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power of attorney

A power of attorney (POA) or letter of attorney is a written authorization to represent or act on another’s behalf in private affairs, business, or some other legal matter, sometimes against the wishes of the other. The person authorizing the other to act is the principal, grantor, or donor (of the power).

The one authorized to act is the agent or, in some common law jurisdictions, the attorney-in-fact (attorney for short). Formerly, a power referred to an instrument under seal while a letter was an instrument under hand, but today both are signed by the grantor, and therefore there is no difference between the two.

Power of Attorney has the power to:

  • Make financial decisions
  • Make gifts of money
  • Make health care decision
  • Recommend a guardian

Normally the attorney-in-fact is paid, which means that the principal should decide on a set amount or the method for determining a pay scale. If the principal doesn’t provide for these payments in his or her power of attorney document, the court will determine how much the attorney-in-fact will earn. The court, however, can never raise this amount above a fixed percentage of the value of the principal’s property.

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