# Risks > Risks involved with using Powers of Attorney Source: https://wiki.powersofattorney.com/insightrisks · Updated 6 April 2025 > [There are **risks** associated with using a *Power of Attorney*](https://wiki.powersofattorney.com/insightrisks#there-are-risks-associated-with-using-a-power-of-attorney) > > [**Risk management** practices are wide and varied](https://wiki.powersofattorney.com/insightrisks#risk-management-practices-are-wide-and-varied) > > Insurance as a risk management strategy > > [There are **risk management practices unrelated to** the **terms** of the *Power of Attorney*](https://wiki.powersofattorney.com/insightrisks#there-are-risk-management-practices-unrelated-to-the-terms-of-the-power-of-attorney) > > [There are **risk management practices involving** the **terms** of the *Power of Attorney*](https://wiki.powersofattorney.com/insightrisks#there-are-risk-management-practices-involving-the-terms-of-the-power-of-attorney) > > - [promoting access to the *Power of Attorney* may reduce risks](https://wiki.powersofattorney.com/insightrisks#promoting-access-to-the-power-of-attorney-may-reduce-risks) > - [promoting access to records and disclosure of information may reduce risks](https://wiki.powersofattorney.com/insightrisks#promoting-access-to-records-and-disclosure-of-information-may-reduce-risks) > - [using notification regimes may reduce risks](https://wiki.powersofattorney.com/insightrisks#using-notification-regimes-may-reduce-risks) > - [imposing review requirements may reduce risks](https://wiki.powersofattorney.com/insightrisks#imposing-review-requirements-may-reduce-risks) > - [good record keeping is important](https://wiki.powersofattorney.com/insightrisks#good-record-keeping-is-important) > - [broad risk management processes may reduce risks](https://wiki.powersofattorney.com/insightrisks#broad-risk-management-processes-may-reduce-risks) > - [in Florida a specific notice regime operates in Respect Of *Powers Of Attorney*](https://wiki.powersofattorney.com/insightrisks#in-florida-a-specific-notice-regime-operates-in-respect-of-powers-of-attorney) > > [There are various **types of risks**](https://wiki.powersofattorney.com/insightrisks#there-are-various-types-of-risks) > > - [there are risks associated with unsigned *Powers of Attorney*](https://wiki.powersofattorney.com/insightrisks#there-are-risks-associated-with-unsigned-powers-of-attorney) > - [there are risks associated with signed *Powers of Attorney*](https://wiki.powersofattorney.com/insightrisks#there-are-risks-associated-with-signed-powers-of-attorney) > > [The **only way to manage** all risks **is legal advice**](https://wiki.powersofattorney.com/insightrisks#the-only-way-to-manage-all-risks-is-legal-advice) ## There Are Risks Associated With Using A *Power of Attorney* A *Power of Attorney* is a very powerful legal document. [Creation](https://wiki.powersofattorney.com/creation/create#three-methods-to-create-a-power-of-attorney) of a *Power of Attorney* presents a series of significant risks. For practical reasons:- - priority given to discussion of risk management practices, which seems more useful - identification of kinds of relevant risks are addressed are at the bottom of this Wiki page ## **Risk Management Practices Are Wide And Varied** Only a properly instructed, suitably qualified lawyer could properly advise as to appropriate risk management practices associated with any given *Power of Attorney*. Instructing a lawyer to confirm a *Power of Attorney* is [fit for purpose](https://wiki.powersofattorney.com/insightseeingoodpoa#fit-for-purpose-means-protecting-the-principals-interests) before it is signed is always appropriate. The mere instruction of a lawyer has natural consequences including opening of a lawyer's file so as to present an obvious basis to suggest that for example, that no question ought be raised as to whether the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) was adequately advised or otherwise with respect to the *Power of Attorney*. Instructing a lawyer making it inherently more difficult for anyone seeking to dispute that the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) well-advised intentions. Instructing a lawyer is the only way any view might be formed as to the suitability of any *Power of Attorney* for the purposes of any given [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney). Determining what is [fit for purpose](https://wiki.powersofattorney.com/insightseeingoodpoa#fit-for-purpose-means-protecting-the-principals-interests) would invariably require the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) being interviewed to gauge their level of understanding, familiarity with their affairs and competence to [create](https://wiki.powersofattorney.com/creation/create#three-methods-to-create-a-power-of-attorney) a *Power of Attorney,* inquiry being made to understand and advise upon the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) objectives including alternatives, review any *Power of Attorney,* tailoring of its terms as required to meet the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) needs and similar. It is this process that substantially separates a *Power of Attorney* bought for example on the internet and a *Power of Attorney* settled (i.e. reviewed and advised upon with instructions to do all work necessary to render it [fit for purpose](https://wiki.powersofattorney.com/insightseeingoodpoa#fit-for-purpose-means-protecting-the-principals-interests)). Accepting that instructing a lawyer is the only way to genuinely manage risks associated with a *Power of Attorney*, it may be helpful to consider some options that might for example, feature in advice received from a lawyer. These risk management processes seem best considered in two parts, risk management practices that are unrelated to the terms of the *Power of Attorney* and risk management practices related to the *Power of Attorney*. Insurance As A Risk Management Strategy Agents (prof, PI insurance) monitors insured for review (see Monitor page - ## **There Are Risk Management Practices Unrelated To The Terms Of The** ***Power of Attorney*** Risks might be managed for example, by:- - using the [best](https://wiki.powersofattorney.com/insightseeingoodpoa) quality *Power of Attorney* available - ensuring that the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) receives legal advice before a *Power of Attorney* is signed - implementing careful storage and access arrangements - ensuring suitable persons are aware of the existence of the *Power of Attorney* - ensuring any witnesses to the execution of *Power of Attorney* remain contactable - filing the *Power of Attorney* (see [§709.2106(6)](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2106.html), in **Florida**, in **Texas** etc.) ## **There Are Risk Management Practices Involving The Terms Of The** ***Power of Attorney*** Provisions that might usefully be included in a *Power of Attorney* to manage risks might deal with matters like:- - [**Promoting Access To The** ***Power of Attorney*** **May Reduce Risks**](https://wiki.powersofattorney.com/insightrisks#promoting-access-to-the-power-of-attorney-may-reduce-risks) - [**Promoting Access To Records And Disclosure Of Information May Reduce Risks**](https://wiki.powersofattorney.com/insightrisks#promoting-access-to-records-and-disclosure-of-information-may-reduce-risks) - [**Using Notification Regimes May Reduce Risks**](https://wiki.powersofattorney.com/insightrisks#using-notification-regimes-may-reduce-risks) - [**Imposing Review Requirements May Reduce Risks**](https://wiki.powersofattorney.com/insightrisks#imposing-review-requirements-may-reduce-risks) - [**Good Record Keeping Is Important**](https://wiki.powersofattorney.com/insightrisks#good-record-keeping-is-important) - [**Broad Risk Management Processes May Reduce Risks**](https://wiki.powersofattorney.com/insightrisks#broad-risk-management-processes-may-reduce-risks) All of these options might discourage any [agent](https://wiki.powersofattorney.com/agentswhatisagent) from dubiously involving themselves in the affairs of their [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal). ### **Promoting** Access To The *Power of Attorney* **May Reduce Risks** Inability to access a P*ower of Attorney* may be a source of problems and particular care and attention should be paid to the question of whom and in what circumstances any and all appropriate persons should have access to a *Power of Attorney*. Where a copy of the *Power of Attorney* cannot be accessed this may frustrate better outcomes. Options might include directions included in the *Power of Attorney* specifying that a copy of the *Power of Attorney* should be produced upon demand from certain persons in conjunction with matters ‘outside the terms of the *Power of Attorney’* such as storage and access arrangements. Directions or other terms in a *Power of Attorney* might for example, go beyond merely specifying to whom the *Power of Attorney* may be released so as to also deal with clear release of the [agent](https://wiki.powersofattorney.com/agentswhatisagent) from any duty of confidentiality that might otherwise require the [agent](https://wiki.powersofattorney.com/agentswhatisagent) to act in a manner that would not result in disclosure of any pertinent information requested from certain persons, in conjunction with relevant documents and similar. ### **Promoting Access To Records And Disclosure Of Information May Reduce Risks** Access to records and disclosure of information can be a problem where for example, an [agent](https://wiki.powersofattorney.com/agentswhatisagent) feels that a duty of confidentiality prevents them from releasing certain documents or information. Clear terms relieving an [agent](https://wiki.powersofattorney.com/agentswhatisagent) from any duty of confidentiality that might be counter-productive are appropriate. In addition, it may be beneficial for example, to include express authority in favour of an [agent](https://wiki.powersofattorney.com/agentswhatisagent) that enables an [agent](https://wiki.powersofattorney.com/agentswhatisagent) to resolve any claims of confidentiality made by a [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) who may hold relevant information or documents, so as to for example in oversimplified terms, expressly delegate authority to deal with all matters pertaining to retention of confidentiality, waiver or variation of terms as between a [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) in possession of relevant information and documents and similar. Notably in **California**, [§4235](https://codes.findlaw.com/ca/probate-code/prob-sect-4235.html) provides in respect of any *Power of Attorney* that if the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) becomes incapacitated or any question relating to the [principal's](https://wiki.powersofattorney.com/principal#who-is-the-principal) capacity arises, an agent may consult with certain persons and obtain information from them (i.e. spouse, physician, attorney, accountant etc) and authorizes such persons to disclose information. Reviewing [§4235](https://codes.findlaw.com/ca/probate-code/prob-sect-4235.html) may be an interesting starting point for anyone looking at this issue. ### Using Notification Regimes May Reduce Risks Notifications by [agents](https://wiki.powersofattorney.com/agentswhatisagent) for example, intention to perform certain important transactions or appoint a sub-agent or similar etc. Some states such as **Florida**, have specific notice regimes included in their legislation. [§709.2121](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2121.html) states: *(1) A notice, including a notice of revocation, notice of partial or complete termination by adjudication of incapacity or by the occurrence of an event referenced in the power of attorney, notice of death of the principal, notice of suspension by initiation of proceedings to determine incapacity or to appoint a guardian, or other notice, is not effective until written notice is provided to the agent or any third persons relying upon a power of attorney.* *(2) Notice must be in writing and must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document.  Permissible methods of notice or for sending a document include first-class mail, personal delivery, delivery to the person's last known place of residence or place of business, or a properly directed facsimile or other electronic message.* *(3) Notice to a financial institution or broker-dealer must contain the principal's name and address and the last four digits of the principal's taxpayer identification number and be directed to an officer or a manager of the financial institution or broker-dealer in this state.* *(4) Notice is effective when given, except that notice upon a financial institution, brokerage company, or title insurance company is not effective until 5 days, excluding Saturdays, Sundays, and legal holidays, after it is received.* ### Imposing Review Requirements May Reduce Risks Arrangements for review of the [principal's](https://wiki.powersofattorney.com/principal) affairs (ie. conduct of regular meetings and similar) are one means by which confidence may be improved in terms of the risk of misappropriation of funds and similar. The mere inclusion of such arrangements in a *Power of Attorney* seems likely to reduce the risk of some kinds of potential problems, including failure to maintain adequate records, lack of clarity in relation to issues like dates of appointment or cessation of appointment in respect of any [agent](https://wiki.powersofattorney.com/agentswhatisagent) and similar. ### Good Record Keeping Is Important Keeping records in relation to the appointment and cessation of officeholders is a key function. It is a task which arguably takes on additional significance in US States like Texas ([§751.022](https://codes.findlaw.com/tx/estates-code/est-sect-751-022.html)) and Florida ([§709.2113](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2113.html)), where an agent may [accept appointment](https://wiki.powersofattorney.com/agentappt#how-an-agent-may-accept-appointment-varies-in-the-six-6-greater-states) without acting signing the *Power of Attorney* and in particular Florida where unlike Texas, legislative states “*the scope of an agent's acceptance is limited to those aspects of the power of attorney for which the agent's assertions or conduct reasonably manifests acceptance*”. Whether or not this is also the case in **Texas** is a matter for the Courts of **Texas**. It seems fundamental for example, when you consider that:- - in the event a *Power of Attorney* is abused, likely the abuse would be found in particular transactions - dispute or uncertainty as to whether a [legal entity](https://wiki.powersofattorney.com/terms#meaning-of-legal-entity) was or was not an appointed agent on the date of the transaction is preferably an issue that the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) would prefer to avoid - it is probably best avoided by adopting a clear and precise regime for the maintenance of records pertaining to appointments This is particularly the case for example in **Texas** [§751.023(b)](https://codes.findlaw.com/tx/estates-code/est-sect-751-023.html), **California** [§4205](https://codes.findlaw.com/ca/probate-code/prob-sect-4205.html), **Illinois** [§2-10.3](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-10-3.html), **Pennyslvania** [§5602(b)](https://wiki.powersofattorney.com/(b) Appointment of agent and successor agent.--A principal may provide for: (1) The appointment of more than one agent, who shall act jointly, severally or in any other combination that the principal may designate, but if there is no such designation, such agents shall only act jointly. (1.1) The delegation of one or more powers by the agent to such person or persons as the agent may designate and on terms as the power of attorney may specify. (2) The appointment of one or more successor agents who shall serve in the order named in the power of attorney, unless the principal expressly directs to the contrary. (3) The delegation to an original or successor agent of the power to appoint his successor or successors.) with respect to the designation of a [protector](https://wiki.powersofattorney.com/introotherofficeholders#protector-ca-tx-il-pa) who may in turn, designate [successor agents](https://wiki.powersofattorney.com/agentswhatisagent#a-successor-agent-replaces-an-original-agent-who-is-ineligible), posing an immediate need for a scheme to manage designation. How else could anyone possibly be confident as to for example, who the [protector](https://wiki.powersofattorney.com/introotherofficeholders#protector-ca-tx-il-pa) has or has not designated as a [successor agent](https://wiki.powersofattorney.com/agentswhatisagent#a-successor-agent-replaces-an-original-agent-who-is-ineligible)? A strong record keeping systems might for example, include requirement for any party to the *Power of Attorney* providing a copy of any execution, appointment, resignation or similar instrument to every other party. This might seem unruly or unwieldy, but perhaps particularly in the context of abuse, the need to be very clear about who was or was not in office at any time is an issue every [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) would prefer to avoid at all times. In a litigious sense, it simply adds many potentially substantial heads of costs associated with proving who was or was not appointed, in conjunction with advising on a wide range of risks based upon whether certain [legal entity](https://wiki.powersofattorney.com/terms#meaning-of-legal-entity) were or were not appointed at given times and similar - all of which could have been very easily avoided with a suitable record keeping system. Consider for example, serving a copy of the executed version of a *Power of Attorney* signed by a sub-agent on every party ([agent](https://wiki.powersofattorney.com/agentswhatisagent), [successor agent](https://wiki.powersofattorney.com/agentswhatisagent#a-successor-agent-replaces-an-original-agent-who-is-ineligible) etc) named in the *Power of Attorney* would have multiple advantages, including the adoption of a practice which sees multiple persons receiving written notice (which is inherently difficult to dispute), bringing to the attention of those persons of the appointment of the sub-agent and similar. In short, the advantages seem to clearly outweigh the disadvantages. Notably, in states like New York and Pennsylvania, more particular requirements exist, for example:- - in **New York**, [agents](https://wiki.powersofattorney.com/agentswhatisagent) must sign a *Power of Attorney*: [§5-1501B](https://codes.findlaw.com/ny/general-obligations-law/gob-sect-5-1501b.html) - in **Pennsylvania**, a certain certificate must be executed in conjunction with a *Power of Attorney*, that tends to ensure a clean, written record exists at least in respect of appointment of agents [§5601(c)](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-5601.html). There is nothing to prevent a [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) including provisions requiring the signing of a *Power of Attorney* in states like **Texas** (with respect to [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Powers of Attorney*) and **Florida** where agents may [accept appointment](https://wiki.powersofattorney.com/agentappt#how-an-agent-may-accept-appointment-varies-in-the-six-6-greater-states) by conduct, if the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) prefers. ### Broad Risk Management Processes May Reduce Risks Broad risks management processes are in order. Principles of risk management include processes to manage review of the risk management processes on a regular basis. ## In Florida A Specific Notice Regime Operates In Respect Of *Powers Of Attorney* [§709.2121](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2121.html) states: *(1) A notice, including a notice of revocation, notice of partial or complete termination by adjudication of incapacity or by the occurrence of an event referenced in the power of attorney, notice of death of the principal, notice of suspension by initiation of proceedings to determine incapacity or to appoint a guardian, or other notice, is not effective until written notice is provided to the agent or any third persons relying upon a power of attorney.* *(2) Notice must be in writing and must be accomplished in a manner reasonably suitable under the circumstances and likely to result in receipt of the notice or document.  Permissible methods of notice or for sending a document include first-class mail, personal delivery, delivery to the person's last known place of residence or place of business, or a properly directed facsimile or other electronic message.* *(3) Notice to a financial institution or broker-dealer must contain the principal's name and address and the last four digits of the principal's taxpayer identification number and be directed to an officer or a manager of the financial institution or broker-dealer in this state.* *(4) Notice is effective when given, except that notice upon a financial institution, brokerage company, or title insurance company is not effective until 5 days, excluding Saturdays, Sundays, and legal holidays, after it is received.* ## **There Are Various Types of Risks** Risks arise in various contexts in respect of a *Power of Attorney*. Risks may arise from wording or error or be associated with abuse of the *Power of Attorney*, as well as many other factors. #### There Are Risks Arising From Wording Risks may arise from words chosen to be included in the *Power of Attorney*. A poorly drafted [condition](https://wiki.powersofattorney.com/agentappt#conditions-can-be-imposed-in-respect-of-an-agents-appointment), [direction](https://wiki.powersofattorney.com/directionwhatis#a-direction-regulates-matters-under-a-power-of-attorney) or [limitation](https://wiki.powersofattorney.com/limitwhatis#a-limitation-is-a-restrictive-covenant), inconsistent terms, wording that offends a legal principle, misdescription, spelling errors, ambiguity, overlapping provisions and other possibilities are problems of a kind only a lawyer is qualified to solve. #### There Are Risks Associated With Error Risks in the nature of an error might include any form of mistake in the content of a *Power of Attorney*, such as overstating or understating the authority delegated to the appointed [agent](https://wiki.powersofattorney.com/agentswhatisagent) or [agents](https://wiki.powersofattorney.com/agentswhatisagent), failure to adequately define matters, mistakes based upon a misconception of the law, misstating or inadequately defining basic facts like names and addresses, failure to take into account the contents of other relevant documents and any manner of other possibilities that only a lawyer is qualified to manage. #### There Are Risks Associated With Malfeasance Risks involving malfeasance primarily involve either an [agent](https://wiki.powersofattorney.com/agentswhatisagent) or [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) acting improperly, for example to an [agent](https://wiki.powersofattorney.com/agentswhatisagent) deriving an unauthorized benefit or pressuring someone to sign a *Power of Attorney*, or a [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) taking deriving an improper benefit where an [agent](https://wiki.powersofattorney.com/agentswhatisagent) for example pays monies for the benefit of a [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) outside the scope of their authority. #### There Are Other Risks There are an inordinate number of other risks, associated with matters like changes in the law, how a *Power of Attorney* came to be executed, the creation or existence of other documents and other matters. ### There Are Risks Associated With Unsigned *Powers of Attorney* Risks arise where a *Power of Attorney* is [created](https://wiki.powersofattorney.com/creation/create#three-methods-to-create-a-power-of-attorney), irrelevant to whether it is ever signed. For example, in Texas or Pennsylvania a person [creating](https://wiki.powersofattorney.com/creation/create) a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* in **Texas** might want to take extra care with an unsigned [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* because [§751.0022](https://codes.findlaw.com/tx/estates-code/est-sect-751-0022.html) and [§5608(c)](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-5608.html)entitle a [third party](https://wiki.powersofattorney.com/terms#meaning-of-third-party) to assume a signature purporting to be the [principal's](https://wiki.powersofattorney.com/principal#who-is-the-principal) signature is genuine, subject to compliance with [§121.004](https://codes.findlaw.com/tx/civil-practice-and-remedies-code/civ-prac-rem-sect-121-004.html) in **Texas** and in absence of actual knowledge the signature is irregular, which tends to heighten the risks associated with an unsigned [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* being improperly signed and used for untoward purposes. ###### There Are Risks Associated With Creation, Storage & Destruction A printed, unsigned *Power of Attorney* left in a drawer may for example, lead to debate as to whether the *Power of Attorney* is evidence of particular preferences, perhaps an intention to [revoke](https://wiki.powersofattorney.com/termrevmng) an earlier *Power of Attorney* or anything else. An unsigned *Powers of Attorney* might for example, be said to somehow inform as to preferences or intentions of the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal), as if to say ‘if they wrote this, they probably wanted certain things to happen’. Particular care should be taken when creating, storing or disposing of a draft *Power of Attorney*, that is any unsigned *Power of Attorney*, to ensure any draft is not a source of problems in the future. Useful steps might include writing clearly on the front of the *Power of Attorney* that it is a draft and that the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) does not intend its creation to have any legal effect or consequence and for example, that its contents are not to be taken into account when determining any matter relevant to the [principal's](https://wiki.powersofattorney.com/principal#who-is-the-principal) affairs. Destroying a draft, unsigned *Power of Attorney* may be a better approach, to avoid any confusion, however there is often situations where it is desirable for drafts is to be retained, in which event suitable options might include for example, keeping all drafts in a folder boldly marked boldly with words to the effect “*Draft Power of Attorney For Discussion With Lawyer Only*” together with words like those mentioned in the previous paragraph, or similar. ###### There Are Risks In A Wider Context An unsigned *Power of Attorney* might be relied upon in other contexts, outside the immediate operation of the *Power of Attorney*. For example, in a dispute as to whether the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) had capacity at the time they wrote their will, evidence of their ability to [create](https://wiki.powersofattorney.com/creation/create#three-methods-to-create-a-power-of-attorney) a *Power of Attorney* at the same time, albeit unsigned, might show that the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) had capacity to understand and structure their [commercial](https://wiki.powersofattorney.com/terms#meaning-of-commercial) affairs, which may be relevant to any determination of whether the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) had capacity at that time to create a will. It has been recognized that in many respects, the concepts and principles required to be understood by a [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) when creating a *Power of Attorney* are considerably more sophisticated than the concepts relevant to a will and so, such evidence might well be persuasive on the question of whether the [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) had capacity to write a will. ### There Are Risks Associated With Signed *Powers of Attorney* Risks associated with a signed *Power of Attorney* include a *Power of Attorney* being used for an unintended purpose, or being partly or wholly ineffective to achieve its intended purpose. Risks arise for example, where a [principal](https://wiki.powersofattorney.com/principal#who-is-the-principal) signs a *Power of Attorney* and retains the *Power of Attorney* in a desk drawer, or in a safety deposit box. It may be unclear whether the *Power of Attorney* is intended to be capable of use by an agent upon an agent [accepting appointment](https://wiki.powersofattorney.com/agentappt#how-an-agent-may-accept-appointment-varies-in-the-six-6-greater-states). This is particularly true, given the unique approach taken to *Powers of Attorney* whereby ordinary assumptions that might attach for example to a [common agency agreement](https://wiki.powersofattorney.com/creation/framework#comparison-to-common-agency-agreement) that was left for some period of time unsigned, do not apply to a *Power of Attorney*. This sort of reasoning is reflected for example in legislation which recognizes that an agent's authority may be exercised until the [agent's](https://wiki.powersofattorney.com/agentswhatisagent) authority terminates notwithstanding a lapse of time since the execution of the *Power of Attorney* (see [§751.132(b)](https://codes.findlaw.com/tx/estates-code/est-sect-751-132.html) in Texas, [§4127](https://codes.findlaw.com/ca/probate-code/prob-sect-4127.html) in California [§5-1504](https://codes.findlaw.com/ny/general-obligations-law/gob-sect-5-1504.html) in New York [§2-5](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-5.html) in Illinois and [§5604(b)](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-5604.html) in Pennsylvania). A signed *Power of Attorney* should be treated with the utmost care. At least in principle an [agent](https://wiki.powersofattorney.com/agentswhatisagent) may [accept appointment](https://wiki.powersofattorney.com/agentappt#how-an-agent-may-accept-appointment-varies-in-the-six-6-greater-states) many years after you sign a *Power of Attorney* which is another distinguishing feature of a *Power of Attorney.* Most other legal documents if left unsigned by one party for years might well be less binding upon a named party, if it was suddenly signed by one party. In Texas for example, this notion is reflected in [§751.132(b)](https://codes.findlaw.com/tx/estates-code/est-sect-751-132.html) which operates specifically in respect of [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Powers of Attorney* and probably echoes in the principles applicable to [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney-wont-operate-if-the-principal-lacks-capacity) *Powers of Attorney*. Key considerations relevant to retaining signed *Powers of Attorney* include access to the *Power of Attorney* in particular by [agents](https://wiki.powersofattorney.com/agentswhatisagent) appointed under the *Power of Attorney*,*,* awareness of the existence of the *Power of Attorney;* the making and whereabouts of any copies of the *Power of Attorney*, together with retention of other relevant documents, such as evidence of an [agent](https://wiki.powersofattorney.com/agentswhatisagent) having [accepted appointment](https://wiki.powersofattorney.com/agentappt#how-an-agent-may-accept-appointment-varies-in-the-six-6-greater-states) or resigning, evidence pertinent to the certification of the *Power of Attorney* before a prescribed witness where applicable and similar. ###### **There Are Risks In Respect Of Revoked** ***Powers of Attorney*** It is often preferable to retain executed *Power of Attorney* that have been [revoked](https://wiki.powersofattorney.com/termmng#a-power-of-attorney-terminates-upon-revocation-by-the-principal) as opposed to for example, destroying them. Retaining a [revoked](https://wiki.powersofattorney.com/termmng#a-power-of-attorney-terminates-upon-revocation-by-the-principal) *Power of Attorney* in this manner has advantages. If issues arise in the future that involve the *Power of Attorney*, its terms can be reviewed, being a somewhat essential step when resolving any dispute involving a *Power of Attorney*. It may be worthwhile to write on the front of a [revoked](https://wiki.powersofattorney.com/termmng#a-power-of-attorney-terminates-upon-revocation-by-the-principal) *Power of Attorney* something to the effect ‘“*this Power of Attorney was revoked by me on …(date).. and the agent/agents appointed under this Power of Attorney were notified by me of the revocation of this Power of Attorney on … (date)…*” and for example, staple the documents evidencing [revocation](https://wiki.powersofattorney.com/termmng#a-power-of-attorney-terminates-upon-revocation-by-the-principal) of the *Power of Attorney* to the back of *Power of Attorney*. ## **The Only Way To Manage All Risks Is Legal Advice** Risks may only be managed at all stages of the *Power of Attorney* [creation](https://wiki.powersofattorney.com/creation/create#three-methods-to-create-a-power-of-attorney) process by obtaining legal advice and using the [best](https://wiki.powersofattorney.com/insightseeingoodpoa) quality *Power of Attorney.*