Different powers of attorney types are created when one person assigns one or more of his rights to another person.
The different powers of attorney types are distinguishable based on the type of right that is assigned, when that right is assigned, and how long the agency relationship lasts.
Financial Powers of Attorney Types
In California, there are different powers of attorney types.
Which one you choose depends on your reason for creating a power of attorney.
In California, the power of attorney is also called a “financial power of attorney,” because the types of rights that can be assigned with a power of attorney are typically financial in nature.
When you assign your agent the right to make decisions regarding your healthcare, on the other hand, this is a special kind of agency relationship, and in California it is not called a power of attorney, it is called an “Advance Healthcare Directive.”
To learn more about how the California Advance Healthcare directive can help you expedite and facilitate your healthcare, without burdening your loved ones, click here: California Advance Healthcare Directive
When a person assigns his rights in California using a power of attorney, he is considered the “principal.”
The principal must appoint someone called an “agent” (also called an “attorney-in-fact”) to act on his behalf.
General vs. Limited Powers of Attorney Types
A principal giving a general power of attorney gives his agent the power to act on behalf of the principal concerning all matters allowable under state law.
A principal giving a limited power of attorney gives his agent the power to act on behalf of the principal concerning certain small-scope financial tasks or projects.
Example:
Charlotte is a real estate investor using her personal funds as capital. She then creates a power of attorney, making her friend James her agent by giving him access to her bank account to purchase new real investments for her.
However, Charlotte decides to limit his access to just one bank account, and create conditions that limit his signing authority to only spend up to a certain amount of money per transaction, or within a given time period.
These limits on James’s powers create a limited power of attorney.
Springing vs. Durable Powers of Attorney Types
“Springing” and “Durable” powers of attorney types are not really opposites, but they each concern when the rights of the agent begin and end.
A “springing” power of attorney refers to powers that are transferred from the principal to the agent at some point in the future. The rights “spring” forth upon the happening of a certain event, such as when the principal becomes incapacitated.
A “durable” power of attorney addresses whether a power of attorney in existence will remain in existence at the time the principal becomes “incapacitated,” in other words, when the principal loses the ability to make legal decisions on his own behalf.
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