April 10, 2018
Powers of attorney are written authorizations to represent or act on another person’s behalf. The person granting the authorization is the principal and the person to whom authorization is granted is the agent. A standard power of attorney gives the agent the authority to act immediately and identifies the specific powers that the agent may exercise. In the case of springing powers of attorney, the document will identify the triggering event that gives the agent the authority to act at some point in the future.
These documents can be immensely useful for a principal suffering from an incapacity, which is to say, an individual who: (1) has an impaired ability to receive and evaluate information, (2) is missing, (3) is detained, be it in the penal system or otherwise, or (4) is outside of the United States and unable to return. Notwithstanding the cause of the principal’s incapacity, the agent (if given the relevant authority in the power of attorney) may make financial decisions for the principal, purchase or sell property on behalf of the principal, make healthcare decisions, etc. All of those actions, however, are prevented when the relevant bank, title agency, or healthcare provider wrongfully rejects a lawful power of attorney.
Lawful powers of attorney are often rejected for inane reasons including preparing the power of attorney more than six months prior to the date that the agent presents it or naming a second or successor agent. Responding to the concerns of the constituency, members of the Ohio House of Representatives recently sponsored House Bill (H.B.) No. 446, which operates to remedy the all-too-common practice of rejecting lawful powers of attorney. The bill does not alter language in the Ohio Revised Code, but rather, it adds the following to Chapter 1337:
(A) As used in this section, “acknowledged” means verified before a notary public or other individual authorized to take acknowledgements.
(B) A person shall not refuse to accept an acknowledged power of attorney for a transaction, or require an additional or different form of power of attorney for any authority granted in a statutory form power of attorney, unless one of the following applies:
- The person has actual knowledge of the termination of the agent’s authority or of the power of attorney.
- The person in good faith believes that the transaction is outside the scope of the authority granted to the agent in the power of attorney.
- The person in good faith believes that the power of attorney is not valid.
(C) A person that fails to comply with this section is subject to both of the following:
- A court order mandating the acceptance of the power of attorney;
- Liability for reasonable attorneys’ fees and costs incurred in any action or proceeding that confirms the validity of the power of attorney or mandates acceptance of the power of attorney.
On January 16, 2018, the Ohio House of Representatives referred H.B. 446 to the Civil Justice Committee, which is where the bill remains today. The Committee held its first hearing regarding the same on January 24, 2018.
The primary sponsors of the bill are Rep. William Seitz (R) and Rep. John Rogers (D). The co-sponsors are Rep. Nickie Antonio (D), Rep. John Becker (R), Rep. John Boccieri (D), Rep. Nicholas Celebrezze (D), Rep. Teresa Fedor (D), Rep. Bernadine Kent (D), Rep. Michael Sheehy (D), and Rep. Kent Smith (D).