This article discusses the use of powers of attorney in Florida, including use for real estate transactions. Most of the information contained in this article was derived from a pamphlet published by the Florida Bar entitled "Florida Powers of Attorney". The pamphlet is available at www.FLABAR.org.

What is a power of attorney? A power of attorney is a written document delegating authority from one person to another to perform a legal act. The authority granted depends on the language in the power of attorney. The person giving the power of attorney is known as the grantor or principal. The principal may make the power of attorney broad or may limit it to certain specific acts. The recipient of the power of attorney, that is the person who is given the power to act on behalf of the principal is known as the attorney-in-fact, agent, or grantee. The term "attorney-in-fact" does not mean that the recipient of the power of attorney is a lawyer.

What is a specific or limited power of attorney? This type of power of attorney gives the attorney-in-fact authority to conduct one or more specific acts. For example, a person might use a specific power of attorney to handle the sale or purchase of specific real property.

What is a general power of attorney? A general power of attorney gives the attorney-in-fact broad powers to perform any legal act on behalf of the principal. Many times this type of power of attorney contains a list of types of activities the attorney-in-fact is authorized to perform but generally states it is not limited to those activities.

What is a durable power of attorney? Powers of attorney terminate when the principal dies or becomes incapacitated. Because many people wanted powers of attorney to continue to be used even upon their incapacity, Florida law was changed a number of years ago to allow for a durable power of attorney. A durable power of attorney remains effective even if the grantor becomes incapacitated, but there are certain exceptions specified in Florida law when a durable power of attorney cannot be used for an incapacitated person, such as when the grantor has been adjudicated by a court to be incompetent. In that instance, the court would appoint a guardian to act on behalf of the principal. A durable power of attorney must have special wording that states that the power of attorney survives the incapacity of the principal. Today, most lawyers draft powers of attorney to be durable.

Must a person be competent to sign a power of attorney and who may serve as attorney-in-fact? The principal must understand what he or she is signing at the time the document is signed, including understanding the effect of the power of attorney, to whom it is being given, and what property may be affected by the power of attorney. Any competent person eighteen years of age or older may serve as an attorney-in-fact. Certain financial institutions and not for profit corporations may also serve as the attorney-in-fact.

Can an attorney-in-fact sell the principal’s homestead property? Yes, if the power of attorney authorizes the sale of real estate. We title attorneys would prefer that the power of attorney describe the specific real estate and state that it is homestead but this is not an absolute requirement. If the principal is married, the attorney-in-fact must also obtain the signature of the principal’s spouse on the deed or mortgage.

Are there any things the attorney-in-fact cannot do on behalf of the principal? There are a few things that the attorney-in-fact cannot do even if the power of attorney states that they can. For example, unless the attorney-in-fact is a licensed member of the Florida Bar, the attorney-in-fact cannot practice law in Florida. Also, the attorney-in-fact cannot sign a document stating that the principal has knowledge of certain facts, as for example, if the principal was a witness to a car accident, the attorney-in-fact cannot sign an affidavit stating what the principal saw or heard. An attorney-in-fact may not vote in a public election on behalf of a principal. An attorney-in-fact may not create or revoke a will or codicil to a will for the principal. If someone has appointed the principal to be a trustee of a trust or if a court has appointed the principal to be a guardian or conservator, the attorney-in-fact cannot perform these duties based solely on the power of attorney. The attorney-in-fact may not make gifts from the principal to the attorney-in-fact unless the power of attorney authorizes that.

What are the responsibilities of an attorney-in-fact? An attorney-in-fact is considered to be a fiduciary under the law. A fiduciary relationship is one of trust. If the attorney-in-fact violates this trust, he may be ordered by a court to pay restitution and punishment money, and even jail if the act becomes criminal.

When is a power of attorney effective? A power of attorney is effective as soon as the principal signs it unless it states that it is conditioned on the principal’s lack of capacity to manage property, in which case appropriate affidavits are required in accordance with Florida law. This latter type of power of attorney is often referred to as a "springing" power of attorney because it springs into effect when the principal lacks capacity to manage their own property.

Must the original power of attorney be presented for use? Yes. For real estate transactions, the original power of attorney must be given to the closing attorney so that it can be recorded in the public records. After recording, the original will be returned to the attorney-in-fact. Banks and others asked to rely on a power of attorney might accept a copy, but the attorney-in-fact should check with them.

How should the attorney-in-fact sign? The attorney-in-fact always needs to type, print, or sign that the document is being signed "as attorney-in-fact" for the principal. It is best to sign as follows: Jeffrey B. Marks, as attorney-in-fact for Penny S. Marks, or Penny S. Marks by Jeffrey B. Marks, as her attorney-in-fact.

Can a third party require the attorney-in-fact to sign an affidavit prior to honoring the power of attorney? Yes, under Florida law, a third party is authorized to require the attorney-in-fact to sign an affidavit stating that he or she is validly exercising the authority under the power of attorney and also perhaps that the power of attorney has not been revoked, that the principal is not deceased and has not been determined to be incapacitated by a court.

Can the attorney-in-fact employ others to assist them? Yes, the attorney-in-fact may hire accountants, lawyers, real estate brokers, and other professionals to help with their duties but they cannot delegate their responsibility as attorney-in fact.

Can the power of attorney avoid the need for a guardianship? Yes. If the incapacitated person executed a valid durable power of attorney prior to his or her incapacity, it may not be necessary for the court to appoint a guardian since the attorney-in-fact already has the authority to act on behalf of the principal. This presumes that the durable power of attorney is a general one, granting the attorney-in-fact all necessary powers.

What is the proper procedure for a principal to revoke a power of attorney? Written notice must be served on the attorney-in-fact and any other party who might rely on the power of attorney. The notice must be served either by any form of mail that requires a signed receipt or by certain approved methods of personal delivery. Special rules exist for servicing notice of revocation on banks and other financial institutions. Check with your lawyer.

Are there any other special requirements when using a power of attorney to sell real estate? Yes. In Florida a power of attorney must be signed with the same formality as the document for which it is to be used. If the attorney-in-fact is signing a deed on behalf of the principal, then the power of attorney must have two witnesses and be notarized. There is one exception to this rule. A valid military power of attorney, using the form provided for in the federal statutes, does not have to be witnessed. If the attorney-in-fact wants to use the power of attorney for a buyer/borrower, then it is necessary that the lender approve the form of the power of attorney in advance of the closing.

Any other cautions? I would caution everyone to have an attorney prepare the power of attorney. Many store bought forms are insufficient under Florida law. The attorney can also counsel the principal and/or the attorney-in-fact about all of the matters contained in this article.