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| Phillip G. Gubler and Thomas J. Bayles, Attorneys at Law |
Utah just adopted the Uniform Power of Attorney Act which
went into effect May 10, 2016. There are
some provisions in the new law that you should know about.
A Durable Power of Attorney allows the principal to authorize
another person (your agent) to make financial decisions the principal specifies
in the document. It is important to name an agent or agents you can trust to
act in your best interest because of the significant authority typically
granted in a power of attorney.
The
statutory power of attorney is automatically durable which means it becomes
effective at signing and remains effective at your incapacity. You can elect to
make the statutory power of attorney so it is only effective on your
incapacity, but you must draft the provision into the statutory form.
The authority
that can be granted in the statutory power of attorney can be very broad
depending upon the principal’s selections in the document. Generally, your agent can make all decisions
related to real property, personal and tangible property, stocks or bonds,
commodities and options, banks and financial institutions, insurance and
annuities, retirement plans, claims and litigation, and estates and trusts or
other beneficial interests. Your agent
has the authority to buy, sell, invest, and
enter into or terminate contracts. Again, this authority becomes effective
immediately even if you are able to make decisions for yourself unless you
state otherwise in the Special Instructions.
There is
a section in the new statutory power of attorney that presents a pitfall for
the unsuspecting principal. The
authority that can be granted in this section includes the authority for the
agent to amend trusts, change beneficiary designations, create joint tenancies
and make gifts, among other “superpowers”. In the course of our work we find
that less than 3% of our clients want or need to grant one of the “superpowers”. You must be careful to only select powers you
wish to grant and be very careful when it comes to the “superpowers” because
they likely grant more authority than you intend.
Typically,
a person signing a new power of attorney will want to revoke prior financial
powers of attorney. The new statutory
power of attorney does not automatically revoke prior powers of attorney so you
must draft language in the document if you wish to terminate the authority of
agents in prior powers of attorney.
JensenBayles, LLP provides a broad
spectrum of legal services. Thomas J.
Bayles has been actively providing advice in the areas of trusts, wills,
probate and tax planning in the St. George market for over 15 years. Please
visit our web site www.jensenbayles.com or call 435-674-9718 and ask for
Thomas J. Bayles or Phillip G. Gubler. The information in this article
is for educational purposes only and is not intended to be construed as legal
advice. Please contact an attorney for legal advice specific to your situation.
