Alaska Modifies Provisions Regarding Powers of Attorney

The legislature of the state of Alaska has recently updated its power of attorney provisions, including an important update to the statutory power of attorney form, with an effective date of January 1, 2017.

The power of attorney provisions first outlines what constitutes acceptance by, and the liability of, an agent. An agent accepts appointment simply by exercising authority or performing duties as an agent, or by any other conduct that would indicate acceptance. If an agent breaches his or her duty to the principal, he or she is liable for the amount needed to restore the value of their property, as well as attorney’s fees and costs.

The provisions also discuss the duties of an agent. If an agent accepts appointment, he or she must act in the principal’s best interest, in good faith, and only within the scope of the authority that he or she granted. The agent must act loyally, avoid conflicts of interest with the principal, keep records of receipts and disbursements, work together with whoever makes the principal’s healthcare decisions, and, if possible, preserve the principal’s estate plan.

There are several circumstances under which a power of attorney may be terminated. For example, if a principal dies, or becomes incapacitated (if the power of attorney is not durable), it would terminate. The principal may also decide to revoke the power of attorney, or the power of attorney itself may provide for termination at a certain point, or it may terminate when a stated objective is accomplished.

The provisions provide for an updated general power of attorney form. The form begins with the following language:

“Pursuant to AS 13.26.338 – 13.26.359 [AS 13.26.338 -13.26.353], I, (Name of principal), of (Address of principal), do hereby appoint (Name and address of agent or agents), my agent(s) to act as indicated below in my name, place, and stead in any way which I myself could do, if I were personally present, with respect to the following matters, as each of them is defined in AS 13.26.344, to the full extent that I am permitted by law to act through an agent.”

The updated form now adds a new section which allows a principal to check off specific powers that he or she wants to give to the agent. This new system is less confusing than the previous form, which conversely stated that the agent would by default have all of the powers listed on the form, unless the principal specifically drew a line through that category and initialed a box to indicate the powers that would be excluded. The new form states the following:

Mark the boxes below to indicated the powers you want to give your agent or agents. Mark the box for “Yes” that is opposite a category below to give your agent or agents the power in that category. If you do not mark a box opposite a category, your agent or agents will not have the power in that category.

The categories that may be checked off are real estate transactions, transactions involving tangible personal property, chattels and goods, bonds, shares, commodities transactions, banking transactions, business operating transactions, insurance transactions, estate transactions, retirement plans, claims and litigation, personal relationships and affairs, benefits from government programs and civil or military service, records, reports, and statements, voter registration and absentee ballot requests, and a final category for all other matters, which the principal may specify by writing them in on the form.

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Zachary Pearlstein, JD, is a senior regulatory compliance consultant with Bankers Advisory. He is a graduate of Brandeis University and earned his juris doctor at Suffolk University Law School. He is admitted to the Massachusetts Bar.

Comments

Can the Principal and Agent provision apply to for a Financial institution that engages a partner to conduct back office mortgage transactions on behalf of the Institution?

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