Understanding Powers of Attorney: What They Do and Differences Between Illinois and Missouri

A power of attorney (POA) is a legal document that grants one person (the agent or attorney-in-fact) the authority to act on behalf of another person (the principal) in legal, financial, or medical matters. Powers of attorney are essential tools in estate planning and managing affairs when someone is unable or unavailable to do so themselves.

What Does a Power of Attorney Do?

A power of attorney allows the agent to make decisions and take actions as specified in the document. There are different types of POAs:

• Financial/Property Power of Attorney: Grants authority to manage financial affairs, pay bills, handle investments, and manage property.
• Medical Power of Attorney: Authorizes decisions about medical treatment if the principal is incapacitated.

The scope and duration of a POA depend on how it is drafted. Some powers of attorney become effective immediately upon signing, while others only take effect upon a triggering event, such as the principal becoming incapacitated.

Durable vs. Springing Power of Attorney for Property

When discussing property or financial POAs, two common types are:

• Durable Power of Attorney: This type remains effective even if the principal becomes incapacitated. It provides continuous authority to the agent until the principal’s death or revocation of the POA.
• Springing Power of Attorney: This type “springs” into effect only upon a specified event, usually the principal’s incapacity, confirmed by a physician or other means. Before the triggering event, the agent has no authority.

Choosing between durable and springing POAs depends on personal preference and circumstances. Durable POAs are generally simpler because they grant immediate authority that continues if incapacity occurs. Springing POAs require proof of incapacity before becoming active, which can delay decisions.

Differences Between Illinois and Missouri Powers of Attorney

While both Illinois and Missouri recognize powers of attorney, there are notable differences in how they are governed:

Illinois:

• Governed by the Illinois Power of Attorney Act (755 ILCS 45/).
• Illinois law requires specific statutory language for durability; a POA is not durable unless it expressly states that it remains effective upon the principal’s incapacity.
• Illinois permits both springing and durable POAs.
• Illinois statutes provide a statutory form for financial POAs, but custom forms are also valid if they meet legal requirements.
• Illinois requires notarization of the POA document for it to be valid.

Missouri:

• Governed by Missouri Revised Statutes Chapter 404.
• Missouri also requires explicit durability language for a POA to be durable.
• Missouri recognizes both durable and springing POAs.
• Missouri does not mandate a statutory form, but forms that comply with the law are accepted.
• Notarization is required for the POA to be valid.
• Missouri law specifically allows the principal to limit the agent’s powers or specify conditions under which the POA becomes effective.

What Happens if You Don’t Have Powers of Attorney in Place?

If you don’t have powers of attorney in place, you lose the ability to choose who will make healthcare decisions on your behalf if you become unable to do so yourself. Without this legal document, decisions about your medical treatment may be made by someone appointed by the court rather than a trusted family member or friend you’ve selected. In many cases, this can lead to the need for a guardianship proceeding, which is often a lengthy, stressful, and costly legal process. Guardianships not only impose financial burdens but can also limit personal freedom and complicate the decision-making process during an already difficult time.

Practical Considerations

• Choosing the Agent: Select someone trustworthy and capable, as they will have significant authority.
• Durability: Durable POAs are often recommended to ensure continuous management without interruption.
• Springing POAs: May be useful if the principal wants to control when the agent’s authority begins, but they can cause delays.
• State Compliance: Make sure the POA complies with your state’s requirements to avoid invalidation.
• Revocation: A POA can be revoked at any time while the principal is competent.

A power of attorney is a vital legal instrument for managing your affairs if you become unable to do so yourself. Understanding the difference between durable and springing POAs is crucial for effective planning. Additionally, knowing the specific laws in Illinois and Missouri ensures that your POA will be valid and enforceable. Consulting with an attorney familiar with your state’s laws can help you create a POA that meets your needs and provides peace of mind.