Business owners/ individuals should consider a lasting power of attorney to make any document legal. It saves you business, and other important affairs when you are not able to manage them on your own.
What’s a Lasting POA?
A power of attorney allows a person to appoint another person, to act on behalf allowing to take important decisions. To give an example, it is a common practice for a property or real estate transaction involving a POA to a real estate agent in order to act on the behalf of a buyer or homeowner in signing documents that are related to the transaction.
According to Article 951 of the CTA
A POA may be canceled under the following situations.
- When the Assignee is dead.
- When the POA is revoked.
- Mental incapacity of the principal
- End of the some specific Transaction
A lasting POA allows continuity of the authority even with the mental incompetence of the principal. Mental incompetence is the situation when a person is unable to make important personal or business decisions. For instance, dementia can be an acceptable reason for mental incompetence. Lasting power of attorney can be created for several reasons. You can create as many lasting POAs as long as the documents don’t overlap.
Also Read: Durable Power Of Attorney FAQs
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When Does a Lasting POA Take into Effect?
There are two kinds of lasting POAs. They are:-
- Springing Lasting POA: it becomes effective only when the principal becomes incapacitated.
- Regular Lasting POA: It becomes effective instantly with the signature and notarization of the legal document.
Take note: a POA notarization in UAE is required. Of course, an agent does have power or authority even when the principal becomes incompetent.
What are the Different Types of Lasting POAs?
A lasting power of attorney is a legal document that allows an individual or business to appoint another person to carry out decisions on their behalf. Individuals may use lasting POA when they are unable to deal with their own affairs.
A lasting POA gives you peace of mind by assigning a person to manage your affairs by assigning a person to manage your affairs at your difficult times. This may include ensuring your family safety, settling your medical treatment dues, and settling mortgage payments.
You need to remember that you can make lasting POA only when you are mentally capable of making one. This means a requirement for the durable power of attorney drafting in UAE is mental capacity. If you don’t have a power of attorney when you lose your mental capacity, your dear ones have to suffer a lot to take control of your wellbeing and finances. They’d also have to go through courts to carry out your affairs.
There are two main kinds of durable or lasting POAs, and they are as follows:
Financial affairs and property
Health and welfare
A lasting power of attorney for health and welfare is focused on the personal wellbeing of the principal. It may be to take health decisions or to ensure that your safety in a nursing home.
Financial and property lasting power of attorney focusses on financial and property decisions. For example paying off mortgage loans, dealing with savings and bank accounts, and settling debts. It may even be deciding sell your house to cover your healthcare costs.
When setting up a lasting power of attorney in UAE, you’ll be able to decide if the agents or persons you are assigning powers to can start their responsibilities immediately or not. A lasting or durable POA may be initiated when you are no longer capable of managing your own finances.
What Should Business Owners Know About Lasting POA?
Business owners in UAE may need the lasting power of attorneys to assign the people to handle the business activities when they are not able to do so. The creation of a limited lasting POA for your business’ legal and financial matters can save your business when you become incapacitated.
For instance, if you have sole ownership of an LLC in Dubai, a lasting POA will provide a specific agent that you have chosen yourself the ability in handling the business’ daily operations and activities in your stead.
Remember that you have to exclude business affairs with other lasting POAs that you create.
Is there a Need for Lasting POA Drafting in UAE if I’m Married or with Kids?
It’s advisable to have a durable or lasting POA in place even when you have a family. Much like a will, you need to specify the person that you wish to take care of the affairs and finances on your behalf. Even your spouse would not be able to make decisions on your behalf immediately when you are incapacitated.
The only way in guaranteeing they’ll be allowed to carry out your decisions for you is to acquire services for a durable power of attorney drafting in UAE. You can set up both healthcare and property POAs, naming your family members as your attorneys-in-fact or agents.
Take note: Your lasting POA is valid only till your death. After your death, the persons in the registered will determine to the person to manage your properties.
Is it Possible to have Multiple Persons as an Agent for a Lasting POA?
There is no limit to how many persons you can appoint as your agents in a power of attorney. The people you appoint can act jointly and they can be your friends, relatives, family members, or anyone that you fully trust.
The term jointly essentially means your appointment agents are to agree unanimously when making a decision on your behalf, regardless of how small or big the decision’s impact is. If one of the agents can’t act, the other attorneys won’t be able to carry out any decision unless the lasting POA states what to do when it happens.
What Should a Lasting POA Include?
Here are some sections that have to be in a lasting POA:
- List all the specific descriptions of the parties that are involved with the power of attorney. There should be complete information on the agent and the principal to avoid the confusion. Also include the relationship between principal and the chosen agent.
- There should be limits that are described in the POA. The limits should be with respect to time or the kind of POA, whichever applies. This is the one play where a principal is able to be specific on whether a POA is for every single matter that is concerning the principal, for medical matters, or for business matters only. A POA should also be the place in which the principal states that the POA doesn’t include specifically.
- There should be a statement saying that if your situation mentally changes, or when you become competent back again e.g. following recovery from major injury, then the POA expires.
- Include the instructions for the agent. It may include the details of the consulting person for medical and business matters. Be careful with the medical lasting POA as it shouldn’t be contradictory to your living will.
- Signature in front of the witnesses.
What should I do with an Enduring Power of Attorney?
On a daily basis, you make a wide range of choices and decisions as to how you invest and spend money. The kinds of decisions that you make are all unique to your specific circumstances and taking into consideration income and assets.
If an illness or accident prevents you from making financial decisions or payments to bills and expenses, you’d probably want a particular level of control for how transactions are carried out. Due to legal requirements of financial institutions and regulatory authorities, if you’re incapable of attending to transactions yourself, an enduring power of attorney in UAE is required.
Registering Enduring Power of Attorney
There’s no formal process for registering an enduring POA or power of attorney in UAE. However, it needs to be lodged with the government departments, banks, and all other institutions before an authorized person can conduct a transaction.
It’s recommended for a principal to keep the document in a safe and secure place. Storage can be with all other important legal documents such as the advance health directive, your will, and your enduring power for guardianship.
It’s essential for you and your agent to know exactly where the original power of attorney is kept.
Are there people I should provide copies of an Enduring Power of Attorney?
Enduring power of attorney documents in UAE are considered private documents. This means it will be completely up to you in deciding who exactly you want to have copies of the document.
It is recommended to make certified copies from a public notary in Dubai and provide them to the agent, family members, and relevant institutions.
What is a Certified Copy of an Enduring Power of Attorney?
A certified copy is issued by a public notary in Dubai. The certified copy of any legal document is certified to be a true and genuine copy of an original.
Keep a list of all certified copies issued, as this will assist you in the future should you decide to revoke your power of attorney.
What Actions are Illegal for Agents Appointed Through Enduring POA in Dubai?
An agent cannot:
create a will
vote
make statutory declarations
swear affidavits
act as executor or trustee
perform illegal acts
dispose assets below market value
An enduring POA may allow decisions relating to:
property management
financial matters
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What are to be Taken into Consideration When Selecting an Agent?
Willingness to accept responsibility
Trustworthiness and reliability
Relationship with spouse or family
Ability of joint agents to work together
An enduring power of attorney allows you to authorize someone in making personal and financial decisions for you should you lose capacity.
If you want more information regarding lasting powers of attorney in UAE and the documents’ notarization, call us here in Notary Public Dubai!