Enduring Power of Attorney – Managing the business of an incapacitated person
How to authorize a durable power of attorney?
Enduring power of attorney is required to deal with the affairs of someone who was declared legally incompetent or incapacitated. Unlike a regular power of attorney, a permanent or durable POA is not automatically canceled over time or due to the mental incapacity of the principal. The option to create an enduring power of attorney was first enacted by the Knesset in 2017. The general public in Israel is often unaware that a durable power of attorney can be granted in Israel.
Michael Decker is a partner in the law firm of Cohen, Decker, Pax, Brosh in Jerusalem and Petach Tikva. In this article Michael will explain in which cases a lasting power of attorney is required and how it is granted. If you require more information regarding a general POA, we recently wrote an article on the subject.
How is an enduring power of attorney different from a regular POA?
As noted in the article above, a regular power of attorney is limited – signed for a specific purpose or period of time. After this period of time has elapsed, or if the purpose has been achieved, the temporary POA is void. If the grantor is declared legally unfit / incapacitated, the POA is also automatically revoked. Moreover, the principal may revoke their donation of power of attorney or renew it as they see fit.
In contrast to a regular power of attorney, an enduring POA allows the agent to deal with grantor’s medical, legal or economic affairs for a long or indefinite period, even after the grantor has passed away or has been declared unfit to conduct their own affairs.
Why prepare an enduring power of attorney in advance?
It is advisable to consider who you want managing your affairs well before any health issues actually crop up. None of us are immortal or insured against the sort of sudden injuries that leave your family and business orphaned, or yourself alive but unable to express your wishes. An accident, a sudden illness, a stroke that permanently damages mental functions – these things can’t be foreseen in advance.
If it is important to you that your desires regarding medical needs such as; artificial respiration of terminally ill patients, “do no resuscitate” orders, termination of ineffective treatment, end of life care, etc, be respected, it is important to note this and empower a person you trust to make these decisions. It is possible for a legal guardian (in the absence of a power of attorney, your spouse, parent or child) to act against the wishes of the patient. For example, keeping a comatose patient on life support for years, in a state said patient will never leave. POA for the “vegetable” (as such a patient is defined in common parlance) will allow the decision to be made based on the patient’s preferences, as expressed to their agent, and not according to the wishes of the doctors or family members.
Enduring power of attorney is particularly important for the elderly
Often, the state or relatives will argue that an adult person is incompetent and needs a legal guardian at their old age. Relatives become particularly concerned when an elderly person decides they are fit to dispose of their property as they wish. Changing the will, supporting friends or partners, getting married in old age are some examples of such controversies.
Many things that would not cause a legal dispute at a younger age could be the basis for a legal argument. An attempt can be made to declare the elderly person mentally incompetent and unfit to govern their financial affairs. In such cases, it is good to have a legally empowered agent to care for one’s affairs. On the other hand, the agent should understand the importance of economic independence and of making decisions about one’s property.
What does the power of attorney allow your lawyer or agent to do?
An enduring power holder may pay current accounts on behalf of the grantor, conduct business, savings and pension funds, and make general financial decisions. Even if the POA should empower the agent to manage the grantor’s affairs in every aspect, it is recommended to formulate two separate powers of attorney documents for medical and financial matters.
Power of attorney rules:
In order to issue an enduring power of attorney, the power donor (“the grantor”) must determine a person whom they trust handle their business or medical decisions if their mental state deteriorates due to an accident, old age, or illness, to the extent of mental or physical incapacity.
- The POA can refer to medical or economic decisions. However, it is better to separate medical and financial power of attorney, even if the agent is the same person.
- The power of attorney must be authenticated by an attorney and signed in their presence.
- The POA holder must undertake to act in accordance with its instructions.
- An alternate agent may be appointed if the authorized person is unable to fulfill their obligations.
- A number of agents may be appointed. In such a case it is important to determine the scope of their powers and deciding authority in case of disagreement.
Not every lawyer can be empowered as an agent by an enduring power of attorney. Since this is a weighty responsibility, only lawyers who have undergone a special course on behalf of the Israeli Bar Association are entitled to receive a POA that will not be revoked over the years or with the incapacity of the grantor.
The POA can be deposited in the office of the Administrator-General and the official receiver at the Ministry of Justice. Sample power of attorney in Hebrew.
Contact an Israel lawyer – power of attorney issues
Contact the law office of Cohen, Decker, Pex, Brosh, Jerusalem and Petach Tikva. We will be happy to provide information and assist in formulating an enduring power of attorney or other legal questions.