THE LEGISLATURE’S HOLIDAY GIFT TO ALL OF US!
If you’re a regular reader of this newsletter, you’re aware that we feel Powers of Attorney (POAs) are absolutely vital estate planning documents. We’ve previously addressed a variety of topics surrounding POAs and the foundation of these discussions has been Washington’s Power of Attorney Statute, Revised Code of Washington (RCW) 11.96. Well, that’s about to change. In April of 2016, Governor Inslee signed a bill creating a new Power of Attorney Statute that will come into effect January 1, of 2017. The new statute will be codified at RCW 11.125. The new statute is based in large part on the American Bar Association’s model power of attorney statute, already adopted in a number of other states.
The new RCW 11.125 contains a multitude of new provisions but the standout differences between the old statute and the new are…
- Execution Requirements. Notarization or two witnesses will be required. The current law is silent as to what procedures are necessary to make a power of attorney valid. Notarization will be the preferred method of execution as it makes it more difficult for an institution (bank, brokerage, medical facility) to deny the document’s validity and the agent’s authority.
- Agent’s Duty. The new law specifies the fiduciary duties owed by the agent. The current law is silent with regards to fiduciary duties although the courts have long held agents to such duties. The new statutory duties broadly reflect those already imposed by the courts.
- Effect of Divorce on Appointment of Spousal Agent. Filing of dissolution petition will terminate the spousal agent’s powers. The current law terminates the agency only on filing of dissolution decree, rather than the filing of the petition.
- Gifting. The agent’s power to gift will be limited to the annual IRS gift tax limit (currently $14,000) unless otherwise specified. The current law does not impose restrictions on gifting.
- Resignation of Agent. The new law will give specific mechanisms for how an agent may resign. The current law is silent with regards to how an agent may resign and many POAs are silent on the issue.
- Co-agency. The new law will provide that co-agents are to act jointly (both their signatures are required) unless the language of the document provides otherwise. The current law is silent regarding the authority of co-agents.
- HIPPA Authority. The new law explicitly states that the attorney-in-fact is authorized to access records under HIPPA. The current law is silent with regards to HIPPA authorization. It is important to note that Powers of Attorney valid under the old statute will continue to be valid, although they may be subject to interpretation under the new statute. If you have questions about your current documents, or (gasp) don’t have any documents at all, we encourage you to make an appointment and come talk with us.
Thanks for reading and have a joyful and safe holiday season.
Barry M. Meyers
David M. Neubeck
Elder Law Offices of Barry M. Meyers
DISCLAIMER: The content of this newsletter is: for information purposes only, subject to change by government agencies, should not be relied upon as current, and, does not constitute legal advice. Reading this newsletter does not establish an attorney-client relationship.