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Introduction: The Purpose & Value of a Power of Attorney (POA)
A power of attorney (POA) is a legal arrangement in which one person (the “principal”) gives authority to another person (the “attorney in fact” or “agent”) to make certain decisions on his or her behalf. POAs can take many different forms, as they can be customized to achieve whatever the principal wants to achieve. In some cases, for instance, a POA will give the attorney in fact the ability to make certain medical related decisions, while other POAs might pertain to financial decisions.
Whatever the specifics of the particular POA, the key fact is that a POA allows the attorney in fact to make decisions which bind the principal. In other words, an attorney in fact can create and execute contracts which involve the principal. And, if the POA is valid, those contracts will be valid and fully enforceable under the law.
Expectedly, there are numerous boxes which need to be checked in order to develop a valid POA here in the State of Maryland.
Technical Requirements to Create Valid POA in Maryland
Capacity
POAs represent a contractual relationship between the principal and the attorney in fact or agent. As such, POAs must follow certain requirements which are common with other contractual arrangements. For example, to create a valid POA, the principal must be at least 18 years of age and also have the mental ability to fully comprehend the provisions of the POA. Again, these are also requirements for other contracts as well.
Witnesses
Under current law, there is a requirement that the POA be signed in front of two adult witnesses, and those witnesses cannot be beneficiaries or the attorney in fact.
Notarization
As with many other legal documents, the POA must be notarized by a licensed notary. This requirement ensures authenticity of the signatures and the intent to create a valid and enforceable POA.
Clarity
As with other contracts, the POA must be sufficiently clear with respect to the identities of the persons involved and also the powers conferred to the attorney in fact. Both the principal and attorney in fact must be unambiguously identified, which means that information beyond just a full name is included. Furthermore, the powers granted should be thoroughly detailed, otherwise there is the risk of unenforceability.
Physical Presence / Residency
The principal must be a resident of the State of Maryland. The principal must also be in the “physical or electronic” presence of the witnesses and supervising attorney at the time of the signing of the POA. Witnesses must be residents of the USA and within the borders of the USA at the time of signing.
In Writing Consistent with Current POA Act
In 2010, the State of Maryland passed the General and Limited Power of Attorney Act. This Act states that all the terms of the POA must be put in writing. Provisions cannot be orally or verbally transmitted, even if those provisions are documented in some way. All provisions must be committed to written form.
Contact the Murphy Law Firm for Additional Resources
If you’d like to know more about the requirements to make an enforceable POA, durable POAs, or another estate planning topic, contact one of the attorneys at the Murphy Law Firm today by calling 240-219-5243.
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