Finance
Instrument: Personal Financial Power of Attorney (POA)
What is it for?
The POA allows an adult (the “principal”) to authorize one or more “agents” to make financial decisions on his or her behalf. The POA does not cover health care decisions. Md. Code Ann., Est. & Trusts § 17-109(b)(2).
What does it do?
Unless stated otherwise in the POA, agents are generally presumed authorized to take certain types of actions, such as contracting or suing on the principal’s behalf or accessing communications intended for the principal. Md. Code Ann., Est. & Trusts § 17-202.
In exercising the authority granted by the principal, an agent also must act loyally, avoid conflicts of interest, and act with care, competence, and diligence consistent with a fiduciary duty. An agent is not liable if the principal’s property declines as a result of the agent’s actions absent a breach of this duty. Md. Code Ann., Est. & Trusts § 17-113.
Third parties are generally obligated to accept decisions by an agent duly appointed by a POA. Md. Code Ann., Est. & Trusts §§ 17-104, 108. A third party may, for example, request the agent to provide a certification of the agent’s authority. Md. Code Ann., Est. & Trusts § tbd. Maryland provides a statutory certification form at Md. Code Ann., Est. & Trusts § 17-204.
How does one make it?
A POA must be in writing and signed by the principal or in the principal’s physical presence by another individual expressly directed by the principal to sign the principal’s name. Md. Code Ann., Est. & Trusts § 17-110(a)(1-2). The signature may be either witnessed by two adult witnesses or be notarized by a single notary public. Md. Code Ann., Est. & Trusts §§ 17-110(a)(4), (b). The POA document must also contain certain notices to the principal and the agent that substantially conform with those provided at Me. Rev. Stat. Ann. tit. 18-C § 5-905(2).
When does it come into effect?
A POA is effective when executed unless the principal provides in the POA that it becomes effective at a future date or upon the occurrence of a future event or contingency. Md. Code Ann., Est. & Trusts § 17-111(a).
If a POA becomes effective upon the principal’s incapacity, the principal may authorize a specific person to determine whether the principal is incapacitated. Md. Code Ann., Est. & Trusts § 17-111(b). If not, then the POA becomes effective upon a written determination of incapacity by a physician or an attorney, judge, or another appropriate government official. Md. Code Ann., Est. & Trusts § 17-111(c).
For the purposes of an incapacity determination, “incapacity” means “the inability of an individual to manage property or business affairs because the individual” satisfies the criteria for appointing a guardian of the property. Md. Code Ann., Est. & Trusts § 17-101(g). A court may appoint a guardian of the property if the “person is unable to manage effectively the person’s property and affairs because of physical or mental disability.” Md. Code Ann., Est. & Trusts § 13-201(c)(1).
The POA is presumed to be “durable” (i.e. presumed to survive the principal’s incapacity) unless it expressly provides that it is terminated by the incapacity of the principal. Md. Code Ann., Est. & Trusts § 17-105(c).
How long does it last?
The POA generally lasts until either the principal revokes it; the principal dies; the agent dies or becomes incapacitated or resigns; or upon the POA’s termination date, if one is provided. Md. Code Ann., Est. & Trusts § 17-112.
Note that the execution of a subsequent POA does not automatically revoke any prior POA unless the subsequent POA expressly states that the prior POA(s) is/are revoked. Me. Rev. Stat. Ann. tit. 18-C § 5-910(6). Nor does a court’s appointment of a guardian terminate a POA; however, the agent must account to the guardian rather than the principal. Md. Code Ann., Est. & Trusts § 17-105(e).
How does one end it?
Maryland’s POA statute does not specify how a principal may revoke the POA.
What does an example look like?
Maryland provides a Personal Financial POA form at Md. Code Ann., Est. & Trusts § 17-202. This is also referred to as a General POA. There is also a Limited POA form at §17-203. Both forms are similar in scope, although the Limited POA form is easier to tailor to specific acts relating to decisions about the principal’s property.
What else should one know?
Maryland’s POA is based on the Uniform Power of Attorney Act.
What does an example look like?
Maryland provides a Personal Financial POA form at Md. Code Ann., Est. & Trusts § 17-202. This is also referred to as a General POA. There is also a Limited POA form at §17-203. Both forms are similar in scope, although the Limited POA form is easier to tailor to specific acts relating to decisions about the principal’s property.
What else should one know?
Maryland’s POA is based on the Uniform Power of Attorney Act.
Last updated April 2021
Education
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Health
Instrument: Advance health care directive (AHCD)
What is it for?
The AHCD allows an adult (the “declarant”) to appoint one or more “agent(s)” to make decisions related to consent, refusal, or withdrawal of any type of health care and decisions related to autopsy, anatomical gifts, and final disposition of a declarant’s body when a declarant is unable or chooses not to make health care decisions for himself or herself.
What does it do?
The declarant’s health care agent has the same authority to make any health care decision that the declarant could make. Health care providers must comply with a health care agent’s decisions for the declarant. However, agents must make only those health care decisions that are in the declarant’s “best interest”. Md. Code Ann., Health-Gen. § 5-601(e).
A health care provider may treat a patient who is incapable of making an informed decision without consent in order to provide emergency treatment if the agent is not available and the attending physician determines that not treating the patient could cause death or serious harm. Md. Code Ann., Health-Gen. § 5-607.
How does one make it?
A declarant must be a “competent individual,” which means he or she must be “capable of making and communicating an informed decision” at the time of executing the AHCD. Md. Code Ann., Health-Gen. § 5-601(g). This means he or she must not have “been determined to be incapable of making an informed decision”. Md. Code Ann., Health-Gen. § 5-601(f). Someone may be determined “incapable of making an informed decision” if he or she is “unable to understand the nature, extent, or probable consequences of the proposed treatment or course of treatment, is unable to make a rational evaluation of the burdens, risks, and benefits of the treatment or course of treatment, or is unable to communicate a decision.” Md. Code Ann., Health-Gen. § 5-601(o)(1). Someone may not be determined “incapable of making an informed decision” if he or she is “able to communicate by means other than speech.” Md. Code Ann., Health-Gen. § 5-601(o)(2).
Written AHCDs must be dated, signed by or at the express direction of the declarant, and subscribed by two witnesses in the physical presence or electronic presence of the declarant. Md. Code Ann., Health-Gen. § 5-602(c)(1)(i). Oral AHCDs are also permitted and they shall have the same effect as a written or electronic advance directive if made in the presence of the attending physician, physician assistant, or nurse practitioner and one witness and if the substance of the oral advance directive is documented as part of the individual’s medical record. Md. Code Ann., Health-Gen. § 5-602(d).
The declarant is responsible for notifying the attending physician of the AHCD, although any other person may do so if the declarant “becomes comatose, incompetent, or otherwise incapable of communication. Md. Code Ann., Health-Gen. § 5-602(f)(1).
When does it come into effect?
The AHCD becomes effective at the time of signing. The agent’s authority begins only if and when the declarant’s “attending physician and a second physician certify in writing that the patient is incapable of making an informed decision,” unless otherwise provided in the AHCD document itself. Md. Code Ann., Health-Gen. § 5-602(e)(1). If the patient is either “unconscious, or unable to communicate by any means,” then the second physician’s certification is not required. Md. Code Ann., Health-Gen. § 5-602(e)(2).
How long does it last?
The AHCD generally lasts until the declarant either dies or revokes it.
How does one end it?
Generally, a declarant may revoke an AHCD at any time “by a signed and dated written or electronic document, by physical cancellation or destruction, by an oral statement to a health care practitioner or by the execution of a subsequent directive.” Md. Code Ann., Health-Gen. § 5-604(a)(1). A declarant may also revoke an AHCD orally, by making an oral statement to a health care practitioner that is witnessed and documented in the declarant’s medical record. Md. Code Ann., Health-Gen. § 5-604(b).
What does an example look like?
Maryland’s Health Care Decisions Act contains a form at Md. Code Ann., Health-Gen. § 5-603. Maryland’s Office of the Attorney General also provides a sample form with instructions: https://www.marylandattorneygeneral.gov/Health%20Policy%20Documents/adirective.pdf.
What else should one know?
Declarants may electronically register their AHCDs with the Mary Health Care Commission. Md. Code Ann., Health-Gen. § 5-623.
Maryland’s AHCD allows declarants to make decisions about life-sustaining procedures. This portion of the AHCD is called a “living will.” A declarant may also use the AHCD with regard to mental health services, as described at Md. Code Ann., Health-Gen. § 5-602.1.
Last updated April 2021
General
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