A Power of Attorney is a Powerful Legal Tool
A typical Oklahoma estate plan usually contains a power of attorney. It is a powerful tool. In the right hands, it can help take care of you when you cannot. Therefore, you want to put a power of attorney only into the hands of someone you trust. This article explores some of the uses, legalities, and limitations of a power of attorney. Your Tulsa estate planning attorney can tell you more.
What is a Power of Attorney in Oklahoma?
In Oklahoma, a Power of Attorney (POA) is a legal document that allows an individual (sometimes called the principal) to grant authority to another person (the agent or attorney-in-fact) to act on their behalf in legal, financial, or other matters. Because of the scope of the document, it should be drafted by a Tulsa estate planning attorney after consultation and careful thought.
Types of Power of Attorney
There are different powers of attorney to be used in differing circumstances and for differing purposes.
A general power of attorney is broad. It grants broad authority to the agent to handle a wide range of legal and financial matters on your behalf. This authority typically includes managing finances, signing documents, making financial transactions, and other legal actions.
A limited or special power of attorney grants specific and limited authority to the agent to perform only certain actions or handle specific matters on your behalf. This type of POA is often used for a particular transaction or during the principal’s temporary absence or incapacity.
A durable power of attorney is also broad in scope and time. It remains in effect even if you as the principal become incapacitated or mentally incompetent. A durable POA can be particularly useful for planning ahead in case of future incapacity. This is one of the most frequently used types of power of attorney in estate planning.
A springing power of attorney only becomes effective upon the occurrence of a specified event, such as your incapacity. A springing POA allows the agent to act on behalf of the principal only when certain conditions are met.
A Power of Attorney can be used to authorize the agent to manage the principal’s financial affairs. This may include paying bills, managing bank accounts, collecting debts, making investment decisions, and handling tax matters. The principal can also grant the agent authority to buy, sell, lease, or manage real estate or personal property on their behalf. This can be useful for individuals who are unable to handle property transactions themselves due to incapacity, absence, or other reasons. A Power of Attorney can empower the agent to engage in legal transactions and business dealings on behalf of the principal. This may include signing contracts, entering into agreements, initiating or defending legal actions, and representing the principal in negotiations. Finally, a POA can be used to make medical decisions for you.
Oklahoma Legal Requirements for Power of Attorney
In Oklahoma, the laws governing Powers of Attorney are primarily found in the Oklahoma Uniform Power of Attorney Act, which is codified in Title 58, Sections 3001 et seq. of the Oklahoma Statutes. This act sets forth the requirements and provisions governing the creation, execution, validity, interpretation, and revocation of powers of attorney in the state.
In Oklahoma, a POA document must be in writing, signed by the principal, and witnessed or notarized in accordance with state law. In addition, irrespective of the powers, duties, and limitations outlined in a POA, the agent must act in good faith, and in accordance with the principal’s reasonable expectations in the principal’s best interest in accordance with the duties and powers outlined in the POA. The agent must also keep good records of all financial transactions and must try to preserve the principal’s estate plan to the extent that the plan is in accordance with the principal’s best interests. Other duties are listed in the statutes. (Okla. Stat. tit. 58, § 3014)
Unless otherwise specified, the agent typically has the authority to make financial decisions, sign contracts, access bank accounts, manage investments, and handle other legal and financial matters on behalf of the principal. The principal has the right to revoke or terminate a Power of Attorney at any time, as long as they have the legal capacity to do so.
Revocation should be done in writing and communicated to the agent and any relevant third parties who may have relied on the POA.
What to Do if an Agent Fails in Their Duties
In Oklahoma, if an agent appointed under a valid Power of Attorney (POA) fails to fulfill their duties or acts improperly, the principal or other interested parties may seek legal remedies to address the agent’s misconduct.
An agent appointed under a POA owes a fiduciary duty to the principal, meaning they are required to act in the principal’s best interests, exercise reasonable care and diligence, avoid conflicts of interest, and comply with any instructions or limitations set forth in the POA.
If an agent breaches their fiduciary duty by acting negligently, recklessly, or fraudulently, the principal or other interested parties may pursue legal action against the agent for breach of fiduciary duty. This includes a civil lawsuit against the agent for damages resulting from the agent’s failure to fulfill their duties under the POA. This could include financial losses incurred as a result of the agent’s actions or failure to act, as well as any other harm caused by the agent’s misconduct.
The court may order the agent to provide an accounting of their actions and to return any misappropriated funds or assets to the principal’s estate. The court may also impose other remedies or sanctions as appropriate to address the agent’s misconduct, including removal of the agent.
In cases of egregious misconduct, such as fraud, embezzlement, or financial exploitation of a vulnerable adult, the agent may face criminal charges under Oklahoma law. Criminal penalties may include fines, imprisonment, or other sanctions imposed by the court.
Overall, an Oklahoma Power of Attorney is a versatile legal tool that can be tailored to meet the specific needs and circumstances of the principal. It provides a way for individuals to delegate authority and ensure that their affairs are properly managed, even if they are unable to do so themselves. It should be prepared after careful consultation with a trusted Tulsa estate planning attorney.
Consult With a Tulsa Estate Planning Attorney
Bring us your questions and let’s see what we can do to help you reach your goals. We are here for you at Oklahoma Will & Trust. To make an appointment for your consultation, call (918) 876-4500. A skilled and sympathetic estate planning attorney can help you take care of your loved ones and reach your estate planning goals.