As Michigan estate planning attorneys with offices in Troy and Shelby Township, we understand that planning for the future encompasses more than just wills and trusts. A critical component of any comprehensive plan is a durable power of attorney. This legal tool ensures that someone trusted can step in to make financial or legal decisions if capacity is lost due to illness, accident, or aging. Without such a document in place, families often face unnecessary court proceedings, stress, and expenses when important decisions need to be made quickly.
A durable power of attorney provides stability and certainty, enabling decisions to be made promptly in the event of the unexpected. It helps preserve family harmony by giving one or more chosen agents clear authority. Michigan law recognizes the importance of this document, which is why state statutes provide specific rules governing its creation and enforcement. By understanding how it works and why it matters, individuals can better protect their assets, families, and personal wishes.
What Is A Durable Power Of Attorney?
A durable power of attorney is a written legal document that grants authority to another person, known as the agent or attorney-in-fact, to handle financial and legal matters on behalf of the principal. Unlike a regular power of attorney, a durable power of attorney continues to remain valid even if the principal becomes incapacitated.
Under Michigan Compiled Laws (MCL) 700.5501, a durable power of attorney must contain specific language stating that the power will not be affected by the principal’s subsequent disability or incapacity. This is what makes it “durable” and distinguishes it from other powers of attorney that would automatically terminate upon incapacity.
Why Is A Durable Power Of Attorney Important In Michigan?
Without a durable power of attorney, a family member or loved one may be forced to petition the probate court for a conservatorship if the individual becomes incapacitated. This process can be costly, time-consuming, and invasive, as it requires ongoing court oversight. By contrast, a durable power of attorney allows the principal to decide in advance who will handle matters such as paying bills, managing investments, or handling real estate transactions.
Michigan law supports personal autonomy by allowing individuals to make these decisions before an emergency arises. Additionally, having a durable power of attorney reduces family disputes by clearly identifying who has legal authority, ensuring that financial obligations are fulfilled, and assets are protected.
Scope Of Authority Granted
The powers granted under a durable power of attorney can be broad or limited, depending on the principal’s wishes. Common authorities include managing bank accounts, filing taxes, handling retirement benefits, buying or selling real estate, and overseeing investments.
MCL 700.5501 allows the principal to define the scope of the agent’s authority. For example, the document may give the agent authority to manage all financial matters or only certain specified tasks. The agent has a fiduciary duty under Michigan law to act in the principal’s best interests, making careful and prudent decisions while avoiding self-dealing or conflicts of interest.
Revocation And Termination Of Authority
A durable power of attorney remains in effect until the principal revokes it or until death. Revocation must be in writing and delivered to the agent in person or by mail. If a court finds that the agent is abusing authority or failing to fulfill fiduciary duties, the court may also intervene.
It is important to note that the durable power of attorney ends upon the death of the principal. At that point, the authority to manage the estate shifts to the personal representative named in a will or appointed by the probate court.
Practical Benefits For Families
In our practice, we have seen how a well-drafted durable power of attorney can prevent financial disruption and emotional stress. When an individual becomes incapacitated without a power of attorney document, family members may struggle to gain access to accounts or make urgent decisions. With a durable power of attorney in place, these barriers are removed, and necessary tasks can be handled smoothly.
This tool also helps preserve privacy, as court involvement is minimized. Families maintain control over decision-making without ongoing judicial supervision. For these reasons, the durable power of attorney is often one of the first documents we recommend as part of a comprehensive estate plan.
Frequently Asked Questions About Durable Powers Of Attorney In Michigan
What Makes A Power Of Attorney “Durable” In Michigan?
A power of attorney becomes durable when it contains language stating that the authority continues even if the principal becomes incapacitated. Michigan Compiled Laws section 700.5501 requires this specific language for enforceability.
Does A Durable Power Of Attorney Need To Be Notarized In Michigan?
Yes. Under Michigan law, a durable power of attorney must either be signed in the presence of two witnesses or notarized to be legally valid. These safeguards ensure authenticity and reduce the risk of fraud.
Can Multiple Agents Be Named In A Durable Power Of Attorney?
Yes. A principal may choose to name more than one agent, either to act jointly or separately. This can provide additional oversight and prevent misuse of authority, but it can also create potential for conflict if the agents disagree. Careful drafting is important when multiple agents are involved.
What Happens If There Is No Durable Power Of Attorney?
If incapacity occurs without a durable power of attorney in place, family members may need to petition the probate court to be appointed as a conservator. This process requires judicial oversight and ongoing reporting, which can be costly and time-consuming.
Can A Durable Power Of Attorney Be Limited In Scope?
Yes. The principal may choose to grant authority for specific purposes, such as selling property, managing bank accounts, or handling investments, rather than granting broad powers. Michigan law gives flexibility to tailor the document to individual needs.
What Fiduciary Duties Does An Agent Have In Michigan?
An agent appointed under a durable power of attorney has fiduciary duties that include acting in the principal’s best interests, keeping accurate records, avoiding conflicts of interest, and not commingling funds. Violation of these duties can lead to legal consequences, including court intervention.
Does A Durable Power Of Attorney Continue After Death?
No. A durable power of attorney automatically terminates upon the death of the principal. At that point, authority to manage the estate transfers to the personal representative through the probate process.
Can A Durable Power Of Attorney Be Changed Or Revoked?
Yes. The principal may revoke or change the durable power of attorney at any time, as long as capacity is intact. Revocation must be in writing and communicated to the agent to be effective.
Call Boroja, Bernier & Associates To Discuss Your Durable Power of Attorney
At Boroja, Bernier & Associates, we believe every Michigan resident should have a durable power of attorney as part of a comprehensive estate plan. This document ensures that financial matters are handled promptly and according to personal wishes, while avoiding costly and stressful court proceedings.
Call 586-991-7611 today to schedule a consultation with the Michigan power of attorney lawyer at Boroja, Bernier & Associates. With offices in Troy and Shelby Township, we serve clients in Oakland County, Macomb County, and across Michigan. Let our team provide the guidance and protection you need to secure your future.
