Article on Power of Appointment Legislation In New York

Ira Mark Bloom (Justice Josiah Brewer Distinguished Professor of Law, Albany Law School) recently published an article entitled, Power of Appointment Legislation In New York: It’s Time For Modernization, 76 Alb. L. Rev. 9 (2013) Provided below is the introduction to his article:

Power of appointmentlegislation has existed in New York since 1830. Indeed, the 1830 legislation remained largely intact until1964 when the legislature effectively repealed existing power of appointmentlegislation that was contained in Article 5 of the Real Property Law and replaced it with a new Article 5. In turn, new Article 5 was essentially reenacted underArticle 10 of the New York Estates, Powers & Trusts Law (“EPTL”) effectiveon September 1, 1967. With few exceptions, current New York power of appointmentlegislation has remained unchanged since 1967.

Although New York power of appointment legislation has remained largelystatic for almost fifty years, major developments in the area have occurred.Two significant developments were made under the Second and Third Restatementsof Property. Published in 1986 as an entire volume of the Restatement (Second)of Property, the power of appointment division effectively updates thetreatment of powers of appointment that is found in the First Restatement. A significantly updated treatment of powers ofappointment, running over two hundred pages, is found in the Restatement (Third) of Property: Willsand Other Donative Transfers, which was published in 2011.

There is another important and very recent national development in thepower of appointment area. A draft Uniform Powers of Appointment Act (“DraftUPOA”) is in progress, which is effectively based on translating the power ofappointment provisions in the Restatement (Third) of Property into statutes.

The purpose for this article is to recommend updated power ofappointment legislation for New York. Specifically, I will recommend specific statutorytreatment for important substantive aspects in the power of appointment area. The Restatement provisions as well as their translationinto statutes by the Draft UPOA will frequently provide the basis for my recommendedstatutes.

Before addressing how New York law should be changed, a fewpreliminaries are in order. First, Part II provides a brief explanation ofpowers of appointment, as many readers may not be familiar with this fairlyarcane, but important, topic. Next, Part III briefly considers the historicaldevelopment of power of appointmentlegislation in New York.

Parts IV-VII recommend specific power of appointment statutes for NewYork in four major areas: general provisions, creation, exercise, andcreditors’ rights. Part IV involves general provisions, includingdefinitions. Part V focuses on the creation of powers of appointment. Part VI recommends statutes involving the exercise ofpowers of appointment while Part VII addresses the importance of creditors’rights. 

Parts IV-VII are structured similarly. First, I provide the current NewYork law on the particular issue; in most cases this will be by reference toexisting New York statutes. Next the applicable Restatement provision or provisionsare identified. I then set forth my recommended statute for the issue. Finally,I include a discussion which explains my recommendation.