Can a power of attorney be useful in the event of incapacity?

Have you ever thought about what would happen if you were suddenly unable to take care of your affairs? It's not a pleasant thing to think about, but being cautious today can save you a lot of trouble in the future. In this post, we explain what a general power of attorney, also known as a power of ruin, is and how it can help you if you are unable to manage your assets in the future.

What is a general power of attorney?

A general power of attorney is a document signed before a solicitor, in which you give permission to a person you trust to act on your behalf. It can be for any type of transaction: selling a property, accessing your bank accounts, renting an apartment, carrying out transactions at the bank, signing contracts, applying for loans, investing, going to court... You determine what that person can do and for how long.

What is a general power of attorney for?

If, due to an accident, a medical problem or the passage of time, you are no longer able to manage your assets, you usually have to go to court to authorise, for example, the sale of your property. This process can be long and complex, just when a quick solution is most needed.

To avoid these setbacks, the law provides an alternative that consists of preparing a power of attorney in anticipation of incapacity. Any person of legal age can prepare, in a public deed, who will help them if that moment arrives and what that person will be able to do for them. You can also establish control measures, how those measures will be reviewed, and how often.

The notary will communicate your decision to the Civil Registry, and only if these measures are not sufficient will the judge be able to intervene.

When does the power of attorney come into effect?

You can indicate in the document itself that the power of attorney will remain valid, even if you require support to manage your affairs in the future. You can also indicate that it should only be activated if you lose the capacity to decide for yourself. You decide how and when it is activated, and you can set out clear requirements so that it is only used if you really need it (for example, in the event of Alzheimer's, dementia or a serious accident).

What can and cannot be done with a power of attorney?

The attorney (the person you choose to represent you) must act personally, although they may delegate specific procedures if you deem it appropriate.

It is also possible to appoint several people and determine whether they should act jointly or separately.

The things they can never do on your behalf are recognise children, marry you or make a will. It is also advisable to limit the power of attorney to prevent them from donating your money or guaranteeing loans without your control. And if any problems arise, you can always go to a judge to modify or revoke the power of attorney.

Is it possible to cancel a power of attorney?

The answer is yes. You can revoke the power of attorney before a notary at any time, without having to give any explanation. The notary will notify the attorney-in-fact and record that they can no longer act on your behalf.

Granting a general or irrevocable power of attorney is a practical and safe way to plan for the future. This way, if one day you are unable to look after yourself, the person you choose will be able to support you with all the legal guarantees.

If you wish to prepare a power of attorney, please contact us.