Makes technical corrections to provisions establishing powers of attorney for financial and estate planning

The definition of a power of attorney is refined in subdivision 10 of §5-1501 of the GOL, and the language regarding the statutory gifts rider is now used consistently throughout the statute. The gift making capacity of a power of attorney without a statutory major gifts rider is stated as a maximum of $500 each year. The gifts rider's purpose is further clarified in the heading, certain gift transactions, and language of section §5-1514 of the GOL.

A new section, §5-1501C has been added to the GOL, listing the types of powers that this law does not apply to. Some of the excluded powers listed in this section include: powers with an interest; a power given for a business purpose; a power given to a creditor in connection with a loan or other credit transactions; a power given to facilitate transfer of stocks, bonds or other asses; a proxy used to exercise voting or management rights within an entity; a power used by a governmental subdivision, agency or instrumentality; a power given to a condominium managing agent; a power contained in a limited liability company operating agreement, partnership agreement declaration of trust, declaration or condominium, condominium bylaws, offering plan or other agreement; a power required by federal or state statute other than this title; a power used to make health care decisions; a power authorizing acceptance of service of process; and powers involved in the disposition of remains.

Further clarification is also provided regarding the effect of divorce on a power of attorney where one spouse was the principal and the other was the agent prior to their divorce along with the ability of a principal, to provide for specific succession rules in the power of attorney.

Justification

Ch.644 '08 provides a comprehensive revision to the power of attorney laws in New York State. The effective date. of Ch.644 '08 was extended from March 1, 2009 to September 1, 2009 by Ch.4 '09. After the effective date of the bill, it became apparent that there was a need to further clarify the application of the Statutory Gifts Rider and limit the types of transactions subject to this law. In addition the requirements for the execution of the gift rider have been clarified by stating that the notary can also serve as one of the two witnesses to the execution of the statutory gift rider.

The technical changes and clarifications made by this bill are necessary in order to facilitate the transition of the comprehensive changes to the power of attorney laws made by Ch.644 '08.

Legislative history

New bill, 2010.

Fiscal implications for state and local governments

None.

Effective date

Effective 30 days after becoming a law and shall be deemed to have been in full force and effect on and after September 1, 2009. Provided, that any statutory short form power of attorney and any statutory gifts rider executed after August 31, 2009 shall remain valid as will any revocation of a prior power of attorney that was delivered to the agent before the effective date of this act.