New Statutory Power of Attorney

durable statutory power of attorney

There is a new Statutory Power of Attorney effective September 1, 2017. Here is a link to the new form: https://hhs.texas.gov/laws-regulations/forms/miscellaneous/sdpoa-statutory-durable-power-attorney. We are including the new Statutory Power of Attorney with every will or trust package we create for our clients after September 1, 2017. We are also preparing the longer more specific power of attorney that we have always been giving our clients. The longer power of attorney provides the ability to do long term care, Medicaid and VA planning and many other things that the new Statutory Power of Attorney does not provide. Texas Estates Code Section 751.201 requires a person who is presented with this form to either accept it or request an agent’s certificate or opinion of counsel unless one or more grounds for refusal exist. If they request an agent’s certificate or opinion of counsel, they must accept the power of attorney if they receive this document unless one or more grounds for refusal exist. There are eleven grounds for refusal. These grounds still make it very difficult to get a power of attorney accepted. It is better to have a living trust in place. The living trust makes it much easier to get things done if someone needs to handle things on your behalf.

The first ground for refusal the new Statutory Power of Attorney exempts title companies from being required to accept the new Statutory Power of Attorney, because they are not required to do business with a customer. The language of the statute regarding these grounds is below:

(1)  the person would not otherwise be required to engage in a transaction with the principal under the same circumstances, including a circumstance in which the agent seeks to:

(A)  establish a customer relationship with the person under the power of attorney when the principal is not already a customer of the person; or

(B)  acquire a product or service under the power of attorney that the person does not offer;

(2)  the person’s engaging in the transaction with the agent or with the principal under the same circumstances would be inconsistent with:

(A)  another law of this state or a federal statute, rule, or regulation;

(B)  a request from a law enforcement agency; or

(C)  a policy adopted by the person in good faith that is necessary to comply with another law of this state or a federal statute, rule, regulation, regulatory directive, guidance, or executive order applicable to the person;

(3)  the person would not engage in a similar transaction with the agent because the person:

(A)  has filed a suspicious activity report as described by 31 U.S.C. Section 5318(g) with respect to the principal or agent;

(B)  believes in good faith that the principal or agent has a prior criminal history involving financial crimes; or

(C)  has had a previous, unsatisfactory business relationship with the agent due to or resulting in:

(i)  substantial loss to the person;

(ii)  financial mismanagement by the agent;

(iii)  litigation between the person and the agent alleging substantial damages; or

(iv)  multiple nuisance lawsuits filed by  the agent;

(4)  the person has actual knowledge of the termination of the agent’s authority or of the power of attorney before an agent’s exercise of authority under the power of attorney;

(5)  the agent refuses to comply with a request for a certification, opinion of counsel, or translation under Section 751.201 or, if the agent complies with one or more of those requests, the requestor in good faith is unable to determine the validity of the power of attorney or the agent’s authority to act under the power of attorney because the certification, opinion, or translation is unclear, limited, or qualified in a manner that makes the certification, opinion, or translation ineffective for its intended purpose;

(6)  regardless of whether an agent’s certification, opinion of counsel, or translation has been requested or received  by the person under this subchapter, the person believes in good faith that:

(A)  the power of attorney is not valid;

(B)  the agent does not have the authority to act as attempted; or

(C)  the performance of the requested act would violate the terms of:

(i)  a business entity’s governing documents; or

(ii)  an agreement affecting a business entity, including how the entity’s business is conducted;

(7)  the person commenced, or has actual knowledge that another person commenced, a judicial proceeding to construe the power of attorney or review the agent’s conduct and that proceeding is pending;

(8)  the person commenced, or has actual knowledge that another person commenced, a judicial proceeding for which a final determination was made that found:

(A)  the power of attorney invalid with respect to a purpose for which the power of attorney is being presented for acceptance; or

(B)  the agent lacked the authority to act in the same manner in which the agent is attempting to act under the power of attorney;

(9)  the person makes, has made, or has actual knowledge that another person has made a report to a law enforcement agency or other federal or state agency, including the Department of Family and Protective Services, stating a good faith belief that the principal may be subject to physical or financial abuse, neglect, exploitation, or abandonment by the agent or a person acting with or on behalf of the agent; or

(10)  the person receives conflicting instructions or communications with regard to a matter from co-agents acting under the same power of attorney or from agents acting under different powers of attorney signed by the same principal or another adult acting for the principal as authorized by Section 751.0021, provided that the person may refuse to accept the power of attorney only with respect to that matter.

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Leigh Hilton is an ACCREDITED ESTATE PLANNER® based in Denton and serving the DFW Metroplex. Areas of practice include:
Wills, Trusts & Estates | Elder Law | Probate Law | Estate Planning