5-27-21 NEW YORK STATE REVISES DURABLE POWER OF ATTORNEY LEGISLATION
On December 15, 2020, Governor Cuomo signed a new law revising New York’s Power of Attorney Statute. This new law becomes effective on June 13, 2021.
In 2009 and 2010, substantial changes were made to the then existing New York Power of Attorney (POA) statute, including the addition of a “Statutory Gifts Rider” which allowed the individual creating the Power of Attorney (the “Principal”) to give to the person appointed (the “Agent”) the right to make gifts of the Principal’s assets, including, if desired, the authority for the Agent to gift the Principal's assets to himself or herself. The Gifts Rider added substantial complication to the POA form but was intended to give the Principal more information regarding the rights being given to the Agent.
That being said, there were still many complications with the POA form and the Statutory Gifts Rider, which gave rise to the need for the State Legislature to review the law and make the recommended changes which will become effective in a few weeks.
Under the new law, in addition to some other revisions and changes to the form itself, the major change involves the repeal of the Statutory Gifts Rider language. While this change will simplify the form to some extent, if the Principal wishes to give the Agent the authority to make gifts specific language will now need to be included in the new form. This includes (among other things), if desired, the authorization for the agent to make gifts to himself/herself, to make changes to jointly owned bank accounts and also to change beneficiaries on retirement accounts. New forms are being prepared by the State Bar Association and related committees and should be available for review and execution soon.
It should also be noted that the new law specifically provides that existing Powers of Attorney continue to be honored so there should be no concern about having to execute a new POA on or after June 13th. However, if a new Power of Attorney is executed on or after June 13, we believe that the new form must be used since it appears from the statute that if an old form is used on or after June 13th it may not be honored.
If gifting powers are to be granted the new form will require that the Principal’s signature be notarized and signed in the presence of two witnesses (and the Notary may act as one of the witnesses). This is not a change from the execution requirements that existed for the now repealed Statutory Gifts Rider.
There will likely be more information on the new statute in the coming weeks. If you have any questions regarding these matters, please do not hesitate to contact your Woods Oviatt Gilman attorney.
