Instrument: Power of attorney (POA)

What is it for?
The power of attorney (POA) allows an adult (the “principal”) to authorize one or more “agents” to make financial decisions on his or her behalf. Generally, the POA does not cover health care decisions. Me. Rev. Stat. Ann. tit. 18-C § 5-903(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. Me. Rev. Stat. Ann. tit. 18-C § 5-933 et seq. 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. Me. Rev. Stat. Ann. tit. 18-C § 5-904.

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. Me. Rev. Stat. Ann. tit. 18-C § 5-914.

Third parties are generally obligated to accept decisions by an agent pursuant to a POA, unless they have a good faith reason for refusing to do so, such as a good faith belief that the principal may be subject to physical or financial abuse, neglect, exploitation or abandonment by the agent or a person acting for or with the agent and the person makes, or has actual knowledge that another person has made, a report to the Department of Health and Human Services regarding such beliefs. Me. Rev. Stat. Ann. tit. 18-C § 5-920(2). A third party may, for example, request the agent to provide a certification of the agent’s authority. Me. Rev. Stat. Ann. tit. 18-C § 5-920(1). Maine’s statute provides a certification form at Me. Rev. Stat. Ann. tit. 18-C § 5-951.

How does one make it?
A POA must be signed by the principal or in the principal’s conscious presence by another individual directed by the principal to sign the principal’s name. The signature must also be notarized. Me. Rev. Stat. Ann. tit. 18-C § 5-905(1). 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. Me. Rev. Stat. Ann. tit. 18-C § 5-909(1). If a POA becomes effective upon the principal’s incapacity, the principal may authorized a specific person to determine whether the principal is incapacitated. 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. Me. Rev. Stat. Ann. tit. 18-C § 5-909(3).

For the purposes of an incapacity determination, “incapacity” is defined means inability of an individual to effectively manage property or business affairs because the individual is impaired by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication or other cause to the extent that the individual lacks sufficient understanding, capacity or ability to receive and evaluate information or make or communicate decisions regarding the individual’s property or business affairs. Me. Rev. Stat. Ann. tit. 18-C § 5-902(5).

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. Me. Rev. Stat. Ann. tit. 18-C § 5-910(1). 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 unless expressly provided by the court. Me. Rev. Stat. Ann. tit. 18-C § 5-908(2).

How does one end it?
An agent may also resign by giving notice to the principal. Me. Rev. Stat. Ann. tit. 18-C § 5-918.

What does an example look like?
Maine does not provide a statutory POA form.

What else should one know?
Maine’s POA is based on the Uniform Power of Attorney Act.

Last updated April 2021

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