Power of Attorney and Estate Planning
By John M. Macaulay - Published on Saturday, 04 July 2009 15:51
What are they? A power of attorney is a legal document which essentially permits a person to name another person(s) to represent them and to make decisions for them about their property and health care. Remember do not confuse the term “attorney” with “lawyer”. In the United States lawyers are called attorneys. This is not so in Canada where they are called “Barristers and Solicitors”.
How would I benefit if I had a power of attorney? A well thought out power of attorney would or should give you peace of mind in knowing that, if you become incapable, you will not be in the hands of a stranger or someone who you did not want looking after your affairs. You would still have control of your affairs through someone in whom you have confidence and trust. The potential for family disagreements and disputes would be reduced since all will know that your attorney was selected by you and your wishes should be respected. Possibly the most important consideration is that the person you chose would be under the supervision of the court and would be accountable for their management of your affairs!
Another benefit, often overlooked, is the “living will” aspect of the power of attorney for personal care.
Who should I choose to be my attorney? This is a very complicated question and there is no correct answer except to say that you must be satisfied that this person is trustworthy! There are many other important qualifications however. Can they get along with your family, where do they reside, can they devote the time needed to look after your affairs or do they have their own matters to take care of – these are but a very few of the questions which need answers before a person is chosen for this very important position.
Are there different types of powers of attorney? Yes. For our general purposes there are two; a power of attorney for property and a power of attorney for personal care. Sometimes it is advisable or necessary to choose a different person to be a power of attorney for property than for personal care.
Is there any age restriction? Yes. A power of attorney for personal care can be 16 years old but must be18 for property.
Do I lose control of my assets if I sign a power of attorney? No! There are many ways to prevent this from happening depending on your personal situation and wishes. This is not addressed in the government form (see below) and it is advisable to seek professional advice before signing anything but the most basic of forms.
What happens if I do not have a power of attorney? If you become legally incapable of managing your affairs it is probable that no one can deal with your assets or give health directives without a court order. There might be a delay in dealing with medical or other emergencies. It is possible family conflict will arise as to who is best suited to look after your affairs, especially where there is an already acrimonious relationship between siblings or other interested persons who think they know best. These are but a few of the potential problems which might arise but even more significant is the financial cost of a court application to have someone appointed to look after your affairs during incapacity. This is magnified if there is a contest as to who might be the best suited to do so.
Do I need to have a lawyer to do a power of attorney? No. The Ontario Government has prepared a power of attorney which can be accessed on the Ministry of the Attorney General website http://www.attorneygeneral.jus.gov.on.ca/english/family/pgt/poa.asp). This is the most basic of forms however, and does not take into account the many different and unique situations which exist. It is still better than nothing however! You do not need a dentist to pull your teeth, a roofer to re-roof your home and there is no legal requirement that a lawyer prepare the power of attorney. As Alexander Pope, the English poet said centuries ago, “A little learning is a dangerous thing; Drink deep, or taste not the Pierian spring”.