Colorado state law imposes a number of requirements to which all power of attorney documents must adhere for the state to legally recognize the assignment of authority it grants to an agent. Failure to adhere to these requirements can frustrate the purpose of the power of attorney and can potentially result in someone other than your agent, such as you next of kin, receiving the legal authority to make financial and medical decisions on your behalf.
Colorado requires that you sign the power of attorney in the presence of a notary, who must also affix his signature and notary seal to the document for the power of attorney to be legally enforceable. Moreover, you must be mentally competent at the time of signing the document; otherwise, Colorado state courts will not enforce the document in the event there is a dispute over your agent’s authority.
Drafting the Document
You have complete discretion in choosing the types of authority you grant to your. However, there are some fundamental rules of which you should be aware when drafting a power of attorney for use in Colorado. As of January 1, 2010, state law treats all power of attorneys as durable unless the document’s language clearly states otherwise. Durability allows your agent to continue making decisions on your behalf in the event you become mentally or physically incapacitated at the time the power of attorney expires. You should also consider electing successor agents in the document in the event that your agent becomes incapacitated or dies during a time when you are also unable to make decisions on your own behalf. This can provide you with peace of mind that only someone of your choosing will have the authority to act in your best interest.
Colorado Hot Powers
As a result of the 2010 legislation, Colorado no longer allows for assignments of certain “hot powers” with broad and general language, such as “authority over all my personal finances.” Instead, the power of attorney must specifically authorize each hot power. Hot powers include an agent’s authority to amend, revoke or create trusts, gift your assets, create or amend preexisting rights of survivorship, or to change beneficiary designations, such as on an insurance policy you purchase. If you choose to create your power of attorney using the Colorado statutory form rather than drafting an original document, you can simply check off each of the hot powers to which you are assigning authority.
Colorado also allows you to create a separate medical power of attorney that allows your agent to make all health-related decisions on your behalf when a mental or physical illness prevents you from making the decisions yourself. A medical power of attorney is subject to the same legal requirements as power of attorneys that cover your finances. However, it’s beneficial to exceed the Colorado requirements and include the signatures of two witnesses in addition to a notary’s signature. In the event you undergo medical treatment outside Colorado, the additional two signatures will increase the likelihood that the power of attorney satisfies the requirements in other states.