A power of attorney is an authorization that allows a person you trust to act on your behalf when you are no longer able to do so. With a power of attorney, you can determine who should handle your affairs in the event you become incapacitated. A power of attorney is an important part of personal care planning and should be created early.
What is a power of attorney?
A power of attorney is a declaration of intent that allows another person to legally represent you. It is intended for emergency situations where a person can no longer act as a decision-maker. The power of attorney allows the authorized person to manage financial transactions, represent you in court and before authorities, and enter into contracts on your behalf. It takes precedence over legal guardianship and, in some cases, can prevent a guardianship order. Anyone can be affected by such a power of attorney, such as after an accident. The provisions for a power of attorney are described in the Civil Code.
Power of Attorney Template:
Power of Attorney
I, [First Name Last Name], born on [Date of Birth], residing at [Address], hereby grant power of attorney to [Agent’s First Name Last Name], born on [Agent’s Date of Birth], residing at [Agent’s Address].
This power of attorney is valid in the event that I am unable to manage my affairs myself due to illness, accident, or other reasons.
The authorized person is entitled to perform all legal transactions and actions necessary to safeguard my interests on my behalf. This includes, in particular, representation before authorities, courts, banks, and other institutions.
This power of attorney is irrevocable and remains valid even in the event of my incapacity.
[Place], dated [Date]
What is the purpose of a power of attorney?
A power of attorney is a legal instrument intended for emergency situations where a person is no longer able to act. With a power of attorney, you commission one or more trusted persons to make legal decisions, enter into contracts, and act on your behalf. You can determine the scope of the powers and state personal wishes. Legally, a power of attorney is an order, a declaration of intent that you can revoke or change at any time.
Creating a power of attorney regularly eliminates the need for legal guardianship of the issuer. It provides clear instructions on who should handle the issuer's affairs when they are no longer able to do so due to cognitive decline or other reasons. Generally, a power of attorney avoids the appointment of an unrelated person.
2. Creating a Power of Attorney
How do I create a power of attorney?
A power of attorney can be created informally. However, it can also be notarized. Notarization is recommended as it makes the power of attorney credible to third parties and thus prevents abuse. The power of attorney must be written and include the name of the authorized person and the scope of the authorization. It is also possible to designate multiple authorized persons. The power of attorney can be revoked or changed at any time.
What are the content requirements for a power of attorney?
The content of a power of attorney is determined by the principal and can regulate financial, health, and communication matters. The authorized person becomes the representative of the principal's will.
The power of attorney must be written and include the name, date of birth, and address of the principal. Furthermore, the power of attorney must be signed and include the location and date. To give the power of attorney enforceability, it should be notarized or certified by a notary.
3. Authorizing a Power of Attorney
Who can be appointed as an authorized person?
In principle, any person who has reached the age of 18 and is capable of making and acting on decisions can be appointed as an agent in a power of attorney. However, there are some restrictions regarding certain interests that exclude the transfer of a power of attorney. It is also possible to appoint several people as agents in the power of attorney. These can be assigned, for example, according to areas of responsibility (asset management, health matters, etc.).
The regulations for the power of attorney are governed by the German Civil Code (Bürgerliches Gesetzbuch - BGB). Sections 164 ff. BGB regulate the legal status of the agent and Sections 167 ff. BGB regulate the form and content of the power of attorney.
What are the requirements for the agent?
A valid power of attorney can be granted by a person of legal age and capacity. The agents are only allowed to act in the areas assigned to them. Usually, the following six legal areas are covered by a power of attorney: health care and need for care, residence and housing matters, assets, postal and telecommunications traffic, representation in court. A person can appoint one or more individuals as agents to make legally binding decisions on their behalf. Multiple agents can provide certain advantages but also increase the risk of conflicts and disagreements.
4. The Entry Into Force of the Power of Attorney
When does a power of attorney come into effect?
A power of attorney usually takes effect immediately. However, there is also the possibility of making a power of attorney effective only when the principal is no longer able to manage their affairs themselves. In this case, the power of attorney is referred to as a care directive.
What conditions are required for it to be effective?
A power of attorney must be issued in writing and signed by the principal. An oral issuance or issuance by e-mail or fax is not sufficient. The power of attorney must also be clearly and unambiguously formulated and must not contain any inadmissible conditions. A power of attorney is also invalid if it violates good morals or if the agent has a conflict of interest.
5. Missing Power of Attorney
What are the consequences of not having a power of attorney?
If no power of attorney is available and the principal is no longer able to manage their affairs due to illness or accident, a guardian will be appointed by the court. The guardian will then make all the decisions that the principal would have made. However, the guardian is not obliged to consider the wishes of the principal. A power of attorney can therefore help ensure that the principal can still act autonomously even when they are no longer able to do so.
What is a care directive?
A care directive is a written declaration in which a person specifies who should be appointed as guardian in the event of their own incapacity to make decisions. The care directive is an instrument of self-determination and can help ensure that the affected person can continue to act autonomously even when they are no longer able to do so.
The regulations for the care directive are governed by the German Civil Code (Bürgerliches Gesetzbuch - BGB). Sections 1896 ff. BGB regulate the legal status of the guardian and Sections 1901 ff. BGB regulate the tasks of the guardian.
6. Changing or Revoking a Power of Attorney
How can I change or revoke my power of attorney?
A power of attorney for precautionary measures can be changed or revoked at any time. The revocation must be in writing and signed by the principal. It is advisable to inform the agent of the revocation in writing and, if necessary, to inform third parties (e.g., banks) about the revocation.
The regulations on the power of attorney for precautionary measures are governed by the German Civil Code (BGB). Sections 164 ff. of the BGB regulate the legal position of the agent, and Sections 167 ff. of the BGB regulate the form and content of the power of attorney.
5 Disadvantages of a Power of Attorney for Precautionary Measures:
A power of attorney for precautionary measures can also have disadvantages. Here are five possible disadvantages:
- Abuse: The agent could abuse the power of attorney and make decisions that are not in the interest of the principal.
- Uncertainties: If the power of attorney is not clearly formulated, there may be uncertainties and the agent may not know exactly what to do.
- Revocation: The principal can revoke the power of attorney at any time. However, if the agent has already made decisions, it can be difficult to undo them.
- Costs: If the agent does not perform his duties on a voluntary basis, costs may arise.
- No Control: The principal no longer has control over his affairs and must rely on the agent to act in his best interests.