Why Might I Need Powers of Attorney in Michigan?

Many people, when they consider what “estate planning” might mean for them, imagine that it deals primarily with what happens to their loved ones or their estate (their property) after they die.  They may not be thinking about planning for conditions that arise in their own lives while they are still alive and in fact may be for many years.

But – we all face the possibility of circumstances where we might be unable to manage our own affairs.  Whether due to accident or illness, we can become disabled from making our own decisions about our health and welfare or about our finances and our property.  Such circumstances may last only a short time, or they can become more extended.  Who can access your bank accounts and pay your bills for you?  Who files your tax returns for you?  Who makes sure your utilities are not shut off?   Who talks with your insurance company?  And, perhaps most importantly, who speaks on your behalf when you need medical care and you are not able to competently participate in your own health care decisions? 

Unless you have already legally designated your choice of “agents” to act for you under such circumstances, the Probate Court may have to make those choices for you.  This requires a legal process to open a probate case in which, after reviewing your needs and the extent of your incapacity, the Court may appoint a Guardian to make medical decisions and/or a Conservator to make financial decisions for you.  

Creating Powers of Attorney avoids the need for court intervention, because they will allow other people whom you trust and have designated beforehand to act on your behalf in those matters until such time as you are able to resume your normal competence.  

The Basics of Powers of Attorney

What are they anyway?  A Power of Attorney is a written instrument – a signed, witnessed legal document – in which you, the “principal”, empower one or more specific individuals to act as your agents when certain occasions arise.  This means that they can represent you and make decisions on your behalf as needed under those circumstances. 

How are they used? Powers of Attorney are actually used in many situations, not just ones in which the principal might be incapacitated.  For example, a home buyer or seller may, for the sake of convenience, grant a Power of Attorney to another individual to represent them in closing the home sale.  Or, someone posted or travelling overseas may want a friend or relative, or even an unrelated professional, to handle financial and property matters on their behalf while they are out of the country.  Sometimes, such grants may be even broader, and less time-limited.  It all depends on what the principal might need or intend, now or later, in whatever situation.  Of course, not all of these are considered part of estate planning.

Which Powers of Attorney are considered estate planning documents?  

Effective estate planning actually begins with two particular “durable” Powers of Attorney: (1) a Durable Power of Attorney for Health Care Decisions, and (2) a Durable Power of Attorney for Finances.  These two documents are called “durable” because the powers they grant are intended to remain effective in spite of, or even to trigger upon, the disability or incapacity of you, the principal.   And, unless the documents specifically state a termination date, they remain effective indefinitely – until and unless they are legally rescinded.  

Durable Powers of Attorney are intended to assure that your needs are satisfactorily met when you are unable to meet them yourself.  Knowing that they help to avoid Court intervention in your affairs but still carry their own legal weight also provides peace of mind.  

Why Would I Want to Involve An Attorney in Creating These Documents?

As you already know, many web sites and other sources offer free or low-cost forms that purport to meet your legal needs – but don’t.  Especially in the case of Durable Powers of Attorney, Michigan law requires specific language for them to be valid that is not necessary for non-durable Powers. Generic legal documents intended for much simpler situations won’t contain that language, nor will you even know that it is missing.

In addition, Durable Powers of Attorney should never be one-size-fits-all.    You are an individual with your own unique set of circumstances and preferences, and your own specific set of trusted relatives, friends, etc.  

For example, if you have a spouse or partner, you may want that person to be your first choice of agent (also known as “attorney-in-fact” or, in the case of health “patient advocate”) – or you may not. 

You may also want one person to act as your patient advocate but a different person as your financial attorney-in-fact.  Then too, what about alternative agents if needed when your first designate is unavailable?

You may also feel comfortable granting financial authority that is effective immediately upon execution of your Durable Power of Attorney for Finances, and does not require that you be disabled for it to take effect.  Or, alternatively, you may want that power to be effective only upon your disability.

You may want to limit the financial decision-making authority to very specific activities.  Alternately, you might choose to allow your agent broader authority, such as making investments and handling real estate transactions on your behalf.

Finally, you may also have strong feelings about certain medical options, such as blood transfusions, intubation, types of mental health treatment, or end-of-life measures, that you would want your health professionals to pursue, or else to withhold.   Including those preferences in your Durable Power of Attorney ensures that they are taken into account when you can’t speak for yourself.

In sum 

Durable Powers of Attorney should be legally sound and specifically tailored to your personal needs and intentions. They require thoughtful consideration and discussion, and in their final form should reflect your careful choices.  Bassett Murray attorneys’ expertise is of longstanding, and will ensure that you have exactly what you need in creating these crucial, powerful documents.

Call us at 734-930-9200 in Ann Arbor or 231-427-2292 for our Petoskey office, or contact us online to schedule a consultation. We are here to help with every form of estate planning.