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Can a Bank Reject My Power of Attorney?

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Though most people do not like to think about it, there may come a time in life when we are unable to make financial decisions for ourselves due to medical issues or not having the ability to keep up on things. A power of attorney can ease the burden of those situations by assigning someone as your agent or attorney-in-fact. It is essentially a legal document that allocates the right to make certain decisions on another’s behalf. The principal, or grantor, still retains the right to make decisions on their own.

What is a Power of Attorney?

A document granting power of attorney can be limited in scope to making either financial or health care decisions on the grantor’s behalf. However, a general power of attorney can also include a much broader set of powers that are not limited to certain areas. A power of attorney can limit the authority to make decisions to a specific amount of time or circumstances. It is executed outside of a courtroom and does not need a judge to sign off on it. The grantor must be in a proper, lucid state-of-mind to have the capacity required to sign off on a power of attorney. Additionally, according to Florida law, signing the document must occur in front of two valid witnesses and a notary public. Otherwise, it is not valid. 

Can a Bank Reject a Power of Attorney?

Are there times when a bank can reject a power of attorney? The short answer is, “yes.” There may be times when a bank will reject a power of attorney and refuse to work with the agent. However, there are consequences for a power of attorney being wrongfully rejected. Let’s explore the topic. 

Types of Powers of Attorney

Depending on the type and scope of the power of attorney document, most will end upon the grantor’s incapacitation. In contrast, a durable power of attorney will end upon the death of the grantor. If the court finds the grantor incapacitated, and the document outlines when a power of attorney ends, then a bank may have grounds to reject the designation. However, if it is a durable power of attorney, the document should be honored, even if the principal is incapacitated. 

Why Would a Bank Reject a Power of Attorney?

Some states have a presumption that Powers of Attorney are durable if not specified, some states do not. In some cases, the bank may argue that the power of attorney was not properly executed. For instance, they may not accept a copy of the original document. In Florida, however, a copy of the document is just as good as the original, and, if appropriately implemented (two witnesses and notary public), it should be honored. 

A bank does have the ability to ensure a power of attorney is legitimate. For instance, in writing, they may ask for proof that the principal is still alive and that a power of attorney has not been revoked. According to Florida law, there are also consequences for a bank denying power of attorney without a legitimate reason.  

How Long Does a Bank Have to Notify an Agent that a Power of Attorney is Being Rejected?

The bank has four business days to notify the agent whether a power of attorney is being accepted or rejected, explaining why it was rejected in writing. If a power of attorney is wrongfully rejected, the bank may be on the hook for any fees or costs involved with proving the document’s validity in court. Additionally, banks must accept a valid power of attorney document, as opposed to requiring one of their own. 

Should I Hire an Estate Planning Lawyer?

An experienced estate planning attorney may be able to help in situations where a bank is rejecting a power of attorney. They can point to various aspects of Florida law on power of attorney documents, and detail for the bank why their designation is wrong (assuming it is). They can also explain the next steps the principal must take, and how the bank would have to pay those fees if they rejected a power of attorney wrongfully. The best way to prevent a bank from rejecting a power of attorney is to be sure you have the right kind of Power of Attorney and the correct documents in place by meeting with a qualified lawyer. The right estate planning attorney, like those at The Mattar Firm, can help. Call today at 239-222-2222


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