Did you know your family (even your spouse!) can’t automatically sign for you if you get sick? A Power of Attorney will solve this problem for you.
What is a Power of Attorney?
A Power of Attorney appoints someone you trust to help you with your legal and financial affairs.
The person you name (called an “Attorney”) can help you pay bills, buy or sell property like your home or your car, or deal with your bank accounts, pension or taxes.
We use the word “Attorney” in Canada to refer to the person you have appointed to help you – in this case, the word “Attorney” doesn’t mean “lawyer”, as you sometimes hear it used on television.
An Attorney follows your instructions, and acts in your best interests. An Attorney must follow the duties set out in the Power of Attorney Act, and must in the document you have made itself.
If you have an enduring Power of Attorney, your Attorney can help you even if you become incapable. If your document is NOT enduring, then it will become invalid if you become incapable.
Why should I make one?
A Power of Attorney is an important document; without it, we don’t know who to listen to when it comes to dealing with your legal and affairs.
There are some assets which you simply can’t deal with without one. These include cars, motorcycles, real property, or investments over a certain size.
Should we listen to your spouse, who you’ve been married to forever and ever? What happens when your spouse doesn’t know how to balance a chequebook? Or when your spouse is really your third spouse, and you’ve only been married for 2 months? What happens when your spouse is just as frail as you?
Should we listen to your children instead of your spouse? Your children might be a good choice, if everyone is getting along. They could also be a terrible choice if they are from a previous relationship, and don’t like your new spouse.
What happens when you have more than one child – how do we tell which one we should be listening to?
As you can see, it can be treacherous for outsiders to try and sort out who to listen to. The liability for an asset-holder who gets it wrong is significant. So we don’t even bother trying now.
The best part about a Power of Attorney document is that we don’t need to guess. Your document will tell us who you wanted us to listen to.
What happens if I don’t have a one?
Without a Power of Attorney, depending on the type of asset you have, and their value, your assets might be frozen.
For example, government registries usually require a Power of Attorney to allow someone else to deal with your affairs. Without one, you will need a court order to manage that asset.
A bank or investment firm might refuse to allow your family to deal with your accounts.
Your spouse might be able to sign for you on a joint account, if the account value is under a certain value. But if that account is worth more than the acceptable amount, the bank might require a Power of Attorney.
Again, if you don’t have a Power of Attorney, a Section 7 Representation Agreement or Committeeship Order might allow someone else to deal with certain aspects of your legal and financial affairs.
Ask us for information on how this incredibly important document could benefit you.January 3, 2018 10:39 pm
Tags: estate planning, financial affairs, power of