A power of attorney, or POA, is one of the most important estate planning tools you can create. It allows you to choose someone in whom you trust to manage your affairs if you ever become incapacitated. The “principal” is the person who signs and executes the power of attorney. Determining if an individual can execute a power of attorney in Arkansas depends on capacity. A standard power of attorney cannot be created unless that individual has the legal capacity to execute the legal document. Although a durable power of attorney remains in effect even after the principal becomes incapacitated, the principal must still create the document while having sufficient legal capacity to do so.

Power of Attorney in Fayetteville: What is required for a POA to be valid in Arkansas?

As of January 1, 2012, Arkansas passed what is known as the Uniform Power of Attorney Act. This new law allows the use of a specific form to create a valid power of attorney. The new “statutory form” is presumed to be valid and must be accepted by others without requiring any changes. This does not mean you should purchase a power of attorney form online. Instead, it is advised that you work with an experienced Fayetteville estate planning attorney to make sure that your power of attorney meets the new criteria in Arkansas.

Legal Incapacity

A person must be “legally competent” in order to execute any legally binding document, including a power of attorney. Competency refers to mental capacity, as well as age and maturity. For instance, to enter a legally binding contract, you must have reached the age of majority set by your state. In Fayetteville, the age of majority is eighteen (18). The basis for this requirement is the notion that those who are still immature require protection from liability, as they are presumed to be too inexperienced to understand or negotiate a contract or legal document.

How is incapacity defined in Arkansas?

Under Arkansas law, an incapacitated person is defined as follows:

“Incapacity” means inability of an individual to manage property or business affairs because the individual:

(A) has impairment in the ability to receive and evaluate information or make or communicate decisions even with the use of technological assistance; or

(B) is missing; detained, including incarcerated in a penal system; or outside the United States and unable to return.

Although some medical conditions, such as Alzheimer’s disease and dementia, are known to lead to mental incapacity, it is important to remember that a physical disability alone is never sufficient. Individuals with a physical disability can make their own decisions as long as they maintain full mental capacity.

Temporary Incapacity

In some situations, an individual’s mental capacity can return when the condition or trauma that led to it has been resolved. For example, intoxication is a type of temporary incapacity, because the condition is resolved when the person becomes sober. Of course minority is a temporary incapacity that ends when the minor reaches the age of majority in his or her state. Medical conditions such as comas and other states of unconsciousness are also considered temporary if the person recovers and regains consciousness and mental capacity.