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Home / General / What are the Maryland Power of Attorney Rules?

What are the Maryland Power of Attorney Rules?

November 18, 2020 by Alexander M. Pagnotta, Estate Planning Attorney

It has been 10 years since Maryland passed the “Maryland General and Limited Power of Attorney Act.” Power of attorney documents have become more complex and now create enforceable, legal obligations for both the principal and the agent. A power of attorney is a legal document in which the principal gives an agent the power to act on his/her behalf. The principal is the one who creates the power of attorney. The agent is the one named in the document to act in the best interest of the principal.

The power of attorney rules are found in Maryland Code Title 17- Maryland General and Limited Power of Attorney Act. One of the most important sections in the Act requires a financial institution to accept the statutory power of attorney document. If not, they could be liable for attorney’s fees and costs if you have to get a court order mandating the acceptance of the power of attorney. Other important subsections of the Act are general rules and execution requirements along with statutory forms that can be used for the creation of a legally valid power of attorney.

The Act indicates that a power of attorney, in order to be validly executed in Maryland, must:

  • Be in writing
  • Be signed by the principal, or be signed on behalf of the principal at the principal’s direction
  • Be acknowledged by the principal before a notary
  • Be signed by at least two adult witnesses who are both in the presence of each other and in the presence of the principal. The notary can count as one of the adult witnesses.

Maryland Code Section 17-105 indicates that when a principal creates a power of attorney and designates an attorney-in-fact, the power of attorney is durable unless otherwise provided. This is important because a durable power of attorney is essential if the power of attorney is to be used for incapacity planning. In some states, one must specify that the grant of authority is durable and if you do not, then the agent’s authority ends when one is incapacitated. Not every state automatically recognizes a power of attorney as durable, so if you relocate you will need to ensure your power of attorney is updated to include the appropriate language in the location you move to.

Maryland’s statutory forms can be used to create a power of attorney. The forms provide fill-in spaces where you can put your own name, the names of the witnesses, the name of the agent you have chosen, and other relevant information. While these statutory forms can work well, having a supplemental durable power of attorney for property can be used to give the agent additional powers. For instance, you can give your agent the power to access your digital assets. This could be helpful in the event that the principal becomes incapacitated and the agent needs to access an account, but doesn’t know the login information. The power of attorney document can be used to obtain this information. Other examples of digital assets include social media content, pictures, videos, and the like. As the world continues to become more digital, giving an agent the power to access digital assets becomes very important. The supplemental durable power of attorney is needed to accomplish these things.

While completing these forms and trying to make a DIY power of attorney arrangement can seem tempting, you do not generally want to try this process on your own. The Maryland power of attorney rules can be complicated and there is no room for mistakes when it comes to naming your agent who will act on your behalf in case of incapacity. If you make any errors and your power of attorney is not legally valid or does not provide expected protections, this could have profound consequences for you and for your family. For example, if the power of attorney is not valid and the principal becomes incapacitated, someone may have to petition the court and be appointed as guardian. Guardianship is a court process designed to protect those who are disabled. The person appointed by the court may or may not be the person that you would have picked to act in your best interest. This process is also very expensive. Working with an estate planning attorney who can provide guidance on powers of attorney and some of the other steps to incapacity planning can help ensure you and your family are safe and protected in the future.

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Alexander M. Pagnotta, Estate Planning Attorney
Alexander M. Pagnotta, Estate Planning Attorney
Estate Planning Attorney at Sinclair Prosser Gasior
Alex Pagnotta’s personal experience with the problems that can result from an inadequate estate plan along with his interest in helping others drove his desire to pursue the areas of estate planning and estate administration. He counsels individuals and families to preserve wealth and ensure that their hard earned assets are passing to the correct individuals when they want and how they want.
Alexander M. Pagnotta, Estate Planning Attorney
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