The Illinois Statutory Short Form Power of Attorney (POA) for Property states, “I . . . hereby revoke all prior powers of attorney for property executed by me and appoint: . . .” Can a customer strike out that language so that they can enter into an additional POA naming a second agent? One of our customers wants to retain their current agent but also wants to add a new agent, as the first agent is currently not feeling up to the responsibility. The customer’s attorney stated that striking through this phrase in the statutory short form is how two agents can act at the same time without naming co-agents as prohibited by the statutory short form. Is this the correct procedure? If this is correct, will it allow both agents to act and can the bank be held responsible if one of the agents acts in a way that the other disagrees with?

Sep 10, 2021

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We believe that it is possible to add a second power of attorney for property using a non-statutory POA (that is, a POA that does not exactly match the form supplied in the Illinois Power of Attorney Act). We note that it would be inappropriate for your institution to offer legal advice to your customer as to the validity of the POA, and we recommend instead relying on the Act’s protections from liability for banks and other parties that may act in reliance on a POA.

The Illinois Power of Attorney Act’s statutory short form power of attorney for property states that it cannot be used to name co-agents, but the Act acknowledges that non-statutory forms may be used to name co-agents. If a POA does name co-agents, the Act imposes a default rule that they must exercise their power by majority consent, unless one of the agents is temporarily incapacitated (for example, due to absence or illness). This default rule applies unless the POA states otherwise. In your customer’s situation, it appears that one of the agents will not be acting for the time being, which may make it difficult to prove that the agents acted by majority consent.

Fortunately, the Act provides protections from liability when relying in good faith on a co-agent’s representations. However, we recommend requesting that the new agent provide you with an affidavit or Co-Agent’s Certification and Acceptance of Authority, which requires the co-agent to certify the other co-agent is unavailable due to illness or other temporary incapacity. If your bank acts in reliance on such a certification, you are “fully protected and released to the same extent” as though you had “dealt directly with all named agents.”

For resources related to our guidance, please see:

Illinois Power of Attorney Act, 755 ILCS 45/3-3(d) (“The Illinois Statutory Short Form Power of Attorney for Property shall be substantially as follows: ‘. . . I, . . . hereby revoke all prior powers of attorney for property executed by me and appoint:. . . . (NOTE: You may not name co-agents using this form.) . . . as my attorney-in-fact (my ‘agent’) to act for me and in my name (in any way I could act in person) with respect to the following powers, as defined in Section 3-4 of the ‘Statutory Short Form Power of Attorney for Property Law’ (including all amendments), but subject to any limitations on or additions to the specified powers inserted in paragraph 2 or 3 below.’”)

Illinois Power of Attorney Act, 755 ILCS 45/3-3(b) (“. . . . Nothing in this Article shall invalidate or bar use by the principal of any other or different form of power of attorney for property. Nonstatutory property powers (i) must be executed by the principal, (ii) must designate the agent and the agent’s powers, (iii) must be signed by at least one witness to the principal’s signature, and (iv) must indicate that the principal has acknowledged his or her signature before a notary public. However, nonstatutory property powers need not conform in any other respect to the statutory property power.”)

Illinois Power of Attorney Act, 755 ILCS 45/2-10.5(a) (“Co-agents may not be named by a principal in a statutory short form power of attorney for property under Article III or a statutory short form power of attorney for health care under Article IV. In the event that co-agents are named in any other form of power of attorney, then the provisions of this Section shall govern the use and acceptance of co-agency designations.”)

Illinois Power of Attorney Act, 755 ILCS 45/2-10.5(b) (“Unless the power of attorney or this Section otherwise provides, authority granted to 2 or more co-agents is exercisable only by their majority consent. However, if prompt action is required to accomplish the purposes of the power of attorney or to avoid irreparable injury to the principal’s interests and an agent is unavailable because of absence, illness, or other temporary incapacity, the other agent or agents may act for the principal. If a vacancy occurs in one or more of the designations of agent under a power of attorney, the remaining agent or agents may act for the principal.”)

Illinois Power of Attorney Act, 755 ILCS 45/10.5(d) (“Any person who acts in good faith reliance on the representation of a co-agent regarding the unavailability of a predecessor agent or one or more co-agents, or the need for prompt action to accomplish the purposes of the power of attorney or to avoid irreparable injury to the principal’s interests, will be fully protected and released to the same extent as though the reliant had dealt directly with all named agents. Upon request, the co-agent shall furnish an affidavit or Co-Agent’s Certification and Acceptance of Authority to the reliant, but good faith reliance on a document purporting to establish an agency will protect the reliant without the affidavit or Co-Agent’s Certification and Acceptance of Authority. A Co-Agent’s Certification and Acceptance of Authority shall be in substantially the following form: . . . .”)

Illinois Power of Attorney Act, 755 ILCS 45/2-8(a) (“Any person who acts in good faith reliance on a copy of a document purporting to establish an agency will be fully protected and released to the same extent as though the reliant had dealt directly with the named principal as a fully-competent person. The named agent shall furnish an affidavit or Agent’s Certification and Acceptance of Authority to the reliant on demand stating that the instrument relied on is a true copy of the agency and that, to the best of the named agent’s knowledge, the named principal is alive and the relevant powers of the named agent have not been altered or terminated; but good faith reliance on a document purporting to establish an agency will protect the reliant without the affidavit or Agent’s Certification and Acceptance of Authority.”)

Illinois Power of Attorney Act, 755 ILCS 45/2-8(c) (“Any person dealing with an agent named in a copy of a document purporting to establish an agency may presume, in the absence of actual knowledge to the contrary, that the document purporting to establish the agency was validly executed, that the agency was validly established, that the named principal was competent at the time of execution, and that, at the time of reliance, the named principal is alive, the agency was validly established and has not terminated or been amended, the relevant powers of the named agent were properly and validly granted and have not terminated or been amended, and the acts of the named agent conform to the standards of this Act. No person relying on a copy of a document purporting to establish an agency shall be required to see to the application of any property delivered to or controlled by the named agent or to question the authority of the named agent.”)