Finance
Instrument: Power of Attorney (POA)
What is it for?
The “power of attorney” (POA) allows an adult (the “principal”) to authorize another person (the “agent”) to make decisions concerning the principal’s property.
What does it do?
The POA empowers the agent to make decisions and act with respect to the principal’s property whether or not the principal is able to act for themself. The agent is granted authority over a broad range of matters, unless the POA expressly limits the agent’s authority. Ark. Code Ann. § 28-68-102.
A POA is presumed to be “durable,” meaning that it remains in effect after the principal’s incapacity, unless otherwise stated in the POA document. Ark. Code Ann. § 28-68-104.
In making decisions for the principal, the agent must act in good faith, only within the scope of the authority granted in the POA, and in accordance with the principal’s known expectations and in the principal’s best interest. Ark. Code Ann. § 28-68-114.
Third parties must generally accept decisions made by the agent as if the principal had made them. They may, however, request the agent for a certification of the POA’s validity. Ark. Code Ann. § 28-68-120.
How does one make it?
A POA must be written, signed by the principal or in the principal’s conscious presence by another, and acknowledged by a notary public. Ark. Code Ann. § 28-68-105.
A principal may, but is not required to, utilize a statutory form to execute a POA. If the principal does not choose to use the statutory POA, however, their POA document must be substantially similar to the statutory POA. Ark. Code Ann. § 28-68-301.
When does it come into effect?
A POA can state that the agent’s authority begins either immediately upon execution, at a future date, or upon the occurrence of a future event, such as the principal’s incapacity. Ark. Code Ann. § 28-68-109(a).
If a POA becomes effective upon a future date, occurrence, or event, the principal may designate one or more persons to determine that the future date, occurrence, or event has occurred in writing. Absent a designation of who will determine the principal’s incapacity, this determination may be made by a physician or licensed psychologist who has evaluated the principal. Ark. Code Ann. § 28-68-109(c).
For the purpose of this determination, “incapacity” means the principal is unable to manage their property or business affairs for two main reasons due to an impairment in the ability to receive and evaluate information or make or communicate decisions even with the use of technological assistance. Ark. Code Ann. § 28-68-102(5)(A).
How long does it last?
A POA lasts until the principal or agent dies or becomes incapacitated (if the POA is not durable); the principal revokes the POA; the POA provides that it terminates upon some future date or event; the purpose of the POA is accomplished; or the agent’s authority is revoked by a court. Ark. Code Ann. § 28-68-110.
How does one end it?
A principal may revoke a POA by either substantially complying with a method specified in the POA itself or by any method manifesting clear and convincing evidence of the principal’s intent to revoke the POA. Ark. Code Ann. § 28-68-110.
What does an example look like?
A sample POA form is available at Ark. Code Ann. § 28-68-301. Arkansas Legal Help also provides a fillable form here.
What else should one know?
Arkansas’ POA is based on the Uniform Power of Attorney Act.
Updated July 2022
Education
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Health
Instrument: Durable Power of Attorney for Health Care (DPOAHC)
What is it for?
A durable power of attorney for health care (DPOAHC) is an advance directive that allows an adult (the “principal”) to appoint another (the “agent” or “healthcare proxy”) to make health care decisions on the principal’s behalf if the principal is incapable of doing so.
What does it do?
The DPOAHC empowers the agent to make decisions about to give, refuse, or withdraw consent to any decisions regarding the principal’s medical care, treatment, service, or procedure to maintain, diagnose, treat, or otherwise affect the principal’s physical or mental condition during periods when the principal does not have capacity to do so. Ark. Code Ann. § 20-6-102.
“Capacity” means an individual’s ability to understand the significant benefits, risks, and alternatives to proposed health care and to make and communicate a healthcare decision. Ark. Code Ann. § 20-6-102(3).
The DPOAHC is “durable,” meaning that it remains in effect beyond the principal’s incapacity. It may also, but need not include individual instructions regarding the principal’s health care. Ark. Code Ann. § 20-6-103(b)(1).
An agent must make healthcare decisions in accordance with the principal’s individual instructions included in the DPOAHC, if any, and other wishes to the extent known to the agent. Otherwise, the agent must make decisions in accordance with the agent’s determination of the principal’s best interest. Ark. Code Ann. § 20-6-103(f).
How does one make it?
A DPOAHC must be in writing, signed by the principal, and either notarized or witnessed by two adults who are not related to the principal, do not have conflicts of interest, and attest to these criteria in writing. Ark. Code Ann. § 20-6-103(c).
When does it come into effect?
Unless otherwise specified in the DPOAHC, the authority of an agent becomes effective only upon a determination that the principal lacks capacity and ceases to be effective upon a determination that the principal has recovered capacity. Ark. Code Ann. § 20-6-103(d). If necessary, a licensed physician will determine if a principal lacks or has recovered capacity. Ark. Code Ann. § 20-6-103(e).
How long does it last?
The DPOAHC lasts until the principal revokes it or executes a new DPOAHC that conflicts with the prior one. Ark. Code Ann. § 20-6-104(a).
How does one end it?
A principal having capacity may revoke all or part of the DPOAHC at any time and in any manner that communicates an intent to revoke. Ark. Code Ann. § 20-6-104.
What does an example look like?
Arkansas Law Help provides a fillable form here.
What else should one know?
The execution or revocation of any advance directive, including a DPOAHC, cannot be a condition of the principal’s being insured for or receiving health care. Ark. Code Ann. § 20-6-103(i).
Updated July 2022
General
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