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Changes to Power of Attorney Act Require Acknowledgement

Written by Zana Tomich on September 19, 2012 Category: Banking, Business Law & Transactions

Recent changes to Michigan’s Power of Attorney laws, require a Durable Power of Attorney drafted after October 1, 2012, to have the designated attorney or agent to execute an acknowledgment of legal responsibilities before exercising authority under each individual durable power of attorney. The statute recommends the following form:

I, ____________________, have been appointed as attorney-in-fact for ________________________, the principal, under a durable power of attorney dated __________. By signing this document, I acknowledge that if and when I act as attorney-in-fact, all of the following apply:

(a) Except as provided in the durable power of attorney, I must act in accordance with the standards of care applicable to fiduciaries acting under durable powers of attorney.

(b) I must take reasonable steps to follow the instructions of the principal.

(c) Upon request of the principal, I must keep the principal informed of my actions. I must provide an accounting to the principal upon request of the principal, to a guardian or conservator appointed on behalf of the principal upon the request of that guardian or conservator, or pursuant to judicial order.

(d) I cannot make a gift from the principal's property, unless provided for in the durable power of attorney or by judicial order.

(e) Unless provided in the durable power of attorney or by judicial order, I, while acting as attorney-in-fact, shall not create an account or other asset in joint tenancy between the principal and me.

(f) I must maintain records of my transactions as attorney-in-fact, including receipts, disbursements, and investments.

(g) I may be liable for any damage or loss to the principal, and may be subject to any other available remedy, for breach of fiduciary duty owed to the principal. In the durable power of attorney, the principal may exonerate me of any liability to the principal for breach of fiduciary duty except for actions committed by me in bad faith or with reckless indifference. An exoneration clause is not enforceable if inserted as the result of my abuse of a fiduciary or confidential relationship to the principal.

(h) I may be subject to civil or criminal penalties if I violate my duties to the principal.

Signature: _______________________ Date: ______________________

The purpose of the changes were to combat fraud, misrepresentation, and error, as well as to grant a POA more clarity, especially in regards to dealing with the elderly. For further information, please reference MCL 770.5501, or contact the attorneys at Dalton & Tomich, PLC to assist you.

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