The Power of Attorney “principal,” gives the “agent” authority to spend their money and sell or dispose of their property during their lifetime without telling them. Principals do not lose their authority to act even though they have given their agent similar authority. When the agent exercises this authority, he or she must act according to any instructions provided by the principal or, where there are no specific instructions, in their best interest. The law governing Powers of Attorney is contained in the New York General Obligations Law, Article 5, Title 15.
An agent can act on the principal’s behalf only after signing the Power of Attorney before a notary public. The principal may request information from the agent at any time. When revoking a prior Power of Attorney,
written notice of the revocation should be provided to prior agent(s) and to any third parties who may have acted upon it, including the financial institutions where the principal’s accounts are located. Principals can revoke or terminate the Power of Attorney at any time for any reason as long as they are of sound mind. If the principal is no longer of sound mind, a court can remove the agent for acting improperly. An agent cannot make health care decisions for the principal. A “Health Care Proxy” must be executed to do this.
When an agent accepts the authority granted under this Power of Attorney, a special legal relationship is created between the agent and the principal. This relationship imposes on the agent legal responsibilities that continue until he or she resigns or the Power of Attorney is terminated or revoked.
Agents are required to:
- Act according to any instructions from the principal, or, where there are no instructions, in the principal’s best interest;
- Avoid conflicts that would impair their ability to act in the principal’s best interest;
- Keep the principal’s property separate and distinct from any assets the agent owns or controls, unless otherwise permitted by law;
- Keep a record of all transactions conducted for the principal or keep all receipts of payments and transactions conducted for the principal; and
- disclose their identity as an agent whenever they act for the principal by writing or printing the principal’s name and signing their own name as “agent” in either of the following manners: (Principal’s Name) by (Your Signature) as Agent, or (your signature) as Agent for (Principal’s Name).
Agents may not use the principal’s assets to benefit themselves or anyone else or make gifts to themselves or anyone else unless the principal has specifically granted them that authority in the modifications section of this document or a Non-Statutory Power of Attorney. If they have that authority, they must act according to any instructions of the principal or, where there are no such instructions, in the principal’s best interest. Agents may resign by giving written notice to the principal and to any co-agent, successor agent, monitor if one has been named in this document, or the principal’s guardian if one has been appointed. If it is found that agents have violated the law or acted outside the authority granted to them in the Power of Attorney, they may be liable under the law for your violation.
The agent is entitled to be reimbursed from the principal’s assets for reasonable expenses incurred on the principal’s behalf. Principals who wish that the agent(s) to be compensated from their assets for services rendered on their behalf, and/or wish to define “reasonable compensation”, may do so in the “Modifications” section of the Power of Attorney.
Contact estate planning attorney Robert Friedman at 716.333.5144 to have your power of attorney properly prepared and executed.