When an individual requires representation in a business or legal transaction, a power of attorney is used in order for an attorney to represent that individual. The power of attorney is a legal document that authorizes an attorney to act on behalf of the individual who filed for the power of attorney or POA. This individual is referred to as a principal, granter, or donor since he or she is the one who grants or donates the power, while the individual who is to wield this power is referred to as an agent or attorney.
The power of attorney is verbal, either oral or written, and will be upheld in a court of law even if it was given in an oral agreement. However, there are instances wherein a power of attorney is required to be written such as transactions done with hospitals or banks.
A power of attorney may be special or limited if the attorney is confined to committing specified acts, or it can also be general wherein its scope is limited only by the scope it details. There are also other different types of powers of attorney. Another type is a health care power of attorney wherein the agent or attorney has the capacity to render decisions on behalf of a principal in terms of the latter’s health. On the other hand, a springing power of attorney only provides the attorney to act on behalf of the principal at a future date or when the principal is incapable to make a decision.