The Definition of a Power of Attorney
A power of attorney is a legal document that allows one person to act on behalf of another to make healthcare or financial decisions, or both. This document permits the person given the authority to make choices for the person who is unable to do so themselves. Two of the most common types of power of attorney are financial and medical.
For a financial power of attorney, the agent or attorney-in-fact may handle business matters, manage the principal’s assets, settle bank and credit card issues, and more . Healthcare or medical powers of attorney allow the person designated by the principal to make decisions about medical care in the event the principal is incapacitated.
An agent may be a family member, a close friend, a legal professional or your attorney. The principal can limit the authority of the agent or authority to specific roles, such as selling real estate or transferring property, or make the power of attorney broad enough for the agent to assume full responsibility should the principal become incapacitated. In some cases, a power of attorney can be used as an advance directive.
Nevada Power of Attorney Types
In Nevada, as at common law, a power of attorney may be "general" or "special" and either "durable" or not durable. A power of attorney is "general" when it is not limited to specifically enumerated acts. See NRS 162A.740. For example, a general power of attorney might be used if the grantor wants the attorney in fact to have all powers under the law. On the other hand, a "special" power of attorney, also known as a limited power of attorney, grants limited powers to an attorney in fact for a specific purpose. The scope of authority is stated in the power of attorney document itself and is typically used when the grantor only wants the attorney in fact to act on his or her behalf for a limited purpose.
Powers of attorney are "durable" if it remains effective after the incapacity of the principal. In Nevada, the statutory form for durable powers of attorney (See NRS ยง 162A.850) becomes effective without a declaration of incapacity. Accordingly, a principal may grant effective authority to the attorney in fact without requiring a declaration of incapacity. As a result, the durable powers of attorney under NRS Chapter 162A are often used as substitutes for guardianship petitions. See NRS 162A.700. There are two exceptions to the rule that durable powers of attorney are effective. The first is that express conditions may be included in the instrument which would terminate it upon a future event. The second is that the power of attorney is void if the principal is determined to be incompetent by a court of competent jurisdiction.
The term "medical power of attorney" refers to a durable power of attorney that names an attorney in fact for the purpose of making medical and healthcare decisions for the principal. The Nevada Durable Power of Attorney for Health Care Decisions Act (Nevada Chapter 162B) requires that this type of power of attorney be executed by a principal who is determined by a physician to be of sound mind and legal capacity. See NRS 162B.650. Unlike durable powers of attorney in general, a power of attorney under Chapter 162A may be revoked at any time as long as the principal is in possession of his or her faculties. See NRS 162C.540.
Nevada Legal Power of Attorney Requirements
An individual seeking to establish a power of attorney (POA) for themselves or to act as an agent for a person in need of assistance has to understand Nevada state requirements.
POAs fall under the general category of advance directives, which are documents that spell out an individual’s wishes for medical, financial or legal situations in the event of an accident, injury or illness. While a living will expresses preferences for end-of-life care, a power of attorney allows an individual to appoint someone to make decisions on his or her behalf in the absence of mental or physical capacity.
Legal requirements for creating a power of attorney in Nevada include:
- Appendix C of the Nevada Uniform Controlled Substances Act requires a POA to be included in the medical record at an inpatient facility if a patient receives pain management or other treatment by opioid analgesic via an intramuscular, intravenous or subcutaneous route.
- The medical records personnel must print that document from the hospital’s electronic medical records system and scan the document into the patient’s medical record so it is informative and viewable by medical professionals including physicians, pharmacists, physician’s assistants and nurses.
- A person who signs an advance directive with the authority to make health care decisions must have capacity to sign. That means capable of making a decision at the time of signing by demonstrating that he/she can understand and appreciate the consequences of signing that document.
- Any advance directives signed before January 1, 2014, must be followed by a signed witness statement that a witness is not related to the patient or employed by a health care provider.
The legal requirements are intended to protect patient rights under Nevada law A person named as a principal or agent and their ability to act on behalf of the principal pursuant to the terms of the POA.
Agent Powers and Duties
The agent named under a Nevada power of attorney, or the person entrusted with that power, is granted a variety of powers to act on behalf of the principal, within the limits of authority expressed in the document. The power of attorney form Nevada requires that the agent, who often is a close family member, fulfill certain rights and responsibilities when exercising those powers. Not only must the agent act with the principal’s best interests in mind, but the agent must organize his or her own affairs to protect the principal.
When executing a power of attorney, the principal signs the document in the presence of a notary public, and may designate an alternate, or successor, agent on the form in case the original appointee can’t perform his or her duties. The agent assumes the responsibilities of an "attorney-in-fact," managing the principal’s personal, financial, and legal affairs for an indefinite amount of time. During this time, the principal gives the agent the authority to make decisions without consulting with or informing the principal as a second or signature on bank accounts, property deeds, contracts, or medical decisions, whichever the document specifies.
The Nevada power of attorney form provides the agent with the authority to make many decisions affecting the principal’s financial and legal well-being, including control of the following matters:
While many financial and legal transactions are included under the umbrella of the Nevada power of attorney, certain decisions are limited or excluded from company property deed. The principal also can designate that the power of attorney be revoked with the designation of another agent. An agent appointed by a principal must act only within the principal’s best interests, and may not use any assets owned by the principal for the benefit of the agent. If the principal is unable or unwilling to make such decisions, the power of attorney designates an agent to act, therefore relieving the principal of any obligations related to those decisions.
Since the power of attorney provides the agent with such vast control over a fundamental aspect of the principal’s life, it is important that the document establish certain safeguards to protect the principal from fraudulent or unwanted actions. The power of attorney should include specific language including:
Without the above mentioned language, the agent may have complete control and authority over the principal’s financial and legal affairs, without any obligation to account for certain actions. However, the executing a power of attorney does not eliminate the rights of third parties to question the agent’s actions. If the agent acts outside of the authority granted by the power of attorney, the principal or others may object to and seek a change in the agent’s authority using resources such as the Elder Law Program of the Nevada Legal Services, Help for Seniors in Crisis, and Nevada Legal Aid Programs.
The use of a power of attorney is an important estate planning decision that can offer peace of mind and protection against unwanted decisions. However, it is critical the principal carefully examines the rights and responsibilities of an agent before signing a power of attorney, taking care to eliminate the possibility of unwanted or harmful actions.
Power of Attorney Revocation in Nevada
To revoke a power of attorney in Nevada, the principal must be competent enough to understand their actions; revocation often requires the assistance of an attorney for handling all the paperwork and filing procedures. When a principal revokes a power of attorney, all previous AGENTS must stop their work immediately and return any documents after revocation becomes official. Revocations must be in writing, signed and notarized by the principal, and effective upon recording with the county recorder where the real estate property is located.
A revocation does not transfer authority or control without the proper notice. The principal or agent must provide sufficient notice of the revocation to the AGENT through hand delivery or by a private mail service. According to the Uniform Electronic Transaction Act, a principal may revoke a power of attorney electronically, unless a third party refuses to honor the electronic document upon a good faith belief that the revocation request is fake or legally invalid . The principal, their estate, or the intended AGENT may bring an action before a Nevada court to end the power of attorney, restricting the authority of the AGENT or adding additional requirements on their abilities.
A third party relying on the AGENT must also receive notice of revocation. It would be prudent for the principal to notify their bank or other financial institutions of the revocation. It is the responsibility of the principal to give this notice and advise the vendors of someone else in the power of attorney role. As long as the third party has good faith and a written notice, no other action(s) shall need to be taken. In most cases, the principal/judicially appointed agent will present a power of attorney packet prepared by a Nevada attorney to be reviewed and signed by those concerned with the matter.
It is imperative to note revocations should be filed in the district court of the district where the principal holds any interest in real property. A separate revocation must be filed in each district court in which the principal has a recorded power of attorney with public notice. If the AGENT misuses the power of attorney, it may even lead to criminal charges.
Avoiding Common Power of Attorney Mistakes
Mistakes in the law are unfortunate enough, but they are especially damaging in the area of Powers of Attorney. The reality is that when people decide to execute a Power of Attorney, they are usually already under stress or facing a financial crisis. Too often, emotions and time constraints lead people to forego the due diligence process that using a qualified attorney should entail. The outcome is devastating. The following are some of the most common mistakes and ways to avoid them: The first step is to give yourself some time and space to understand the process of creating a Power of Attorney. Many people think that Power of Attorney just means signing a form, and it is over. This is not the case. Drafting an effective Power of Attorney requires a thorough discussion about your current and future needs. You must first identify an agent who you can trust to serve in this role, and be prepared to discuss the kind of financial authority you would like to grant. You and your attorney will need a clear understanding of how long you expect the document to remain in place. As with many other experienced estate planning attorneys, my clients are invited to come speak with me about Powers of Attorney before they need to execute them. I offer a free consultation to talk through the process and any questions. Another way you can circumvent mistakes is to do your homework and educate yourself about the laws of Nevada and surrounding states when you find yourself in need of this type of document. Crucial to navigating around one of the most common mistakes is to be aware of the scope of notaries in the state of Nevada. A common misconception is that notarization of a document is all that’s necessary for such a specialized and important legal instrument as the Power of Attorney. This is false. In Nevada, only a non-family member notary public can be used on a Power of Attorney. If you attempt to use a family notary, your document may be denied. Be sure to inquire at your financial institution as to how they want you to proceed with the notarization. Generally, if it seems that you need a notary who is willing to travel to you, the cost may be higher and you might have to pay additional fees.
Seeking Legal Assistance in Nevada
When it comes to the topic of Nevada power of attorney requirements, the last thing you want is to make a mistake. This is because if a mistake does occur in your Nevada power of attorney, the document can be rendered null and void. It then falls to the Nevada courts to determine whether the error was harmless or not – a stressful process that wastes everyone’s time and funds. Consulting legal professionals will ensure that your power of attorney is created and executed under Nevada law according to all state regulations and rules. If you use an estate planning lawyer to write your power of attorney , there is a high probability that the document will meet all requirements in Nevada.
The attorney you hire will give assistance at any step of the estate planning process at your request. Whether or not you need a power of attorney put together or you need guidance later in your estate planning, you will find professional help with this process. Consulting an estate planning lawyer will help protect your interests as an estate owner.