Power of Attorney
Powers of Attorney are essential and valuable documents in Estate planning.
The general rule of thumb is anyone who has assets, especially bank accounts and real estate, or is over the age of 50, should have a Power of Attorney in place. Ideally, the document will collect dust, but it is in place should something sudden happen in your life that makes it challenging to protect your assets or pay your bills.
The Power of Attorney is only valid while a person is alive, and it can be revoked at any time as long as you have capacity to do so. In British Columbia it does not include health decision making for another person. (See Health Representation Agreements).
Typically, people think of this as a document for older people, but the reality is that it is an important document for any age.
Young Son Travelling
When my son was 19 years old, he travelled for many months in another country and soon had his wallet, ID, and bank cards stolen. Fortunately, we had arranged for me to have his Power of Attorney. I could easily step in to assist in getting a replacement driver’s license, bank cards, and so on.
Mom with Alzheimer’s
During the last several years of my mom’s declining health due to Alzheimer’s, I had my own Power of Attorney in place as I knew I might have been required to leave on a moment’s notice to go to my mom. This would mean my husband could easily step in and sign off on anything financial that might arise while I was away. As anyone who has dealt with a family member in declining health, we never know when we need to leave or how long we will be away for.
Parent Long term Illness and Decline
I used the Power of Attorney for my mom for over 10 years through her declining cognitive functioning due to Alzheimer’s disease to pay bills, sell the house, sign off on pensions for healthcare, redirect mail, pay Income Taxes, cancel credit cards, etc.
Dad fell down the stairs
My dad had a catastrophic accident that left him paralyzed and substantially brain damaged. He did not die immediately, but for four weeks we were able to make sure his affairs were in order for his death. The Power of Attorney was a powerful document to prepare for that end.
Numerous clients or family members found themselves in the equivalent of being stranded on an island and unable to manage their own affairs. This world event illustrated how easily our lives were changed and how important planning for unexpected events matters. Some people were stuck in New Zealand unable to travel to Canada to deal with things like the sale of their home, while others were locked into facilities to keep them safe.
What is a Power of Attorney?
A Power of Attorney is a powerful document that allows an individual to appoint an Attorney to act on their behalf for financial decisions should they become mentally or physically incapacitated, whether it be permanently or temporarily. A Power of Attorney can also be used to for practical purposes at other times. See scenarios above.
What is an Attorney?
An attorney is an individual or individual(s) appointed to act on one’s behalf should they become mentally or physically incapable. It gives them power to act on behalf of their financial affairs. In a Power of Attorney document, it does not mean a lawyer.
Is an Attorney a lawyer?
No, in this instance a Power of Attorney is not a lawyer. An attorney is the appointed person in the document who can act on your behalf.
Is my Power of Attorney an Enduring Power of Attorney?
Unlike general and specific Powers of Attorney, Enduring Powers of Attorney allows for your attorneys to act on your behalf even if you become mentally incapable. In most cases, Notaries prepare a general enduring Power of Attorney which include special clauses so your attorney(s) can act for you when you are both capable and incapable.
Do I need a Power of Attorney?
The general rule of thumb is anyone who has assets, especially bank accounts and real estate, or is over the age of 50, should have a Power of Attorney in place. Definitely people who should have these are those with advanced age, health conditions, and travel frequently. A Power of Attorney is put in place for when you cannot take care of your own business needs.
Can I use my Power of Attorney for medical decisions?
A general enduring Power of Attorney allows you to appoint an individual(s) to take care of your financial and legal matters on your behalf in the event you need them to step in or you become incapacitated. It does not allow for them to make any medical decisions on your behalf.
To act on one’s behalf for medical decisions, you must have a Section 9 Health Representation Agreement in place. These representation agreements include making decisions for minor and major health care, as well as personal care.
What types of Powers of Attorney are there?
There are three different types of Powers of Attorney in British Columbia: 1) Enduring 2) General and 3) Specific.
Who should I appoint in my Power of Attorney?
Most people appoint an immediate family member (spouse, child, parent, sibling). It is recommended you have at least 2 attorneys appointed with a primary and a backup or alternate. Ideally these people live close or at least in the same province, but that is not essential – they can live elsewhere. What is most important is these are trusted people to you who are financially stable and have good ethics.
What if I do not have someone who I trust to appoint?
If you do not have anyone you can trust; you may appoint a trusted professional such a Notary, lawyer, accountant or trust company to act on your behalf. Professionals are required to operate at a higher standard of care and are experienced in managing other people’s financial matters.
We offer Notary appointed attorney and executor services. For more information regarding these services, call our office or send us email to email@example.com.
Executor vs Attorney
An Executor is the person you name in your Will who takes care of your affairs and your Estate after you die. Their first job begins with dealing with your body and protecting assets and debts. A Power of Attorney names a person to handle financial and legal matters for you while you are alive. It is an important document should you lose capacity mentally or physically. The reality is none of us know if we will lose capacity or not. It is better to have one and not need it… than to need it and do not have it.
I do not own anything, why do I need one?
Everybody has something, even a bank account or a car. A Power of Attorney may only be needed once, but it will be a very important once. For example, in British Columbia many elderly people end up in assisted living or extended care and a Power of Attorney is helpful to sign legal and financial paperwork to assign a portion of pensions or income for their healthcare. Other areas where a Power of Attorney may be used is to deal with ending a rental contract, income taxes, utility bills, cellphone plans, credit card payments or cancellations…and the list goes on to all the practical daily personal expenditures that we do not normally think about in this way.
What kind of Powers will my Attorney have?
Typically, we provide general powers meaning they can step in and manage your personal legal and financial affairs. Duties of the attorney are well spelled out under the Power of Attorney Act and the very first duties are to act honestly and in good faith. **click here for a list of duties** Aside from that we can build in specific provisions to allow for the maintenance and care of minor children or a spouse, or restrictions where an attorney cannot transfer assets into their own name. A part of our process is to assess the context of your situation and make recommendations on clauses to use to protect you and fulfill your objectives.
Does my attorney have to live close to me?
No. It is important that your attorney would be able to act for you, so the further away they live, the harder that may be. It might be that they have to travel here to do certain things, like register a Power of Attorney at a banking institution, however, much can be accomplished at a distance through electronic communications and courier. What is most important is that your attorney(s) are trusted people and willing to take on the role.
I have a Power of Attorney from another province, state, country - will that work in BC?
Probably yes, but it is not a guarantee. It is best to have a Power of Attorney for the province for where you reside. Powers of Attorney from different jurisdictions may have different formats or language that may not have a direct interpretation in British Columbia. In some cases, it might be a consideration to keep an existing Power of Attorney and make a second one for British Columbia. For example, if a person has recently moved to BC from Ireland, but they still have financial and legal ties in Ireland (i.e. they still own a bank account, pension and real estate) the existing Power of Attorney done in that country appointing a person in that country will still provide an important benefit and ease of use. Make sure you advise your Notary of existing Powers of Attorney.
Can I name my kids?
To act as a Power of Attorney in British Columbia you must be at least 19 years or older. As long as your children are 19, they may be appointed as an Attorney. Considerations around experience and financial stability should be assessed to determine suitability for appointment as an attorney and whether or not certain restrictions are built into the Power of Attorney document.
The government has a free Power of Attorney, why should I pay to get one done?
Many people say they have a simple life but having a free Power of Attorney is probably not in your best interests. To our knowledge, banks will routinely not accept these because they have no idea if the person had capacity at the time, they did the document and if they were being unduly influenced by another family member or other person. Notaries are required to assess capacity, plus we determine risk factors in your specific context and make recommendations on how best to protect yourself from fraud or abuse from people near to you.
Can a Notary sign my homemade Power of Attorney?
No, we do NOT sign homemade Powers of Attorneys. Homemade documents typically have errors, and we do not know if the person creating the document will be financially abused, or if they had capacity at the time the document was filled out. To our knowledge, banks routinely do not accept these homemade Powers of Attorneys for the reasons mentioned above. It is important to have a legal professional, such as a Notary or lawyer, prepare your documents as professionals assess mental capacity, undue influence, and identify risk factors to your specific context. Legal professionals also make recommendations on how to best protect yourself from fraud and abuse from attorneys.
What is an Enduring Power of Attorney?
You may have heard the term “enduring” as it relates to a Power of Attorney (POA). Enduring simply means that the document is drafted in a way that allows the Attorney to have power or authority even after a person has lost capacity either permanently or temporarily. For example, the person granting the Power may no longer think or act in a normal capacity for themselves for such reasons that might stem from dementia, Alzheimer’s, physical injury, or disease. Essentially the document endures (remains valid) through the ups and downs or permanent loss of capacity.
If you are not sure if you need a Power of Attorney, or how to plan one that meets your needs, please contact us to discuss your unique situation.