What does a Power of Attorney do?

A Power of Attorney (POA) is a legal document that allows an individual (the “principal”) to grant authority to another person (the “agent” or “attorney-in-fact”) to act on their behalf in certain matters, such as managing financial or legal affairs.

While a Power of Attorney can be a useful tool, there are some limitations to what an agent can do on behalf of the principal. These limitations can vary depending on the specific terms of the POA document, as well as the laws in the jurisdiction where it was executed.

Some of the limitations of a Power of Attorney include:

  1. Limited scope: The POA document may specify certain actions that the agent is authorized to take, while other actions may be excluded.
  2. Limited duration: The POA may have a specific expiration date, or it may terminate upon the occurrence of a specific event, such as the death or incapacity of the principal.
  3. Limited authority: The agent’s authority may be limited to certain types of transactions, such as managing bank accounts, but may not extend to other areas such as real estate transactions.
  4. Revocation: The principal may have the ability to revoke the POA at any time, which would terminate the agent’s authority.
  5. Fiduciary duties: The agent is required to act in the best interests of the principal and avoid any conflicts of interest, or else they may be liable for any damages caused.

Overall, while a Power of Attorney can be a useful tool for managing affairs, it is important to understand the limitations and scope of the authority granted to the agent. It is also important to choose an agent who is trustworthy and has the skills and knowledge to carry out the duties required. 

To learn more about Power of Attorney visit FormalWill.ca, head to our Knowledge Centre and start planning today!