A power of attorney authorizes one person — an attorney in fact — to act on behalf of another person — a principal. When a power of attorney is “durable,” it exists even when the principal lacks legal capacity. Given this relationship, an attorney in fact owes fiduciary duties to the principal.
In terms of the attorney in fact’s rights and responsibilities, the power of attorney instrument itself will specify what is authorized. Missouri statutes make clear that an attorney in fact’s responsibility can be quite broad and specifically allows a power of attorney document to authorize, among other things, the following: (1) the power to execute, amend or revoke a trust agreement, (2) to fund with the principal’s assets any trust not created by the principal, (3) to make or revoke a gift of the principal’s property in trust or otherwise, (4) to disclaim a gift or devise of property to or for the benefit of the principal, and to (5) designate or change the designation of beneficiaries to receive any property, benefit or contract right on the principal’s death.
Notwithstanding these powers, there are certain situations in which case law adds heightened obligations to an attorney in fact. For example, while an attorney in fact may generally be authorized to gift property to himself, he is prohibited from doing so unless there is express authorization to do so in the power of attorney instrument. Antrim v. Wolken, 228 S.W.3d 50, 53 (Mo. Ct. App. 2007). Missouri courts have recognized a strong public policy for requiring express authorization of the attorney-in-fact to make a gift himself of the principal’s property, especially given the potential for abuse. Id. Abusing power of attorney documents can give rise to breach of fiduciary duty claims and/or other types of civil liability.
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