A power of attorney (POA) or letter of attorney in common law systems or mandate in civil law systems is an authorization to act on someone else's behalf in a legal or business matter. The person authorizing the other to act is the principal or granter (of the power), and the one authorized to act is the agent or attorney-in-fact.
In the context of the unincorporated reciprocal inter-insurance exchange (URIE) the attorney-in-fact is a stakeholder/trustee who takes custody of the subscriber funds placed on deposit with him, and then uses those funds to pay insurance claims. When all the claims are paid, the attorney-in-fact then returns the leftover funds to the subscribers.
The term attorney-in-fact should not be confused with the term attorney at law. An attorney-at-law in the United States is a lawyer—someone licensed to practice law in a particular jurisdiction. In most other common-law jurisdictions lawyers are not called attorneys, and in those jurisdictions the term "attorney" generally refers to either attorneys-in-fact or lawyers from the United States.
In some jurisdictions, a durable power of attorney can also be a "Health Care Power of Attorney", an advance directive which empowers the attorney-in-fact (proxy) to make health-care decisions for the grantor, up to and including terminating care and "pulling the plug" on machines keeping a critically and terminally ill patient alive. Health care decisions include the power to consent, refuse consent or withdraw consent to any type of medical care, treatment, service or procedure. A living will is a written statement of a person's health care and medical wishes but does not appoint another person to make health care decisions. New York State has enacted a Health Care Proxy law that requires a separate document be prepared appointing one as your health care agent.
People with mental illness may prepare Psychiatric Advance Directives (PADs in some U.S. states) or Ulysses contracts as they are called in Canada. Ulysses contracts are powers of attorney that enable a patient to dictate preferences for care before becoming incapacitated by recurring mental illness. Although they are not used very often, there is speculation in some of the academic literature as to whether or not these advance directives are empowering for people with mental illness (Journal of Ethics in Mental Health 2006-1).
In some U.S. states and other jurisdictions it is possible to grant a springing power of attorney;i.e., a power that only takes effect after the incapacity of the grantor or some other definite future act or circumstance. After such incapacitation the power is identical to a durable power, but cannot be invoked before the incapacity. This may be used to allow a spouse or family member to manage the grantor's affairs in case illness or injury makes the grantor unable to act, while retaining the power for without an attorney-in-fact before the incapacity occurs. If a springing power is used, care should be given to specifying exactly how and when the power springs into effect. As the result of privacy legislation in the U.S., medical doctors will often not reveal information relating to capacity of the principal unless the power of attorney specifically authorizes them to do so.
Unless the power of attorney has been made irrevocable (by its own terms or by some legal principle), the grantor may revoke the power of attorney by telling the attorney-in-fact it is revoked; however, if the principal does not inform third parties and it is reasonable for the third parties to rely upon the power of attorney being in force, the principal may still be bound by the acts of the agent, though the agent may also be liable for such unauthorized acts.
Many standardized forms are available for various kinds of powers of attorney, and many organizations provide them for their clients, customers, patients, employees, or members. In some states statutory power of attorney forms are available. Some individuals have used powers of attorney to unscrupulously waste or steal the assets of vulnerable individuals such as the elderly (see elder abuse).
In English law, anyone with capacity can grant a Power of Attorney. These can be general (i.e. to do anything which can legally be done by an attorney), or relate to a specific act (eg. to sell freehold property).
A normal Power of Attorney however ceases to have effect if the donor loses capacity. If it is the donor's intention for the Power to continue after they have lost capacity, then a "Lasting Power of Attorney" (LPA) should be granted. These came into being in 1 October 2007, and replaced the simpler "Enduring Powers of Attorney" (EPA's) which had previously been used. LPA's were introduced by the government in order to reduce the potential for abuse that was a problem with the EPA system, and also to allow donor's to grant attorneys the power to look after their welfare and not just their finances, which had not been possible under the EPA regime.
The new LPA regime is therefore a lot more complicated and expensive than the old EPA regime, with the average LPA costing in the region of £800 compared to the £100 charge for EPA's.
Note: Enduring Power of Attorney was replaced with Lasting Power of Attorney in October 2007
Predstavnytstvo see chapter 17 of Civil Code of Ukraine
* by law
* by agreement