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Letter of Attorney: What are the Requirements ?

Letter of Attorney

A Letter of Attorney provides written instructions from one person to another, usually authorizing them to act on the first person’s behalf in some specific matter. The letter may be used if the first person is unable to take care of their own affairs due to illness, disability, or death.

A Letter of Attorney can also provide written authorization for a trusted individual or company to handle financial matters for an incapacitated person who does not have power of attorney. It might also instruct someone else with the power of attorney how they should act on behalf of the incapacitated person until they regain their capacity.

These are all situations where you would need a lawyer’s help drafting your document; however, there are many other ways that you can make use of this legal form.

What is Letter of Attorney?

A Letter of Attorney (LOA) is a document that authorizes someone else to act on your behalf in specific legal matters. Typically, the person giving the authorization is called the “Principal” and the person authorized to act on their behalf is called the “Agent.”

In the United States, Letters of Attorney are governed by state law. In most states, a Letter of Attorney must be in writing and signed by both the Principal and Agent. The Agent must also be given authority to act specifically in relation to the types of legal matters specified in the LOA.

Generally speaking, a Letter of Attorney can be used to authorize an Agent to do any number of things including representing you in a legal action, signing contracts on your behalf, deciding on medical procedures, etc.

Requirements of a Letter of Attorney

letter of attorney
  • Authorization. To form a letter of attorney, the person who wants to delegate authority must have the power of attorney before granting a third-party authorization over his or her affairs. This gives the lawyer explicit authorization to take charge of all legal actions and transactions on behalf of their client- including writing, signing, and filing any necessary paperwork that is required by law. Furthermore, this also allows them to conduct business with other parties that have previously been delegated authority by the original grantor/authorizer without having to gain permission from them first.
  • The Capacity of the Grantor. A power of attorney is only valid if the grantor has the requisite mental capacity. If the grantor loses the capacity to give permission after the POA has been created (for example, because of Alzheimer’s disease or a head injury in a vehicle accident), the power will most likely become ineffective. In certain powers of attorney, the grantor stipulates that the document continues in force even if he or she becomes incapacitated. A durable power of attorney is one such example.
  • Oral or Written Declaration. A power of attorney may be oral in some jurisdictions, and it will hold up in court if witnessed, even as a written document. For various reasons, a power of attorney must be in writing under the law. For example, before they will accept it, certain organizations, such as hospitals and banks, as well as the Internal Revenue Service in the United States, require a power of attorney to be in writing. Many facilities will maintain two copies: one for their files, and the other to copy records. Nursing homes frequently follow this procedure.
  • The principle of equal dignity states that someone executing certain actions for another person must be appointed with the same formality as required for the act that representative is going to perform. It also means, for example, that if a senior authorizes someone to sell his or her house or other real property and the statute of frauds requires a written contract for the sale of real property (which is required in most US jurisdictions), then so must the authorization for the other person to sign the sales agreement and deed. In addition, in common-law countries other than the United States, a power of attorney to execute a deed (i.e., an instrument under seal or executed before two witnesses) must be treated as if it were a deed.

Other requisition for a power of attorney to be recognized and honored, it must at a minimum be signed and dated by the principal. Some jurisdictions demand that a power of attorney be notarized, witnessed, or both. Even if it isn’t necessary, having the document verified and signed (and often stamped) by a notary public may help you avoid legal trouble.

A separate contract for payment may be included with the document issuing power of attorney if the attorney-in-fact is being compensated to act on behalf of the principal. Even when the power of attorney is presented to others for the purposes of performing the agent’s duties, a separate contract in writing may be kept private between the principal and agent even though it is a separate document.

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