Bill Advanced by NYSBA and Signed By Governor Tuesday Protects Consumers Who Need Help Handling Their Legal Affairs
12.16.2020
A bill advanced by the New York State Bar Association (NYSBA) and signed into law by Gov. Andrew M. Cuomo will protect consumers who want a trusted individual to handle their legal affairs should they become incapacitated and need to execute a power of attorney form.
A power of attorney is one of the most widely used legal documents, allowing people who fear they will no longer be able to manage their own financial affairs to transfer that power to someone else. Doing so avoids the need for a time-consuming and expensive guardianship proceeding when a person becomes incapacitated.
The current power of attorney form proved to be too complex, costly and difficult for individuals to use. Residents of nursing homes and long-term care facilities found it nearly impossible to fill out during the pandemic when an attorney was not present. Its rigid requirement that the exact language of the statute be incorporated in the document meant that the form could be invalidated for harmless errors.
The new law makes rejection of the document less likely because it allows language that substantially conforms with the statute rather than requiring the form to incorporate the exact wording. It also discourages banks and other financial institutions from improperly refusing to accept the form by allowing a judge to impose penalties and attorney fees against institutions that unreasonably refuse to accept a consumer’s valid power of attorney form.
“The reform of the power of attorney law is a big win for every New York resident and the New York State Bar Association,” said NYSBA President Scott M. Karson. “The coronavirus pandemic has forced us to reevaluate every aspect of our lives, and this important improvement could not come at a better time. It will protect our state’s vulnerable residents by helping them through a critical process at a time when a legal adviser may not be able to be at their side.”
Most importantly, the new law creates a presumption in favor of the validity of a power of attorney form.
“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,” Karson said. “When a consumer no longer has the capacity to sign a new form, the misery is compounded. This new law essentially makes accepting rather than rejecting the power of attorney the default.”
The new law takes effect in 180 days.
About the New York State Bar Association
The New York State Bar Association is the largest voluntary state bar association in the nation. Since 1876, the Association has helped shape the development of law, educated and informed the legal profession and the public, and championed the rights of New Yorkers through advocacy and guidance in our communities.
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Contact: Susan DeSantis
sdesantis@nysba.org
201-575-5756
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