A power of attorney and durable power of attorney are both legal documents that are fundamentally similar. Both are meant to authorize a person to act on someone else’s behalf. However, they have a few important differences that make them distinct from each other.
A power of attorney, sometimes called a “letter of attorney,” is a legal document. It assigns legal authorization to an individual to engage in business and personal matters on behalf of somebody else. The person who initiates a power of attorney may be called a grantor, principal, or donor. An agent is the person authorized to act on behalf of the grantor. He can be authorized to write checks, enter into agreements, conduct business and bank transactions, sign tax returns, or other things as instructed by the grantor. An agent is only allowed to do what is specified in the document. In some common law jurisdictions, an agent is also called an attorney-in-fact. Note that the agent is not required to be an attorney.
A power of attorney can only be valid if the grantor is of sound mind during the creation of this legal instrument. The power can be revoked or modified as long as the grantor is capable of making legal decisions. Should the grantor lose the mental capacity to assign permission after the document has been created, the power becomes null and void. A power of attorney also ends upon completion of its purpose or the death of the grantor.
A durable power of attorney is designed to keep a power of attorney in effect if the grantor becomes mentally or physically unable to make legal decisions. For it to be valid, it must be explicitly stated in the document that the power is durable. In instances where a power of attorney is not created or no durable power is in effect, a court may assign a guardianship or conservatorship. This allows an agent authority to act on the principal’s behalf in the absence of these two legal instruments.
In other jurisdictions, a durable power of attorney is also known as a “health care power of attorney.” This authorizes the agent to make health care decisions on behalf of the grantor, including ending care and even end-of-life decisions. The effectivity of a durable power of attorney ends if the grantor recuperates or when he dies.
Power of Attorney vs Durable Power of Attorney
So what’s the difference between a power of attorney and a durable power of attorney? Both are used to allow a person to conduct personal and business matters on behalf of another person.
A power of attorney is a written authorization that gives an individual (the agent) the power to act on behalf of another person (the grantor). This includes personal, business, and legal matters. Its validity ends when the grantor dies or becomes incapable of making legal decisions. A durable power of attorney extends the validity of a power of attorney. This has to be explicitly stated in the power of attorney to become valid.
|Power of Attorney||Durable Power of Attorney|
|Authorizes a person to act on behalf of another||Extends the validity of a power of attorney|
|Only valid if grantor is capable of legal decisions||Only valid when explicitly stated in power of attorney|
|Ends when grantor is incapacitated or has died||Continues to be effective until grantor is capable or has died.|
Watch this video for more information on the differences between power of attorney and durable power of attorney.