If you wish to give another person the authority to make important decisions and act on your behalf, you may draw up a power of attorney, or POA. This document allows an agent to sign documents or otherwise act in your place. A specific POA grants authority over a single matter or field, while a general POA gives blanket authorization in any and all matters, as allowed by state law. The POA expires under certain circumstances, including death.
By the laws of all states, a power of attorney expires on the death of the principal. More specifically, when an agent learns of the death of a power-of-attorney grantor, he may no longer act as an agent in the principal's place. This means that the agent may legally act on the principal's behalf if he does not yet have knowledge of the principal's death.
When a principal who has granted a POA dies, his will becomes the authorizing document for an executor. The will must name the executor, who follows instructions given in the will for the handling of finances, dealing with heirs and the estate, and arranging the funeral and burial according to the deceased's wishes. If there is no will, then the principal dies "intestate," and a probate court will divide the assets and act otherwise in accordance with the law.
If the principal has granted a durable POA, then the agent is authorized to act even after the principal becomes incapacitated. This includes a situation in which the principal is not expected to recover from a coma. Most states require an advance health-care directive, however, in order for an agent to order any procedures that the principal would ordinarily have to personally authorize, such as the removal of life support. In these states, the durable POA would not grant that authority.
Living Trusts and POAs
A living trust provides an alternative to a durable power of attorney. In this document, a principal grants authority to a trustee to manage his financial or legal affairs. The living trust gives specific authority to the trustee, and may also include an advance health-care directive. The trustee acts on behalf of the principal and controls the assets placed in the trust, overseeing distribution of the assets to the beneficiaries according to the trust's instructions. The authority granted by a living trust continues even after the death of the principal, and the trust also allows the estate to avoid distribution by a probate court.
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