Thursday, May 13, 2010

More Power to Ya: Virginia Adopts Uniform Power of Attorney Act

If you have ever given a power of attorney to someone or have been named as an attorney-in-fact for someone in Virginia, you should know about Virginia’s new Uniform Power of Attorney Act which is effective July 1st.

The new law applies not only to new powers of attorney granted after July 1st, but also those granted prior to July 1st, so it is retroactive and governs all existing powers.

Under the new law, all powers of attorney are deemed to be durable, which means they continue to be effective, unless they expire by date or upon an event specified in the power of attorney.

No longer do hard or original copies of powers of attorney need to be retained or produced; now, electronic and photo copies are deemed to have the same effect as an original. Powers of attorney also do not have to be delivered to the agent to become effective.

The new law permits a principal to grant powers to the agent in the power of attorney by simply incorporating by reference certain Sections of the Code of Virginia. For the first time ever in Virginia, where powers of attorney have been strictly construed, the powers of an agent will be deemed to include other incidental powers necessary to carry out general duties. Duties and standards of care are also now codified by the Act.

The law permits an agent to personally benefit from an act or transaction that he enters into on behalf of the principal. Agents are exonerated from liability for their actions unless they act dishonestly, with improper motive, or are recklessly indifferent to their powers. This means that the threshold for holding that an agent has breached their duties to the principal is set very high.

The General Assembly declined to include in the Act a statutory Power of Attorney form. However, there is a new Certification form whereby an agent can certify the validity of the power of attorney and their authority under it.

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