The legislature also created a statutory form general power of attorney, and limited power of attorney as to real estate. The trust's modification or termination in accordance with G.S. Exercise the powers of the principal as settlor of an irrevocable trust to consent to Exercise the powers of the principal as settlor of a revocable trust in accordance withī. In addition to the powers listed above, there are also hot powers with respect to Trusts, specifically the powers to:Ī. Renounce or disclaim property, including a power of appointment. Exercise fiduciary powers that the principal has authority to delegate. Including a survivor benefit under a retirement plan.į. Waive the principal's right to be a beneficiary of a joint and survivor annuity, Delegate authority granted under the power of attorney.Į. Create or change a beneficiary designation.ĭ. Create or change rights of survivorship.Ĭ. Therefore, if you have a power of attorney executed prior to January 1, 2018, the agent can only exercise the hot powers if they are explicitly stated in the power of attorney. Whether or not the POA was created before or after Januis irrelevant to the requirement that the hot powers be explicit in the document, unless the application of the new statute would substantial impair the rights of a party to a POA executed prior to January 1, 2018. The rules of construction in the new statute apply to POAs created prior to January 1, 2018. The new act also creates a category of “hot powers” that need to be explicitly stated in a power of attorney for the agent to possess those powers. So if clients have powers of attorneys that were witnessed but not acknowledged, they do not need to worry that their powers of attorney are no longer valid. A power of attorney that was validly executed prior to Januunder the laws as they existed at that time is still valid. This distinction between incapacity and disability is especially important if you are using springing powers of attorney, which only become effective upon the incapacity of the principal.Īnother major change is that powers of attorney now must be acknowledged, no other witnesses are required except the notary – whereas POAs executed before Januwere sufficient with just witnesses, all POAs executed Januor later require a notary acknowledgement. The definition of incapacity stresses the inability to manage property or business affairs. Another definitional change is that the law now refers to “incapacity” of the principal, no longer using the term “disability.” This change is to acknowledge the fact that being disabled does not necessarily render an individual incapable of managing their property or business affairs. In addition, the term “Attorney-in-Fact” has been dropped and replaced with the simpler term “Agent” to describe the appointee under a power of appointment. They will still need to be recorded as part of any real estate transactions being performed by the Agent on the Principal’s behalf. The new statute changes this requirement, and does not require the power of attorney to be recorded with the register of deeds for to be durable.
That changed when powers of attorney started including clauses stating that the power of attorney was valid to obligate the principal on contracts, even if the principal was incapacitated, making those powers of attorney “durable.” Under the old statute, a clause making a power of attorney durable was only valid if the Power of Attorney was recorded with the register of deeds in the county of the principal’s residence. If the principal was incapacitated and unable to sign a contract, then neither could an agent on the principal’s behalf. Traditionally and under the common law, powers of attorney are only valid so long as the principal has the capacity to sign contracts. Under the prior version of the statute, the reverse was true. One of the major changes under the new law is that powers of attorney are automatically durable, meaning the Power of Attorney is still valid upon the incapacity of the Principal, unless the document explicitly states an intention that it not be durable. If you have a General Power of Attorney, it is important to have it reviewed in light of the new statute to ensure that your document complies with the new requirements. The new POA Act does not apply to Health Care Powers of Attorney.
The new POA Act effectively rewrites the entire POA statute as it applies to General Powers of Attorneys.
CONVEYANCE OF REAL PROPERTY POWER OF ATTORNEY NC 2018 PC
Maynard Nexsen PC Maynard Nexsen PC Main Content Main Menu MenuĪs you may be aware, North Carolina adopted the Uniform Power of Attorney Act effective January 1, 2018.
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