by: Kate M. Stellmach
Updated Short Form Power of Attorney
We have received questions from several of our client’s how the changes to Minnesota’s statutory short form power of attorney that took effect January 1, 2014 affects their estate plans, their existing powers of attorney, and what actions they need to take.
A statutory short form power of attorney is a legal document allowing a person (the “Principal”) to designate a person or persons to act on their behalf (“Attorney-in-Fact”) if the principal becomes incapacitated. In Minnesota these powers of attorney are governed by Minnesota Chapter 523, specifically §523.23 and §523.231.
The amendments that came into effect January 1, 2014 aim to provide greater protection for a Principle executing a power of attorney. The amendments include requiring not only the Principle to execute the document, but also the Attorney-in-Fact. By signing, all parties acknowledge that they reviewed the provisions of the power of attorney and understand the responsibilities and liabilities involved as they pertain to the Principle and Attorney-in-Fact. Additionally, new provisions are required regarding an Attorney-in-Fact’s rights to transfer property, specifically setting parameters around the rights of the Attorney-in-Fact to make gifts. The purpose behind these parameters is to prevent the Attorney-in-Fact from making self dealing gifts unless specifically allowed by the Principle.
A statutory short form power of attorney properly drafted and executed prior to January 1, 2014 is still valid, and does not have to be updated to include the new provisions to remain effective. If, or when, the Principle updates or amends his or her power of attorney the new document will need to include the amendments.
Please contact our office with any questions on powers of attorney in Minnesota.