Jan162026
Estate Planning Q&A Series

What happens if the person signing a power of attorney has memory issues or may not have the capacity to sign? – North Carolina

Short Answer

In North Carolina, a power of attorney generally must be signed while the person (the “principal”) still has enough mental capacity to understand what the document does and what authority it gives to an agent. If memory issues rise to the point that the principal cannot understand the appointment and its consequences, the document can be challenged and may not be accepted by banks, health care providers, or a court. When capacity is doubtful, the safer path is to address it promptly and, if capacity is already gone, consider a guardianship through the Clerk of Superior Court.

Understanding the Problem

In North Carolina estate planning, the key question is whether an adult with memory problems can still legally sign a healthcare power of attorney (to name someone for medical decisions) and/or a financial power of attorney (to name someone for banking, real estate, and other non-medical matters). The decision point is capacity at the time of signing: can the principal understand what a power of attorney is, who is being appointed, and what powers are being granted. If the principal cannot meet that baseline, the document may be invalid or later attacked, and a court-supervised alternative may be needed.

Apply the Law

North Carolina treats capacity as a threshold requirement. For a healthcare power of attorney, the statute expressly requires that the principal have “understanding and capacity to make and communicate health care decisions” at the time the document is made. If capacity is questionable, the risk is not only a later court challenge; it is also practical refusal by third parties (like hospitals or banks) who may hesitate to rely on a document signed under suspicious circumstances. For healthcare decisions, North Carolina also uses a separate “capacity” determination to decide when a signed healthcare power of attorney becomes usable: it typically becomes effective only after a physician (or other authorized professional in limited situations) documents that the principal lacks sufficient capacity to make or communicate health care decisions.

Key Requirements

  • Capacity at signing: The principal must understand what a power of attorney does, who the agent is, and the general scope of authority being granted.
  • Proper execution formalities: The document must be signed with the required witnesses/notary formalities for that type of power of attorney, or it may be rejected even if capacity exists.
  • Freedom from pressure: The signing should be voluntary. Memory issues can make a person more vulnerable to undue influence, which can lead to challenges later.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, the goal is for an adult with memory issues to appoint an agent for both medical and financial decisions. If the adult can still explain (in simple terms) what the documents do, identify the chosen agent, and show a consistent choice without pressure, capacity may still be present and the powers of attorney may be signed with the required formalities. If the adult cannot track what is being signed or cannot communicate a stable decision, the documents may be vulnerable to rejection or later challenge, and a guardianship may be the more realistic option.

Process & Timing

  1. Who signs: The principal (the adult granting authority). Where: Typically in an attorney’s office or another controlled setting in North Carolina with a notary public and any required witnesses. What: A healthcare power of attorney for medical decisions and a financial power of attorney for non-medical matters; if real estate authority will be used, plan for recording with the Register of Deeds in the appropriate county. When: As early as possible once memory issues appear, because capacity can fluctuate and often declines over time.
  2. Capacity-focused signing meeting: A careful signing process often includes a private conversation with the principal (without the proposed agent in the room), plain-language explanations, and documentation of the principal’s understanding to reduce later disputes.
  3. If capacity is not present: The usual next step is a guardianship case filed with the Clerk of Superior Court, which can authorize a court-appointed guardian to make decisions when a valid power of attorney cannot be created.

Exceptions & Pitfalls

  • “Good day/bad day” capacity: Some people with dementia can understand on certain days or times. A signing done during a clearer period may be more defensible than one done during confusion, but it still must meet the legal standard at the moment of signing.
  • Undue influence risk: When a proposed agent arranges the appointment, speaks for the principal, or is present for all discussions, it can create red flags and increase the chance of a later challenge.
  • Execution mistakes: A healthcare power of attorney has specific witness and notary requirements under Chapter 32A, and errors can cause rejection even if capacity exists.
  • Real estate delay: Even with a valid financial power of attorney, real estate transactions can stall if the power of attorney was not recorded as required before the agent signs a deed.
  • Confusing “signing capacity” with “when it becomes usable”: A healthcare power of attorney can be validly signed while the principal still has capacity, but it usually does not become effective until a written medical determination of incapacity is made.

Conclusion

In North Carolina, memory issues do not automatically prevent signing a power of attorney, but the principal must have enough capacity at the time of signing to understand the appointment and the authority being granted. A healthcare power of attorney also generally becomes usable only after a written determination that the principal lacks sufficient capacity for health care decisions. The most important next step is to complete and properly execute the healthcare and financial powers of attorney promptly while capacity is still present; if capacity is already gone, a guardianship filing with the Clerk of Superior Court may be necessary.

Talk to a Estate Planning Attorney

If memory issues are affecting whether an adult can sign a healthcare power of attorney or financial power of attorney, our firm has experienced attorneys who can help explain the capacity standard, plan a careful signing process, and discuss alternatives like guardianship if needed. Call us today at [CONTACT NUMBER].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Estate Planning Q&A Series

Author: Pierce Law

Pierce Law Group is a North Carolina law firm focused on probate administration, real estate partition matters, and surplus funds claims across North Carolina. We know these situations often come with stress, family dynamics, and time-sensitive decisions—so we prioritize clear communication, steady guidance, and a practical plan from day one. Our goal is to make a complicated process feel manageable, while protecting what matters most to you.