What Is a Power of Attorney (PA)?
Many lawyers draft a PA at the same time that they prepare a will. A PA designates a person or a trust company to take over your affairs if, for example, you can no longer handle them because of illness or incapacitation, referred to as an enduring power of attorney. You may be away for extended periods on personal or business matters, and want to give someone the authority to sign documents on your behalf regarding the sale of your home while you are away. This is normally referred to as a specific power of attorney, and is limited in scope and time. Considering the benefits of a PA is especially important if you have substantial assets that require active management. You can revoke the PA at any time in writing.
What if You Don’t Have a Power of Attorney?
If you do not have a PA and are unable to manage your financial affairs because of illness, accident, or mental infirmity, an application has to be made to the court by the party who wishes permission to manage your affairs. This party is referred to as a committee. A committee’s rights and actions are governed by provincial legislation and monitored by the provincial Public Trustee office under direction from the court. The purpose of this approach is to protect the financial and health interests of the person who is incapacitated. However, as bureaucracy, delays, expense and loss of autonomy results when the government intervenes, this can all be avoided if you have the proper PA.
Committee duties include filing with the court a summary of assets, liabilities and income sources, along with a description of the person’s needs and an outline of how the committee proposes to manage the accounts or structure the estate to serve those needs. Continuing asset management is required to meet any changes in circumstances or needs, as well as record-keeping and accounting functions, all subject to the direction of the court.
For further information about a Public Trustee’s duties, contact your provincial government Public Trustee Office.