A general power of attorney is a document that authorizes someone (called an agent) to act with the same authority as another person (known as the principal). Usually, the principal will provide an agent with their general power of attorney in order to support them while they are having difficulty managing decisions or tasks on their own.
The principal may be experiencing challenges handling their affairs because of something temporary, like a busy schedule or international travel. Their need for an agent may also arise because of a more serious condition, like medical incapacity or cognitive decline. In the latter cases, the condition may be indefinite, meaning it is unclear how long it will last or if the principal could ever recover from it.
Importantly, a general power of attorney provides an agent with nearly all of the same authority as the principal. This arrangement can create risks for the principal, especially if the agent is provided with vague instructions and loose supervision. Refer to an experienced Albuquerque lawyer to get guidance on how to best provide guardrails for an agent, so as to reduce your risks and maximize the chances that they will act according to your wishes.
Get started learning about general power of attorney and creating your own when you reach out to our Albuquerque law firm at 505-503-1637 or contact us online to schedule a no-obligation case review.
A general power of attorney provides someone with unlimited authority to make decisions or conduct transactions on your behalf. This arrangement can be merely convenient, in some cases, and wholly necessary in others.
Because of the risks involved, trusting a generic form or online service to create a general power of attorney is not recommended. Before jumping into the process of giving someone your general power of attorney, it is advisable to first consult with an experienced Albuquerque law firm. A lawyer can help you understand when a general power of attorney might be necessary, whether you want it to remain inactive until you are incapacitated, or if you only want it to be active while you are not incapacitated.
Major decisions like these can dramatically change the nature of your power of attorney arrangements. With the wrong configuration, you could end up giving your agent too much or too little power. Worse, they could have the wrong set of powers for the situations you want to be prepared for.
While consulting with an experienced lawyer in Albuquerque, you can discuss your goals for giving someone general power of attorney. A lawyer can review the relevant factors in your life to determine what the optimal arrangements might be. They can then help you identify an appropriate person (or people, or organization) to represent you as your agent.
With a lawyer’s help, you can create a general power of attorney document that is precise and strategic in its language. The agreement could outline specific types of conduct, for example. It could also name a person or institution to provide supervision so that the agent does not stray beyond the expected boundaries. Our Albuquerque law firm can also help you decide if additional or alternate arrangements might be appropriate, such as using a limited power of attorney, naming multiple agents, or opening a trust.
Ultimately, our goal is to provide you with the optimal arrangements, with consideration for your goals and your unique situation. With this preparation, you can enjoy the peace of mind, convenience, and security offered by a general power of attorney with minimal drawbacks.
New Mexico has adopted the Uniform Power of Attorney Act — and in fact was the first state to do so, in 2007. This act lays out several provisions that apply to any power of attorney created after 2007 (unless the principal explicitly modifies their power of attorney using specific language).
One of the relevant provisions of the Uniform Power of Attorney Act is that all powers of attorney are assumed to provide general financial powers, unless the principal specifically bars the use of certain powers or limits the agent’s powers to specifically listed capabilities.
However, the most recent version of state law (specifically NM Stat § 45-5B-201 (2024)) requires that the agent has express permission to do the following, even if the principal otherwise acknowledges general powers in their document:
In addition, the agent may not deceptively represent themselves in communications as the de facto principal, nor may they limit communications to the principal if someone’s objective is to communicate with them directly (unless the principal specifically requests in writing for communication to be barred).
By granting a general power of attorney, a principal delegates their authority in all of the following areas to their agent:
Alternatively, if the principal wishes to limit their agent’s authority to only a few categories — or a few activities within a given category — then they can restrict their general power of attorney to make it more limited.
Agents wielding general power of attorney have a number of expectations placed upon them by state law. According to New Mexico statute § 45-5B-114, the agent shall be responsible for:
Agents who generally uphold these duties may avoid liability for any actions they take (or any inaction) that results in harm to the principal’s asset values, as well as their estate plans, their health, or general well-being.
If a party with significant interest in the well-being of the principal observes that the agent is failing to uphold their duties, such as by acting in bad faith and intentionally self-enriching at the expense of the principal, then they can petition a court to halt the agent’s further actions and request appropriate relief (NM Stat § 45-5B-116).
Parties entitled to potential relief can include:
Unless a principal specifically states that their general power of attorney terminates when they lose capacity (e.g., a non-durable power of attorney), it is presumed to be durable — meaning it lasts even when the principal is incapacitated (NM Stat § 45-5B-104).
A power of attorney is created when a principal creates a written document expressing their wishes to do so in clear terms that legally comply with all relevant state and federal laws (NM Stat § 45-5B-105). They must then sign the document for it to be effective. Optionally, they can sign the document in front of a notary and have it notarized, which has the effect of proving that the signature is genuine.
A general power of attorney becomes active the moment it is signed, unless the principal specifically delays its activation. At their discretion, they can delay the activation of the agent’s authority until a later date. Or, the powers can remain dormant until a triggering condition or event occurs — making it a “springing” general power of attorney.
An agent accepts their duties by acknowledging them in communication or by taking any actions on behalf of the principal that represent their acceptance of their duties.
Unless specified otherwise, a general power of attorney usually lasts from the moment it is activated until the principal dies or revokes it. Additionally, if the general power of attorney was created for a specifically stated purpose, then once that purpose has been fulfilled, the agent’s authority automatically terminates (NM Stat § 45-5B-110).
An interested party can petition a court to revoke an agent’s authority before any of these points as a form of relief. This revocation is usually done in response to a clear violation of the agent’s duties, such as after they have misused funds. An interested party can also make a request to revoke an agent’s authority if they can demonstrate to the satisfaction of the court that doing so complies with the principal’s wishes and intentions.
Optionally, the principal can lay out other conditions that would cause the general power of attorney to automatically terminate, such as:
Note that a general power of attorney may require additional documentation to be recognized by a bank, financial institution, or other authority. Many such entities have policies requiring that specific paperwork be filled out, for example. Other times, the institution will limit the capabilities of an agent, even when that agent has been granted the same authority as the principal. One major bank, for example, limits the type and size of transactions that agents can perform.
When creating a general power of attorney, make sure to research possible hurdles like these with the help of an experienced Albuquerque law firm. Your agent can also contact our firm for assistance if the authority of a general power of attorney is not being recognized as expected by an institution.
Creating a general power of attorney can be highly useful, especially if you are interested in planning for a time in which you may become incapacitated. Giving an agent the authority to act on your behalf while you’re incapacitated can prevent serious disruptions to your finances, your end-of-life planning, and the general well-being of your estate and your family.
New Mexico Financial Law is prepared to assist you in all matters pertaining to the creation, modification, or litigation of a general power of attorney. Reach out to our experienced lawyers in Albuquerque to get started on the process and receive answers to your pressing legal questions.
Reach out to our Albuquerque law firm today when you call 505-503-1637 or contact us online to schedule your confidential, no-obligation case review.
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