The Governor signed Enrolled Senate Bill 92 yesterday, which deals with new requirements for durable powers of attorney for finances. The law is PA 2012, No. 141. The new requirements do not apply to a durable power of attorney executed before October 1, 2012. However, if your durable power of attorney does not meet the new requirements, it would be wise to contact your attorney to execute a new one.
One of the new requirements is that in order to be valid, the durable power of attorney must be signed, dated, and either (or both) witnessed by two individuals (neither of whom is the agent named in the document) or notarized.
Another new requirement is that before acting as an agent under a durable power of attorney, the agent must first sign an acknowledgment (i.e. acceptance) outlining the agent’s responsibilities, and the acknowledgment must include language that is substantially the same as the suggested language provided in the Act. Further, an agent is now required by law to maintain records of their actions, including transactions, receipts, disbursements, and investments.
Finally, there are specific restrictions on the agent’s authority written into the Act. For example, an agent may not make a gift of any portion of assets unless the durable power of attorney allows gifting (or unless a court authorizes it). Additionally, an agent may not make him/herself a joint owner on any asset unless the durable power of attorney allows creation of joint tenancy (or unless a court authorizes it). And an agent may not be paid for his/her services unless the durable power of attorney allows such compensation for services.
As provided above, if your durable power of attorney does not meet the new requirements, you should consider contacting your attorney to execute a new one. Banks and other financial institutions will be required to follow this new law, and you may have problems getting your durable power of attorney accepted if it doesn’t meet these requirements – even if it was executed prior to October 1, 2012. For more information, please contact Melisa Mysliwiec. She may be reached at 616-301-0800 or
email@example.com, or you may also reach her, or any of our other Trusts and Estates attorneys in our Lansing office by calling 517-482-5800.