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A Power of Attorney (POA) is a legal document created by a person (donor) to entrust another person (donee) to act on the donor’s behalf.
Donor: A person who creates the POA.
Donee: A person who acquires certain powers as stated in the POA.
Why create a Power of Attorney?
A Power of Attorney (POA) comes in handy if a person works abroad or travels often, or the person is not in Singapore and thus he or she cannot personally manage his or her legal affairs such as selling, purchasing or renting his or her property.
Types of Power of Attorney
There are 5 types of POAs with different functions.
General Power of Attorney
The general POA empowers the donee to act on behalf of the donor in all circumstances unless the POA document limits the power of the donee in certain areas. The general POA authorises the donee with numerous powers such as opening a safe deposit box in a bank, selling or purchasing property, filing tax returns, entering into a contract for the donor, collecting debts etc.
A general POA is revocable under the following situations:
- revocation by the donor himself / herself;
- the donor passed away;
- the donor becomes incapacitated; or
- upon a specific event(s) stated in the POA.
Specific Power of Attorney / Non-Durable Power of Attorney
As suggested by its name, this type of POA empowers the donee to act on behalf of the donor for specified matters. Thus, the donee has power only on those specified areas.
Similar to the general POA, a specific POA is revocable under the following situations:
- revocation by the donor himself / herself;
- the donor passed away;
- the donor becomes incapacitated; or
- upon a specific event(s) stated in the POA.
Lasting Power of Attorney (LPA)
A LPA is a legal document made by a person (donor), authorising one or more persons (donee(s)) to manage the donor’s affairs if the donor loses mental capacity. The donee is authorised by the donor to make decision for the donor in matters regarding personal welfare, property and financial.
A LPA eliminates the stress and burden that the donor’s family may suffer in applying for a court order which may cost them $5,000 to $10,000 in legal fees. In addition, it helps to prevent any potential disputes within the family about who should be the decision maker for the donor.
The Mental Capacity Act governs all matters regarding the LPA.
In order to make a valid LPA, it is compulsory to fill up a LPA form and get the form certified. This is to ensure the donor understands the purpose and consequences of the LPA. In addition, it ensures that there is no fraud, coercion or undue pressure / influence.
Persons who can certify the LPA form include practicing lawyers, a psychiatrist, or an accredited medical doctor. We have a more detailed article on lasting power of attorney available here.
HDB Power of Attorney
Housing and Development Board (HDB) POA is the most common type of POA in Singapore.
A HDB POA is needed when a purchaser of a house cannot attend the appointment to collect his or her keys. A HDB POA is also necessary if the purchaser is unable to personally attend the signing of legal documents as follows:
- Sales Agreement
- Lease Agreement
- Option-to-Purchase
- Deed of Assignment
- Lease-in-Escrow
- Mortgage-in-Escrow
This type of POA is especially common for the situation where a homebuyer resides abroad and thus he or she is unable to sign the legal documents in Singapore. The said homebuyer appoints a lawyer to act on his or her behalf by using a HDB POA. Normally, a HDB POA laid down the lawyer’s powers to sell, execute documents, or refund money to the CPF Board.
Conditional or Springing Power of Attorney
This type of POA is activated only when a specific event occurred. For example, a conditional POA is activated when the donor travels to another country.
Is it necessary to hire a Lawyer to create a POA?
Since creating a POA involves complicated legal procedure and legal issues, it is advisable to hire a lawyer for the drafting and signing of the power of attorney. I.R.B Law is highly experienced in this area and would be happy to offer you a free initial discussion to better understand your requirements.
