What is Power of Attorney in North Carolina?

power of attorney

Power of attorney or (POA) is the legally authorized representation to act on another person’s behalf regarding private matters, business or other legal matters. The person who appoints permission is the principle or grantor. The person that is appointed to act as the Power of Attorney is the called the agent.

North Carolina Recognizes 2 Forms of Power of Attorney: Financial and Health Care

There are terms that are used that may be confusing regarding North Carolina Power of Attorney laws. Due to several terms such as General, Durable, Limited Power of Attorney, etc. the legal team of Kirk, Kirk, Howell, Cutler & Thomas, LLP provide some insight into the differing factors that constitute a Power of Attorney Clause in the North Carolina legal system.

Financial Power of Attorney

Power of Attorney to conduct financial matters for the grantor. This could be purchasing real estate, depositing payroll into bank accounts, liquidating assets and more.

Limitations of the Power of Attorney Agreement

Special or Limited Power of Attorney

Actions are limited by strict guidelines preventing the agent from acting outside the desires of the grantor. A limited POA agreement explicitly details what an agent is allowed do to as a representative on your behalf.

Temporarily Limited Power of Attorney

Granting power of attorney for a specific time frame. After the time frame expires, the Power of Attorney agreement is no longer lawful.

General Power of Attorney

Allows the agent to make all decisions for the grantor be it business or personal.

The assignment of a General Power of Attorney gives an agent the legal authority to make decisions regarding legal, financial and other personal decisions. A general power of attorney agreement is commonly used for the care of the elderly and estate planning. Once granted, the Power of Attorney is considered effective immediately.

Only decisions related to medical treatment and life ending decisions are omitted.

A few examples of matters that can be covered by an agent:

  • Real estate property transactions
  • Banking transactions
  • Social Security and unemployment
  • Tax representation
  • Personal affairs
  • etc.

Durable Power of Attorney

Giving power of attorney to an agent due to the mental for physical incompetence of the grantor.

Due to specific clause in the Power of Attorney agreement, an agent may remain as the Power of Attorney with Durable provisions, that during which the time of the grantor becomes mentally or physically incapacitated. This means that unlike the General POA, which terminates upon incapacity due to illness, the Durable POA continues and the agent can act on behalf of the grantor until death. This clause must be added to the Power of Attorney agreement, otherwise the agreement defaults to the General provision.

Health Care Power of Attorney

The Power of Attorney for Health Care allows the agent to make health care related decisions for the grantor. If the grantor wishes, they can include the authority of the agent to make the decision for continued life support or discontinuing health care.

Typically, this POA only becomes valid after a health care provider legally pronounces the grantor to be incompetent or unable to communicate or make sound health care decisions. The power of attorney ends after the death of the grantor.

A Living Will

This is the legal documentation outlining the wishes of a person, relating to their health care and end of life decision, but not granting another person the power to act as the agent in health related decisions.

Power of Attorney for Military Personnel or Those Living Abroad

North Carolina residents living abroad can grant Power of Attorney to an agent to conduct daily business on their behalf. Living outside the confines of US borders can create hindrances to payment of bills, cashing of payroll checks, etc. This representation allows someone to handle financial and legal matters when the grantor is unable or cannot easily take care of the business.

People who use power of attorney are:

  • Military personnel
  • Overseas contractors
  • Business personnel who travel frequently outside the US

Making a Power of Attorney Agreement Legal

For a Power of Attorney agreement to be legal, the document must be signed by both the grantor and agent, witnessed by two additional people and notarized. Once completed, the agent can begin acting on the behalf of the grantor immediately. Only if the grantor becomes ill or mentally incapacitated with the authority cease.

Springing – this provision specifies that the POA agreement only become active in the event of incapacity.

The powers specifically granted to the agent are only given to that agent. Power cannot be transferred from one agent to another.

Changes to the Power of Attorney Act in North Carolina

As of January 1, 2018 the NC legislature have enacted a new Power of Attorney Act N.C.G.S. 32C to update on the previously existing statute. The changes are in effect to help reduce the abuse of power by Financial Power of Attorney agents. The new statute allows for a person to petition against the current agent, with claims of abuse of power that could hurt the well-being of the grantor.

An attempt of petition to the clerk of courts can be for:

  • the removal
  • the suspension
  • or limiting the authority of the agent

The new provision allows for better accountability of agents and grantors should be aware of should the event of a petition arise.

Contact Our Legal Team to Set Up Power of Attorney

Establishing a power of attorney can be troubling to many NC residents. The thought of giving someone else the responsibility of your assets and health in dire situations can leave even the most prepared person feeling vulnerable. That is why it is a wise decision to speak with a lawyer experienced in setting up a Power of Attorney.

Our legal team is here to help you and your family through the challenges of setting up a Power of Attorney. Give us a call at (919) 615-2473 or by completing the form below.

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