About that Power of Attorney

A power of attorney gives someone else–the agent–the power to act in place of the person granting the power–the principal. A durable power of attorney is a power that continues even after the principal becomes incapacitated, hence the adjective “durable.”

If you or your attorney is drafting a power of attorney in Utah or any other Uniform Power of Attorney Act state, be careful and be very specific; make sure certain grants of power are “expressly” authorized in the document that allows the agent to act in the principal’s behalf.

To wit, Utah Code §75-5-503, signed into law in 2003, says:

A power of attorney may not be construed to grant authority to an attorney-in-fact or agent to perform any of the following, unless expressly authorized in the power of attorney:

(1)  create, modify, or revoke an inter vivos revocable trust created by the principal;

(2)  fund, with the principal’s property, a trust not created by the principal or by a person authorized to create a trust on behalf of the principal;

(3)  make or revoke a gift of the principal’s property, in trust or otherwise; or

(4)  designate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death. (emphasis supplied)

General, broad language probably won’t do. The grant in these four cases must be express because these four cases present too great an opportunity for abuse. I’ve hedged just a little here because the one Utah Supreme Court case on this point seems to leave the door open, if only slightly, to less express language, language typical of a broad grant of power.

In fact, in analyzing the language of the durable power of attorney at issue in the Burrows case, the Utah Supreme Court talked favorably about both the broad and the express grants of power:

¶ 17 The durable power of attorney expressly granted Ray authority to gift Ida’s personal property. The two-page instrument gives Ray broad authority over Ida’s assets and personal property. It authorizes Ray “ in any and every way and manner [to] deal in and with goods, wares, and merchandise, [choses] in action, and other property in possession or in action, and to make, do, and transact all and every kind of business of what nature or kind soever.”

¶ 18 More specifically, the power of attorney expressly authorizes Ray “ to gift property whether real or personal.” . . .  131 P.3rd 9 (Utah 2008)

If I were arguing this proposition before another court, I would argue like a mother bear that even the broad language does the job according to Burrows. If I were drafting the power, I would make sure the power of attorney expressly authorized each of the four powers outlined in §75-5-503, that is, if my client wanted to give those powers to his agent.

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