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In this blog post, we discuss power of attorney laws in Ohio. Ohio residents who wish to make sure that someone will be able to manage their affairs in the event of their own incapacity can utilize a legal document known as a power of attorney to authorize an agent, also known as an attorney-in-fact, to conduct business on behalf of the individual who creates the document, known legally as the “principal.” A special type of power of attorney, known under Ohio’s laws as a durable power of attorney for healthcare, can allow a principal to authorize an agent to make decisions specifically related to the principal’s medical care if the principal is unconscious or subject to a declaration of incapacity by their attending physician. Either type of document can form an important part of a comprehensive Ohio estate plan. Some individuals may want to use both, depending on the specifics of their situation. To be effective, however, these highly flexible documents must be not only customized to address the individual’s specific circumstances, but also carefully drafted to conform with state-specific power of attorney regulations.
Even the most carefully-designed power of attorney document will not do its job if it is not recognized as valid when the time comes for the agent to present it to bank tellers, investment advisers, or other parties in order to access the principal’s accounts and carry out business on the individual’s behalf. Many of the institutions with which an agent may need to interact in order to conduct business on behalf of the principal may have their own internal guidelines for establishing the validity of the authority claimed by the attorney-in-fact, and anticipating every potential qualm from every potential employee of every institution that may come into play can seem a daunting task.
Fortunately, there are a few steps that a principal can take to minimize the risks of potential hiccups arising just when all involved most need operations to run smoothly. Most of these steps will apply to both a financial power of attorney (also known as simply a “power of attorney”) and a medical power of attorney (or “durable power of attorney for healthcare”); in a few places, the specific power of attorney laws that apply will diverge depending on the type of power of attorney under discussion. Taking the recommended steps in advance may be especially helpful for individuals preparing a “springing” power of attorney, as the circumstances delineated for the activation of a springing durable power of attorney are often precisely those under which the principal will be unable to participate in the satisfactory resolution of any disputes or discrepancies related to their documentation. For practical purposes, virtually all medical powers of attorney are “springing” (they take effect when the principal is incapacitated); generally speaking, other powers of attorney take effect immediately unless the principal specifies otherwise in the power of attorney document.
Make sure that the wording used throughout your power of attorney is clear and specific throughout, unambiguously indicating the actions your agent is and is not authorized to take as well as the areas in which the agent’s authority does and does not apply. Some actions, such as amending the terms of an inter vivos trust or updating beneficiary designations, will be presumed to fall outside the agent’s scope of authority unless the principal specifically includes them in the power of attorney document, pursuant to O.R.C. § 1337.42. This presumption limiting the power of the attorney-in-fact to make major changes in areas of activity many principals prefer to reserve to themselves (even and perhaps especially if they have become unable to make new decisions on their own behalf “in real time”) serves as safeguard against abuse, but it can also be inconvenient if in fact a principal wants to entrust those activities to their agent.
Providing the explicit expansion of scope necessary to authorize the agent to initiate changes to the principal’s estate plan under the power of attorney is not typically recommended unless the principal has both immense confidence in the agent’s integrity (and soundness of judgment, as even well-meaning mistakes can nonetheless lead to disaster) and reason to believe such interventions are likely to be called for, even after the principal has put in place a comprehensive estate plan. If both of those conditions apply, however, the generally recommended practice is to explicitly authorize each type of action separately, in its own clause, and to take steps to ensure that the authorities granted are sufficient to carry out the principal’s wishes, but narrow enough to prevent either confusion or overreach. Working with an experienced estate planning attorney may prove useful in establishing both the extent of authority needed and the precise language that will be effective in achieving the principal’s estate planning goals.
The agent himself or herself should be clearly identified, ideally in a manner that can readily be verified by presentation of a commonly recognized and widely available form of identification (such as a driver’s license). Any co-agents or successor attorneys-in-fact designated under O.R.C. § 1337.31 should be identified with similar clarity and precision.
O.R.C. § 1337.27 specifies that a power of attorney’s “meaning and effect” is determined by reference to the laws of the jurisdiction indicated in the document. If the document fails to indicate a jurisdiction, then the choice of applicable law will default to the jurisdiction in which the power of attorney has been executed. Rather than leaving this kind of consideration to be determined when the power of attorney is called for, principals can take steps to avoid unnecessary confusion by making the applicability of Ohio’s state-specific power of attorney regulations explicit in the text of the document as written.
For a financial power of attorney executed in Ohio to be valid, O.R.C. § 1337.25 requires that the principal sign the document (or, if the principal is physically unable to sign the document, then someone else must sign the power of attorney at the principal’s direction and in the principal’s “conscious presence”). While a durable power of attorney for healthcare needs either two witnesses or certification by a notary public, in Ohio a signature, purporting to be that of the principal, on a power of attorney is “presumed to be genuine” if the signature is acknowledged by the principal in the presence of any person (such as a notary public) who has the legal authority to accept such acknowledgements. An Ohio estate planning attorney with Rhodium Law may be able to help you review your documents and help you to verify whether they meet state-specific power of attorney regulations for legal validity.
Like other powers of attorney, a durable power of attorney for healthcare in Ohio allows the principal to designate an agent to take specific actions on the principal’s behalf. In the case of a durable power of attorney for healthcare, these actions will typically be limited to making decisions related to the principal’s medical care, pursuant to O.R.C. § 1337.13.
The state-specific power of attorney regulations establishing the minimum requirements for legally validating a durable power of attorney for healthcare in Ohio are in some respects more demanding than those that apply to a financial power of attorney, with the requirements for legal validity of a durable power of attorney for healthcare requiring one of the following:
The restrictions on witness eligibility and other specific details necessary for legal execution of a medical power of attorney in Ohio are laid out in § 1337.12.
Ohio residents contemplating a power of attorney primarily in order to designate a proxy for healthcare decisions can easily find themselves somewhat perplexed early in their search for a statutory form amid relevant laws, as Ohio places its only statutory form for power of attorney within Title 13 – the portion of the Ohio Revised Code labeled “Commercial Transactions.” Although O.R.C. § 1337.12 provides for an individual to authorize an “agent” or attorney-in-fact specifically for the purpose of making medical decisions in the event of the principal’s incapacity (as determined by the principal’s attending physician in compliance with O.R.C. § 2133.03). Because Ohio law classifies the document making such a designation a “power of attorney,” the language to be used and the specific legal requirements governing the designation of a healthcare proxy or surrogate in Ohio do not appear in the portions of the state’s code that pertain to guardianships and conservatorships and the administration of estates; rather, the legal authorization and requirements for what Ohio calls a “durable power of attorney for healthcare” are placed with the statutory requirements for powers of attorney more generally.
As the Ohio State Bar Association (OSBA) explains, these more general requirements for powers of attorney were adopted as part of Ohio’s implementation of its own version of the Uniform Power of Attorney Act (UPOAA), which became effective throughout the state in March of 2012. As the Uniform Laws Commission indicates and the OSBA underscores, the UPOAA was developed in large part as an update to laws in multiple states that covered broadly similar authorizations, and in keeping with the Uniform Laws Commission’s general operating principles aimed to increase the relative consistency of laws across the United States while also, in this instance, improving protections against elder abuse, which as powers of attorney have been notable for their susceptibility to malicious manipulation in that regard. As a result of the Commission’s efforts, the finished version of the UPOAA was approved by the American Bar Association (ABA) in 2007, went on to receive an endorsement from the American Association of Retired Persons (AARP), and as of 2024 had been enacted in 32 out of United States’ 53 combined states and territories, with a version introduced in the Massachusetts legislature.
The 2006 version of the UPOAA, as approved for distribution by the Uniform Laws Commission and forwarded to the ABA and eventually disseminated to legislators around the country for their consideration, explicitly excluded powers of attorney for healthcare from the statutory form provided. States that went on to adopt the UPOAA dealt with this exclusion in a number of ways, including by making separate provisions for a substantially similar form used to designate a healthcare “proxy” or surrogate. In Ohio, the articles establishing the requirements for, and limitations on, a durable power of attorney for healthcare, were included in the Ohio version of the UPOAA as enacted – making the various laws governing powers of attorney in the state easier for Ohioans to locate side-by-side, but separating the medical power of attorney from other healthcare directives used to address similar advance planning concerns.
Individuals in Ohio preparing comprehensive estate plans may wish to consider including a financial power of attorney or durable power of attorney for healthcare. In some situations, it may make sense to use both documents – and to consider naming separate agents in each of them. To ensure maximum efficacy, powers of attorney must be not only carefully drafted, but signed and, depending on the type of power of attorney involved, potentially witnessed or notarized, in accordance with Ohio’s power of attorney laws. State-specific power of attorney regulations can have a number of implications as individuals attempt to navigate Ohio’s implementation of the Uniform Power of Attorney Act and as they consider the optimal strategy for integrating their power of attorney options with other estate planning documents to form a comprehensive custom estate plan.
Seek legal support and advice as you evaluate your estate planning options by requesting a consultation with Rhodium Law. You can reach our office by calling (216) 699-8145 today.
