Springing Power of Attorney - an important insurance for businesses
By preparing a springing power of attorney, you will be in position to appoint trusted persons to have the necessary powers to take care of your interests and make decisions on your behalf if you become unable to do so yourself. This applies to both your personal and business interests.
We generally recommend everyone to prepare a springing power of attorney, especially for those who runs businesses controlled by themselves in all material aspects.
If you should become exposed to mental illness or otherwise incapable of taking care of your interest, the absence of a valid and enforceable springing power of attorney entails that the County Administrator will make a decision on guardianship and appoint a guardian to take care of your business and other private interests. The appointed guardian will then decide, among other and subject to the County Administrator's consent, whether the business should be continued or not. This process is generally severely time consuming. Our experience is also that appointed guardians (normally "all-rounders") sometimes lack the specific competence and knowledge needed to properly take care of a particular business or business branch and thus the ability to make rational and appropriate decisions. This situation may, in time, leave you and your heirs with less or ultimately lost values.
By preparing a springing power of attorney you will be able to decide for yourself who should be in position to take care of your interests if you for any reason should become incapable. The power of attorney will also enable you to determine the terms and conditions applying to the attorney's governance, including decisions on whether the business should be continued, how, and on what terms. These steps will allow you to secure and protect the business and its employees, avoid disruption of assigned tasks and projects, follow up invoicing, keep up compliance with agreements, payment of wages etc.
If desired, you can also decide that the business shall be discontinued and the terms, conditions and process for such discontinuation. For those who run a business, it may sometimes be practical to arrange for more than one appointed attorney. For example; one separate attorney covering personal and private interests and one covering your business interests.
If you should be interested in making a closer assessment of your possibilities and eventually in need of assistance to prepare a springing power of attorney, we at Law firm Hulaas AS would be pleased to help you out.