
If you need another individual to make important decisions on your behalf, either temporarily or permanently, the way to do this legally in Mississippi is through a power of attorney (POA).
POAs are an essential part of estate planning, allowing nominated individuals to act on financial, health, business or legal matters.
However, strict rules exist regarding the rights and responsibilities of agents in power of attorney agreements in Mississippi.
If you are considering this path, it is essential to understand what it involves, the scope of these arrangements, and how to go about setting up a power of attorney…
What is a power of attorney?
A power of attorney is a written authorization to act for or represent another individual in business, legal matters or private affairs.
This involves two main characters:
- The “principal” (sometimes called “donor” or “grantor”) is the individual who provides the authority for the other person to act.
- The “agent” or “attorney-in-fact” is the individual who receives the authority to act. This should not be confused with the term attorney-at-law, who is licensed to practice law in a certain jurisdiction.
Mental capacity of a grantor
Importantly, the principal can only execute a power of attorney if he/she has the mental capacity to do so.
After the individual has lost the capacity to make reasonable decisions, due to illness or injury, that individual cannot legally sign documents, including a power of attorney. Court intervention will be required via a request for conservatorship or guardianship, which slows matters down.
With a legally executed power of attorney in Mississippi, no court involvement is necessary. Durable powers of attorney are where grantors state in the agreement that the power of attorney will still be in effect even if the grantor becomes incapacitated.
Can a power of attorney be oral in Mississippi?
Oral powers of attorney are not recognized under Mississippi law. These agreements must be in writing to be legally valid under the Uniform Power of Attorney Act (UPOAA), which Mississippi has adopted.
To be valid, the power of attorney must also be signed by the principal and notarized.
Types of power of attorney in Mississippi
There are several types of power of attorney in Mississippi:
General power of attorney
A general POA provides broad powers over financial and legal matters but the authority ends if the principal becomes incapacitated.
Durable/lasting power of attorney
This is where the power of attorney remains in effect even if the principal later becomes incapacitated. This is not automatic with POAs in Mississippi, as it is in some jurisdictions; it must be specified.
Health care power of attorney (“Health care proxy”)
This is where the attorney-in-fact has the power to make healthcare decisions for the grantor, including terminating care or life support.
Springing power of attorney
This type of POA is triggered when a specific event occurs, such as the grantor losing mental capacity through a sudden injury. Once triggered, a springing POA is similar to a durable power of attorney.
Rights and responsibilities of a power of attorney
Very specific rights and responsibilities accompany the role of the attorney-in-fact or agent in a power of attorney, according to the needs of the grantor and the capabilities of the agent.
For instance, if the grantor needs someone to act mainly for financial matters, the authority to act in the following areas may be granted:
- Real property (real estate)
- Stocks and bonds
- Banks and other financial institutions
- Business operations
- Insurance and annuities
- Estates, trusts, and other beneficial interests
- Retirement plans
- Tax matters
Grantors may also be authorized to act with claims and litigation, health matters, estate planning matters, such as creating or terminating living trusts or making gifts, or even managing certain personal and family matters.
Before granting powers under a POA, the grantor should carefully consider what responsibilities should be granted to the agent.
After the POA has been established, agents have certain legal rights to enable them to perform their duties effectively, such as the authority to make medical decisions, access the principal’s financial records, make financial transactions, and sign legal documents.
An agent has the responsibility to act in the principal’s best interest, make decisions in accordance with the principal’s wishes, and avoid conflicts of interest. Accurate financial transaction records must be maintained and regular reports submitted to the principal and local authorities.
Agents can be held legally accountable for misconduct, incompetence or misuse of power and often face legal action from third parties, such as family members.
Steps to make a financial power of attorney in Mississippi
For a power of attorney to be legally enforceable in Mississippi, follow these basic steps:
1. Create your POA with an estate planning attorney
It’s best to first discuss your estate plan with a qualified attorney, who can advise you on how to structure your power of attorney and any other matters concerning wills, living trusts, probate, etc. Powers of attorney should be included as part of a comprehensive estate plan.
Consider the powers you want to grant the agent. You may be able to select from a pre-prepared list with your lawyer.
2. Notarize the POA
Once the POA document has been drafted by your lawyer, sign it in the presence of a notary public so that it is legally enforceable.
3. File the original POA and provide a copy to the agent
The original power of attorney document should be copied and stored in a safe place with access provided to loved ones if something should happen to you. Ideally, keep the original with your lawyer.
Then, provide a copy to the agent or attorney-in-fact, so that there are no surprises.
4. File a copy with the land records office
For extra peace of mind if your POA grants the authority to act in property transactions, file a copy with the land records office (the “chancery clerk’s office”) in the county or counties where you own real estate.
5. Provide a copy to other relevant financial institutions
You may also consider providing a copy of the POA to banks or any other financial institutions that your agent might need to deal with in the future.
If you need help with a power of attorney or any aspect of estate planning in the Biloxi area of Mississippi, contact a lawyer at Rushing & Guice, PLLC for legal advice and assistance.