By Howard S. Krooks, Esq., CELA, CAP, Partner, Elder Law Associates PA
New York Gov. Andrew M. Cuomo recently signed a new bill that simplifies and improves the state’s durable power of attorney form.
According to an article by the New York State Bar Association, the move is “a major victory for New York State Bar Association advocacy on behalf of its members.” In a nutshell, the new law simplifies the form and improves it for consumers.
A power of attorney, the one document that everyone needs right now, is one of the most widely used legal documents. When executed, a power of attorney gives one person the authority to act on another’s behalf if that person becomes incapacitated. With a power of attorney, you can avoid the need for a guardianship proceeding should you become incapacitated in the future. You can allow someone you trust to manage financial or business affairs or make other major decisions if you cannot due to an incapacitating illness or injury.
The current New York power of attorney form is complex, costly and difficult to use. This past year during the pandemic, both long-term care facilities and residents had trouble filling out the form when attorneys were not present. One of the big issues is that the form can be invalidated for minor errors in wording due to the rigid nature of the language required in the current statute.
The NYSBA has been advocating for a change for many years. In 2015, it established a task force comprised of members from NYSBA’s Elder Law and Special Needs Section, Trusts & Estates Law Section, Business Law Section, Real Property Law Section and Health Law Section to determine what reforms should be made to the power of attorney form. The Working Group on the Power of Attorney Task Force recommended that the modifications include both substantive and technical changes. The recommendations served as the basis for the new statute.
The new law takes effect 180 days from Dec. 15, 2020, the date Gov. Cuomo signed the bill into law. The new power of attorney form allows language that conforms with the new statute instead of requiring exact wording, which makes it less likely for it to be rejected. The new law also discourages financial institutions from unreasonably refusing to accept the form, and allows judges to impose penalties and attorney fees against institutions that refuse to accept a valid power of attorney form. The new law also eliminates the Statutory Gifts Rider, which was determined to be a cumbersome additional document, adding complexity and difficulty in signing a power of attorney.
The new simplified power of attorney form will assist New York’s most vulnerable residents, seniors in long-term care facilities, by helping them during an emotional and stressful time when an attorney may not be able to be with them. In addition, the new law creates a presumption in favor of the power of attorney form’s validity.
According to the president of the NYSBA, Scott M. Karson, “When a power of attorney form cannot be executed, the rent goes unpaid, the utility payments can’t be made, and an incapacitated person goes without services that they desperately need. When a consumer no longer has the capacity to sign a new form, the misery is compounded,” he added. “This new law essentially makes accepting rather than rejecting the power of attorney the default.”