Things Clients Should Know - Durable Powers of Attorney
A general power of attorney is a legal document in which a person (the Principal) gives another person (the Agent) the power to handle all financial, business, and, if included, medical affairs of the Principal. The power terminates upon the death of the Principal. A very important estate planning document is the durable power of attorney. Prior to its statutory enactment in the 1970's, South Carolina powers of attorney were voided by law in the event that the Principal became mentally incompetent or physically disabled. The statute allows the Principal to give a power of attorney which remains valid notwithstanding any subsequent mental incompetence or physical disability which may affect the Principal. Very specific language is required to create a durable power of attorney and the document must be recorded at the public records office in the county in which you reside. With such a document in place, should you become mentally incapacitated, either temporarily or permanently, the Agent can handle all of your affairs with no further action needed. If you do not have such a document in place, a family member (usually a spouse, child or parent) or some other interested person will have to file a lawsuit in Probate Court to ask the judge to find that you are legally incompetent and to appoint someone as your conservator (manager of your business affairs) and guardian (physical custodian for you). Such a proceeding usually involves hiring an attorney to bring the lawsuit, at your expense. The court appoints an attorney for you (the alleged incompetent person), at your expense, and a doctor and social worker are hired by the court to examine you, at your expense. After the family member or other interested person is appointed as conservator, an annual accounting must be filed with the court detailing all financial activity for the year. All of this hassle, delay and expense can be avoided by the stroke of a pen in signing a durable power of attorney.
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