• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Sexton, Bailey Attorneys, PA

SEXTON BAILEY ATTORNEYS, PA an Arkansas Estate Planning & Trust Information Center

Sexton, Bailey Attorneys, PANorthwest Arkansas Estate Planning Attorneys(479) 443-0062

Client Vault
  • Home
  • Our Firm
    • Our Firm
    • About the American Academy
    • Advantages of Working With Our Firm
    • Attorney and Staff Profiles
    • News & Events
    • Our Reviews
    • Speaker Connection
  • Estate Planning
    • Asset Protection & Business Planning
    • Elder Law & Medicaid Services
    • Estate and Gift Tax Figures
    • Estate Planning Services
    • Family-Owned Businesses & Farms
    • Incapacity Planning
    • Legacy Planning
    • Pet Planning
    • SECURE Act
    • Special Needs Planning
    • Trust Administration & Probate
  • Webinars
  • Practice Areas
  • Resources
    • DocuBank
    • Elder Law Reports
    • Estate Planning Resources
      • Estate Planning Articles
      • Estate Planning Checkup
      • Estate Planning Definitions
      • Estate Planning Reports
      • Incapacity Planning Definitions
      • Is Your Estate Plan Outdated?
      • Top 10 Estate and Legacy Planning Techniques
    • FREQUENTLY ASKED QUESTIONS
      • Estate Planning
      • Frequently Asked Questions for Families Without an Estate Plan
      • Legacy Wealth Planning
      • Medicaid Planning
      • Pet Planning
      • Trust Administration & Probate
    • Newsletters
    • Trust Administration & Probate Resources
      • Bereavement Resources
      • How to Know if You Need Extra Help With Your Grieving
      • Loss of a Loved One
      • The Mourner’s Bill of Rights
      • Things You Need To Do When a Loved One Passes Away With a Trust
      • Things You Need To Do When a Loved One Passes Away With a Will
      • Trust Administration & Probate Definitions
  • Reviews
    • Our Reviews
    • Review Us
  • Contact Us
  • Blog
Home / Estate Planning / Are Third Parties Required to Honor Powers of Attorney in Fayetteville?

Are Third Parties Required to Honor Powers of Attorney in Fayetteville?

July 14, 2014 by Audra Bailey Wilcox Leave a Comment

honor powers of attorneyMany of us assume that once a power of attorney is executed, everyone is required to honor powers of attorney or acknowledge the authority that is given to the agent.  However, that is not necessarily true. A power of attorney can be, and often will be, questioned by third parties, like banks and insurance companies.  They may demand proof that the legal document is still valid.  They can reject it entirely, if it was executed too long ago.  So, what can be done?

How abuse of powers of attorney has affected the law

There was a time when a power of attorney was rarely challenged.  That is because they were rarely exploited by the agent.  Regrettably, the number of cases of adult children using a power of attorney to steal from their parents has increased over the years.  This rise in incidents of misuse began prompting lawmakers to focus on the problem of power of attorney abuse.

The abuse of powers of attorney really gained national attention in 2007, when the son of philanthropist, Brooke Astor, was indicted for attempting to “unjustly enrich” himself through her power of attorney.  He was ultimately convicted in 2009 for grand larceny, after stealing more than $1 million from his mother.

Abuse leads to refusal to honor powers of attorney

Banks and other financial companies began taking their own precautions against abuse of powers of attorney, by imposing tougher requirements for honoring these instruments.  As a result, banks routinely refuse to honor powers of attorney if they were signed more than 6 months prior, as well as powers of attorney from other states.  These higher standards make it more difficult for well-meaning adult children to care for their parents’ affairs when necessary.  In some cases, the requirements imposed by these entities can be extremely burdensome, and almost impossible to meet.  But how do you strike a balance?

The Uniform Power of Attorney Act

Nearly every state has enacted its own laws concerning powers of attorney.  However, not every state requires businesses to honor a power of attorney.  Lawmakers and regulators began expressing their concerns with the inconsistency of state laws.  As a result, the National Conference of Commissioners on Uniform State Laws approved the Uniform Power of Attorney Act in 2006.  Only nine states have adopted this uniform law, including Arkansas. The Uniform Power of Attorney Act was enacted for the purpose of bringing uniformity to powers of attorney, which have rapidly become very common tools in estate planning.  Arkansas adopted the Uniform Power of Attorney Act in 2011.

One of the provisions of the act addresses “Liability for Refusal to Accept Acknowledged Power of Attorney.” Under this provision, a third party must either accept an acknowledged power of attorney or request a certification, translation, or an opinion of counsel within seven business days of presentment.  Once requested, the third party must accept the power of attorney within five business days of receiving the requested document.  Also significant is the provision that a third party cannot require an additional or different form of power of attorney, which banks had begun to do routinely.

If you have questions regarding a power of attorney, or any other estate planning needs, please contact Sexton, Bailey Attorneys, PA online, or by calling us at (479) 443-0062.

  • Author
  • Recent Posts
Audra Bailey Wilcox
Audra Bailey Wilcox
Attorney at Sexton, Bailey Attorneys, PA
Audra Bailey Wilcox
Latest posts by Audra Bailey Wilcox (see all)
  • Bill Nye the Science Guy on Wearing Masks in Public - July 11, 2020
  • Low-Interest Loans: An Estate Planning Technique - June 23, 2020
  • Irrevocable Medicaid Trusts - June 16, 2020

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Sexton, Bailey Attorneys, PA

Is Your Plan Outdated?

Subscribe to Our Blog

Office Address

Fayetteville
2766 Millenium Drive
Fayetteville, AR 72703
Phone: (479) 443-0062

Office Address

Prairie Grove
1100 Division Street, Suite 4
Prairie Grove, AR 72753
Phone: (479) 846-6026

Office Address

Farmington
6 West Main
Farmington, AR 72730
Phone: (479) 267-4441

Office Hours

Monday9:00 AM - 5:00 PM
Tuesday9:00 AM - 5:00 PM
Wednesday9:00 AM - 5:00 PM
Thursday9:00 AM - 5:00 PM
Friday9:00 AM - 12:00 PM

Map

map for office
  • Facebook
  • LinkedIn
  • RSS
  • Twitter
  • YouTube

footer-logo

© 2021 American Academy of Estate Planning Attorneys, Inc.