Governor Andrew M. Cuomo has signed legislation amending New York State’s law relating to power of attorney forms. The legislation makes granting, using and understanding a power of attorney simpler and removes much of the complexity traditionally associated with individual powers of attorney in New York. Under the previous statute, these forms could be invalidated on technicalities if the exact wording of the statute wasn’t followed. Furthermore, often the form was not easy to put into effect – especially if you didn’t have a lawyer there to help the grantor understand what they were signing and the powers they were agreeing to grant. A hardship to many vulnerable nursing home and assisted living residents – especially during this pandemic.
While understanding the implications and legal effect of granting a power of attorney is still an essential ingredient to effectiveness and enforcement, the new law, Chapter 323 of the 2020 Session Laws, becomes effective 180 days from December 15, 2020. What’s changed?
- The new law modifies the prior requirement of “exact wording” in the “Caution to the Principal” and “Important Information for the Agent” sections of a power of attorney. Although those sections are still required, the ‘exact language’ requirement has been replaced with a “substantially conforms” standard – making it less likely that innocuous and immaterial technical differences will invalidate the power;
- The new legislation creates a presumption in favor of the validity of the power of attorney form and expressly provides that anyone accepting an acknowledged power of attorney with no actual knowledge the signature isn’t genuine, may rely on the presumption the signature is, in fact, genuine;
- Although the unwillingness or inability of an agent to provide an opinion of counsel or certification is grounds to refuse to honor a power of attorney, if a third party has a good faith belief the power is valid and has no knowledge that it isn’t valid or the agent doesn’t have the authority for a particular act, they can now feel comfortable honoring the power of attorney in reliance on the agent’s authority. In fact, the new law allows a judge to impose penalties (including attorneys’ fees) if an institution unreasonably refuses to accept a presumptively valid power of attorney form;
- One other welcome benefit of the new law. The statutory gifts rider has been eliminated and the authority to make gifts above “standard amount” is to be included in a modifications section in the power of attorney itself. If there is no gifting language in the modification, the authority to make gifts is now $5,000 in any calendar year (up from the previous $500).
To many, welcome and long overdue changes to the power of attorney law in New York State. You can read the amended version of the legislation that was signed by the Governor of New York State here: NYS Power of Attorney Legislation.