The New Uniform Power of Attorney Act
The Uniform Power of Attorney Act (UPOAA) became effective in Michigan on July 1, 2024. Developed by the Uniform Law Commission, the UPOAA is a model statute that has been adopted in 30 other states and the District of Columbia. Regarding the UPOAA, there are some important things to know:
1. Encourage acceptance of powers of attorney. The UPOAA is designed to encourage acceptance of powers of attorney. Third parties such as banks will no longer be able to refuse to accept a properly executed power of attorney.
2. Existing powers of attorney remain valid. Powers of attorney that were drafted prior to July 1, will still be effective provided the power of attorney was executed in compliance with the laws in existence at the time of its execution.
3. Durability is presumed. A power of attorney acknowledged by the principal before a notary public or signed in the presence of two witnesses is durable (durability means the power will continue after the principal’s incapacity).
4. Strict fiduciary duties imposed on agents. The UPOAA requires agents to act in the principal’s best interest, in good faith, prudently manage assets, keep reasonable records, avoid conflict of interests, preserve the principal’s estate plan, and act loyally for the principal’s benefit.
5. The agent’s authority. The UPOAA sets forth specific provisions outlining what an agent may or may not do on behalf of a principal. Unless expressly granted, an agent may not make any changes to a living trust, make a gift, or change a beneficiary designation.
6. The agent’s liability. An agent is liable for three times the value of the property if the agent embezzles or converts the principal’s property.
7. Statutory form. The UPOAA contains a statutory power of attorney form. Similar to Michigan’s Designation of Patient Advocate Form, it is designed to provide the public with access to a power of attorney.
In light of the new law, now is an excellent time to review your power of attorney. This should include reviewing the authority you have given to your agents, confirming that your agents are willing to serve, and checking with your financial institutions to make sure your power of attorney is acceptable. You may discover that a new power of attorney is needed.
This blog post is written by Brett A. Howell, Certified Elder Law Attorney. The blog is written as a service of The Elder and Estate Planning Law Firm, P.L.L.C. This information is for general informational purposes only and does not constitute legal advice. For a consultation to address specific questions, please call (810) 953-3846.
留言