, but the statutory power of attorney allows the principal to pick and choose powers from that list.
The principal can also add powers, place specific limits on powers, and provide special instructions (See Colorado Statutory Power of Attorney).
What about a financial power of attorney?
A financial power of attorney is a document that cedes specific financial duties to the agent. But if you need a financial power of attorney form, you can easily use the statutory power of attorney. The list of powers granted in this power of attorney form include transactions related to:
• real property;
• stocks and bonds;
• banks and other financial institutions;
• insurance and annuities;
• claims and litigation;
• benefits from governmental programs or civil or military service;
• tangible personal property;
• commodities and options;
• the operation of an entity or business;
• estates, trusts, and other beneficial interests;
• personal and family maintenance; and
• retirement plans.
As stated above, the principal can also add powers, place specific limits on powers, and provide special instructions.
For more information see Bradford Guide, Using Powers of Attorney in Colorado, by Karen Brady