A written document in which one person (the principal) appoints another person to act as an agent on his or her behalf, thus conferring authority on the agent to perform certain acts or functions on behalf of the principal. Powers of attorney are routinely granted to allow the agent to take care of a variety of transactions for the principal, such as executing a stock power, handling a tax audit, or maintaining a safe-deposit box. Powers of attorney can be written to be either general (full) or limited to special circumstances. A power of attorney generally is terminated when the principal dies or becomes incompetent, but the principal can revoke the power of attorney at any time.
A special type of power of attorney that is used frequently is the "durable" power of attorney. A durable power of attorney differs from a traditional power of attorney in that it continues the agency relationship beyond the incapacity of the principal. The two types of durable power of attorney are immediate and "springing." The first type takes effect as soon as the durable power of attorney is executed. The second is intended to "spring" into effect when a specific event occurs, such as the disability of the principal. Most often, durable powers of attorney are created to deal with decisions involving either property management or HEALTH CARE.