*UPDATED TO REFLECT AMENDMENTS MADE IN 2018*

 

As of July 1, 2017, Georgia has a new law on powers of attorney that will impact many Georgians sooner or later.  It was enacted with the goals of making powers of attorney easier for agents to use and building protection for principals against an agent’s abuse of power.  The full protections and benefits apply only to powers of attorney signed after July 1, 2017, that follow the language of the new statutory form, so Georgians need to act to gain the benefit of this new law.

 

In its 2017 session, the Georgia General Assembly unanimously passed House Bill 221 creating the Uniform Power of Attorney Act (UPAA) with support from AARP Georgia and the Alzheimer’s Association, Georgia Chapter.  Governor Nathan Deal signed the bill into law on May 8, 2017.  The UPAA went into effect on July 1, 2017.  Its protections apply to powers of attorney signed on or after July 1, 2017, that follow or substantially reflect the language of a new statutory form power of attorney.  (They also apply to military powers of attorney that are in compliance with federal law.)  In 2018, several “clean-up” amendments were adopted, and the Act was renamed the Georgia Power of Attorney Act (GPAA).

 

The GPAA is found in the Georgia Code at O.C.G.A. § 10-6B-1 et seq.

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How does the GPAA make a power of attorney easier to use? 

• The GPAA permits the use of not only original power of attorney documents but also photocopies and electronic versions.  An original is required when being recorded in connection with a real estate transaction.  Otherwise, unless some other law prohibits it, a photocopy or electronically transmitted copy of the original power of attorney may now be used.

• Third parties in Georgia were not previously required to accept powers of attorney as presented to them – leaving an uncertainty over whether a power of attorney could be used in an emergency situation.  In fact, powers of attorney have been commonly declined by banks and others who preferred that customers complete set forms instead.  The GPAA includes many provisions to address power of attorney acceptance.  Within seven (7) business days of being presented with a GPAA-compliant power of attorney, a third party must either accept the power of attorney or request further information pertaining to it – certification from an agent or co-agent under penalty of perjury as to any fact concerning the principal, agent, or power of attorney; opinion of an attorney as to relevant matters of law; or an English translation of any portion of the power of attorney written in another language.  The third party is authorized under the GPAA to accept such certification, opinion, or translation with no further investigation required and shall accept the power of attorney within five (5) business days of receiving the certification, opinion, or translation.  There are limited circumstances under which a third party can decline to accept a GPAA-compliant power of attorney even after this process, but absent one of those, the third party should accept the power of attorney.  If the third party declines to accept a power of attorney in violation of the GPAA, he, she, or it can be mandated by court order to accept it and can be liable for reasonable attorney’s fees and expenses incurred in that process.

• A third party shall not require an additional or different form of power of attorney for authority that is granted in the power of attorney presented.

• The GPAA formalizes protections for third parties who accept powers of attorney in good faith without actual knowledge that the power of attorney has some invalidity or deficiency that would make it ineffective.  This increases the likelihood that a third party will accept a power of attorney when presented with no further inquiry.

 

How does the GPAA better protect the principal from an agent’s misbehavior? 

• Several individuals with an interest in the principal’s protection and well-being may petition a court to interpret a power of attorney or review the agent’s conduct and grant appropriate relief:  the agent; a guardian, conservator, personal representative, or other person legally acting for the principal or the principal’s estate; a person authorized to make health care decisions for the principal; the principal’s spouse, parent, or descendant; an individual who would qualify as a presumptive heir of the principal; a person named as a beneficiary to receive any property, benefit, or contractual right on the principal’s death or as a beneficiary of a trust created by or for the principal that has a financial interest in the principal’s estate; a governmental agency having authority to protect the welfare of the principal; the principal’s caregiver or another person that demonstrates sufficient interest in the principal’s welfare; and a third party asked to accept the power of attorney.

• Unless the document provides otherwise, the authority of an agent terminates when an action is filed for the dissolution or annulment of the agent’s marriage to the principal.

• If an agent learns of a breach or imminent breach of fiduciary duty by another agent, the discovering agent is obligated to notify the principal and, if the principal is incapacitated, take any action reasonably appropriate in the circumstances to safeguard the principal’s best interest.  If the discovering agent fails to do so, he or she is liable to the principal for reasonably foreseeable damages that could have been avoided if the discovering agent had properly reported and acted when he or she learned of the breach or imminent breach of duty.

• An agent who violates his or her duties under the GPAA is liable to the principal for the value of the principal's property lost as a result of the agent’s violation and for reimbursement of attorney’s fees and costs paid on the agent’s behalf.

 

How does my incapacity affect my power of attorney? 

“Incapacity” means the inability to manage your property or your business affairs (1) because you have an impairment in your ability to receive and evaluate information or make or communicate decisions even with technological assistance or (2) because you are missing, detained, or outside the United States and unable to return.  Most principals want the agent named in their power of attorney to be able to act when the principal is incapacitated, and the new power of attorney assumes that unless you specify otherwise.  (The term “durable” on a power of attorney means that the document is effective even when the principal is incapacitated.)

 

Sometimes, though, a principal is uncomfortable having a power of attorney that is effective when the principal is NOT incapacitated – in other words, when the principal can act for himself or herself.  Keeping the power of attorney in the principal’s possession until it is needed may ease the principal’s worries, but the principal needs to ensure that someone can get the power of attorney into the agent’s hands if the document is needed and the principal is unable to do so.  If the principal wants the power of attorney only to be effective when the principal is incapacitated, that limitation must be expressly set forth in the document.  The power of attorney document will have to explain who decides that the principal is incapacitated – for example, one or two physicians, one trusted individual, or a committee of trusted individuals by unanimous or majority vote – and how the decision-makers indicate their determination to the agent.

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Is a power of attorney still in effect after the principal dies? 

No, it is not.  People often forget or do not realize that a power of attorney is only good while the principal is still living.  As soon as the agent learns that the principal has died, the agent is no longer authorized to act under the power of attorney.  Thus, the power of attorney cannot help you in handling the principal’s estate.  This has long been the law and has not changed under the GPAA, but it is often misunderstood and worth mentioning in discussions of powers of attorney.

 

What if my first-choice agent cannot serve under my power of attorney? 

A principal may name back-up agents in a power of attorney.  If a first-choice agent at some point resigns, is unable or unqualified to serve as the agent, or chooses not to serve as the agent, then the back-up agent can step in. An agent who has been incapacitated and unable to serve for more than six months cannot later resume acting as the agent under the same power of attorney.

 

When does a power of attorney end? 

A power of attorney terminates when the principal dies (or, if the document specifies, when the principal becomes incapacitated), when there is no remaining agent who has not resigned, become incapacitated for more than six months, or died, or when the power of attorney’s stated purpose is accomplished or its expiration date is reached.  If the principal wishes to revoke the power of attorney before one of those termination events occurs, the principal should revoke the power of attorney by sending a written revocation to the agent by certified mail or statutory overnight delivery.  You should also send written notice of the revocation to any third parties who have a copy of the power of attorney.

 

What about my existing power of attorney? 

A power of attorney that you signed before July 1, 2017, remains as valid as it was on the day when you signed it, but the old law continues to govern your document.  You will need to continue to operate under the cautions about third parties not accepting the power of attorney and the requirement that your agent present an original document.  For the full protections and conveniences of the GPAA to apply, you will need to sign a new, GPAA-compliant power of attorney.

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