Definition of Limited Power of Attorney

by Tom Streissguth

    A power of attorney allows an agent to act on behalf of a principal. When a principal signs and grants a power of attorney, he grants either general or limited authority to the agent. The limited (also known as "specific") power of attorney restricts the scope to the agent's activities.


    A limited power of attorney specifies the authority the agent will have. The principal lists all the matters for which the agent will make decisions, sign documents or give instructions. Often, a limited power of attorney covers only a single process or matter; for example, a contract signing which the principal is unable to carry out due to absence or illness.


    The principal may also limit a power of attorney to a single field of activity, such as the handling of investments. A principal who trusts an agent to make decisions and sign paperwork related to an account may grant a limited power of attorney to an investment adviser.


    A principal may also limit a power of attorney to a specific period of time. This often occurs when a principal is temporarily absent from his home or business and trusts an aide or friend to carry out business decisions and sign paperwork on his behalf.


    The principal must sign, date and have witnessed the limited power of attorney, which must set out in detail the scope of the agent's authority. This includes specific information on the accounts, negotiations or other mechanisms by which the agent may operate. Most limited powers of attorney also contain a revocation clause, which the principal may sign and date at any time in order to void the document and bring the agent's authorities to an end.

    About the Author

    Founder/president of the innovative reference publisher The Archive LLC, Tom Streissguth has been a self-employed business owner, independent bookseller and freelance author in the school/library market. Holding a bachelor's degree from Yale, Streissguth has published more than 100 works of history, biography, current affairs and geography for young readers.

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