Individuals who grant power of attorney to someone authorize that person to act as their agent (sometimes called their proxy or attorney-in-fact) during important legal or medical matters.
If you give someone power of attorney, they can act on your behalf with the same level of authority as you when signing forms, consenting to procedures, or accessing financial accounts. You can specifically indicate the powers they receive on the power of attorney document you create.
Granting someone in New Mexico durable power of attorney gives them permission to act on your behalf, even in situations where you cannot object or intervene. Specifically, durable power of attorney is usually granted so that someone can make the same medical or financial decisions you would while you are incapacitated.
Authorizing a durable power of attorney can create risks as well as advantages. You can discuss your goals and learn about the best strategies to protect yourself by talking with a New Mexico lawyer about durable power of attorney.
Schedule your confidential appointment to discuss durable power of attorney today when you call New Mexico Financial & Family Law at 505-503-1637 or contact us online.
A durable power of attorney is a special type of power of attorney that authorizes someone to act as your proxy or agent when you are incapacitated. While there may be risks involved if you let someone act as your proxy while you can’t watch over them, there are also major obstacles that can emerge if you don’t.
Non-durable powers of attorney are limited to times when you are conscious and otherwise capable of performing certain tasks, such as selling a personal vehicle, but choose not to.
If you extend this power to times when you are incapacitated, it could create risk. You would not be able to monitor the agent’s actions and intervene quickly if they go against your wishes. As such, there is a chance the agent could make a mistake or take advantage of your inability to react.
However, when you become medically incapacitated, you will suddenly (and often unexpectedly) have the need for someone to act as your agent. This person can authorize important financial transactions or consent to certain medical procedures while you are unable to.
A durable power of attorney is created for this exact purpose.
If no one is able to make financial decisions for you when you lack the capacity, your personal accounts may suffer.
Similarly, if you can’t voice your own opinions about your medical care, you may receive procedures you don’t agree with. Or, you could have care taken away when you’d rather use any means possible to prolong your life.
The good news is that a durable power of attorney can not only protect from these risks but also be highly customized. You can limit their scope to just the responsibilities you feel comfortable delegating. You can even go so far as to require your attorney-in-fact to follow written instructions you’ve left, down to the letter.
You can set these powers to only activate when you enter a coma or a mental state where you lack the capacity to make decisions. You can also authorize powers for an indefinite period. Because they are durable, they would remain active should you become incapacitated.
You can even specify a limited time for durable power of attorney, such as by stating that the power is only active until you show medical improvement, regardless of whether you’ve regained full capacity.
All of these arrangements are preferable to you falling into an incapacitated state without anyone authorized to act on your behalf. Otherwise, your loved ones or people closely involved in your financial activities would be forced to petition the court for guardianship and/or conservatorship. Obtaining either can be time-consuming. In the meantime, your health and finances could suffer.
To decide on the best arrangement for you and your family, speak with a New Mexico lawyer about durable power of attorney as soon as you can. They can help you review all of your options and consider them in light of the goals you want to achieve.
With your lawyer’s assistance, you can craft personalized power of attorney documents that give your agents all of the capabilities they need. You can also limit their power or put checks against it, such as by assigning someone to monitor them and revoke their power the moment they go against your wishes.
Anyone who is at least 18 years old (or an emancipated minor) can authorize power of attorney, provided that they have the mental capacity to understand what they are doing.
They must give their power of attorney to an individual, not a trust or organization. That individual must also be at least 18 years old and have the capacity to consent to their role as attorney-in-fact.
To grant a power of attorney, all you have to do is create and sign a document with the appropriate wording on it. The document authorizes the agent to operate in your place during specific situations, which will be listed in detail.
Note that New Mexico automatically assumes a power of attorney appointment is durable unless the authorizing document specifically states that incapacity revokes the power (NM Stat § 45-5B-104).
Once your power of attorney document has been created, you should date and sign it in the presence of a notary public.
While notarization is not strictly required by New Mexico law, having the power of attorney document notarized means that any signature “is presumed to be genuine” (NM Stat § 45-5B-105).
Without notarization, an organization or individual might challenge the authenticity of the document. To dismiss their challenge, a court would need some other proof that it was legitimately signed by the alleged principal (the individual who authorized someone to receive their power of attorney).
In addition, many institutions that would otherwise recognize a power of attorney could instead decline it automatically, as a matter of policy, if it is not notarized.
The effective date and duration of a durable power of attorney is spelled out in the authorizing document. Otherwise, it becomes effective immediately (see NM Stat § 45-5B-109).
The person granting power of attorney has many options to indicate the duration that someone can act as their attorney-in-fact. They can:
In addition, the authorizing person can specify similar conditions for when the power ends. Options can include setting a specific:
All powers of attorney are automatically revoked upon the principal’s death.
A durable power of attorney can be revoked at any time while the original authorizing person has the capacity to do so.
Just like the original document, the revocation should be notarized.
One key aspect of a durable power of attorney is that the attorney-in-fact is usually asked to step in only once the principal becomes medically incapacitated.
But who determines that you no longer have capacity? There are several options.
Before investigating who and how incapacity is determined, it is first very important to realize that everyone is presumed to be competent, and no-one is able to brush off a legal document executed by someone because there are concerns about competency. See Matter of Estate of Head, 94 N.M. 656, 615 P.2d 271 (N.M. Ct. App. 1980). Without some agreement or procedure to determine competency, someone would have to go to court to have an adult guardian appointed, which is a very expensive and humiliating process.
However, an adult guardianship or conservatorship is sometimes necessary to protect the individual if A. There is no durable POA that has already been executed, and it is too late now. An incompetent person cannot execute any legal document, including a power of attorney; or B. A durable power of attorney exists, but the principal refuses to give up control to the attorney in fact. Incapacitated adults who insist on attempting to manage their own affairs are a risk to themselves and others, and an adult guardianship could be necessary.
What is discussed below is the limited situation where a power of attorney only becomes effective upon incapacity. The more typical situation is when a durable power of attorney is executed while the individual is competent, and the person gradually fades. In this case, the attorney in fact, who is usually a family member, just conducts business on behalf of their incapacitated family member. Because a durable power of attorney is immediately effective, even during the time when the principal is competent, as well as after becoming incapacitated, there is no reason to have that question answered by any court or agency.
The statute governing powers of attorney allow for the POA to have a provision that it only becomes active on the incapacity of the principal. In that situation, there are lower standards or thresholds for incapacity if the only reason for that determination is that the power does not become effective until incapacity of the principal is established.
With an advance agreement, capacity could be determined by a specific individual named in the power of attorney authorization form. That individual could be the attorney-in-fact, a spouse, the authorizer’s primary care physician, or another designated party.
If the principal does not name someone to make a determination of capacity — or the person asked to make a determination is unwilling or unable to do so — then capacity can instead be determined by one of the following parties (per NM Stat § 45-5B-109):
For a physician to determine incapacity and activate a durable power of attorney, the principal must exhibit “gross mismanagement, as evidenced by recent behavior, of the individual’s income and resources or the individual’s medical inability to manage the individual’s income and resources that has led, or is likely in the near future to lead, to financial vulnerability.”
An attorney at law or other legal authority can only certify incapacity if the principal is:
As mentioned, your agent can only perform the specific tasks or consent to the specific types of agreements you authorize.
There are two main types of durable power of attorney you can confer:
With durable financial power of attorney, your agent can be authorized to perform financial transactions or request disclosures in the same way that you could.
Common examples include the ability to:
Often, in cases where someone has become incapacitated, their agent will be performing tasks needed to free up money to pay for treatment while financially providing for dependents.
The agent may be asked to continue “regular business” for the incapacitated individual, such as paying routine bills, or they may asked to take extraordinary measures, like selling off some portion of stock to pay for insurance deductibles.
To ensure that your attorney-in-fact can successfully complete the tasks you require, you can submit your power of attorney document to each financial institution you use. Ask in advance of any incapacitating condition if they will accept the form as-is or if they need any additional authorization.
A durable medical power of attorney authorizes your agent to access your healthcare records and consent to (or deny) certain forms of medical care.
Examples of actions an attorney-in-fact can take with the durable medical power of attorney granted to them can include:
As you can see, granting someone power of attorney can lead to you giving up a lot of control or just a little, depending on how you word your document. Just a few sentences can have a huge impact on your future.
With this in mind, it is critical to work with an experienced New Mexico law firm when creating a durable power of attorney authorization. The lawyer you work with can explain your options, help you anticipate risks, and guide you toward the best possible way to structure your durable power of attorney.
New Mexico Financial & Family Law can also assist you with selecting an agent you can trust, naming successor agents in case they are unavailable, and creating airtight guidelines to limit the actions they can take on your behalf. You can select someone to oversee your attorney-in-fact and revoke their authorization if they meet the threshold for a breach of their fiduciary duties.
Get started working on your durable powers of attorney — and be prepared for nearly any situation life throws your way — when you contact New Mexico Financial & Family Law. Call 505-503-1637 or contact us online to schedule your confidential appointment with no obligation today.
CallCall now to schedule your consultation 505.503.1637
Office