This short article explores the concept of lasting power of attorney in Israel, defining key terms, explaining its importance, and outlining who can draft it. Lasting (or continuing/enduring) power of attorney is a crucial aspect of family law in Israel.
?What is a Lasting Power of Attorney
Commonly referred to as continuing (or enduring) power of attorney (Yipuy Coakh Mitmashekh in Hebrew), this document designates a person or persons to make personal, financial, and health decisions on someone’s behalf when they are no longer mentally capable. The appointed person is called meupeh coakh
Why You Need a Lasting Power of Attorney?
There are several compelling reasons to establish a lasting power of attorney:
- Peace of Mind: Ensures that your personal, financial, and health preferences are followed even when you cannot make decisions yourself.
- Legal Efficiency: Avoids the need for court approval for someone to carry out your specific wishes. Without a lasting power of attorney, a court-appointed legal guardian (apotropus) may be necessary, who must report to the court before making various decisions.
- Cost and Conflict Avoidance: Saves time and money and prevents family conflicts and prolonged court proceedings regarding future decision-making.
Here is a comparison between lasting power of attorney and a legal guardian:
Lasting Power of Attorney vs. Legal Guardian
| Number | Category | Lasting power of attorney | Legal Gurdian |
| 1 | Control | Yes, you set advance directives in advance of how you want your life to look if your medical or cognitive condition has deteriorated | No |
| 2 | Money & Time | Yes | No – What is done in retrospect always costs more money |
| 3 | Can you bypass the Court? | Yes, but under certain conditions | No |
| 4 | Reporting | No, but under certain conditions you need to report to the court | Yes, The guardian submits annual reports in connection with the management of the assets |
Importance for Business Owners
Business owners must draw up a lasting power of attorney. However, it is essential to understand that this power of attorney does not manage the company. Instead, it is created for a specific person because the company has a separate legal personality. The board of directors is responsible for managing and outlining the company’s strategy.
A lasting power of attorney is crucial for replacing a director’s judgment if there is a significant cognitive or medical deterioration causing dysfunction. Notably, the Companies Law in Israel explicitly states that a director has independent discretion that cannot be conditioned, so the power of attorney cannot include instructions for company management except in transferring powers as a director.
A properly drafted power of attorney should synchronize with the company’s documents (protocols, amendment of the bylaws, etc.) to help manage the company effectively, even in the event of a medical or cognitive decline.
Don’t leave your future to chance. Contact us today to draft a lasting power of attorney and ensure your wishes are respected, and your business remains in capable hands.
Secure your peace of mind now!
If you have any questions or wish to draw up any documents and authorities discussed, feel free to contact us.
Email: Avidor@Lapid-Law.com
Office: 076-5384690
Phone: +972544468113
