A North Dakota durable power of attorney form allows someone to manage financial matters on behalf of another person, even if the person granting authority becomes incapacitated. The designated person can handle tasks ranging from bill payments to overseeing daily business operations, so selecting a trusted individual for this role is essential.
Laws
In North Dakota, power of attorney forms can be made durable by including the following or similar language:
“This power of attorney is not affected by subsequent disability or incapacity of the principal or by lapse of time.”
“This power of attorney becomes effective upon the disability or incapacity of the principal.”
- Relevant Laws: §§ 30.1-30-01 — 30.1-30-06 (Uniform Durable Power of Attorney Act)
- Presumed Durable: No. § 30.1-30-01
- Signing: While state law does not explicitly require the document to be signed, an unsigned power of attorney may not be accepted.
- Notarization: No requirements, although it’s recommended in case banks or other financial institutions will require it to validate the document.
- Statutory Form: No.
Definitions
Durable – “All acts done by an attorney in fact pursuant to a durable power of attorney during any period of disability or incapacity of the principal have the same effect and inure to the benefit of and bind the principal and the principal’s successors in interest as if the principal were competent and not disabled” (§ 30.1-30-02).
Power of Attorney – “A durable power of attorney is a power of attorney by which a principal designates another as the principal’s attorney in fact in writing and the writing contains the words “This power of attorney is not affected by subsequent disability or incapacity of the principal or by lapse of time,” or “This power of attorney becomes effective upon the disability or incapacity of the principal,” or similar words showing the intent of the principal that the authority conferred is exercisable notwithstanding the principal’s subsequent disability or incapacity, and, unless it states a time of termination, notwithstanding the lapse of time since the execution of the instrument” (§ 30.1-30-01).
Specific Powers and Limitations
Restrictions on Gifts and Transfers
Per § 30.1-30-06, there are certain limitations to the agent’s authority with respect to gifts.
Types of Gifts:
- Gifts “for the benefit of” a person: The gifts can be of any value, involving any portion of the principal’s assets, and can be given to any individual or to organizations specified in sections 170(c) and 2522(a) of the Internal Revenue Code.
- Outright gifts to individuals: The agent can make gifts up to the annual dollar limits set by the federal gift tax exclusion.
- Consent to splitting gifts made by the principal’s spouse: The total gift amount per donee should not exceed the combined annual gift tax exclusions for both spouses.
Considerations:
- Adhering to the principal’s known wishes if they are communicated.
- Prioritizing the principal’s best interest, especially in the absence of explicit instructions.
- Evaluating the principal’s property’s nature and value in the context of gift-making.
- Anticipating the principal’s future needs and potential obligations.
- Implementing strategies that could minimize taxes, considering income, estate, and inheritance taxes.
- Preserving the principal’s eligibility for public benefits or assistance programs.
- Reflecting on the principal’s historical pattern of gift-giving to guide decisions.
Agent’s Authority Limitations
The agent must act in good faith, only undertaking actions explicitly allowed by the DPOA document while avoiding conflicts of interest. They are also expected to act with reasonable care and diligence, maintaining records of financial transactions.
There might be specific limitations on the types of transactions the agent can engage in, such as selling property or entering contracts. The agent is generally prohibited from using their authority for personal gain or benefitting from the principal’s property or affairs.
Revocation and Termination
In North Dakota, a DPOA terminates under certain conditions (§ 30.1-30-04):
- The death of the principal.
- Revocation by the principal at any discretion.
- Fulfillment of the DPOA’s specific purpose or upon a predetermined termination date.
- Legal action, including court orders.
- Death, incapacity, resignation of the agent, or revocation of the agent’s authority without a successor agent designated.
Should the agent be the spouse of the principal, their authority is automatically terminated upon the dissolution or legal separation of the marriage, unless the DPOA specifies otherwise.
Safekeeping and Registration
North Dakota does not offer a centralized registry for Durable Powers of Attorney. It’s essential for the principal to store the original document securely, making it accessible to the agent when needed. Copies should also be provided to legal or financial advisors for additional security.
Banks and financial institutions may have specific requirements for acknowledging a DPOA. Principals and agents should consult with these entities to ensure compliance and facilitate the agent’s ability to act on the principal’s behalf.
Additional Resources
- North Dakota Court: Offers general information on DPOAs and other legal documents.
- Legal Services of North Dakota: Provides legal aid to low-income residents, including assistance with DPOAs and related legal matters.
