A few years ago I took my parents’ powers of attorney (“POAs”) to the bank. The bank threw me out, explaining, “We don’t honor powers of attorney. If you’re not on the account agreement, we won’t talk to you.” At the time, that was legal. Anyone could reject a POA, and for good reason, bad reason, or no reason.

That just changed. Effective September 1, banks and others generally must accept durable POAs.

“Durable” means the agent may use the POA while the principal is disabled or incapacitated. Texas did not authorize durable powers of attorney before 1972. Not every POA is durable. Look for language like “shall not terminate on disability,” “not affected by the subsequent disability or incapacity,” or “effective on the disability or incapacity” of the principal. If signed from August 28, 1989, through August 31, 1993, the POA must be recorded with the county clerk to be durable. “Durable” may include POAs under military or other state or foreign law. With a translation, even a POA in a different language can qualify.

Before accepting a durable power of attorney, the bank may require the agent to certify all the facts confirming the agent’s authority. The bank is not required to provide a certification form. The statutory form Certification of Durable Power of Attorney by Agent is from Estates Code, Section 751.203.
A durable POA may be immediate or “springing.” If springing, it is not effective until the principal is disabled, and the bank may require the agent’s certification to add a physician’s statement that the principal is disabled or incapacitated.

The bank may require a legal opinion from the agent’s attorney, at the agent’s expense.

Texas has a standard form, the Statutory Durable Power of Attorney, which is less likely to draw a demand for an opinion letter. The form was first promulgated in 1993. Custom forms are still allowed but are harder to understand. Assume your agent will be required to provide an opinion letter if you have a custom durable POA, a military POA, or one from another state or country.

If you don’t have a Statutory Durable Power of Attorney, get one, if only to qualify for these new protections.

Consider delivering a copy of your own POA now, before disability, to your banker, broker, IRA custodian, employer, and any other asset custodian or benefits administrator. If more is required to accept your POA, better and cheaper to resolve it now.

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