Power of Attorney
What Is A Power Of Attorney?
A power of attorney is a document that appoints another person, called an “attorney,” to deal with your business and property and to make financial and legal decisions for you. The word “attorney” here means “one who is appointed and authorized to act in the place of another person”
Did You Know BC Has A New Power Of Attorney Act?
A new Power of Attorney Act came into effect in BC on September 1, 2011. It brought in many new changes relating to “enduring powers of attorney” (discussed later in this script). Powers of attorney signed before September 1, 2011 will generally still be valid, but since the new Power of Attorney Act brought in many changes, it’s a good idea to have a notary review your power(s) of attorney to ensure they are still valid and will do what you need them to do. Any powers of attorney signed on or after September 1, 2011 must follow all the new laws.
What Is An Enduring Power of Attorney?
An enduring power of attorney allows your attorney to make the necessary financial and legal decisions for you . To make a valid enduring power of attorney, the document must specify whether the attorney can exercise authority while you are capable or only while you are incapable (or both). The document must also state that your attorney’s authority will continue (endure) your capacity.
An EPA only covers financial and legal affairs, not health care or personal care matters. A Representation Agreement appoints someone to act on your behalf for health care and personal care matters
Who Should You Appoint As Your Attorney?
There are two roles to consider when appointing an Attorney by way of the Power of Attorney : 1) attorney, and 2) alternate attorney.
Remember the term ‘attorney’ does not refer to a lawyer, your Attorney can be your spouse, family member or friend. The people you appoint do not have to live in B.C. For example, it is common for spouses to appoint each other, but they will want to appoint someone else as a back-up. For example, John and Mary can appoint each other, but they may also want to each appoint their daughter Anna as an alternate.
Consider carefully who to appoint as your attorney and the powers you want to give. You cannot appoint anyone who is paid to provide you with personal or health care or who works at a facility through which you receive personal or health care, unless that person is your child, parent or spouse. It’s important that you trust the person’s honesty and judgment. If you have no family member or friend that you can or want to appoint, you can appoint a respected professional such as your notary, accountant or trust company. As a power of attorney gives your attorney very broad power, it can cause a lot of harm if misused.
What Are The Duties Of An Attorney Under An Enduring Power Of Attorney?
Before a person agrees to act as an Attorney under an enduring power of attorney, the person should be aware of the duties and obligations that they will have as an Attorney. All of the duties and obligations are described in the Power of Attorney Act. These include the duty:
• to act honestly and in good faith
• to act in your best interests, taking into account your current wishes, known beliefs and values and any directions that are set out in the document
• to not dispose of any property that the attorney knows is specifically gifted in your Will
• to keep your assets separate from the attorney’s assets
• to keep proper records, including creating and maintaining a list of your property and liabilities
When Should I Make An Enduring Power Of Attorney?
It is important to make an EPA before a crisis happens.
This could be when you turn 19 years old, the age of majority in B.C. – when parental rights end. As an adult, no one, not even a spouse, has legal authority over your financial or legal affairs.
Owning real estate or a motor vehicle jointly with your spouse or anyone else is an estate planning tool for when an owner dies. It does not apply if an owner becomes incapable. For example, if John and Mary are named jointly on a motor home, and Mary becomes mentally incapable, John would not have the legal authority to sell their motor home on his own. If Mary made an EPA or a Representation Agreement with routine finances, John would have legal authority to sell the motor home.